Guillermo Furniture Store Analysis Research Paper - 1

Guillermo Furniture Store summary - Research Paper ExampleThe benefits of operating as a sole proprietorship include the item that Guillermo is fitting to make decisions without consulting anyone. With this in mind, Guillermo has decided not to merge with new(prenominal) organizations or even to dramatise another organization. This led to the consideration of three resources overlay as usual purchase a advanced machine and operate as a broker. However, before any decision can be taken, an analytic thinking of the three options is gestated.Continuing as usual does not require Guillermo to do anything but to do descent in the same manner as before. It is best that Guillermo makes some changes to his current operations. If sales and profits continue to fall then the end result is that the firm would have cease operations. However, with Guillermos reluctance to go the behavior of merger or acquisition closure of the business may be inevitable if the other options are not fea sible.Purchasing a hi-tech machine is a very pricely option as it requires an outlay of capital. Therefore, Guillermos ability to obtain funds as well as the cost of capital has to be a prime consideration. However, there are benefits that can be achieved from going this route. In order to break even, a certain level of sales would have to be achieved. The break-even point is achieved at the minimum level of sales which ensures that the firm neither makes a loss nor a profit. It is a measurement of risk that is and s frequently used in making entrepreneurial decisions (Prakash and Deshpande 1982). This is only possible if Guillermo is able to produce furniture at a cost which is lower than the competition.This option of operating as a broker would require Guillermo to become a local distributor for an overseas firm while move to manufacture some of the items currently produced. This option will therefore require some changes in the way it has been operating as the main emphasis w ill be on distribution. This option does not require any capital outlay.An