4.5 Assignment: Mini Case

Background Information

We commonly hear about maturing companies who are struggling to reignite the growth they once enjoyed. However, as you have already studied in this workshop, managing rapid growth can also be a surprisingly difficult challenge. In the last workshop, you selected a real-world company to investigate. This company is predictably facing one of these growth challenges: either growth is falling short of what the company is capable of sustaining, or growth is exceeding sustainable levels. Both scenarios require skillful management.

Instructions

1. Review the rubric to make sure you understand the criteria for earning your grade.
2. In your textbook, Analysis for Financial Management, read Chapter 3, "Financial Forecasting," and Chapter 4, "Managing Growth."
   1. Download and review the Higgins Chapter 3 Slides and Higgins Chapter 4 Slidesto help you further understand the chapter concepts.
3. View Franchising and Managing Growthto hear a financial executive discuss some of the challenges of managing rapid growth.
4. Research the financial statements for the company you chose for the 3.5 Assignment.
   1. Note: it is particularly recommended for this assignment you locate the annual statements (called "10-K" forms) for your company through the company's web site or by using the SEC's EDGAR system. Annual statements will often include commentary explaining recent financial challenges and plans for the future.
   2. Many free financial websites, such as Morningstar, provide financial data and ratios for public companies. Search for your company on Morningstar and then select "Operating Performance" for a list of ratios for previous years.
   3. Consider accessing company reports through OCLS using the Business Insights: Essentials tool. Detailed financial and investment reports are available for hundreds of companies.
5. Using the sustainable growth equation from your textbook, calculate the company's sustainable growth rate for at least the past three years. Compare your calculated sustainable growth rate to the company's actual growth rate in sales during this period.
6. Begin the paper by crafting a table showing the company's actual growth rates, the sustainable growth rates you calculated, and the four components of sustainable growth: profit margin, retention ratio, asset turnover, and financial leverage (assets/equity).
7. Describe what growth challenge the company is currently facing.
8. Analyze what actions the company has taken to deal with their particular growth challenge. Your analysis should be based on changes in the components of sustainable growth, on the actions reported by executives in annual reports, and on any other commentary you discover through your research.
9. Make a series of specific recommendations on what actions the company could take in the future to address its growth challenges.
10. Pls Do not use Walmart