Business Proposal for Thomas Money Service
Thomas Money Service with the acquisition of Future Growth Incorporated (FGI) has the capability and willpower to succeed. From inception in 1951, FGI has been manufacturing, selling, and financing its own brand of construction and forestry equipment that has been profitable over the years. With the current economic situation, their profits have declined by 30 % that led to a layoff of about one-third of the workforce and the effect of the reduction in new-home sales have caused business to go into a plunge. The decline in the activity level of the economy is the effect of business cycles. Business cycles are instability that pushes the economy above or below full employment. Currently the economy is at the trough phase of the business cycle with it is about to change its course from a recession phase to an expansion phase. Although the economy is in a slump, there is still a demand for new buildings for hospitals and nursing homes in the United States.
As the manufacturer of heavy construction equipment used for developing residential and nonresidential buildings, energy and manufacturing plants, roads and bridges, and water lines, FGI is in a position to take advantage of the situation capitalize on this opportunity. However, being in this industry for years FGI executives realize that acquiring the amount of funds for this investment is influenced by per capita income, the condition of the existing infrastructure, the rate of urbanization, and various social conditions.
Based on information given, there are currently several international and domestic and companies that manufactures’ construction and forestry equipment. Each company’s equipment is somewhat different in functions and features, which allows the market to supply various substitutes. According to McConnell et al, The market structure that FGI business is categorized as is an oligopoly structure, as it is dominated by few large producers of...