Evaluate your client company’s contingency plan

Read your client company’s response, see whether it is consistent with lessons we learned in chapter seven and whether you can improve it by applying this week’s lessons. Elaborate at least in 200 words and cite the lessons from the Best Practices 7 assignment.

My client companies contingency plan is Grappone. Overall my company has many great ideas And has a step-by-step process for one hour session does occur. But some things that I’ve seen that they can improve on or add, is that they should cut the capital spending entirely, and they should begin to start selling some of their assets in preparation for a recession. Another thing they mention is that they focus on trying to keep their team members fully engaged although this policy is good, They might reconsider their hiring situation, and potentially fire some individuals to save costs. Another part of the contingency plan they mention is that they must tighten control of their inventory levels. As a car company the Market trends usually suggest that the selling price for vehicles drastically increase right before a recession, and then drastically decreased as soon as the Recession begins. I believe that they should use these market trends to their advantage, they should sell most of their inventory for when the market is high, and use that money to purchase vehicles at a extremely low market price, this means that once the recession is over and the prices start to go up They have plenty of inventory to make their money back.

Business response to the questionnaire

Graponne

Question Response from the company
Please, discuss your contingency plan for dealing with recession, if you have one.

Our contingency plan include:

  1. Tighter control of our inventory levels
  2. Managing our cash. Making sure we have enough liquid reserves to get us through the downturn
  3. Limiting discretionary expenses. Including delaying intensive capital type projects.
  4. Keeping our team members fully engaged
  5. Making sure we have available credit (to finance cars that are not selling as well as lines to draw down for working capital). 

Bank of New Hampshire

Question Response from the company
Please, discuss your contingency plan for dealing with recession, if you have one. As previously mentioned, we build loan loss reserves and carefully monitor for signs of economic stress that may impact our business. We have sources of emergency liquidity available, and other similar tools to ensure the viability of the bank through a very severe downturn. Furthermore, we stress test our loan portfolios and entire balance sheet to determine how the bank would perform in various economic scenarios. This allows us to determine is additional reserves, liquidity, etc. are needed.

Comptus

Question Response from the company
Please, discuss your contingency plan for dealing with recession, if you have one. We do not have a contingency plan for an extended recession.