Tim Horton’s Risk Management PDF

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Risks Associated with Tim-Horton’s Venture in Japan...

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Risks Associated with Tim-Horton’s Venture in Japan

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2 Risks Associated with the Venture The risk that Tim Hortons will face in their Japanese venture is related to their finances. The financial ratios of value companies and their share prices are used for fundamental analysis. Financial ratios may also be used to assess a company's risk level, particularly regarding the short-term and long-term maintenance of debts and other obligations. Analysis of the assets and liabilities balance sheet of Tim Horton shows that there is a high financial risk of venturing into the business in Japan. However, the danger does impact some of the elements on a balance sheet as some of these risks can be quantified and immediately reported on the balance sheet. This is also expressed in the balance-sheet contingencies since liability is likely, and a loss can be accurately expected (Kumar et al., 2018). These financial risks primarily result from a substantial increase in uncontrollable or unexpected external forces of the company and thus challenging if not corrected with time. If they remain there, they can spread and influence other sectors within the company. Data from Tim Hortons' cash flow analysis reveals a low cash flow in short supply. This has a negative impact on the company since it will be most likely to higher interest and banking charges. Simultaneously, additional expenses may be involved when financing the lending institutions. These additional costs would impact the profit and cash flow of Tim Hortons. If their credit terms are accepted, for example, the bank fees and interest will collect quickly (Kumar et al., 2018). Make sure your company has the best overdraft and loan. Furthermore, Tim Hortons will find out that they will have some missed chances at the end of their financial year. Insufficient cash flows can lead to significant changes for your company to expand. This can be seen if the brand cannot invest in means that make manufacturing more competitive or pass on a supplier's speciality.

3 Mitigation A significant risk faced in Tim Hortons is lacking a reliable and positive cash flow. This is perhaps the most challenging risk to mitigate for the organization, even though many are available. The management must make sure that their credit is good and borrow money if required before Tim Hortons can start the company. The organization must take its properties into account to eliminate the potential risks in its setting (Broadstock et al., 2021). Selling assets or liquidating goods reduces risk, and a healthy balance sheet can also contribute to investment opportunities in the sector in several ways. Sales of stock or equity holdings will provide a cash infusion necessary for Tim Hortons while simultaneously alleviating financial risk.

4 References Broadstock, D. C., Chan, K., Cheng, L. T., & Wang, X. (2021). The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China. Finance research letters, 38, 101716. Kumar, L., Jindal, A., & Velaga, N. R. (2018). Financial risk assessment and modelling of PPP based Indian highway infrastructure projects. Transport Policy, 62, 2-11....