Working Capital and Financing

Sabre Computer Corporation Case Study What are the organizational and external forces at work within this case? Sabre Computer Corporation is faced with internal and external forces especially with the decision to operate within international markets. Forces are defined as any compelling issues that lead to a need for change within an organization. The forces can either be external or internal. An organization that does not positively respond to the forces would find it hard to continue doing business.

With the requirement to setup and partner with companies within the two locations, Sabre will be faced with conflict. Conflicts will arise as some of its employees would need to relocate to either of the two countries. The relocation might not be well received, and this might lead to conflict with the selected employees. With the relocation to the new country, there will be a change in management, and this would be another internal force that the company would have to deal with.

The external environment of an organization refers to the entities existing outside its boundaries, but have a significant influence on the organization's growth and survival. Competition is one of the external entities that Sabre will have to deal with especially in Hungary. Sabre will also have to deal with new customers located in the two regions. These would be a challenge because the customers might have different likes and dislikes (Ivancevich, Matteson, & Konopaske, 1990).

Therefore, the company would have to learn how to deal with the new batch of customers and adopt their preferences. There are also different laws and regulations that the company will have to abide with if it is to continue operating in the two regions. Currency fluctuations will also affect the company, and it might have to look for ways to mitigate against fluctuations in exchange rates. Explain the environment within which this International Finance situation is occurring Sabre will start trading in the international currency market.

According to the case, it is indicated that the company will be selling the computers in the local currency of their country of operation. Therefore, the economy of one country will have an impact on the company's overall operations. This is because it would have to mitigate against the negative currency effects in order to maintain and support its operations. The foreign exchange market will be an environment that the company will have to operate in because it has to price its products competitively while still maintaining a profit.

There is need to make conversions before sales prices can be agreed in order to ensure that the company does not loose in case it transfers the funds to its parent company in the United States. International financial transactions might be tricky and considering that Sabre would be receiving 30% of the revenues, it needs to put all transactions through the foreign exchange market.

How might Sabre Computer Corporation finance their exports? Which methods of payments would be most beneficial for the organization? In order for Sabre to finance its exports, it could employ different methods for financing to suit its different market needs. In Mexico, since the company is dealing with Government and has a contract to sell all the computers it produces to educational and governmental institutions, it could use the contract to get a loan either in Mexico or within the United States.

Sabre can receive a working capital financing, which is a short-term loan that would assist the company to finance its working capital in the two regions. The company could also receive accounts receivable financing. Accounts receivable financing refers to obtaining a.