Lester

Lester Electronics Generic Benchmarking

Lester Electronics Inc.(LEI) is a consumer and industrial electronics parts master distributor (UoP, 2009). Bernard Lester is the founder and CEO. He has made good decisions that have grown the company over the years. Current earnings per year are $500 million. Bernard is now faced with a critical decision that will determine the fate of LEI. He has been approached by his long-term partner, Shang-wa Electronics, to merge the companies and open a joint venture manufacturing facility in Asia. Furthermore, he has a potential offer to merge LEI with Avral Electronics. However, before LEI can make a decision an examination needs to be done to look at internal and external growth options, assess financial stability, and examine strategies to maximize shareholder wealth. By performing a generic benchmarking exercise, LEI can evaluate how other companies have handled these types of situations.

Benchmarking is a process of comparing an organization or company's performance to that of other organizations or companies using objective and subjective criteria. Generic benchmarking investigates activities that are or can be used in most businesses. This type of benchmarking makes the broadest use of data collection. Yet generic benchmarking can often result in an organization's drastically altering its ideas about its performance capability and in the reengineering of business processes (Encyclopedia of Business & Finance, 2009).

This paper summarizes the generic benchmarking process that was conducted to acquire generic benchmarking data for Lester Electronics.

Company Analysis

In both the AT&T/BellSouth and Pfizer/Wyeth scenarios, the mergers were possible because the acquiring company had a strong financial standing. LEI needs to examine the financial statements as well as the financial statements of the proposed combined companies. Three standard types of financial reporting are common.

“The balance sheet...