Baldwin Company Essay

Submitted By cbs0031
Words: 742
Pages: 3

Now we will dig deep into the financial highlights of Baldwin Company and the success and failure that we have to report for the different rounds. We, as the chief management team, split the weights of the financial section in order for us to better attain our goal of providing high-quality products at an affordable price and reach as many consumers as possible with a first class shopping experience. The management team put 50% of the weight of the financial section on Market Share in hopes of providing that shopping experience and becoming number one in the traditional market segment. With the remaining 50%, we spit it between asset turnover and market capitalization. Asset turnover is a financial ratio that measures the efficiency of a company’s use of its assets in generating sales revenue or sales income to the company. From Round One until Round three, Baldwin’s asset turnover rate was continuously increasing and assets were continuing to create revenue for the company. When Round 4 reports came back, however, Baldwin saw a small decrease in the asset turnover ratio. For the remainder of the rounds, Baldwin’s asset turnover ratio fluctuated until the final round and ended with a 1.10. Considering we started with an asset turnover ratio of 0.84 and ended with a ratio higher than that, Baldwin saw revenue throughout all eight round. Below, we have provided a graph to compare Baldwin’s asset turnover to the rest of the industry.

As discussed above, we put 25% of the weight in Market Capitalization. Market Capitalization is simply just the market value of a company’s outstanding shares. The process of finding the market cap is taking the stock price and multiplying it by the total number of shares outstanding of the company. We, at Baldwin, used this approach to determine the actual size of the company as opposed to using sales or total asset figures. Baldwin Co started out strong and after Round 1 was in second place in the industry for the highest market capitalization rate. In rounds 2-8, we were very inconsistent in our Market Cap and fluctuated between a very high and very low number for that specific factor. This obviously was an area that we, as top management, focused quite a bit of time on and developed several strategies to bring Baldwin’s market cap rate to the highest in the industry, as well as making that rate stay consistent. Below, we’ve put together another detailed graph of the market rate of Baldwin compared to other competitors in the industry. With this incontinency that we can see detailed in the graph below, our finance department is working hard to develop more strategic plans in issuing stock and carrying Baldwin’s market cap rate back to the original success that it experienced in the first few rounds that we went through.