Recommendations of The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital Case Solution

Home >> Darden Business School >> The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital >> Recommendations

Recommendations of The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital Case Study Help

On the basis of above internal and external analysis of the business along with the evaluation of numerous alternatives, the business is recommended to think about alternative 3. As alternative 3 would enable the business to expand in global markets without any reduction in its regional incomes and any deterioration of its market position. The company might pursue alternative 1 which would enable the business to focus on prospective international markets rather than the local markets however as the company is highly dependent on the local markets with 90% of its shops in the United States, there fore pursuing alternative 1 would result in the significant decrease in company's income.

Aletrnative-1: Expanding International Brick and Recommendations of The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital Case Solution Stores

The company has a long term market position in US which can not be generated soon in the new markets. The option would assist the business to broaden in worldwide markets along with the elimination of problems raised in its regional markets related to its diversity.

Pros:

• Exploration of brand-new international markets.
• Increase in revenue from global markets.
• Elimination of problems related to diversity.
• Revenue diversification.
• Action towards being a strong worldwide brand name.

Cons:

• Loss of comprehensive revenues from the local markets.
• Increase in competition.
• Distinctions in cultures could led to a failure of the brand specifically in Asian nations.
• Low profits at preliminary levels.
• Increase in marketing expenditures to gain market share.

Alternative-2: Introduction of Click and Recommendations of The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital Case Analysis Stores

With the increased patterns towards online shopping, the online stores like Amazon, Alibaba etc. could present an extreme risk to the market share of company. In this scenario the company might consider presenting Click and Recommendations of The Wm Wrigley Jr Company: Capital Structure Valuation And Cost Of Capital Case Analysis shops. These stores with a low requirement of funds to settle would enable the business to reach global markets, without ending its domestic shops.

Pros:

• Low financial investment
• Lowering competitors risk
• Access to the world markets
• Enlarging consumer base
• Easy to handle
• Large Revenues
• Low Operating Costs
• Easy new market entryway

Cons:

• Threat to the marketplace position
• Elimination of brand Individuality
• Removal of the excellent store experience.
• Danger of decrease in elite sales.

Alternative-3: Expansion towards International Markets Without closing Domestic Stores

Another option that the company could think about, is to broaden towards the worldwide markets without closing its domestic stores that contributes to the major part of earnings of the company. The benefits and drawbacks associated with Alternative 3 are given below;

Pros:

• Decreasing competitors hazard
• Access to the world markets
• Enlarging consumer base
• Large Incomes
• Expedition of brand-new international markets.
• Boost in income from international markets.
• Income diversity.
• Step towards being a strong global brand name.

Cons:

• Extension of concerns related to diversity.
• Distinctions in cultures could caused a failure of the brand especially in Asian nations.
• Low incomes at initial levels.
• Boost in marketing expenses to gain market share.



This is sample work and not applicable to real case study. Please place the order on the website to get your own originally done case solution.