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The Expansion of Riordan Manufacturing


Submitted By osborng936
Words 1244
Pages 5
Caledonia Products Integrative Problem
Cathi Stark, Jamie Prettyman, Sylvia Mendoza, and Gregory A. Osborn Jr.
May 19, 2014
Christine Gordon

The Expansion of Riordan Manufacturing
Riordan Manufacturing has been in business for over 30 years. The company first opened their doors in 1991 as a research and development company. Over the last 30 years it has acquired a fan manufacturing company and a plastic bottle manufacturing plant. The company also made a big leap when it decided to move part of the company to China in 2000. It has been a while since the company has made any moves, and they have decided to expand the company once again. Riordan can expand the business in one of three ways: an IPO, acquire another organization, or merge with another organization.
Strengths of Expansion Options
Riordan must decide how to continue building their company. The first choice is an Initial Public Offering (IPO). This is “… basically the first time a company decides to sell stock to the public” (Marquit, 2012, Para. 2). This is a good idea because it allows the company to gain funds without the commitment of paying interest on a loan. The second option Riordan has is to acquire another. Because of its successful experience with acquisitions in the past, Riordan knows how to proceed. Purchasing another company Riordan can expand the product base while absorbing the competition. The final option is to merge with another company. This choice allows Riordan the ability to manufacture new products without full accountability for the financial aspect. If the products do poorly, Riordan will not have full financial responsibility.
Weaknesses of Expansion Options
Each of the three options has positive and negative aspects. If Riordan Manufacturing chooses the IPO route, there are added requirements the company faces. It must abide by the rules and

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