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RUNNING HEAD: LAWRENCE SPORTS BENCHMARKING
Lawrence Sports Benchmarking
University of Phoenix
Introduction
Lawrence Sports, a manufacturer of sports equipment, is having cash flow problems. On one hand, it has obligations to pay its suppliers, but on the other hand, it is expecting receivables from a customer who is unable to pay in a timely manner. Cash flow is often a problem in big, successful companies. However, a lack of effective working capital management can cause shortfalls to occur. In the case of Lawrence Sports, outflows exceed inflows, and the shortfall is being made up by a credit line that is maxed out. Not only is the credit line maxed out, but it also carries with it an interest that fluctuates depending on the amount borrowed. This is proving very costly to Lawrence.
Wal-Mart
Wal-Mart's history goes back to the 1940s by founder Sam Walton. Its headquarters is located in Bentonville, Arkansas. As with any business, working capital is necessary in order to remain solvent, and in a position to meet the demands of the industry in which that company operates as well as the ever-increasing competition of the industry.
In a study of the Wal-Mart's working capital, it has been determined that a number of strategies have been put into place in order to meet the challenges of the future. Working Capital reflects the liquidity of a company and its ability to meet its short-term obligations. Working capital is determined by subtracting total current liabilities from total current assets (BNET, 2007).
As a company grows, its nee ...