SWOT Analysis Of Cyclermate

Register to read the introduction… The firm was set up by Lewis Llewellyn and Dai Armstrong, the two close friends in a local cycle touring club. They produce traditional upright cycle, which imitate the 1940’s and 1950’s. In 1990s, the company expanded to meet the demand and they bought a 15,000 square feet warehouse with 2,000 square feet of office accommodation. The high quality hand- made bikes brought them good reputation and maintained high sales though they did not advertise much. However in 2010 the company has trouble as the sales decrease and the demand fell in spite of lower price. Some customers even complained about quality of the product because they got accidents due to front brake. We are a group of consultants and we are preparing this report that will give Cyclermate’s banker an objective view about this company. Although at the moment they are having overdraft and some difficulties in selling products, we are here to make the bank see opportunities of this company and continue investing in it.

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2. Liquidity and Capital Structure
2.1. SWOT Analysis  Strengths
  Cyclermate has a long establishment time and reputation in producing traditional bike. The company has asset of a large piece of land worth £ 208,000 (included £ 48,000 of factory and £ 160,000 of unused land).

 Weaknesses
  Cyclermate has very few current assets and more non-current asset. This reduces the liquidity of money. There is a great liability that is in the form of bank overdrafts. Costs are rising while price per unit decrease to encourage customers resulting in reduce in revenue.

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