Rosetta Stone

Topics: Financial ratio, Financial ratios, Balance sheet Pages: 5 (1511 words) Published: April 1, 2012
Rosetta Stone Inc.
Changing The Way People Learn Languages
Peter Bussa
MGMT 480

1. Rosetta Stone has been one of the leading language learning companies and software’s on the market. Many competitors have not been able to enter into markets due to the strategic planning it takes to decide whether it is feasible and profitable as a company to grow stronger. Rosetta stone wants to enter into the European market to expand and grow as a globalization company. To facilitate growth, the company has already protected its trade dress because its keeps it distinctively different from the competitors. Rosetta Stone has Totale, which makes it easier for entrance into the market. Totale has the technology and software to make consumer sales increase. The European market is one of the biggest markets for business due to the location. By doing so, operating expenses will increase making the net income decrease but depending on the market demand, which in the UK shouldn’t be a problem due to business standards of location. By having the Totale software, it would make it easier for businesses to learn due to the integrated course led courses with games, interacted speakers and live customer support. For the expense or accessing it online for companies would make it easier while technology is growing rapidly due to research and development such as an expense acquired in process R&D. Rosetta Stones return on equity is low so a bigger market with more potential shareholders could be good to make the return on equity increase. By entering into Europe, operating expenses will increase but as that increases it means that the revenue will increase with the demand for businesses to comply with the software to build nationally and learn more languages to up their credibility and resume for potential jobs or opportunities that may arise.

2. Rosetta Stone has had sales increase around 19% from 2008 meaning that the activity has increased due to the demand of learning a second or even a third language. Many people are trying to embrace themselves with different cultures. By knowing how effective a company is, activity ratios measures the efficiency of the company using its resources or assets. Accounts receivable turnover shows the company how quickly collects what is owed to it. To profit, must manage inventory because it is money that does not earn a return. While net sales are increasing, inventory increases meaning that the inventory turnover ratio will decrease but meaning that inventory is harder to keep track due to an excess amount of sales. Rosetta Stone has a low inventory turnover ratio but the asset turnover ratio is high meaning that generating revenue with assets. Due to the excess amount of cash, we see that more cash is in hand than the past 3 years. Rosetta Stone has pushed to be the leader in technology and innovation to have such a unique change in market shares. The total asset turnover measure the return on each dollar invested in assets which shows how much revenue is generated for each dollar invested. With as many shareholders as, to know how well a company is ran, look into the activity ratios to see how effective a company really is with their net sales due to the assets that help generate profitability.

3. Rosetta Stones vision is to change the way people learn language. It blended language learning with technology when globalization connected more and more individual and institutions together. As a company, RST has developed most of their own technology to assist learner’s transition from listening comprehension to speaking. Technology is the key in what RST has to offer as a vision and values for future. They would not be where the company was today with out technology. Technology is a staple point of where the company is at currently. As people develop day-by-day, new features and technology are being integrated into the view...
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