Thomas Money Service


Thomas Money Service Market Structure Proposal
Edna E. Perry
University of Phoenix
February 22, 2011

Thomas Money Service Market Structure Proposal
Thomas Money Service Incorporated is consumer finance company that grants small loans for individual’s needs and has been in business since1940.   Thomas Money Service services expanded over the past five years by, issuing business loans, commercial real estate loans, and issuing business acquisition financing service.   The firm has decided to branch out into equipment financing by a subsidiary name Future Growth Incorporated (FGI) established in 1946.   This decision was made because of the huge demand for forestry and construction equipment.  
Another huge decision made by Future Growth was to purchase an equipment manufacturing company.   This will allow the firm to sell, build, and finance their own brand of forestry and building equipment.   Profits for Future Growth for the past 67 years have been continuously increasing even during economic downturns, and Future Growth has never laid-off employees.   This allowed stock to grow from $5.00 to $85.60 with stock splits form 1975 to 1998.   The present stock value is $35 and FGI has never issued bonds.
American economy is suffering because of current global downturn in several states flooding, massive fires, and protest from animal activists.   Profits have decline 30% in one year and for the first time in FGI history and the firm had to lay off one-third of their workforce.   Also falling is a drop in new-home sales which has caused construction industry to slow down and cut back on orders.   Hospitals and nursing homes are still in demand for new facilities.  
Since FGI is not the only company that can deliver forestry and construction equipment, and each offers slightly different features and function, which the market can make many substitutions.   FGI repossessed...