Minor Case Clayton Industries

Minor Case Clayton Industries - Tyler Michael Fin 485 Sec B...

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Tyler Michael Fin 485 Sec B Brief Case #2: Clayton 10/11/11 Question #1 : Clayton’s Position in Europe A.) Between 2004 and early 2009 Clayton Europe faced a number of key economic, social, and organizational factors that affected their performance. These factors were: Europeans’ view of Air Conditioning as an expensive American luxury. Europeans’ strong national brand preferences Products did not meet Europeans’ different needs. A main source of struggle for Clayton was an overall negative view of air conditioning in Europe. Many Europeans saw air conditioning as a luxury that harmed the environment. Additionally, Europeans tended to buy familiar local brands over Clayton products which featured components assembled from around the world. Lastly, products such as central AC units did not meet the needs of many European homes which lacked the necessary duct work to support it. B.) Factors Summarizing Financial Position 1. SpA’s EBITDA (losing money) 2. Revenue growth (Lack thereof) 3. Lack of sales outside of Italy 4. Debt is 48% of revenue I believe SpA’s negative EBITDA is the best summary of their financial position. Currently the operation is bleeding money, losing over $1M/month and shows no sign of turning it around. In addition, the past 2 years SpA has seen revenues fall 5.3% and 19.4% respectively. While other European operations have seen revenues dip, none have been this drastic and all have still posted positive EBITDA. Furthermore, while industry sales throughout Europe have continued to climb, SpA has had a depleted market share. This lack of penetration into the European market has underlined their financial distress. Question #2 : Peter Arnell A.) When discussing attributes that Peter Arnell possesses that will allow him to be successful in this job, I believe you must look at his leadership ability, competitive nature, and ability to make tough decisions. Arnell’s experience as a Captain in the Royal Marines represents his leadership ability and gives you confidence that he will be able to effectively motivate his employees. Furthermore his competitive nature and background in sports displays that he is a fighter and a team player who will not accept failure. While Arnell has qualities that may allow him successful, his crass tendencies may alienate his
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Minor Case Clayton Industries - Tyler Michael Fin 485 Sec B...

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