Breadtalk

5020 Words21 Pages
INTERPRETATION OF
FINANCIAL STATEMENTS

Food and Beverage (F&B) Industry * Food & beverage services comprise establishments engaged in the sale of prepared food and drinks for immediate consumption * Integral part of Singapore’s economy * Caters to local consumption and tourism industry

2011 Key Indicators (F&B Industry) INDUSTRY | ESTABLISHMENTS | EMPLOYMENT | OPERATING RECIEPTS | OPERATING EXPENDITURE | OPERATING SURPLUS | VALUE ADDED | | | | | TOTAL | COST OF PURCHASES SOLD | REMUNERATION | OTHERS | | | | NUMBER | THOUSAND DOLLARS | Food &Beverage Services | 8,018 | 111,444 | 7,499,335 | 7,201,973 | 2,527,914 | 1,992,084 | 2,681,975 | 530,561 | 2,577,956 | Restaurants | 2,843 |
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A lot of planning and thought is placed in the locations of these outlets, taking into consideration the composition of the surrounding stores and the presence of competing bakeries within the vicinity. 5. Experienced management
The BreadTalk Group is headed by the Chairman, Mr George Quek, who has more than 20 years of experience in the F&B industry. His management team have about nine years of experience in the industry each. Their reign and strategic business plans have helped hoist the BreadTalk brand name to the soaring heights and success it is enjoying now.

Internal Weaknesses 1. Higher rents and failure to renew existing leases
All current BreadTalk outlets are leased from third parties. Rental costs constitute a 20% of the group’s operating expenses. Moreover, upon the expiry of leases, landlords have the right to review rental rates which may not be favourable to the organization. Therefore, costs are highly sensitive to increases in rentals which could have a material adverse effect or potentially erode their profit margin and, ultimately, their earnings. In addition, BreadTalk may not be able to renew existing leases on the revised terms and conditions implemented by their landlords which may not to the advantage of the business. 2. Dependence on senior management staff
BreadTalk is highly dependent on their senior management staff which includes Mr George
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