Answer the following questions:

1. How do exchange rate fluctuations directly affect the bottom line (profit) of a small business, and thus present a risk to be managed? Can alliance design concepts share the foreign exchange risk that it experiences with others in its supply chain (e.g., suppliers, customers)?

2. Discuss the importance of cash to a small business, and general “levers” for managing cash (such as receivables and payables) that are relevant in this case.

3. What are the relative strengths and weaknesses of the proposed risk mitigation strategies, in the specific business context of alliance design concepts?

4. Propose an implementable mitigation strategy for alliance design concepts. The strategy can include a combination of any of the strategies mentioned in the case, and/or other strategies that you may have come up with. Your strategy should explicitly address the business process regarding quotation/sourcing/payment.