'Cyclermate Report Essay\r'

'I. An executive summary\r\nDai Armstrong and Lewis Lle soundyn ar the two men who visualisened to open their own political party later being superfluous due to the shutting exhaust of the steel plants in their town of South Wales were Dai Armstrong and Lewis Lle soundyn. They became up overcompensate friends be causation of taking part in the local golf club of cycle touring together and decided to start Cyclermate, which was a bicycle manufacturing comp whatsoever that was lay see in the class 1988. In the beginning of time, Cyclermate gained a immense influence over the treat of the market. The connection appe ard well with no riddles and difficulties up to 2010, the time when the line of credit is in trouble, it confronted lots of consequences with respect to ope dimensionn human option and finance.\r\nTherefore, the demand by purchasers fell continue woefull even though the legal injurys were cut down by the company; the distinguishing attributes of the nears were non up to the woodland as they were in front. The rising complaints from the customers regarding degrading quality and faults in the crossroad and the c at a timern by the chamfer manager regarding the overdraft could ca exercise trouble if the problems are not solved as soon as feasible. Beca intake of that, the company requires a right panache to deal with this let out and save it from the boundary line of going coin deposerupt.\r\nII. Introduction\r\nBased on character reference study research in Cyclermate Ltd. and a serial publication of case in community, this report leave al atomic number 53 rifle out the monetary problems and various separate problems confronted by Cyclermate. It has been designed to analysis the assembly line environment and heed, metric by donkeywork and PET models that are call for to be looked upon. The report in like manner draws on a brief summary for the financial side of the business. In addition, this report takes into ac count an examination of difficulties confronted by Cyclermate and mathematical solution for the problems, included short and languish edge solutions. other function of this report is to examine how the company could get out of the crisis and get back to the menstruation market share. Finally, the report brings us some recommendations and shutting of the whole Cyclermate case study.\r\nIII. abstract of short letter environs\r\n1. PEST Analysis\r\nPEST analysis is elusive in the chief remote environmental that nitty-gritty or control cerebrateably a business st computegy. As we stomach see, PEST is aimed for Political, Economic, Social and expert matters that evoke affect the business. PEST is recognized to persuade it in a utile manner of summarizing the external environment. However, it whitethorn be adopted the ability of how an government activity should react to these factors.\r\nPolitical Factor\r\nA political factor has a tycoonful contact on income tax, lab or law, trade restriction and umpteen such(prenominal). community did not recruit overflowing workers to bear the targets and worker had to work overtime to get the work oblige and workers are getting paid at convention rate. Using a handed-down method may harm workers wellness and decreased their ingatheringivity as well. These mistakes made Cyclermate become a target of health and safety agencies. They adjudge to reform the quality or else they abide be stuck in authorized issues. On the other hand, they also need to achieve higher(prenominal) standard in manufacturing to meet requirements of the market, especially foreign markets.\r\nEconomic Factor\r\nCyclermate had purchased a larger storehouse for goods, which indeed was essential to them but did not fulfil their requirements. Purchasing a warehouse, which fulfilled the needs of the company, could dedicate saved a lot of money and that a homogeneous(p) money could fix used in bracing or currently in exi stence projects. Another factor in economics that affects to the development of Cyclermate Ltd is labor. The un utilizement rate is change magnitude, in that locationfore, this is a good guess for this company to consider worker more easily, and employ them easily with cheap price.\r\nSocial Factor\r\nSocial factor has a functionful impact on human behavior, Cyclermate had many grade but they did not develop enough hands to complete these orders. They have to work long hours in order to achieve their goals. One more important thing is that high- drive innovation as well as the increasing demands of consumers requires Cyclermate to change and improve every day. scarce there is a in truth infact that living standard of clients could effect to their choices. The higher income distribution they get, the higher demands they re\r\nTechnological Factor\r\nCyclermate Ltd is exploitation the oldest way to advertise their products by posting advert in traditional newborn(a)spa pers. It has limited their goods to the customers. Instead, this company rotter set up its own website. In addition, Cyclermate Ltd is utilise the oldest way to advertise their products by posting publicizing in traditional newspapers. It has limited their goods to the customers. Instead, this company can set up its own website.\r\n2. SWOT Analysis\r\nIt is a methodical technique that is utilized to categorize and identify substantial external (Opportunities and Threats) and internal (Strengths and Weaknesses) factors confronted with a specific area. (Johnson, 1993) It renders data which are useful in corresponding the capabilities and resources to the spiritual atmosphere in which it functions and thusly is a significant addition to the planning and market procedure. (Pearce, 2005) permit have look at the SWOT of cyclermate to understand more about the current issue that company has to bet with.\r\nStrengths\r\n mail channels of trade\r\nCyclermate has straightaway channel s of gross gross trades with the count on gross revenue and direct shops; hence intermediary’s greet is largely eliminated. Reducing the cost of manufacturing could unquestionably protagonist Cyclermate achieve a huge share of the market. As direct channels are in direct contact with the providers, thus, it could attend to in increasing in quantity or protect of the sales and it provides a good hazard to the providers to empathize the clients and could make unavoid adequate to(p) changes are per the requirement of the customers.\r\nMotivated workforce\r\nThe employees at the Cyclermate are extremely pioneering and are can fully utilize and achieve any disposed intention or alterations in the company but they are inhibited by the administration as a result they are unable to express their views drop outly. The employees could have a crucial role in the company for its overall growth and development.\r\nPossession of makes and lands\r\nUn corresponding Cyclermat e some of the companies don’t possess either building or land and hence have to expect the heavy rents which adds to the cost but cyclermate can make any changes in the buildings and could greatize in whichever way they deal to as they own it, which reduces the overall cost.\r\nWeaknesses\r\n incompleteness and unmotivated modules of the company\r\nThe company has made use of untrained workers. These untrained workers are not given the proper training after their employment. It is the fact that the employees and the staff are never allowed to put forward their creative and self-ideas due to the policies of the management, as a result of this motivating in the staff is lost. Sales are lessen in amount or degree and there is piling up of nervous strains in the warehouses which generates a speck among the staff that they are not under a good management and as this feeling flourishes they flake out hopes from the company and it has a very bad impact on their morale. T he apparelors do not truly interested in the business\r\n out-of-pocket to the low returns on the capital invested by the investors, they are unhappy with the implementation of the company and are losing faith in it. In addition, the very fact that the shareholders were not paid any interest last year, it may result in the withdrawal of their money from the company. The quality concerns\r\nBecause lack of the power to be effective of the staffs to keep up the measures of the goods and the quality of raw material utilized is leading to immobile quality of the goods eventually. Old machinery such(prenominal) as traditional s representing technique, painting and low-quality stock control engine room needs updating as soon as possible if the business hopes to improve the performance and sales in the coming time.\r\nOpportunities\r\nTake the advantages of social media\r\nCyclermate should piece its website, which provides complete detail and digress of the products available wit h them. fellowship can employ a new estimator dodge for keeping a good database of the company. They can introduce online give awaying and modification according to the wish of customers. Introduction of new machines\r\nThey should introduce some of the ripe machinery in order to achieve higher- direct productivity. Cyclermate could bring in new robotic machinery in the action change that leave alone lead to speedy output and a ace quality of goods.\r\n wage trained workers\r\nThey have the opportunity to make use of the trained workforce, which has been recently laid off from the nearby production site. More workforce mode opportunity to gain more productivity.\r\nThreats\r\n overseas competitors\r\nAs a result of the growth to a global or worldwide scale, many companies from across the globe have entered the market with products of low price and high quality, which certainly is a threat for Cyclermate as it supplies good with high cost and of lower quality. Due to reces sion, which is prevailing in Europe the purchasing power of people is going down. Thus, company can have reduced sales or can face financial crises.\r\nReputation\r\nDue to poor-quality product for a period of Cyclermate’s reputation is going down and therefore people do not like to go for their products. Huge retail\r\nMerchants\r\nRetail Merchants like Argos and Halfords are captivating the market eventually and it powerfulness happen that Cyclermate may lose the market share completely. Customer threatens them to sue their company after their product was fail in delivering the good performance.\r\nIV. Analysis of Business Management\r\n1. Financial Problems\r\nProb. 1.1: Uncontrolled cost\r\nThe main(prenominal) problem that company is in this situation is because of the undisciplined cost and mismanaged budget. The costs are increasing per year with the sales and selling price of the products going down. Let have look at the financial literary argument that company h as £210,800 expenditure of non-current assets. Loan request will be refused as company all holds capital fund of £675 into their bank account. tolls are increasing at a rapid rate year after year. Asset turnover rate ratio is 2.06:1. This indicates that the emolument margins for the company are very low that’s why the ratio is so high. We can also conclude from this that the company’s pricing outline is not effective leading to lower pro accommodates.\r\nProb. 1.2: transaction with a big loan\r\nCreditor age †24 days leads to the company has to cook up back it its debtors in 24 days and it is just left with 675£ of cash. The fellowship is liable to pay £87,500 to the creditors and if they don’t so a legal action may be taken on them, which are not good for company’s reputation. They may talk to the creditors and read for an extension in time for payments as they are going through financial crisis and don’t have money r ight now to pay back.\r\nProb. 1.3: Lots of inventories\r\nBesides, it shows that the majority of inventories are stored and not in effect managed, that is why current ratio is at such high level, which also means low sales and low revenue gained. Moreover, the company relies on the bank loan as the main monetary support.\r\n2. summons Problems\r\nProb. 2.1: Stock control system\r\nDisturbingly, materials are evermore in the shortage which results in the disruption of the production process recently. Although the demand is higher and higher, company cannot meet their requirement because of lacking necessary components.\r\nProb. 2.2: Inappropriate incision of duties\r\nThe inappropriate division of duties obviously had made such a burden on many workers. In particular, Dai Armstrong has to deal with many tasks such as qualification all the frames, factory manager and business man develop director at the same time. He himself also finds it grievous to keep up the level of produc tion (approximately 8 frames/day) because it requires the harsh carnal demands.\r\nProb. 2.3: Assembly is a tangled process\r\nMoreover, assembly is a complex process, which takes 2 or 3 hours for one person. Janice Jones and Ffred Gregory often have to work overtime to catch up with the progress. As a result, their health and time issue could be heavily damaged.\r\n3. HR Management problems\r\nProb. 3.1: Improper workforce in manufacturing\r\nUnreasonable workforce division is one of the most serious problems of Cyclermate Ltd. Besides, lack of experienced employees and the aging workforce are worrying the production process and raising a big question for a more effective training system.\r\nProb. 3.2: The training system creates\r\nThe training system creates such obstacles for the assembly process. Typically, Fred, who is 18 years old, is a new and un-experienced person; the training for him is necessary, however, not easy at all. It takes so much time to instruct Fred in tradi tional way, which is ostensibly the cause of slow production recently.\r\nProb. 3.3: Corporate nuance\r\nThe staff is highly de-motivated due to decreasing sales and profits and also the behavior of the management as in the sinking company they are not free to put up their ideas even if they do they are rejected because of the superiority of the management.\r\nV. resultant\r\nA. on the spur of the moment term and immediate planning\r\n1. Financial problems:\r\n origin 1.1: Cost in selling and distribution\r\nCost in selling and distribution could be possible declined to save more money for the company such as cutting cost for postage and courier charges by substituting by cheaper service, as well as the travelling and hospitality. Those indirect costs yield such high cost to the manufacturing of the cycles, restricting them would help boost the sales with cheaper price.\r\nSolution 1.2: Ask for trade debtors to repay\r\nThe solution to this issue is that they should strictly propose and for the trade debtors to repay the loans as soon as possible. The amount of $200,571 would help the financial situation meliorate in the coming time. Once their assets are raise through and their liquidity are proved to be valuable enough to afford the loan, it will be beneficial for them to borrow money from the banks.\r\nSolution 1.3: Direct sale prices\r\nCyclermate’s direct sale prices are higher than shop sale price. In order to generate healthy revenue, Cyclermate needs to reduce their direct sale price. By reducing the direct sale prices will increase their sale and it will be easy for them to generate healthy revenue.\r\n2. Operation Problems\r\nSolution 2.1: Buy stock when needed\r\nCompany should only buy stock when they needed. Buying stock earlier will harm company’s financial positions, because raw material does not hold their value and it has got more chances of losing its market value.\r\nSolution 2.2: Require adopt division\r\nA good answ er for this problem is that the company should require clear division to who is able to undertake and separate arrangement of duties. Specifically, assigning other qualified person on frame-making position so that Mr. Dai could concentrate and dedicate himself to external relations business only.\r\nSolution 2.3: hiring more experienced labors\r\nThe company should consider hiring more experienced labors for assemble line and frame-making because Mr Dai can no longer put up with the physical requirement of the task. With those simple tasks like packaging, it is acceptable for free hand employees to help out, but only when they unblemished all their tasks.\r\n3. HR Management problems\r\nSolution 3.1: Employ cheaper labors\r\nIn this case, the company can consider employ cheaper labors that are suggested by Maldwyn Jones: Chinese or Taiwanese labor to make the machine for them- much fracture quality but half the price and drift Idris Pugh to higher position as a supervisor for t he whole wheel-making process.\r\nSolution 3.2: Improving the staff’s skills\r\nThis training program involves directly in the new changes with a purpose of improving the staff’s skills, expertise and methods to complete an error-free task, exposing them to unfamiliar ideas and of course, giving them the chance to practice task under time/speed limit.\r\nSolution 3.3: Core business value\r\n cartel in others and a firm belief in overcoming difficulties (set up new mission: overcome difficulty, denigrate waste and consequence)\r\nB. Long term and efficiency improvements\r\n bequest fiscal condition of Cyclermate (Accounting ratios).The acid / liquid ratio of Cyclermate is 0.76:1, which depicts Cyclermate is incapable to satisfy indebtednesses of shorter term, which mean that it would not be competent to satisfy fiscal difficulty which may happen in the time to come. The Asset turnover ratio for Cyclermate is 2.06:1. As the ratio is excessively high, this means that pro fit margins are very low. The pricing outline of Cyclermate is ineffective and because of that low profit. Return on capital employed â€Cyclermate has far too less returns on the capital employed, just a unstained 0.11 or 11%. Debtor days â€It would take Cyclermate cxv days to get back the money from debtors. Creditor days †Cyclermate has to pay back in 24 days to its debtors with a cash balance of 675£.\r\nThe financial program line of Cyclermate shows that it has non-current assets which is of worth £210,800.Any request regarding a loan from the bank will be refused as it has a mere cash balance of £675. It may get a loan based on the position of its non-current assets. In place of the above-discussed alternative, it can sell its freehold land, which is worth £160,000, and use the proceeds from the sale in the business. Cyclermate could acquire cash if they pursue its trade debtors to pay off soon. Debtors worth £200,571 are to be recovered and the fu nds would be acquired soon if the debtors do not default and pay in full. Once it has sufficient fund, Cyclermate could apply for the bank loan.\r\nVI. Conclusion\r\nOverall, Cyclermate will have a split future if they operate their business in approximately different ways. Cyclermate products were famous for its quality and price,if the company mollify provide what the consumer wants than it would be no harm to the company. But there few changes needs to be changed and once the new rules and regulation apply into the business than it would be a great opportunity for Cyclermate to operate their services. Moreover, With the motion of new threats into the marketplace the present systematic plan of action of Cyclermate is continuously below the acceptable level in its performance due to the fact that the new firms and the existing organizations are coming up with ameliorate quality of products at a cheaper price\r\nVII. Recommendations\r\nThe company must sign up correct singular as per the requirement of the position. Currently the management is fussy in the process of production and is unable to centralise of the activities they should be concerned. The financial hardships through which Cyclermate is going through at present could be resolved by selling the unused stock that is piled up in the warehouse. In order to generate revenues and funds to invest in other arena of the company, Cyclermate must sell its freehold land that would certainly generate high revenue.\r\nIn order to achieve higher output and productivity, raw technology should be applied in the production process. Installing a computer database through which the management could look into all the important and relevant data as and when required. Cyclermate should launch its website, which provides complete detail and range of the products available with them. Reducing both direct sales prices so as to sell the current stock and trade debtors. Employing young and trained workforce that is fit for the position.\r\n'