• as far as exporting is concerned, blades, inc could be one of the first firms to sell roller blades in thailand since blades is considering longer range plans in thailand, importing from and exporting to thailand may present it with an opportunity to establish initial relationships with some thai suppliers. Problem 5bic: decision by blades, inc, to invest in thailand since ben holt, blades’ chief financial officer, believes the growth potential for the roller blade market in thailand is very high, he has decided to invest in thailand the investment would involve establishing a subsidiary in bangkok consisting of a manufacturing plant to produce speedos, blades’ high-quality roller blades. Blades, inc case exposure to international flow of funds 1 how could a higher level of inflation in thailand affect blades (assume us inflation remains constant) answer: blades had a decreasing demand for “speedos” (in chapter 1. Assignment 2 blades, inc case 1 one point of concern for you is that there is a trade-off between the higher interest rates in thailand and the delayed conversion of baht into dollars.
Answer: the advantages blades, inc could gain from importing from thailand include potentially lowering blades’ cost of goods sold if the inputs (rubber and plastic) are cheaper when imported from a foreign country such as thailand, this would increase blades’ net income. For blades inc, the strategy of importing raw materials at cheap cost from thailand and exporting roller blades to thailand's market is viewed as a creative and useful idea in order to improve the unfavorable business condition of blade in its host country, america.
Though blade inc meet some of their expenses in thai baht, but in case of currency conversion blade inc gets less amount of us dollars because of thai depreciation as thai baht depreciates export in thailand will unlikely to increase. If blades increases its business in thailand and experiences serious financial problems, are there any international agencies that the company could approach for loans or other financial assistance answer: international financial corporation (ifc) is the international agency that would approach for loans or assistance in financial crisis. Since ben holt, blades’ chief financial officer (cfo), believes the growth potential for the roller blade market in thailand is very high, he, together with blades’ board of directors, has decided to invest in thailand.
Under an existing agreement with entertainment products, inc, a thai retailer, blades is committed to selling 180,000 pairs of speedos to the retailer at a fixed price of 4,594 thai baht per pair once operations in thailand commence, the agreement will last another year, at which time it may be renewed. Blades, inc case decision by blades, inc to invest in thailand (chapter 14) blade inc it is a true fact that every business longs for expanding their business to other countries for further development, especially when the business within the country is facing many obstacles.
Should blades renew the agreement with entertainment products 4 since future economic conditions in thailand are uncertain, ben holt would like to know how critical the salvage value is in the alternative you think is most feasible. Answer to 1 should the sales and the associated costs of 180,000 pairs of roller blades to be sold in thailand under the existing agreement be included in the capital bu.
Blades, inc case decisions to use international financial markets as a financial analyst for blades, inc, you are reasonably satisfied with blades' current setup of exporting “speedos” (roller blades) to thailand due to the unique arrangement with blades' primary customer in thailand, forecasting the revenue to be generated there is a relatively easy task. Blades inc, a us roller blades manufacturer, began exporting their product to entertainment products inc, a thailand company shortly after exportation began, asia developed weak economic conditions this resulted in an excess supply of the baht.