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Strength and Weakness

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Submitted By steffichen
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UNIQLO Strengths and Weaknesses:
I. STRENGTHS * Strong liquidation
Base on the current ratio, it showed that Uniqlo counts with more than enough current assets to cover all of its liabilities. In proportion to 2.45:1 * High quick turnover from account receivables turnover and low days to collect receivables.
According with the information analyzed we found that Uniqlo experienced a high level in account receivables turnover, which means that Uniqlo has high capability to collect its receivables. * Debt ratio is lower than 70%
In accordance with the benchmark of debt ratio, we saw that the company is lower than the 70% which is a good standard to assess its performance. * High profit
In addition, Uniqlo return on investment, return on equity and return on sales showed that the company earned a considerable profit. * Good long term investment
Taking into consideration investment cash flows structure analysis, from 2010 to 2012, the money that company spent in investing activities is keep increasing. * Their earning per share is increasing Although in 2011, the company suffered a decreasing in earning pershare, but in 2012 , the company had successfully regained an increasing in its eps. * High turnover of operating cash flow
Uniqlo selling process was rapid; this brought as a result an increase in the speed of the operation process, which was reflected in high operating cash flow.

Weaknesses * Low Inventory Turnover inventory turnover rate indicates how quickly inventory sells, Uniqlo has high inventory turnover rate which means it takes more days for them to sell its inventories.

* Excess in bad accounts
In 2012 Uniqlo offered more credits to its clients than the previous year, this generated an increase in the probabilities of bad

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