Acc/531 Week 4 Individual Case Analysis
Individual Case Analysis 1
Exercise 4a, Step 1: 1. Current Ratio: $3,517,600/$2,537,900= 139%, 1.39 2. Quick Ratio: $3,406,100/$2,537,900= 134%, 1.34 3. Debt-to-Total-Assets Ratio: $10,217,800/ $28,461,500=35.9%, .359 4. Debt-to-Equity Ratio: $10,217,800/$13,382,600= 76%, .764 5. Long-Term Debt-to-Equity Ratio: $10,186,000/$13,382,600=76%, .761 6. Times-Interest-Earned Ratio: $6,442.90/$445= 1447%, 14.48 7. Inventory Turnover : $23,552.40/$.11 8. Fixed Assets: $23,522.40/$4.71 9. Total Assets Turnover: $23,522.40/$28.46 10. Accounts Receivable Turnover: $0/$931,200 11. Average Collection Period: N/A 12. Gross Profit Margin: $23,522.40/$5,586.10=421% 13. Operating Profit Margin: $6,442.90/$23,522.40=27% …show more content…
The first would be Market Penetration. Wal-Mart has been successful in gaining customers from other electronic stores; however, I believe that their market share could be increased. In my personal opinion, Wal-Mart’s electronic section is equivalent to that of Best Buy. With increased consumer awareness of this, they could control a larger section of the market. Another strategy that could be used is Related Diversification. This can relate to their electronic Department by improving the products belonging to their in-house brand. Creating products equal in features to the name brands would create a possibility for increased consumption.
-How can Wal-Mart benefit from Internet retailing?
Wal-Mart can benefit from internet retailing because this type of retailing now controls a large part of the consumer markets. Internet retailing has potential to increase its share over the next years and it would be foolish of Wal-Mart to not keep up with the current trends.
-How aggressively should Wal-Mart expand internationally and …show more content…
Costco is known for only carrying products of superior quality; on the other hand, Wal-Mart is known for carrying cheap products. They must try not to relate Sam’s Club with Wal-Mart, as Sam’s Club needs to have more of a Costco reputation than Wal-Mart. If it can be established in the consumer eye that Sam’s Club is superior to Costco in price and quality, there is potential to improve their future development.
Develop a three-year strategic plan for CEO Mike Duke.
Market Penetration- Over the three year period continually try to increase their market share of the current products they sell. Competing with grocery stores and electronic stores must be a top priority through marketing.
Develop Sam’s Club- Begin to examine the weak areas of current operations and improve them. Also, find weaknesses in Costco’s operations (which won’t be easy) and make those areas a position of strength. Seek to shrink revenue gap between the competitors by 50%.
International Expansion- Continue to expand in China, with caution and following the current trends. Also, begin to look for opportunities to expand into Europe as the market is
Exercise 4a, Step 1: 1. Current Ratio: $3,517,600/$2,537,900= 139%, 1.39 2. Quick Ratio: $3,406,100/$2,537,900= 134%, 1.34 3. Debt-to-Total-Assets Ratio: $10,217,800/ $28,461,500=35.9%, .359 4. Debt-to-Equity Ratio: $10,217,800/$13,382,600= 76%, .764 5. Long-Term Debt-to-Equity Ratio: $10,186,000/$13,382,600=76%, .761 6. Times-Interest-Earned Ratio: $6,442.90/$445= 1447%, 14.48 7. Inventory Turnover : $23,552.40/$.11 8. Fixed Assets: $23,522.40/$4.71 9. Total Assets Turnover: $23,522.40/$28.46 10. Accounts Receivable Turnover: $0/$931,200 11. Average Collection Period: N/A 12. Gross Profit Margin: $23,522.40/$5,586.10=421% 13. Operating Profit Margin: $6,442.90/$23,522.40=27% …show more content…
The first would be Market Penetration. Wal-Mart has been successful in gaining customers from other electronic stores; however, I believe that their market share could be increased. In my personal opinion, Wal-Mart’s electronic section is equivalent to that of Best Buy. With increased consumer awareness of this, they could control a larger section of the market. Another strategy that could be used is Related Diversification. This can relate to their electronic Department by improving the products belonging to their in-house brand. Creating products equal in features to the name brands would create a possibility for increased consumption.
-How can Wal-Mart benefit from Internet retailing?
Wal-Mart can benefit from internet retailing because this type of retailing now controls a large part of the consumer markets. Internet retailing has potential to increase its share over the next years and it would be foolish of Wal-Mart to not keep up with the current trends.
-How aggressively should Wal-Mart expand internationally and …show more content…
Costco is known for only carrying products of superior quality; on the other hand, Wal-Mart is known for carrying cheap products. They must try not to relate Sam’s Club with Wal-Mart, as Sam’s Club needs to have more of a Costco reputation than Wal-Mart. If it can be established in the consumer eye that Sam’s Club is superior to Costco in price and quality, there is potential to improve their future development.
Develop a three-year strategic plan for CEO Mike Duke.
Market Penetration- Over the three year period continually try to increase their market share of the current products they sell. Competing with grocery stores and electronic stores must be a top priority through marketing.
Develop Sam’s Club- Begin to examine the weak areas of current operations and improve them. Also, find weaknesses in Costco’s operations (which won’t be easy) and make those areas a position of strength. Seek to shrink revenue gap between the competitors by 50%.
International Expansion- Continue to expand in China, with caution and following the current trends. Also, begin to look for opportunities to expand into Europe as the market is