Robert Reyteran Prof. Alberto Cayco
BSA-1I September 23, 2009

Case 1
Generoso Pharmaceuticals & Chemicals, Inc.

Statement of the Problem

To determine the possible actions the Generoso Pharmaceuticals & Chemicals, Inc. should take in order to stay in competition and where to find additional capital.

Areas of Consideration

* Liquidity of the Company
* Ready for expansion
* A wide supply for raw materials
* Conservative cash management policies

* A good project
* Contacts in the Us who provides supply
* A large area for expansion
* Less quality of their products
* Expansions are too costly
* Lack of additional capital
* Poor management

* Stability of the economy
* Risky project because its too costly
* Fast turnover of participants in the industry

Alternative Courses of Action
1. GPC can borrow money from banks or other financial intermediaries, and they can hire Filipino chemist who is less expensive but still has the quality.
a. It will be less risky
b. It will cost less and support our Filipino chemists
a. Its quality is at risk

2. GPC should accept the project.
a. It will make the company stay in competition
b. Creditors will provide the needed budget
a. It is too costly and risky

3. GPC should not accept the project and stay small
a. It will cost less and less risky for the company
a. It will not make us competitive

I therefore recommend that the best alternative action is to accept the proposal of the project for Generoso Pharmaceuticals & Chemicals, Inc. in order for them to stay in competition and reputation. Creditors will provide the needed budget, the risk of borrowing a huge amount of money can be assured that the project will provide a good result and will provide additional income for the company.

Detailed Action Plan

1. Find for financial intermediaries who will lend the amount needed for the project.
2. After obtaining the loan, proceed for planning and implementing the project.
3. Create a team that will monitor the progress of the project.
4. When the project is ongoing monitor its effectiveness in creating additional sales.
5. Monitor if you can pay your debts on time.
6. Evaluate the performance of the project and the company.
7. If it had a positive result we should improve more and if it is a negative result we should perform adjustment.


In this case study, risk is a great factor. The amount risk the GPC is willing to take to stay and to dominate in competition. We are not sure of the following outcomes of our possible actions but if we are just willing to take small amount of risk we are just about to receive small success but if we are ready to take all the risk, we can receive all the success. We should not be afraid of failure there will always be a room for improvement. Even though we are ready to take the risk we should be conservative enough to minimize the risk of the actions we have taken to assure our success and good results of our actions.

Generoso 7.6 of 10 on the basis of 1544 Review.