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SHL Case Study Potential Questions

So a couple of people have worked out that theres a high chance there will be a question concerning exchange rtes on the paper so im just wondering what kind of stuff we will have to discuss. Im guessing it will be along the lines of how it will benefit SHL with different strengths and weaknesses of the GBP but im still unsure what to make points on. Anyone got any ideas?
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r-t
22
I also believe this will arise. You have to talk about both the benefits and cons of a high/low exchange rate

- if the pound strengthen then this means that SHL can afford to order more stock from their suppliers meaning that they will be able to charge a Lower price for customers which means revenue will increase so they can achieve their sales revenue objective. Also vice versa.
- however a strong pound means their customers in the foreign countries cannot afford to buy from SHL and will look for cheaper alternatives meaning that they will find it harder achieving their exports target unless SHL lower their prices for them but this will reduce their revenue and therefore the chances of meeting their sales revenue target. However if the pound weakens then this means more customers from other countries can afford to buy from SHL meaning they can achieve their exports target.
However they will earn less revenue from UK customers due to exchange rates being weak meaning the majority of the revenue would have to come from other countries.
- if they buy into Mardidi then exchange rates will also effect them as if the dollar is strong then fewer people would be able to buy from Mardidi which means Mardidi will have low revenue and SHL would probably get lower amount of their investment back.


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