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Chapter 3 analyzing financial statements
Chapter 3 analyzing financial statements
Financial statement analysis northwestern memorial essay
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Earth’s General Store (EGS) has been around for 20yrs and since the addition of the second location located downtown, the company is struggling financial. Kalmanovitch’s vision and the future of the original Whyte Avenue store were both in jeopardy” (Paulitsch et al., 2017). Kalmanovitch has asked for help to identify issues that are preventing the company moving in a profitable direction. First, we analyze the income statement (Exhibit 1) and provide a recommendation to improve profits and sustainability. Second, we provide a Balanced Scorecard and Strategy Map identifying some strategic objectives and measures. Finally, we identify three management tools that will improve EGS future. Part 1 – Income Statement Financial Analysis A) Looking …show more content…
The expenses are growing faster than revenue coming in and this will not last for any business. Employee headcount reduction would be the fastest way to reduce costs, but this may pose challenges from an HR perspective with morale and performance with productivity. Lastly, I would renegotiate with suppliers looking for better product costs and that may also mean finding new suppliers. Part 2 A) Balanced Scorecard “A balanced score card measures the organizational performance across four different but linked perspectives that are derived from the organizations’ mission, vision, and strategy” (Atkinson, Kaplan, Matsumura, & Young, 2012). Here we look at how financial success can be measured by the owners, how to grow and retain customers, improve operational efficiencies, and increase employee morale and productivity. Earth's General Store Mission - Do as little harm as possible and leave the world better than when we arrived. Vision - Advocating for environmental and social sustainability by offering products that lessened citizens' impact on the plant. Strategy - Operate several small stores throughout Edmonton's food desert areas. Balanced Scorecard - Earth's General Store Perspective Strategic Objective Associated Measures Financial Grow revenue - Sales volume …show more content…
The strategy map below walks us through the casual relationships of the objectives that link to EGS’s Mission, Vision and Strategy. Part 3 Here are three Management Tools that would have the greatest impact for Earth’s General Store. o Measuring and Managing Process Performance focuses more on the marketing, selling, distribution and administrative expenses. Reaching customers through many different channels, typically these expenses are incurred with selling products. This process will directly link priorities to the Balance Scorecard and Strategy Map. In addition, this process looks at both financial and non-financial metrics for customer
The balanced scorecard has been used in the business community for many years (Evans, 2002). The balanced scorecard is used to put all the information that a company needs for its strategic plan into an easy to understand and read chart. There are many different versions of the balanced scorecard, but the standard scorecard lays out how the company can increase its profits by looking at the internal working of the company, the customer service, and the education of the company. The Heathrow Terminal 5 project used a unique balanced scorecard. The Heathrow Terminal 5 project really showed just how versatile the balanced scorecard can be (Basu, 2009).
Tim Hortons launched in United Arab Emirates in December 2011, and they have been vastly successful ever since. Nonetheless, this report proposes a business growth strategy that Tim Hortons may implement in order to increase its market share for the sake of matching its competitors’ progress and sustain its growth strategy in the region.
By taking a globalized approach, they are expected to open roughly 300 restaurants in the U.S. alone by the end of 2018. Essentially, Tim Hortons has gained the trust of millions of people in North America by their ethical practices. This disciplined approach of contributing to society has allowed the company to gain a commanding 42% share of the quick service restaurant market in Canada. In this case, it is evident from their positive same-store sales growth in the country for the 22nd consecutive year. Their recent annual report also shows continuing top-line and bottom-line growth, which supports the idea of not only attracting new customers, but retaining the loyal ones as well. Because of this, management is working towards opening more than 800 locations in North America. Generally speaking, Tim Hortons’ economic success is unquestionably correlated with the social conditions that are being
Quintana can also use a balanced scorecard approach for each store. A store’s success can be based on a number of factors aside from sales. These factors could be customer satisfaction surveys, growth within the store, and management of employees and human resources.
They have the community and employees in mind. For customers this means helping them "Save time. Save money. Every day!" by providing clean, well-stocked stores with quality products at low prices. For employees, this means creating an environment that attracts and retains key employees throughout the organization. For the public, this means giving back to our store communities through our charitable and other efforts. In 2012, we, along with our vendors, customers and employees, donated millions of dollars through our various charitable initiatives. For shareholders, this means meeting their expectations of an efficiently and profitably run organization that operates with compassion and integrity (Farfan,
1.2: Explain the process of mapping the customer journey and its importance in delivering effective customer service
Maple Leaf Foods Inc. is well known as a leading packaged food provider in Canada with over 100 years sustainable working. Its head quarter is in Toronto, but it operates across the North of America, the United Kingdom, Mexico and Asia, as well. Since its foundation, this company has expanded primarily by merger and acquisition activities. It owned 90 percent of Canada Bread Company, Limited, found in 1911. It was created by the merger of Maple Leaf Mills Limited and Canada Packers Inc. in 1991, and these companies consisted of subsidiaries. By providing the highest quality, nutritious and innovative products to excess customers’ needs, Maple Leaf Foods is pursuing its vision to become globally admired food processing firm. It was gotten honor awards such as “Product of the Year 2011”; “Canada’s 10 most admired corporate culture”; “Best New Product Award”; “Canadian Family 2010 Food Awards”. Its total asset of 2013 was $ 3,599,092, compared with $ 3,243,696 in 2012. Net earnings of this enterprise were $ 512,163 in 2013, compared with $ 96,562 in 2012. Although, the company faced challenges caused by the increased price of raw materials and effects of macroeconomic issues; it still keep its values and be willing to change for sustainable achievement in the future. As a result of changes, Maple Leaf Foods Inc. is making an agreement to sell Canada Bread Company for Mexico's Grupo Bimbo with the price of $1.83 billion in cash in order to focus on its meat products business in 2014. The company financial report indicates its focus in 2014 with five main points. First, pricing actions to address higher ...
Their financial objectives are to open more bakery stores, gain a larger market share, achieve average sales gains at 4-5 percent, and grow diluted earnings per share at the low end of its long-term target of 15 to 20 percent. They choose not to fund their franchisee stores, thus reducing their long-term debt.
4. End the practice of awarding business on the basis of price tag. Instead, minimize total cost. Move toward a single supplier for any one item, on a long-term relationship of loyalty and trust.
the framework should contain distinct and multi-dimensional perspectives that are used for tracking organisation performance at all areas and perspective selection and design should be in accordance with the organisation strategy (DeBusk et al., 2003). At each perspective, a number of strategic direction or goals are demonstrated in a suitable format. Goals should be brief, directly express the strategy, and cover long period such as 3 years. Building strategy network or map suggested by (Kaplan and Norton, 2001), is used by many organisations for illustrating, communicating, and mapping the cause and effect of organisation goals (Ahn, 2001...
Reduce supplier costs- to negotiate for less prices from our long standing suppliers to enable high sales volume and increased
To what extent does the organisation use multiple channels to deliver sources of value (can be product/service related, process related or communication related) to its customers?
The advanced costing techniques used to develop product costs are equally applicable to other cost elements, especially customers. According to the article, an effective cost management system provides information not only on the basis of cost input but it also includes strategic, customer issues and product life cycle, which will be relevant to the decision on discontinuation of any product. This article segregates the analysis of customer profitability into assigning the costs to products that means customers who purchase high cost products are charged properly by applying the costs against the customers mix. The second step is to assign to customers expenses and assets that are driven by marketing and sales process, the result will be a total cost associated with customers and lastly, this cost is compared with customer’s revenue stream to establish profitability. The analytic tool used to develop customer and product profitability analysis is Resource Costing, which simply combines activity analysis and direct costing techniques to assign resources in a logical way to customers or to products that includes assigning cost to customers, markets, or channels of distribution and finally assigning the cost on the basis
Marketing and sales process: It is critical to manage this segment as it is the main stream operations to reach more and more customers based on the marketing strategies and the sales process to offer more discounts to customers.
The more opportunities that a customer has to conduct business with a company the better, and one way of achieving this is by opening up channels such as direct sales, online sales, franchises, use of agents, etc. However, the more channels a business have, the greater the need to manage its interaction with its customer base.