Risk and Insurance Over the Term Paper

Open, View, and/or
Download this Document

Total Length: 2468 words ( 8 double-spaced pages)

Total Sources: 1

Page 1 of 8

To rebuild their image, the company would try a number of different strategies, none of which would prove to be successful. This would hurt the market share of Gap to the point that many analysts now believe that it may be advantageous to spin off the company's: Old Navy, Banana Republic and Gap stores. What this shows, is how a company can begin to lose its way when it is not focused on adjusting to changes in consumer tastes and trends. In the case of Ann Taylor, they need to be aware of this hazard, as it can have an adverse impact on the long-term viability of their business. (Reingold)

A second challenge that Ann Taylor can be wrestling with is a lack of focus on the part of management. In this case, managers must understand the role that their decisions will have on their organization. Where, executives must clearly evaluate their actions to ensure that they are helping their organization, to prepare for the underlying challenges that they will be facing in the future. This is important, because the focus of managers will determine the ability of the company to be able increase the financial stability. For example, in 2009 managers were focused on reducing the effects that costs and the slowdown in consumer spending would have on the company. To reduce this as much as possible, they would begin closing a number of different stores and limiting the amounts of expansions that were taking a place. Evidence of this, can be seen by looking no further than total number of stores that were open between 2009 (which was 933) to 2010 (which was 894). At the same time, company would halt all new store expansions in 2009 and they would close five different locations in 2010. This is significant, because it shows how management was focused on identifying the changes that were occurring in their business model. In many ways, once could argue that the focus and insights of managers would play a major role in determining how they would adapt to host of situations that they were facing. Evidence of this can be seen by looking at the operating income that the company would report between 2009 and 2010. As this would come in at: -$20 million for 2009 and $41 million for 2010. ("10Q") This is significant, because it shows how the underlying focus of managers would help Ann Taylor to be able to withstand the implosion in consumer spending.

When you look at these two hazards, it is obvious that Ann Taylor will have to constantly remain focused on the issues of: consumer trends / tastes and ensuring that managers are always focused.

Stuck Writing Your "Risk and Insurance Over The" Term Paper?

View All Our Example Risk and Insurance Over the Term Paper

Have A Custom Example Essay Written

As these two elements will help the company be able to quickly adapt to the various challenges that they will constantly face on a regular basis. In many ways, one could argue that these elements are interconnected, as they will play a vital role in determining what will happen with the earnings of the company in the future. As a result, Ann Taylor must be prepared for these hazards to ensure that they can adapt to underlying challenges that they are facing. This is important, because the effects from these obvious hazards will cause their overall amounts of insurance coverage to change. Where, actions that managers could take to prevent a situation from becoming worse, could cause the underlying risks and costs to increase. However, over the long-term these actions could cause the overall amounts of coverage to change, as the underlying risks will more than likely improve. This is important, because it highlights how the insurance needs of Ann Taylor, can change based upon issues affecting their business. To mitigate this underlying risk, managers must be observant of what changes are taking place in the industry.

Clearly, Ann Taylor's earnings are being impacted by changes in consumer spending and the economic cycle. This important, because it means that the underlying challenges facing the company will have an effect on its insurance coverage. As it will cause the overall amounts of risks to increase, because of changes in the company's profitability and needs. Over the course of time, this will have an impact on the company's overall rates that they are paying, as they more than likely will have to be adjusted upward. At the same time, the company is facing the peril of a double dip recession occurring, as a secondary slowdown could increase the risks and change their underlying insurance needs. However, the fact that that the company has large amounts of cash in comparison to their debt, means that they are in stronger position to protect themselves vs. competitors. The obvious hazards of: changing consumer trends and the focus of management, will determine the ability of the company to be able to overcome the different challenges that they are facing. As this will play a role how quickly the organization responds to changes that occurring. This is important, because it highlights how Ann Taylor can face changes in their business model that can literally come out of nowhere. When you put these different elements together, this highlights how all of the above factors will play an interconnected role, in determining the underlying risks and amounts of insurance company that it will require. This significant, because it highlights how all organizations will.....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Risk And Insurance Over The" (2010, October 31) Retrieved June 5, 2026, from
https://www.aceyourpaper.com/essays/risk-insurance-7246

Latest MLA Format (8th edition)

Copy Reference
"Risk And Insurance Over The" 31 October 2010. Web.5 June. 2026. <
https://www.aceyourpaper.com/essays/risk-insurance-7246>

Latest Chicago Format (16th edition)

Copy Reference
"Risk And Insurance Over The", 31 October 2010, Accessed.5 June. 2026,
https://www.aceyourpaper.com/essays/risk-insurance-7246
   

Open, View, and/or
Download this Document
order custom essay example