Yu Ranchh Harvard Case Solution & Analysis

Yu Ranchh Case Study Solution

PEST Analysis

The political environment in the region shows increased government regulations regarding the safety of beef production, however,the business ensures compliance with these regulations as GFSR beef is additive free. The Ontario beef industry has suffered a significant decline in consumer demand as many of the customers have shifted towards healthy and additive free diet. This social factor supports the founder’s plan of expanding the supply of GFSR beef as profits will be guaranteed. Prices and feed cost of beef was much higher in the U.S as compared to other types of meat. Moreover, as a result of escalating prices of land in the region, purchasing or renting addition land to support the growth of the farm became difficult. The technological innovation in the beef industry of Ontario appears to be switching to additive free production of meet.


In order to achieve growth, it will be recommended to rent the additional land required of more than 250 acres throughfinance lease as the present value of lease rentals calculated under the finance lease amounted $230033 is much loweras compared to present value of annual interest payments amounting $532632 through borrowing loan from government (Annexure, Excel).As the demand of GFSR is likely to increase further in the future, it is likely that the organization will be able to pay the annual lease rentals without compromising their profits.

Similarly, the business is recommended to rent the land as compared to purchase the land by borrowing loan from government as finance lease will give the business the right to use the land without investing any money in the asset. This will allow the business to invest the available funds in meeting working capital requirements such as hiring of additional staff to handle the cattle......................


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