ETHICS, CONSUMERISM AND SOCIAL RESPONSIBILITY Essay

ETHICS, CONSUMERISM AND SOCIAL RESPONSIBILITY - Essay Example This can be achieved through regular regulation of the business approach to go well with the present market. This paper looks at how organizations can make use of management tools to manage their operations in a more efficient way taking the example of Franke Sessions. It also proposes a communication plan for Franke Sessions that can help the organization to develop awareness in all its stake holders. An environmental management system is a typical method for the incorporation of sustainable ecological management all through the business structure. EMS consists of the organization composition, development activities, properties and measures for implementation the environmental strategy as an essential part of the executive procedure. It is a functional instrument to put into practice in order to act in accordance with the legislation, deal with stakeholder demands, progress business representation and elevate alertness of environmental concerns. EMS is a good method for identifying problems and solving them, it is founded on the notion of repeated development. It can be put into practice in a business in numerous diverse ways, depending on the segment of action and the requirements alleged by management. As a matter of fact, principles for EMS have been built up by the ISO and by the European Commission Eco-Management and Audit Scheme (EMAS) (Darnall, et al 2008). The requisites of the vibrant business environment have made many companies’ value chains unsteady, this means that businesses have more and more been required to formulate decisions regarding the management of the value chain into a further peripheral system of management. The vibrant commerce environment gives the impression of affecting both interior and exterior business procedures. Its latest transformation from in-house business procedures to peripheral business procedures has been extremely rapid because of the use of diverse IT-application. These

Extinction Essay Example for Free

Extinction Essay Extinction is a natural selection process. Should humans strive to preserve a representative sample of all biomes or aquatic zones? I personally believe that we are already preserving when it comes to wondering if we are going to become extincted. We as human have a hard time not reproducing, this meaning most humans that become married usually begin having children within the first 5 years of their marriage if they haven’t married and already have children. This being said we may not leave an carbon copy of ourselves but we are leaving genies that we carry as well as tradition and legacies that we uphold. We has humans don’t understand the importance of preserving things, we are so focused on who has more than the other or who is worth more than the other that it never dawns on us that one day humans can be a thing of the past. Looking at the most important things of life now with is preserving and growth of things we are currently involved in. Keeping the world a better place to live in so that we are in a good environment to continue preserving the things we need. Why should humans be concerned with the extinction rate? We should be concerned with the extinction and try and preserve the biomes and ecosystems that are present. Over time the ecosystem and biomes have evolved changed in some form or fashion that will leave us in difference from this particular time now. It’s important to have something to be able to look back on for information and or instructions on how to change things that we as human may make a mistake and mess up.

Glucose Tolerance Tests Accuracy In Diagnosing Diabetes

Glucose Tolerance Tests Accuracy In Diagnosing Diabetes According to the World Health Organization (WHO), more than 220 million people worldwide have diabetes. An estimated 1.1 million people died from diabetes in 2005, and almost half of diabetic deaths occurred in people under the age of 70 years of age. WHO projects that the number of diabetic deaths will increase to 366 million by the year 2030 (8). Diabetes Mellitus Type 2 is a prevalent disorder that causes one to have high blood sugar, or hyperglycemia. This hyperglycemia can be the result from one or a combination of 1) decrease production of insulin from beta cells of the pancreas; 2) increase sugar production from the liver; 3) decrease sugar uptake by cells secondary to insulin receptors. Symptoms of DMII are excess urination, excess thirst, dizziness, blurred vision, sweating, and fatigue. Patients presenting with these symptoms should be screened by a finger stick, where a blood sample is taken from a quick prick of the finger, to be tested for hyperglycemia. Normal blood sugar should range from 70-100mg. If one has a fasting sugar of >126mg or an after eating sugar level > 200mg, then an oral glucose tolerance test (OGTT) should be performed. During an OGTT, a patient consumes a 150-200g carbohydrate diet for three days and fasts from midnight prior to test date. The morning of test, the patient consumes 75g sugar mixe d with 300ml of water within a 5 minute period. The patients blood sugar level is be measured at baseline, and then again at 120 minutes. A diagnosis of DMII is made if the baseline level is >126 mg and the 120 minute level is >200mg. These guidelines are set by the American Diabetic Association (ADA) and the World Health Organization (WHO) (1,8). Another option for obtaining a blood sugar level is measuring the percent of glycosylated red blood cells, or the percent of sugar attached to a RBC. RBCs live for approximately 90 days in the human body. By measuring this percentile one can observe the patients blood sugar level over the previous 3 months and not just at the moment an OGTT is performed. Today, HbA1c is a main tool for following metabolic control in persons with diabetes(5). A HbA1c > 6.0 percent should permit a diagnosis of DMII, but is not at this time a definite diagnostic tool. Diabetes can cause complications of multiple organ systems. WHO defines consequences of diabetes as follows: Diabetes increases the risk of heart disease and stroke. 50% of people with diabetes die of cardiovascular disease (primarily heart disease and stroke). Combined with reduced blood flow, neuropathy in the feet increases the chance of foot ulcers and eventual limb amputation. Diabetic retinopathy is an important cause of blindness, and occurs as a result of long-term accumulated damage to the small blood vessels in the retina. After 15 years of diabetes, approximately 2% of people become blind, and about 10% develop severe visual impairment. Diabetes is among the leading causes of kidney failure. 10-20% of people with diabetes die of kidney failure. Diabetic neuropathy is damage to the nerves as a result of diabetes, and affects up to 50% of people with diabetes. Although many different problems can occur as a result of diabetic neuropathy, common symptoms are tingling, pain, numbness, or weakness in the feet and hands. The overall risk of dying among people with diabetes is at least double the risk of their peers without diabetes (8). Previous studies have showed that better control of plasma glucose levels reduced the risk of developing long-term complications pertaining to diabetes (4). A higher HbA1c correlates well with the likelihood of developing chronic complications such as the ones listed above. This study is designed to explore if a HbA1c be used to diagnose diabetes. Observations suggest that a reliable measure of chronic glycemic levels such as HbA1c, which captures the degree of glucose exposure over time and which is related more intimately to the risk of complications than single or episodic measures of glucose levels, may serve as a better biochemical marker of diabetes and should be considered a diagnostic tool (2). As for the current gold standard for diagnosing diabetes, the oral glucose tolerance test (OGTT) has its limitations (2). These include high interindividual variability, low reproducibility compared to FPG, poor compliance with the conditions needed to perform the test correctly, and is cumbersome and time-consuming for medical staff and patients (4). Due to these factors one may ask, Is a HbA1c or an OGTT more accurate at diagnosing new onset diabetes mellitus type 2 in a patient presenting with hyperglycemia? By exploring this question and answering it from an evidence-based approach, the answer may help clinicians advance to an easier and less time consuming way to diagnose diabetes mellitus type II. CLINICAL CASE A 57 year old African American male presented to the outpatient office with symptoms of dizziness, blurred vision, polydipsia, and polyuria. He has a significant history of hypertension and hyperlipidemia. The patient was unclear when his symptoms started. Upon evaluation in the office, the patient was noted to have a marked glucose elevation of 420. An in-house HbA1c was also noted at 13.0. Upon further questioning, the patient has not been taking any medications for diabetes, and is currently taking Lisinopril and Zocor for his other medical conditions. Due to the presenting symptoms and lab results, the patient was admitted to the hospital for hyperosmolar nonketotic hyperglycemic state. METHODS A PubMed search was performed by using the Clinical queries and Diagnosis filters. The terms A1c AND diagnosis AND diabetes and glycosylated hemoglobin AND diagnosis AND diabetes were used to search the site for relating articles. With these search terms, a total of 176 hits revealed articles pertaining to the requested information. Articles that met all inclusion criteria for the research were evaluated and assigned a type/level of evidence. In order to be included in this evidence-based study, articles had to meet the following inclusion criteria: Articles must be cohort studies. Studies must not be > 6 years old. Articles must have participants with impaired glucose levels or symptoms of impaired glucose. Studies must include evidence of OGTT or FPG and HbA1c. Studies must have a significant number of participants to produce a significant result (n > 375). Any articles that did not specifically relate to diagnosing DMII with a HbA1c were excluded. Articles that were not cohort studies, were older than six years, did not have participants with impaired glucose, or did not have a significant amount of participants were excluded. Certain articles that appeared in the PubMed search were strictly review articles. These papers were reviewed, and if applicable, may be used to provided supporting factors about pathophysiology/ epidemiology of diabetes type II and its diagnostic criteria. Articles that met all inclusion criteria were evaluated and assigned a level of evidence using the Oxford Centre for Evidence-based Medicine Levels of Evidence worksheet. RESULTS Study #1: Diagnosing Type 2 Diabetes Mellitus: in Primary Care, Fasting Plasma Glucose and Glycosylated Hemoglobin Do the Job Study Design: This study was performed at the Raval Sud Primary Care Center in Barcelona, Spain and was begun in 1992. The purpose of this study was to determine the validity of glycosylated hemoglobin values as a method to diagnose type 2 diabetes mellitus in a population at risk seen in primary care. Four hundred fifty four subjects were selected to participate in the study. The population served by the Raval Sud Center is characterized by it low evonomic level, high rate of immigration, and high rate of morbidity and mortality for certain diseases and disorders. Inclusion criteria for eligible participants had at least on e of the risk factors for developing DMII described in the ADA guidelines. These included family history of DMII, personal history of carbohydrate intolerance or gestational diabletes, prolonged use of a drug able to raise glucose levels, obesity with a body mass index > 30, hypertension, HDL-cholesterol levels 250 mg/dL. Persons who did not wish to take part in the study were excluded. For the purpose of this particular study, data was recorded from the time the patient was included in the Raval Sud Care Center. The study then used a cross-sectional analytical design to validate a diagnostic test. (4) Study Conduct: Subjects were interviewed and variables were recorded for each participant. These included sociodemographic characteristics such as age and sex, clinical characteristics such as BMI and blood pressure, and laboratory values including fasting plasma glucose in a venous blood sample, oral glucose tolerance test after a 75g glucose overload, and a HbA1c measured by high pressure liquid chromatography. To standardize the results for the HbA1c, the absolute values were recalculated in terms of the number of standard deviations above the mean. FPG and OGTT values were based on the WHO criteria as having normal, impaired, or DMII glucose levels. (4) Study Results: The distribution of demographic characteristics and laboratory findings are shown in Table 1. The study found that plasma glucose levels were significantly lower in normal subjects than in subjects with abnormal glucose levels (IFG or OGTT) and even lower in subjects with abnormal glucose levels than in patients with diabetes (P 5.94% (mean, +3SD), the diagnosis of DMII is reliable and accurate in 93% of the cases. Table 4 shows the diagnostic validity of a combined strategy of FPG and HbA1c values: patients were considered to have DMII when FPG > 125 mg/dL, or when FPG >110 mg/dL and HbA1c was greater than the cutoff value. Maximal efficacy (93% GV) was found for HbA1c > 5.94% (x +3SD), with a sensitivity of 92.2% and a specificity of 95.1%. (4) Study Critique: It has been confirmed that the relationship between circulating glucose values and the onset of chronic complications exists. Thus, it is logical for the diagnosis of DMII to be based on glucose values. One of the main problems in this particular study was to define and establish a cutoff point for this continuous quantitative variable. This study analyzed different cutoff points for the whole sample of patients at risk for DMII. When HbA1c values > 5.51% (x +2SD), were used for the cutoff point for diagnosis of DMII, the sensitivity (76%) and specificity (85%) were acceptable. However, when a higher cutoff point was used, specificity increased, but only at the expense of reduced sensitivity. Due to this situation, the study designed a strategy for diagnosis based on the FPG values and the validity of HbA1c. (4) Level of Evidence: 1c Study #2: Comparison of A1c and Fasting Glucose Criteria to Diagnose Diabetes Among U.S. Adults Study Design: This study included participants from the 1999-2006 National Health and Nutrition Examination Survey. Participants included 6,890 adults (>20 years of age), without a self-reported history of diabetes. The subjects attended a morning examination, fasted for > 9 hours at the time of their blood collection, and had valid plasma glucose and HbA1c values taken. Participants were categorized into one of the four groups by presence or absence of fasting plasma glucose > 126 mg/dL and HbA1c > 6.5%. The distribution of the population into these groupings was determined and the K statistic value was calculated. Also, the distribution of U.S. adults by fasting glucose and different HbA1c cutoff points (6.0-6.7%) were calculated. The objective for this study was to compare A1c and fasting glucose for the diagnosis of diabetes among U.S. adults. (6) Study Conduct: Data was collected through questionnaires (demographics, medical history), a physical examination (blood pressure, BMI, and waist circumference), and blood collection (lipids, plasma glucose, HbA1c). The plasma glucose was measured by using a modified hexokinase enzymatic method and the HbA1c using a high-performance liquid chromatography. (6) Study Results: This study concludes that an HbA1c of > 6.5%, along with a FPG >125 mg/dL demonstrates reasonable agreement for diagnosing diabetes. 1.8% of the participants were classified as having diabetes with a HbA1c > 6.5% and a fasting glucose >126 mg/dL. Among participants with a HbA1c 125 mg/dL, 45% had an A1c value > 6.0% but less than 6.5%. According to A1c guidelines, this value poses an elevated risk for diabetes. Table A1 shows a distribution of adults by fasting glucose and different HbA1c cutoff points. From this table, the lower the HbA1c cutoff points results in higher sensitivity and lower specificity. (6) Study Critique: In this study, certain participants had discordant results such as a HbA1c > 6.5% and a fasting glucose of Study #3: A1c and Diabetes Diagnosis: The Rancho Bernardo Study Study Design: The Rancho Bernardo Study included 2, 107 participants without known DMII, who had an OGTT and a HbA1c between 1984 and 1987. This cross-sectional study of community dwelling adults was provided written informed consent and laboratory data was performed. (3) Study Conduct: HbA1c was measured with high performance liquid chromatography using an automated analyzer. Ophthalmologic evaluation was also performed on the subjects. This was done by using nonmydriatic retinal photography. Sensitivity and specificity of HbA1c cutoff points for DMII were calculated, along with K coefficients which were used to test for agreement between A1c values and diabetes status. The objective for this study was to examine the sensitivity and specificity of HbA1c as a diagnostic test for DMII in older adults. (3) Study Results: For this study the HbA1c cutoff value was 6.5%. This value had a sensitivity of 44% and a specificity of 79%. A lower A1c cutoff point of 6.15% yielded the highest sensitivity at 63% but a lower specificity at 60%. If one were to use this cutoff value, it would miss one-third of those with DMII by the American Diabetes Association guidelines. It would also misclassify one-third of those without DMII. Using the HbA1c value of 6.5% as the cutoff point, the agreement with DMII diagnosis was low (K coefficient was 0.119). In order to compare A1c and ADA criteria with DMII complications, the study looked at participants with some degree of retinopathy. Of the participants who had retinopathy, 40% had and A1c > 6.5% and none had DMII by ADA criteria. This study concluded that the limited sensitivity of the A1c value cutoff may result in missed or delayed diagnosis of DMII, whereas the use of current OGTT criteria will fail to identify a high proportion of individuals with hi gh A1c values, which correlate with long term complications of DMII. (3) Study Critique: This study was performed on a much older population than the other studies examined in this paper. It has its benefits and disadvantages for surveying a population in which there mean age was 69.4. The advantage is that the U.S. elderly population has the greatest current burden and is expected to have the greatest increase in the prevalence of DMII. On the other hand, the disadvantage to having such an older subject population is that it limited the HbA1c cutoff values to that particular population. In a previous critique of an article one of the concerns was the fact that there are different aspects of glucose metabolism. It would have been supportive if the article addressed the age of their participants and compared them with the study results. (3) Level of Evidence: 1c Study #4: Diagnostic value of glycated haemoglobin (HbA1c) for the early detection of diabetes in high-risk subjects Study Design: This study was performed by collecting data from the Bundang CHA General Hospital database. A total of 392 subjects who had an abnormal random plasma glucose, a history of gestational diabetes mellitus, a macrosomic baby, or a severe obesity were selected to participate in the study. Exclusion criteria included a previous history of diabetes of other endocrinopathies, pregnancy, abnormal liver or renal function tests, a history of major surgery, severe illness, blood transfusion within the previous 6 months, and weight loss > 3kg during the past three months. After an overnight fasting, blood samples were drawn from all participating subjects to include FPG and HbA1c values. (7) Study Conduct: Glucose concentrations were measured using the glucose oxidase method on a autoanalyzer. The HbA1c values were measured by the high-performance liquid chromatography method. All statistical analysis was performed and the best predictive cutoff values for FPG and A1c for detecting patients with new diabetes were identified using the optimal sensitivity/specificity values determined by the receiver operating characteristic curve. (7) Study Results: Figure 1 shows the ROC plot representing the sensitivity and specificity for the HbA1c and the FPG in detecting undiagnosed DMII. From this study, the optimal cutoff value for HbA1c was 6.1% and for FPG was 6.1 mmol/l. The sensitivity/specificity for the HbA1c cutoff value was 81.8% and 84.9% respectively. Table 1 shows the results from the combination of using FPG and HbA1c. This study demonstrated that HbA1c was very useful to screen for diabetes in high-risk patients and the combined use of HbA1c and FPG made up for the lack of sensitivity in FPG alone. (7) Study Critique: This studys subjects were only Korean, therefore making the population very ethnically limited. It would have been beneficial to have seen the population more diverse and to notice the change in results. Also, the study stated that an OGTT was performed, yet a confirmation status of repeat testing was not recorded. This would have been beneficial to have in order to compare results to the FPG and HbA1c values obtained for cutoff for diagnosing DMII. (7) Level of Evidence: 1c DISCUSSION The purpose if this study was to assess if a HbA1c was sufficient enough to make a unknown diagnosis of diabetes mellitus type 2. From these studies one can gather that a HbA1c is adequate for making a new diagnosis for DMII. The following chart compares the specificity and sensitivity of each HbA1c from each study critiqued in this study. Also, each study uses a different HbA1c cutoff that they gathered from their cohort or cross-sectional study which is also included in the chart below. Study Sensitivity Specificity HbA1c used for Diagnosis Diagnosing Type 2 Diabetes Mellitus: in Primary Care, Fasting Plasma Glucose and Glycosylated Hemoglobin Do the Job 63.3% 93.4% 5.94% Comparison of A1c and Fasting Glucose Criteria to Diagnose Diabetes Among U.S. Adults 72.5% 96.5% > 6.0% A1c and Diabetes Diagnosis: The Rancho Bernardo Study 44% 79% 6.5% Diagnostic value of glycated haemoglobin (HbA1c) for the early detection of diabetes in high-risk subjects 81.8% 84.9% 6.1% Study #1 discussed the option of performing a combination of HbA1c and a FPG test. This exhibited to be most the most poignant result with a specificity/sensitivity of 92.2 and 95.1, respectively. In study #2, it also agreed that a HbA1c and a FPG level provided the most assured diagnosis for DMII. However, this study had the most discordant results and was probably due to the fact of its subject population. It stated that the results may have been due to the fact that assessment of different aspects of glucose metabolism was present (6). Study #3 was performed on a much older population, and focused on the importance of following HbA1c levels to help prevent long term complications of DMII. However, it also stated that a HbA1c would also have a higher sensitivity and specificity if it were performed along with a FPG test. Finally, study #4 agreed on the fact that a HbA1c was very sufficient for screening for DMII, and that it provided much support for diagnosing DMII along with a FP G. CONCLUSION This study provided that a HbA1c of approximately 6.0% is a great support to help making the diagnosis of DMII along with a FPG > 125. Some studies have suggested that a HbA1c of this value is suggestive of a diagnosis, however, the studies above advocate that FPG levels should also be obtained to solidify the actually diagnosis of DMII. However, in a recent publication from the JAAP, it states thatan A1c value of 6.5% higher as diagnostic. This value appears to be the level at which a person is at risk for developing the complications of diabetes. A diagnosis should be confirmed with a repeat A1c test, unless clinical symptoms and a glucose level higher than 200 mg/dL are present (5). From this statement one can confer that the patient described above in the clinical case portion of this paper, does indeed warrant the diagnosis of DMII on the basis of a HbA1c of 13.0%, the presence of clinical symptoms, and the glucose elevation of 420 mg/dL.

Prohibition - The Noble Experiment :: American America History

Prohibition - 'The Noble Experiment' In 1920 congress began what was called "The Noble Experiment". This experiment began with the signing of the eighteenth amendment of the constitution into law. It was titled by society as Prohibition. Websters dictionary defines prohibition as: A prohibiting, the forbidding by law of the manufacture or sale of alcoholic liquors. Prohibition can extend to mean the foreboding of any number of substances. I define it as a social injustice to the human race as we know it. Prohibition was designed to rid the country of businesses that manufactured, sold, and or distributed alcoholic beverages. The eighteenth amendment made it a violation of the constitution to do and of the before mentioned. This was a crime punishable up to the Supreme Court. The original idea was that Americans as a whole were unhealthy, there was too much crime and corruption, and that people were being burdened by excess taxes that poorhouses and prisons were creating. What happened? The cheap alcohol being illegally produced killed more Americans, crime and corruption went up, taxes were raised to fund the law enforcement needed to enforce prohibition, and the prisons became overcrowded. Some would have you believe that crime decreased during prohibition. Well, it did. Crime decreased, as a whole, by 37.7% during prohibition. However violent crime and other serious crimes were up. Theft of property was up 13.2%, homicide was up m16.1%, and robbery was up 83.3%. Minor crimes had decreased though- by 50%. Crimes such as malicious mischief, public swearing, vagrancy, etc. (Dr. Fairburn pg 75-80) The prohibition movement did have its fair share of supporters however. The most active in the movement was the Women's Christian Temperance Union. They worked hard in campaigning towards this amendment and gathered, what is now believed today, as to be biased statistics. For example one area that the WCTU attacked was the saloons and in particular the sale of distilled spirits, hard alcohol. The WCTU claimed drinking during prohibition was down 30% as opposed to pre-prohibition. However as a percentage to total alcohol sales the consumption of distilled spirits was up from 50% (pre-prohibition) to an astonishing 89% during prohibition. "Most estimates place the potency of prohibition-era products at 150+ percent of the potency of products produced either before or after prohibition (qtd. In Henry Lee 202) Prohibition did not succeed at all. In order for prohibition to achieve what it was set to do it had to meet four specific guidelines.

Ben & Jerry’s Case

Started almost 20 years earlier, Ben & Jerry’s had plenty of great opportunities to expand the business by entering into foreign markets. However, their attempts of expansion cannot really be considered successful (note: the case describes the period 1978-1997). In the following paragraphs, I will evaluate their international market entry strategies, based on the ’International Market Entry Evaluation Process’ described by J. K. Johansson in his book Global Marketing – Foreign Entry, Local Marketing, and Global Management written in 2000.According to the process, the five steps of evaluation are Country Identification, Preliminary Screening, In-Depth Screening, Final Selection and Direct Experience. Before its idea of entry into Japan, Ben & Jerry’s attempted to expand their business in six different countries on three continents, none of which was approached in a systematical way eg. based on the above-mentioned process. Had the company followed a well-thought-out plan, it probably would have realized more success than it actually did.The first country Ben & Jerry’s tried to set foot in was Canada, which comes by no surprise as the Country Identification step assumes foreign partners to be chosen based on geographical closeness. The strategy was not successful as the company finally had to repurchase its licensing agreement because of high taxes and low quotas. The next country of attempt was Israel, which I consider an opportunistic approach since the license was given based on friendship and not real evaluation.The country held good opportunities though with the product being sold in supermarkets and restaurants, but the partnership did not result in high income according to the terms and conditions of the contract. The first joint venture in Russia did not prove to be a lucrative business either, and the four years spent in the country ended on disadvantageous terms. It could be considered as a free give-away of tec hnologies, equity and equipment. The last three foreign markets approached were the United Kingdom, France and the Benelux States.In none of these cases was any of the steps of the International Market Entry Evaluation Process followed which resulted in very opportunistic approaches without consensus, a well-designed plan or a valuable strategy. I do not consider the first six foreign entries to be successful at all, however, some of the countries held good potentials but lack of experience and knowledge made Ben & Jerry’s not successful. The company has a great chance to increase its sales, market share, profits and income by entering into the Japanese market.Probably having learnt from its previous experiences, the approach of the Japanese market has been more systematic than the previous one. It has actually been quite consistent with the steps of the International Market Entry Evaluation Process, they have even reached the stage of the last step, as it turns out at the be ginning of the case – they made a trip to Japan to get first-hand experience before making a decision. The Japanese market has correctly been evaluated to have a large market and an existing demand for super premium ice-cream, which makes it a prospective opening.At the same time, the company has recently been experiencing declining market share on the domestic markets, worsened by decreasing growth rates. The combination of these factors result in finding the idea of entrance appealing, however, the complicated process of entering into the market must be taken into consideration too. In my opinion, it is time Ben & Jerry’s did the necessary steps to expand their business. The company has seen different ways to approach Japanese consumers, however, the two best ones has been to enter with Seven-Eleven or through Mr.Yamada. These represent two totally different strategies and both have their advantages as well as disadvantages. Entering with Seven-Eleven has the advanta ge of providing high sales and also a lot of experience in effective involvement of professionals. Making them partners would also mean a quick access to the Japanese market. On the other hand, they have expressed a complicated way of logistics and inventory management, and they would also presume a very dominant position in their partnership. Making Mr.Yamada their partner seems to be a much easier way to approach Japanese consumers. Mr. Yamada does not have complex and specific requirements as Seven-Eleven but he still has the extensive knowledge of the market, however, what he does not have is a proven business plan to start the business. Although it may seem to be easier to choose the strategy that involves less complications, Ben & Jerry’s has reached the stage where they ought to make responsible long-term decisions rather than focusing on short-term convenience.Seven-Eleven has a lot of requests to be followed, it only proves that they have experience and market knowle dge and they know what type of products there will be sufficient demand for. In my opinion, the company should choose Seven-Eleven to form a partnership with, based on the information provided by the case. The chance to succeed in the Japanese market would be higher this way. Bibliography Johansson, J. K. Global Marketing – Foreign Entry, Local Marketing, and Global Management, Johansson, 2000.

The Inner Workings of a Gold Loan Essays

The Inner Workings of a Gold Loan Essays The Inner Workings of a Gold Loan Essay The Inner Workings of a Gold Loan Essay Essay Topic: The Birthday Party â€Å"Gold Loans- The Old Concept in a New Package† Introduction: It has been observed recently that Indians own more gold than the citizens of any other country. They use the glittering metal as ornaments to flaunt family wealth, as a source of retirement savings and as insurance against calamities. Gold and domestic savings: In rural areas in India, due to the lack of access to banks the poor continue to invest their savings mainly in gold. Also, there are strong cultural factors at work in India which make gold not only a desirable but also a necessary asset to hold. But lately, gold has become something else: collateral, and the basis of one of the country’s fastest growing businesses, gold loans. It is therefore an apt moment to acquaint the reader with an insider’s perspective on why gold loans matter and why they hold so much promise for our country’s future. The purpose of this paper is to present a consolidated review of the various facets of the gold loans spreading with speed in India to the readers. Gold Loan: Gold loan  is a secured loan issued by lenders against gold as the undersigned asset. Gold loan gives an opportunity for people to liquefy the value of their jewelry items and use it for financing purposes. Rise in gold prices have increased the disbursal of Gold Loans in the middle and upper middle class. With changing times working women are becoming financially independent and taking active part in decision making process. They are working in unison with their husbands to ensure a bright and secured future for their family. As the couples are well employed, they seek to return the principal even within a month of receiving their salary. They are now using such loans to finance their children’s education, (particularly for meeting donation demands), which a bank will not entertain, car purchases, holiday trips or even to put up margin money for a home buy. The loan process begins once the gold is deposited with the lenders. After a ‘purity’ check is done, lenders may  offer  loans  for as high as 80% of the gold’s worth. While the gold market has only shown an ascent, lenders still consider the risk that gold carries and thus are reluctant to issue more than 80% of the value. Gold loans today are issued both by banks and non-banking companies. Objectives of the Study: The main objective of this study is to present a comprehensive picture of gold loans currently prevailing in India. Lending against gold being one of the oldest businesses of India is being served in an altogether different style which is organized and regulated. The business which was until lately dominated by unorganized money lenders has attracted all from organized Non-banking finance companies to banks in the public and private sector. The study aims at- * To examine the present scenario of gold loan industry in India whether organized or unorganized. To discover the reasons; appearing as advantages; for the growing popularity of such a business. * To compare gold loans with the personal loans. * To chalk out some precautions to be adhered to while availing gold loans. Methodology: Sources of data: The data for the study has been collected from- a) Internet b) Journals c) Articles of well known Newspapers d) Published reports of IMACS Literature Review: Gold Demand in India India is one of the largest markets of gold accounting for nearly 10% of total world stock with 18,000 tonnes of gold [IMaCS Industry Report (2010 Update)] ? Value of gold stock in India has grown at 22% CAGR from FY02 to FY10 ? Despite increase in gold prices from Rs. 15,026 to Rs. 51,150 per ounce between 2002 and 2009, the demand for gold remained relatively stable at around 700 tonnes, which clearly demonstrates the price in-elasticity ? Rural India is estimated to hold ~65% of the gold stock which depicts the concentration. ?Southern India is the largest market accounting for 40% of India’s gold demand, followed by West at ~25%, North at 20-25% and East at 10-15% of annual Gold demand [Mannapuram Finance in Jan 2011] Gold Finance Industry in India India being one of the largest markets for gold, several gold based financial products have been made available to retail consumers here from time to time with a view to bring the gold holdings to the core financial market. Lending against gold has been one of the most popular instruments based on gold, and it works well with the Indian rural population, which typically views gold as an important savings instrument that is liquid and can be converted into cash instantly to meet their urgent cash requirements. Moreover, since traditional times gold owners in southern India have been more open than elsewhere in the country to accept and exercise the option of pledging gold to borrow money (Source: IMaCS Industry Report 2009). In an effort to tap the market for gold related investment and services, companies in the financial sector have launched several products such as gold coins and bars; exchange traded gold funds and lending against gold. Gold Loans have emerged as key gold based financial products, and in the year ended March 31, 2010, the organized Gold Loans market in India was estimated at between `350 billion and ` 400 billion with a CAGR of approximately 40% during fiscal 2002 to fiscal 2010. Notwithstanding the above, the organized Gold Loans portfolio accounted for merely 1. 2% of the value of total gold stock in India. Despite the increase the experts still feel that the gold loans market is significantly under-penetrated and is expected to continue growing at the rate of 35-40% in the future. (Source: IMaCS Industry Report (2010 Update). The organized lenders; particularly NBFCs have become more aggressive in the gold loans market, charging interest rates that vary from 18% to 24%. Organized gold loans portfolio translates into a marginal 0. 12% of the value of total gold stock in India. A significant part of the gold loans may shift from the un-organized lenders to the organized lenders. South India continues to account for 85-90% of the gold loans market in India. However other areas also provide scope for expansion. There are no publicly available aggregate data about gold loans, but finance companies that specialize in them are growing fast. Manappuram, a pioneer in the business, made $730 million in gold loans in the year 2008 - up from $397 million a year earlier. Muthoot Finance, a privately held firm, said its lending was growing at 60 percent a year [â€Å"The New York Times† (Sept 28, 2009)]. By contrast, total outstanding bank loans to the private sector have increased 16 percent last year, year over year, and have been essentially flat so far this year. Though the financial system in India is becoming more inclusive, it still has not reached many people. More Indians, for instance, own gold than own stocks or mutual funds. It has been found that only around 5% of the Indian educated class does understand about working and investing in stock markets. The total value of gold in private hands is roughly 60 percent of deposits in banks, according to data from the World Gold Council and India’s central bank. A 2006 government survey found that less than 41 percent of Indian households had bank or post office savings accounts. By contrast, 92 percent of American households had bank accounts. The growth in size of the gold loan market has been manifold and is clearly visible as in FY 2002 the market for gold loans stood at a meager figure of less than Rs. 0 bn which rose a little above Rs. 100 bn in 5 years by FY 2007. The growth was almost double in next 2 years by FY 2009 the gold loan market has almost multiplied three fold since FY 2007 till FY 2010 to near about Rs. 400 bn. Source:  IMaCS Industry Report  (2010 Update) Features of a Gold Loan Gold loans come with  higher  interest  rate s  and have a processing fee as well. There are instances where the interest rates go as high as 27% per annum. However, the private lending businesses, especially new entrants, offer lower rates and gold loans in strategic ways such as without levying any processing fess. It is fortunate that most lenders do not charge any evaluation fee even when the  loan  amount  is based on the quality of gold. They prefer to play it safe by offering a lesser amount of loan than the gold’s actual value. Most loans span 3 months to 12 months and the borrowers have the choice of prepaying at any time. Non-banking companies let borrowers choose their terms as well. Typically, the tenure on a gold loan falls around one year to two year with some lenders even extending loan for three years. The documents required are residential proof and a recognised photo identity for example a PAN card, voter Identity card or driving license. The banks may take an hour to a day to extend the gold loan. On the other hand, NBFCs like Muthoot Finance and Manappuram, going by their advertisements, extend the loan within minutes. The average rate of interest they charge falls around 11 % 14 %. However, some NBFCs are charging a much higher interest rate of 20-24 %. Many banks impose reasonable restrictions against the loan money being used for stocks trading. In comparison, private lenders are slightly moderate in issuing any such restrictions. Why Gold Loans? Some of the reasons discovered for the growing popularity of gold loans in the form of advantages to customers in India are: 1. Continuous Increase in Gold prices- Gold price is increasing on an average by @ 20% per annum over the last five years. With gold prices continually rising, people find it a wise decision to take a loan against the gold. Say for eg: one has a gold ring and does’nt wish to sell it but needs cash. One simply has to stop by any of the gold loan offices of a company or banks so that their gold can be valued and they can get cash. The added advantages are that  people no longer have to sell their gold and the company does not run credit checks also! 2. Interest rates of  loans  are lower than that of unsecured loans (Personal Loan) Pawnbrokers and money lenders have long operated in India’s back alleys, making loans against jewelry to families in distress in rural as well as urban areas, at interest rates of 30 percent or more. But gold loans made by banks and finance companies are regulated the rates charged are lower - 14 to 30 percent. These policies have led to chances of further increase in their businesses. 3. Fast and easy option to obtain  loan  from NBFCs (Non-Banking Finance Companies) as well as Banks to meet short-term financial requirements- People do not have to wait till the long processing time finishes. The loan is approved in very short duration with least hassles and processing delays. Since it has collateral therefore risk is mitigated to a large extent. Drivers of Growth in Gold Loans Market in India A retail research report prepared by HDFC Securities found that the key usiness drivers of the gold loan market in India have been the following: a) Regulatory incentives to lenders: The prescribed risk weight on gold loans has been approximately 50% for commercial banks, further reducing the associated capital costs thus proving a beneficial deal for those engaged in its provision. b) Policy focus: The Government of India views gold loans as an effective means to meet the potential micro- finance demand in India. In fiscal 2007, the Government of the state of Tamil Nadu set a jewelry loans target of ` 60 billion (75% of the total loan disbursement target) for co-operatives in Tamil Nadu. ) Cash crunch arising out of global slowdown- Gold loan firms have also benefited from the financial crisis. In the last year and a half, many lenders have stopped making unsecured personal loans because of the rising default cases in India. d) Increasing interest of the lenders in the segment: Considering the recent rise in default rates (which was expected to vary from 8-10% in fiscal 2009) in personal loans, banks have started focusing on the gold loans segment because it offers attractive returns (although lower than personal loans) with very low levels of defaults. Several private sector banks have started participating in the segment by getting into bilateral sale agreements with NBFCs that specialize in gold loan. A few private sector banks like HDFC Bank have already initiated efforts to tap into such segments. e) High levels of indebtedness: The National Sample Survey Organization (NSSO) 2003 survey on situational assessment of farmers’ indebtedness in the country has estimated that 60. 4% of rural households in India were farmer households, out of which 48. 6% were indebted. The incidence of indebtedness was highest in the state of Andhra Pradesh (82%) followed by Tamil Nadu (74. 5%), Punjab (65. 4%), Kerala (64. 4%), Karnataka (61. 6%) and Maharashtra (54. 8 %). This shows the scope of a good business exists not only in down south but north India as the rural households hold gold and require easy terms of repayment which is readily available with NBFCs. f) Changing customer attitudes and preferences: Indian customers have demonstrated a change in their traditionally debt-averse psychology, promoting the creation of assets through growth in financial liabilities. Some of the other critical factors that can augment the growth of a gold loan company are a strong distribution network, faster turn around time, operational risk management through better technology, systems and processes, unique and customized product offering, access to low cost of funds and brand recognition due to heavy expenditure on advertisements. Source:indiainfoline. com How does a loan on gold work? The process of borrowing on gold as commonly specified by many of the gold loan companies seems  very easy. People simply bring them the gold and receive cash within a matter of minutes. All gold loans are usually 90 days long and can be paid off at the end of the term or extended for another 90 days. If people can’t pay back the gold loan in full at its maturity, they may surrender the gold as full payment. What type of gold can people borrow on? One can borrow loan against gold coins, gold rings, gold watches (working or not), broken jewelry, estate jewelry, collectible gold, gold figurines, gold charms. Basically, one can loan on any type of gold without regard for condition. Current Status of Gold Loan Companies in India- Non-Banking Finance Companies A non-banking finance company (NBFC) is a company registered under the Companies Act, 1956 and is engaged in the business of loans and advances, acquisition of shares/stock/bonds/debentures/securities issued by Government or local authority or other securities of like marketable nature, leasing, hire-purchase, insurance business, chit business but does not include any institution whose principal business is that of agriculture activity, industrial activity, sale/purchase/construction of immovable roperty. A nonbanking institution which is a company and which has its principal business of receiving deposits under any scheme or arrangement or any other manner, or lending in any manner is also a non-banking financial company (Residuary non-banking company). It is mandatory that every NBFC should be registered with RBI to commence or carry on any business of non-banking financial institution as defined in claus e (a) of Section 45 I of the RBI Act, 1934. All NBFCs are not entitled to accept public deposits. Only those NBFCs holding a valid Certificate of Registration with authorization to accept public deposits can accept/hold public deposits. NBFCs authorized to accept/hold public deposits besides having minimum stipulated net owned fund should also comply with the directions such as investing part of the funds in liquid assets, maintain reserves, rating etc. issued by the Bank. As of June 2009 there were 12,740 NBFCs in India, mostly in the private sector (RBI Press Release, October, 2009). Role of NBFCs in the competitive landscape of the gold finance industry in India The further stated that a typical Gold Loan customer expects high loan-to-value ratios, easy access, low levels of documentation and formalities, quick approval and disbursal of loans, lockers to ensure safety of their pledged gold and a team of expert valuers. Specialized NBFCs have created a niche in the gold loans capabilities by meeting these requirements of the typical gold loan customers, who require gold loans primarily to meet their urgent cash requirements. NBFCs specializing in gold loans continue to perform strongly in the gold loans market and the overall statistics demonstrate that the relative share of traditional gold finance NBFCs in the market has not changed significantly over the last three years. In fiscal 2010, the Gold Loans market was largely concentrated between two categories of lenders: south India based SCBs (Scheduled Commercial Banks) and NBFCs specializing in gold loans which held approximately 58% and 32%, respectively, of the total market. The rest of the Gold Loans portfolio was held by several small co-operative banks. [Retail research report by HDFC Securities] NBFCs are the Fastest Growing Lenders in the Organized Gold Loan Market| Targeting Non-bankable customers| High Comfort Level: Transparency ; Trust| Minimal documentation and formalities| Quick approvals and disbursals| Flexibility in Terms of Loans| Easy Access due to Greater Penetration| Presence of expert valuers| Robust control systems| Ability to handle cash| Better Operating Cost Structures vis-a-vis Banks| Are gold loans better than personal loans? Comparing personal loan and gold loan, Manappuram Finance Managing Director I. Unnikrishnan said, â€Å"in times of emergency you need a loan almost immediately with minimum documentation, and without any evaluation of your loan repaying capacity and if you have gold it can be a better option compared to a personal loan where all these factors come into play. † Personal loans and gold loans are born equal. They attract almost the same kind of interest. While a personal loan can quickly turn in to a non-performing asset for banks, gold loans are designed to benefit the banks. Asian Correspondent. com (31st May 2011)] For someone who is serious about clearing the loan in due time, a gold loan might prove to be a better choice. On comparing the procedures of the two, gold loans look like a neat and clean process. Personal loans, if one would observe work a little differently as they are not secured by any asset but by the loan takers future earning potential and credit history. T here is an unspeakable necessity for submission of paperwork including pay-slips. A few calls are also made to the loan taker’s nearest and dearest friends. And that’s where gold loans score. For personal loans, there is no partial payment option. Here one either pays in full or gets on with the monthly payments. Gold loan provides partial payment flexibility. If you have some money to pay, you can go ahead and pay it. The outstanding amount will come down and so will the interest. The catch is one will not get any gold back for the amount one has paid. He/she can only release their gold after the complete principal amount is cleared. Gold loans’ only caveat or the obvious downfall for gold loans is that jewelry and ornaments will not be available when required. A friend’s wedding or a birthday party might just come when we don’t want them to. Keeping in view the above comparison without hesitation we can conclude that loans should be avoided at all times as all loans are born equal with a common objective- to lay interest on the person who takes the loan and make him or her work for them, at least for  a while. But if it is really required, a gold loan could be a better choice. Precautions before Availing Gold Loans Even though from the aforementioned discussion, gold loans may seem to be an easy option to borrow money there is a word of caution from the financial experts who advise that taking a gold loan for buying luxury items or for consumption purposes may not be a great idea. Being a secured loan, gold loans must be sought only after a careful assessment of one’s payment capabilities or else the gold might get forfeited. The  lenders  offer gold loans after much consideration and tend to ask about the purpose of the loan. Borrowers  need to ensure that the loan they take against gold is not meant for pure consumption or speculative purposes. They need to exercise caution with their investments or else they may end up losing the gold. * Another thing is to ensure is that there are no missed payments otherwise the default penalties can take the gold loan amount to an unmanageable balance. This also has an inevitable impact: it may spoil one ’s  credit  score. It is advised to take a gold loan in small sums and make sure that one has enough liquidity to repay the loan and get the gold back. The gold pledged with the lender is usually auctioned 12 months after the due date of repayment has lapsed. NCDEX Chief Business Officer Vijay Kumar has a smart advice for borrowers: â€Å"if you have a good quality hallmarked gold and the value of the gold you want to borrow is 60 % or less you may negotiate for lower interest rate from the lender. † * There are various parameters on which the tenure, interest rate and the level of negotiation would depend - like whether the gold is hallmarked or not, the tenure of the loan amount and what percentage of the value of the gold you would like to borrow. One should also not get carried away by the attractive interest rates on gold loans as there are half a dozen other charges for gold loans like the handling and processing fee of about 0. 25-0. 50 per cent, gold assessing charges of about one per cent and also custodial charges for safekeeping of your gold. [article in Financial Chronicle (June 23, 2011)] * Like most other loans gold loans too come with pre-closure charges though a few NBFCs promise exemption of these charges. Thus one needs to answer some these questions before approaching a gold loan company: * Do you really need a gold loan? How much money can be raised through gold loans? * What are the interest rates on gold loans? * What are the other charges? * How is the repayment process? The author of ‘Retire Rich Invest Rs 40 A Day’ PV Subramanyam, suggests to try a public sector bank for taking gold loan as gold loan is a secured  loan and banks are well regulated, are sound and carry lesser risk compared to a non-banking finance company. Since high emotional value is attached to the jewelry one pledges, it’s better to opt for a lender which is stable, well diversified and is in the gold loan business for a long period. Conclusion: Outlook of the Gold Loans Market in India Based on the assessment of the emerging dynamics and competitive landscape, the gold loans market is expected to grow at between 35% and 40% over the next three years (Source: IMACs Industry Report, 2009). Moreover, as the market is currently under-penetrated, it is expected that the gold loans market will offer enough opportunities for portfolio expansion and retain attractive margins for all existing specialized NBFCs, banks and new entrants. The branch expansion and marketing initiatives of various specialized NBFCs are anticipated to give a strong boost to the acceptability of gold loans and lead to further growth in the gold loans market. In addition, it is anticipated that the large public sector banks in southern India will continue to be amongst the leading lenders, but considering the various regulatory and operational processes, it would be challenging for the banks to match the flexible service regime of the specialized NBFCs. New NBFC entrants in the market are currently in a cautious preparatory mode to enter the gold loans market but it will take some time for these NBFCs to emerge as formidable competitors to specialized existing NBFCs. This is because it will take time for these new NBFCs to build the requisite focus, infrastructure (valuers, lockers, etc,) and branch network. Specialized NBFCs are expected to continue to hold their share of the Gold Loans market with their ability to provide superior and niche servicing capabilities to their exiting and future customers. References: 1. P V Subramanyam: ‘Retire Rich Invest Rs 40 A Day’ 2. The New York Times, newspaper article published on September 28, 2009 3. The Economic Times, newspaper article published on July 29, 2010 4. The Financial Chronicle, digital newspaper article published on June 23, 2011 5. IPO note on Muthoot Finance Ltd. ; prepared by HDFC Securities published on April 15,2011 6. Published presentation by Mannapuram Finance Ltd. For January 2011 7. IMACS Industry Report for 2009 ; 2010 8. www. deal4loans. com 9. www. asiancorrespondent. com 10. www. scottsdaleloancompany. com 11. www. goldprice. org