...1. Why is the soft drink industry so profitable? An industry analysis through Porter’s Five Forces reveals that market forces are favorable for profitability. Defining the industry: Both concentrate producers (CP) and bottlers are profitable. These two parts of the industry are extremely interdependent, sharing costs in procurement, production, marketing and distribution. Many of their functions overlap; for instance, CPs do some bottling, and bottlers conduct many promotional activities. The industry is already vertically integrated to some extent. They also deal with similar suppliers and buyers. Entry into the industry would involve developing operations in either or both disciplines. Beverage substitutes would threaten both CPs and their associated bottlers. Because of operational overlap and similarities in their market environment, we can include both CPs and bottlers in our definition of the soft drink industry. In 1993, CPs earned 29% pretax profits on their sales, while bottlers earned 9% profits on their sales, for a total industry profitability of 14% (Exhibit 1). This industry as a whole generates positive economic profits. Rivalry: Revenues are extremely concentrated in this industry, with Coke and Pepsi, together with their associated bottlers, commanding 73% of the case market in 1994. Adding in the next tier of soft drink companies, the top six controlled 89% of the market. In fact, one could characterize the soft drink market as an oligopoly, or even a duopoly...
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...1. Why is the soft drink industry so profitable? An industry analysis through Porter’s Five Forces reveals that market forces are favorable for profitability. Defining the industry: Both concentrate producers (CP) and bottlers are profitable. These two parts of the industry are extremely interdependent, sharing costs in procurement, production, marketing and distribution. Many of their functions overlap; for instance, CPs do some bottling, and bottlers conduct many promotional activities. The industry is already vertically integrated to some extent. They also deal with similar suppliers and buyers. Entry into the industry would involve developing operations in either or both disciplines. Beverage substitutes would threaten both CPs and their associated bottlers. Because of operational overlap and similarities in their market environment, we can include both CPs and bottlers in our definition of the soft drink industry. In 1993, CPs earned 29% pretax profits on their sales, while bottlers earned 9% profits on their sales, for a total industry profitability of 14% (Exhibit 1). This industry as a whole generates positive economic profits. Rivalry: Revenues are extremely concentrated in this industry, with Coke and Pepsi, together with their associated bottlers, commanding 73% of the case market in 1994. Adding in the next tier of soft drink companies, the top six controlled 89% of the market. In fact, one could characterize the soft drink market as an oligopoly, or even a duopoly...
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...Case: R & D Electronics Company (Case adapted from: Heitger, L.E. and Heitger, D.L. (2008)., Issues in Accounting Education, 23(2), 261-272.) The Automotive Electronic Industry R & D Electronics Company is an established manufacturer and has been designing, manufacturing, and supplying electrical supplies in various forms to the automotive industry. The worldwide market for semiconductors in the automotive electronics industry exceeds $10 billion. In addition, wireless data delivery – currently is estimated to be a $20 billion industry, and experts predict that soon 50 percent of all new cars and 90 percent of higherend models will possess telematic-capable devices. Further, many experts estimate that 30 to 40 percent of the production value of all automobiles consist of electrical products. R & D Electronics historically has invested heavily in researching and developing auto-motive electronic technology in order to provide customers with state-of-the-art functionality, safety, and performance. R&D Electronics continues its heavy investment in this research and development arena because the resulting product features quickly devolve from being “cutting edge” features that create a competitive advantage to commodities that customers regard as standard features on all automobiles. R&D Electronics has continued to upgrade its research and development and manufacturing abilities to keep pace with changing technologies. For instance, R&D Electronics designs, produces, and installs...
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...operating under the BancABC brand in Sub-Saharan Africa, with operations in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe. A group services office is located in South Africa.Historically, BancABC was a merchant bank offering a diverse range of services including wealth management, corporate banking, treasury services, leasing, asset management, and stock broking.ABC Holdings had Its primary listing on the Botswana Stock Exchange, and a secondary listing on the Zimbabwe Stock Exchange (BancABC annual report 2009) During 2014, the ABC Holdings Group was acquired by Atlas Mara. As at 31 December 2014, Atlas Mara had a 98.7% equity stake in ABC Holdings, held directly (60.8%) and indirectly (37.9%). Subsequent to the takeover, ABC Holdings was delisted from the Botswana Stock Exchange on 30 January 2015, and from Zimbabwe Stock Exchange on 12 February 2015.Atlas Mara is a British Virgin Islands registered company with a standard listing on the London Stock Exchange(BancAbc Annual report 2014) The seeks to review the credit risk management methods implemented by the bank . Definition of terms 2.3.1Credit According to Onyeagocha (2001), the term credit is used specifically to refer to the faith placed by a creditor in a debtor by extending a loan usually in the form of money, goods or securities to a debtor .According to Onyeagocha‘sview for a bank to grant some credit to its client there should be element of creditworthiness on the part of the borrower. Credit can also...
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...1.1 Implementation of Customer Profitability Analysis There are six steps taken in implementing this technique in a company which are select customers, determine revenues and costs, analyze profitability and non-profitability customers, develop strategies and review the affects. We decided to choose Perodua as one of the local company that implements this technique. Determine Costs Determine Costs Determine Revenues Determine Revenues Select Customers Select Customers Diagram 1.1.1 Analyze profitable and non-profitable customers Analyze profitable and non-profitable customers Develop strategies Develop strategies Review the affects Review the affects Based on Diagram 1.1.1, first step shows that a company should select their customers based on customer segmentation. The basis of customer segmentation will differ across the companies and across the industries. There are two basic approaches to customer segmentation which are demographic segmentation and psychographic segmentation. Demographic segmentation based on observable characteristics such as geographic area, customer age, sex and income level. Psychographic segmentation based on customer needs and behavior such as customer values, attitudes, and interests. Perodua has selects their customers based on customer segmentations. Currently, there are two types of customer selected by Perodua which are high cost customer and low cost customer. High cost customer refers to the people which has high income...
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...1) scope of the analysis: companies assigned and their annual reports The listed firm assigned to me is Saipem S.p.A. is an Italian oil and gas industry contractor (also “Saipem” hereafter). The firm is a subsidiary of ENI S.p.A., the largest Italian energy company, which currently holds a 42.93% share in Saipem. The listed competitor of the firm assigned to me that I choose is Schlumberger Limited (also “Schlumberger” hereafter). In the World’s Top 10 biggest oilfield services companies list, Schlumberger is the top 1 biggest company and Saipem is the top 3 biggest company; furthermore both companies are listed. For these reasons, we can consider those companies as proper peers. We collected the 2014 Annual Report for both companies. The Annual Reports, retrieved from the Investors section in the related official websites, show the consolidated figures as of December 31, 2014 and the comparative data for the year 2013. Saipem is one of the largest turnkey contractors in the oil and gas industry. Founded in 1957 as service provider to ENI, the company has made its name handling the oilfield services for a number of challenging projects both on and offshore. With over 30,000 employees, the company operates in all the major oil and gas producing nations, the company has earned a reputation in the industry for achieving results. Saipem own and operate over 50 vessels that deal with all aspects of offshore construction and services activities including drilling and pipe laying...
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...GROUP PROJECT ‘Emperical Analysis of Capital Structure and Cost Of capital between Public Listed Companies in Bursa Malaysia and Their Effect to Market Valuation and Firm’s performance’ SEM I 2012/2013 PREPARED BY : (SECTION 3BM) CHRISCILLA MOJINOL BF088334 NUR SYAZWANIE BT RAMLI BF088446 NANTINI D/O SUNDARAM AC088601 PREPARED FOR: MISS NOR RAZUANA BT AMRAM DATE OF SUBMISSION: JULY 16TH 2012 TABLE OF CONTENT EXECUTIVE SUMMARY This assignment focus is to compare and contrast the capital structure and cost of capital of two public listed companies within the same industry in BMSB. The aim of the assignment is to show whether higher gearing level and higher cost of capital will affect the firm’s value and performance. The two companies we have chosen are Dutch Lady Berhad (DUTCH LADY) and Guinness Anchor Berhad (GAB), In this assignment we have analyse five years performance (2007-2011) of both company. We analysed the composition of the capital structure in detail to estimate their cost of capital, and how their gearing level and cost of capital affect the firm’s value and profitability. We did ratio analysis (debt to asset and debt to equity) to find out the companies capital structure and calculated WACC value to determine the companies cost of capital. We calculated market value ratio (comprises of price to earning ratio, dividend yield, market to book ratio and Tobin’s ratio) and profitability ratio (EPS, NPM, ROE...
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...V. ALLEN BARNES Parlin, NJ 08859 PROJECT MANAGER/BUSINESS ANALYST Accomplished, versatile, and effective Project Manager with 10+ years of experience in Financial Analysis, Business Development, Project Management, Team Training, Client Support, and System Implementation across telecommunications and technology companies. Recognized for exceptional ability to research, analyze, and implement innovative processes and system solutions that ensure cost reduction and improvements in efficiencies and performance. A Proven communicator, fostering relations with management, team members, vendors, and customers, consistently achieving profitability and quality goals. Area Of Expertise ◆ Program coordination ◆ Financial management ◆ Custom Software Development ◆ Client Relations &Presentations ◆ Risk management ◆ Procurement ◆ Business & IT Planning ◆ Vendor Management ◆ Requirements Analysis ◆ ROI Analysis & metrics ◆ Costing & Budgeting ◆ Project Scheduling ◆ Financial reporting ◆ Training development ◆ Contract negotiations ◆ Team Building & Mentoring Achievement Highlights ✓ Reduced overtime by 65% and increase productivity by 20% and work force by 10%. ✓ Liaised between 1,200 corporate customers and IT team for all reporting matters, including scoping and planning, design specification and implementation, with 95% in client ratings ✓ Designed and developed training curriculum for...
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...Team A Ending Cash Balance: $1,915,226 (6th Place) Return On Investment: 549% ROI=Final Cash-Day 50 Cash-PP&E ExpenditurePP&E Expenditure→ 1,915,226-97,649-280,000280,000=549% Analysis of the First 50 Days The Littlefield Technologies management group hired Team A consulting firm to help analyze and improve the operational efficiency of their Digital Satellite Systems receivers manufacturing facility. Upon the preliminary meeting with Littlefield management, Team A were presented with all pertinent data from the first 50 days of operations within the facility in order for the firm to analyze and develop an operational strategy to increase Littlefield’s throughput and ultimately profits. Figure 1: Day 1-50 Demand and Linear Regression Model Figure 1: Day 1-50 Demand and Linear Regression Model With little time to waste, Team A began by analyzing demand over the first 50 days of operations in order to create a linear regression model to predict demand into the future in order to make critical operational decisions; refer to Figure 1. In Littlefield, total operational costs are comprised of raw material costs, ordering costs and holding costs. Raw material costs are fixed, therefore the only way to improve the facility’s financial performance without changing contracts is to reduce ordering and holding costs. As such, the first decision to be made involved inventory management and raw material ordering. Inventory management is critical to Littlefield’s bottom...
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...Word count Core text: 9706 Total: 7932 Table of content Preface 5 1. Summary of Ryanair 6 2. Problem statement 7 3. Corporate Strategy 8 3.1 Strategic development 8 3.1.1 Intended Strategy 8 3.1.2 Emergent Strategy 8 3.1.3 Strategic Lenses 8 4. Organizational Environment 9 4.1 PESTEL Framework 9 4.2 The Five Forces framework 12 5.2.1 The threat of entry 12 5.2.2 The threat of substitutes 12 5.2.3 The power of buyers 12 5.2.4 The power of suppliers 12 5.2.5 Competitive rivalry 13 5. Strategic capability 14 5.1 DuPont Analysis 14 5.2 Robustness 16 6. Competitive Strategy 18 7. Strategic Purpose 20 8. Business Economic Analysis 23 8.1 Liquidity 23 8.2 Solvability 23 8.3 Profitability 24 8.4 Efficiency 24 9. SWOT analysis 25 9.1 SWOT of Ryanair 25 9.1.1 Strengths 26 9.1.2 Weakness 26 9.1.3 Opportunities 26 9.1.3 Threats 26 10. TOWS Analysis 27 11. Alternative courses of action 28 12. Decision and Reasoning 29 9.1 Top 2 Alternatives 29 13. Implementation 30 Literature 31 Figure list 33 Preface The following report is written on behalf of the module Strategic Management, by students of Leisure Management. The case to write this report is “Ryanair” and the strategies that were used to become the biggest airline of the world. Ryanair is the first low-fare airline company of its kind and their unique strategy make it possible for costumers to fly for the lowest prices. The aim of this...
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...BPI S.A. (BPI) - Financial Analysis Review Reference Code: GDFS34484FA Rua Tenente Valadim, 284 Lordelo do Ouro, Porto 4100 - 476 Portugal Phone Fax Website Exchange +351 22 6073100 +351 22 6098787 www.bancobpi.pt BPI [Euronext Lisbon] Revenue Net Profit Employees Industry Publication Date: AUG 2012 2,005 (million EUR) -284.87 (million EUR) 8,965 Financial Services Company Overview Banco BPI S.A. (BPI) is the fourth largest Portuguese private financial multi-specialist group. The bank has institutional, corporate and individual customers and is among the leaders in mutual funds, pension funds and life-capitalization insurance. Its products and services include asset management, credit and debit cards, deposits, investment, mortgages and insurance. The bank also offers a broad range of life insurance and non-life insurance through Allianz Portugal, in which the bank holds 35% interest. The bank operates its business through a network of 654 retail branches 39 investment centers, 5 specializing in home loans branches. Key Executives Name Fernando Ulrich Antonio Domingues Antonio Farinha Morais Jose Pena do Amaral Manuel Ferreira da Silva Chairman Deputy Chairman Director Director Director Title Key Competitors Name Mercantil Servicios Financieros, C.A. Banif SGPS SA Banco Comercial Portugues SA Bank of Alexandria SAE Banco Espirito Santo S.A. Source: Annual Report, Company Website, Primary and Secondary Research, GlobalData Source: Annual Report, Company Website,...
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...City of Richmond Water Metering Contract Renewal…..or not?? Should Neptune extend the contract? Pro’s Spread the initial start up costs Maintain a hold in the market. Opportunity to build on existing competencies. Strengthen and enhance the relationship with the City which could lead to referrals Avoid cost of shut down and new RFP. Experience developing customer relations would otherwise be lost. Opportunity to pursue other service support roles. Opportunity to renegotiate some conditions but not cost. Con’s Lose Revenue and Contract Generally low operating profit of $28 equivalent per volunteer (2007) from the program. Potential for profit to lower if marketing and advertising costs increase. Incur cost from shutting down the business. 2 Analysis of Neptune’s Initial 2005‐2007 Approach: INTERNAL (micro environment ‐ 5 C’s) STRENGTHS: • Gaining competence and credibility in meter installation and servicing • Strong Customer Relationship Record being established • 20% of the target market already adopted the new system • Development of a direct channel to the customer EXTERNAL (macro environment ‐ PEST) MISSED OPPORTUNITIES • Capitalize on the awareness peaks in Feb/March. • Endorsement and support from the growing sustainability movement. • Investigate new social technologies to 'spread the word' • No media aimed specifically at the ‘kids’ target market • Not taking advantage of the ‘kids' target market to convey the ...
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...one dollar. Pepsi-Cola was invented in 1893 by Caleb Bradham a pharmacist from North Carolina. Pepsi also franchised its bottling operations. Pepsi struggled over the years going bankrupt twice within a decade, first in 1923 and again in 1931. Pepsi competed aggressively against coke offering almost twice the amount of Pepsi for the same price in the 1930s. Coca –Cola or Coke on the other hand was the market leader through the early 20th century with numerous imitators popping up trying to clone Coke. Coke fought back in the courts to aggressively deter imitators and counterfeiters. During the 1920s and 1930s, Coke was marketed to multiple market segments making it available to anyone desiring the brand. Eventually Coke sued Pepsi for trademark infringement in 1938 and lost. Pepsi gained market share and became a titan competitor in the market for CSDs beating out all other brands except Coke. Thus began the “Cola Wars” in 1950 with Pepsi’s aggressive “beat Coke” strategy. For the last quarter of the 20th century both Coke and Pepsi mustered annual growth of 10%. By the turn of the 21st century US consumption of CDS began to drop; at the same time there were many new entrants and differentiated competitors in the hotly contested drink markets. Strategy, competition, product differentiation, pricing, branding and market segmentation defines the game...
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...1. Project Objectives and Overall Research Approach 2.1. Reasons for choosing Project Topic Area and Organisation The reason why I have decided on this Project Topic 8 about the business and financial analysis of organisation is because it is regarded as a popular agenda topic in many different investment forums, meetings and even verbal conversations. Such area of knowledge on “Analysing the business and financial health of organisation” is deemed important as it is evidently seen widely incorporated into many teaching syllabus and conventional business finance textbooks. For myself whose ambition is to become an audit partner of an accounting firm, such topic area will be extremely common in my field, and grasping such expertise is definitely a must given that becoming a master of it makes me competitive advantageous over others. Then again, I am especially fascinated concerning the success of Singapore’s duopoly public transportation system which is perceived as one of the key sector in the success of Singapore’s infrastructure. This duopoly transportation system is dominated by 2 major players, one of which is my choice of organisation, Singapore Mass Rapid Transport Corporation Limited. (Also known as SMRT Corporation Ltd). In fact, total number of passengers utilising public transport has been growing constantly since Year 2000. For the year ended 31 December 2010, a highest record of 726,034,000 passengers was achieved (Yearbook of Statistics Singapore,...
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...globally, a recent underperformance reflected in its annual report and relevant negative news regarding the profit decline indicate that there are some factors interfering with its sustainability and profitability. Keppel’s Offshore and Marine sector is facing certain risks, which might hamper the overall growth of the corporation as this sector accounts for 65% of total revenue generated by Keppel. This report provides a brief overview of Keppel’s main businesses. The focal point of interest would be on the offshore and marine industry. Multiple industry and strategy analysis frameworks will be used to analyze the factors affecting the sustainable development of Keppel Corporation in order to determine underlying reasons for its dilemmas and to provide recommendations for mitigation. Foundations of Strategic Management Final Project for Group 6: Shreya Garg Rohit Tatineni Guo Yao Huang Xingyu Tan Choon Long Martin Table of Contents 1. Keppel Corporation- A Brief History 3 2. Offshore and Marine Industry in Singapore 4 Strategic positioning of Singapore 4 Existing opportunities and threats in the industry 5 Industry outlook 6 3. Analysis of Keppel O&M’s business philosophy 7 Potential risks and challenges 8 4. The Business Dilemma 8 Underlying Reasons of the Dilemma 9 Geographic over-concentration 9 Fluctuating oil prices 9 Technological challenges in deep-water exploration 9 VRIO Analysis 12 6. Recommendations to resolve the dilemmas 13 ...
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