Rented warehouse full inventory of forklift parts

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Reference no: EM132287578

On October 15, the Hino Company has in stock in it’s rented warehouse a full inventory of forklift parts valued at $1.8 million dollars. Since Hino’s stock has been falling for the past three years due to foreign competition, Hino puts the parts out for sale at a bid auction. Hino must pay his warehouse rent at the first of the month, for $4,500 per month.

Flint and company, a Chicago based discount firm repairs forklifts and is the only bidder at 1.1 million dollars. Hino accepts the only bid and specifies in the contract to purchase the parts that the goods must be out by November 1st. Flint goes to his bank and obtains a loan on Oct. 15 to secure the 1.1 million dollar deal.

Flint and Company then calls on his friend a Bernie Broker to arrange or find the 12-15 trucks to haul the goods from Hino to Flint in Chicago. Flint contracts with the Bernie Broker to pay him $800 per load for every loaded out by the 30th.

Bernie gets on the horn and contacts some of his carriers that include:

A. A union carrier who has five trucks available for……………… $750

B. Non union carrier who has seven company drivers……………. $600

C. CS Trucking who has 12 contractors and trucks paid 72% of load…. $450

Analyze the logistics of this arrangement. Discuss the positive/negative position of each of the following, or stated another way, what is each one after in the deal?

Hino Corporation

Flint

Bernie Broker

Can you project any situation or possible consequences if the deal falls through?

Reference no: EM132287578

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