To understand fully the client’s (MTI) business and risks, PEST (political, economical, social, and technological) model and Porters Five Forces model should be used. For political factors, MTI imports 40% of their inventory from countries like Europe that are usually highly regulated due to differing requirements in safety standard for imported goods. On top of that, there are significantly different taxes and tariffs imposed on goods from different countries and these may change due to different political parties coming to power. For economical factors, since different countries use different currencies and are susceptible to their own economies, MTI is highly vulnerable to negative price movements significantly increasing their cost of inventory and may either deter customers with higher prices or absorbing the cost leading to lower profit margins. World events like war or financial crisis can increase MTI’s cost of sales and inventory availability. For social factors, MTI doesn’t seem to be importing goods manufactured in third world countries that usually employ underpaid employees or even uses child labour. Customers may see this as a plus as large competitor companies outsource manufacturing to third world countries. For technological factors, MTI has started the plan to sell their goods on the Internet so they must hire a tech firm for supporting the online platform. Since this is still in the early stages of development, there are still plenty of risk and uncertainties. Depending on how well the system is set up or how well it performs, it may have an adverse affect on its existing internal controls and management systems. For the Porter’s Five Forces model, supplier power is extremely high for MTI. Even though MTI has 25 regular suppliers from both Canada and Europe, MTI has recently signed an agreement with an Italian supplier to purchase $1 million worth