Problem Solution: Lawrence Sports

Problem Solution: Lawrence Sports

Running head:   PROBLEM SOLUTION: LAWRENCE SPORTS









Problem Solution: Lawrence Sports
University of Phoenix


Problem Solution: Lawrence Sports
Lawrence Sports a manufacturing and distribution company that specializes in sporting goods. The company is facing situations that will offer Lawrence sports several opportunities as well as problems that need to be evaluated. The first issue is a cash flow problem; this situation needs to be handled for all the company’s involved. The cash deficit situation causes a issue that if not handled will cause a bigger issue and eventually cause problems and put a strain on vendors, suppliers and stakeholders. Lawrence Sports made it through the week of March by borrowing from the bank and deferring payment to Gartner by one week. With this borrowing this has caused a burden on the company by the outstanding loan and ensuing interest payments. Lawrence sports needs to have a better cash flow plan better management, in this paper I will take a look at Lawrence Sports dilemma and determine a viable solution. This will increase the cash flow so that cash flow will be able to help pay debt and supply enough working capital to handle any unforeseen circumstances.

Situation Analysis
Issue and Opportunity Identification
Mayo the prime customer of Lawrence Sports is in a troubled spot and LS is left trying to pay for the items they have supplied to Mayo. While Suppliers need to get paid while they supplied the resources on time and Lawrence Sports supplied the products the issue is that with no money from Mayo. The payment arrangements are for Mayo to pay 20% at the time of purchase with the next 80% to be paid the following week. Mayo is the principle customer and with this company being the major buyer from Lawrence Sports this has left L.S. fighting for capital. With them being the major buyer L.S. has no customer base to draw from.   With Loans from Central Bank the issue is that the maximum amount that...