Lizzie Ward runs The Brick House, a fast-growing construction materials retailer in Christchurch, New Zealand. Strong sales are straining cash flow, making it hard to pay suppliers on time. She meets with her banker to seek a higher credit limit or alternative financing, as the business continues to expand rapidly. The case requires students to analyze the firm’s business strategy, diagnose its financial trajectory, quantify funding needs through sources-and-uses and multi-scenario forecasts, and assess whether additional debt is appropriate. It highlights the tension between rapid growth, low margins, and sustainable financial policy in a small entrepreneurial firm.
The main objective is for students to understand how to link strategy and finance—specifically, how to design a financial policy that supports and is consistent with the firm’s growth strategy. To achieve this, they must:
• Forecast financial needs: Build pro-forma financial statements under multiple growth scenarios to quantify future funding requirements.
• Analyze the cash conversion cycle: Use inventory, receivables, and payables dynamics to assess working-capital needs and their impact on liquidity.
• Apply sustainable growth concepts: Compare actual growth to sustainable growth to anticipate leverage pressures and evaluate financial feasibility.
• Evaluate financing alternatives: Assess whether to extend the credit line and identify viable funding options for a small, rapidly growing firm.
- Forecasting and managing growth
- Estimating financing needs
- small enterprise
- sustainable growth rate
- Working capital management
- Financial leverage
- Q42025
