tai chinh nop 2 - N guyn Hong Tm K074010096 Mai Th Nh t L...

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Nguy n Hoàng Tâm K074010096 Mai Th Nh t L K074010056 Case Study 2: exposure to International flow of funds. Summary: Ben Holt, the CFO of Blades company has decided to counteract the decreasing of demand for “speedo” roller blade by exporting the products to ThaiLand. And due to the low prices of rubber and plastic of Southeast Asia , Holt decided to import some of components needed from Thailand, and with that works he got an advantage about manufacture cost. In the business of ThaiLand, Blades follows the policy of invoicing in Thai Baht. Ben Holt felt this strategy would give Blades a competitive advantage, Since Thai importer can plan more easily and they do not have to worry about paying the differing amounts due to currency fluctuation. And Holt also feels that Thai importer will refer Blades over its competitor because Blades invoices in Thai Baht. Answer the questions: 1. How could the higher level of inflation in Thailand affect Baldes? Some problem will appear if the inflation increases. First, with the higher level of inflation Blades will faces with the currency problem, because they invoicing Baht Thai to exchanges, inflation increase synonymous with the decreasing of currency value, if the inflation is high their profits will be low, and that is the bad thing.
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Second , if inflation happen, the price of many goods will increase and Blades have to fix the price to suitable and it’s not easily. Thinks, if you don’t change your product price that mean your price of product will be low than market price
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This note was uploaded on 03/23/2010 for the course VINH 1234 taught by Professor Alex during the Spring '10 term at Vaasan ammattikorkeakoulu.

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tai chinh nop 2 - N guyn Hong Tm K074010096 Mai Th Nh t L...

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