Radio Shack Report

1. What type of decision was the group instructed to reach (e.g. majority, consensus, authoritarian, etc.)

The following financial report provides an analysis of the financial ratios of David Jones with its close competitor in the retail sector, Myer. The financial ratios analyzed include profitability ratios, leverage ratios, efficiency ratios and market ratios for the two companies. The analysis utilizes individual company time-series analysis as well as industry cross-sectional analysis with the aim of determining the competitiveness of David Jones relative to its close competitor Myer.

The purpose of this report is to compare the financial report of the two ASX listed companies they are Harvey Norman and JB Hi-Fi. It provides an analysis and evaluation of the current and previous profitability, liquidity and financial stability of both companies. Methods of analysis include financial ratio analysis for example profitability and performance ratio, liquidity ratio, financial and stability ratio by reviewing the financial report of two companies. It also review the industry analysis, highlighting the size of the industry in Australia, the level of competition and the significant environmental factors facing by these two particular companies and the industry as a whole. Further, it discusses about the

The company’s net profit has been growing over the past 3 years; it seems to have a stable, increasing trend. This could be a result of technological advancements within the cellular phone, television, and Internet industries; the endeavors of their competitors; Bell’s charitable efforts; as well as their expanding business.

The companies that were chosen for a company analysis include Macy’s, Kohl’s, and Burlington. Since the retail industry has been lagging behind lately, these companies will help determine the prospective financial investment in the retail industry. As Macy’s as our primary company, we chose Kohl’s and Burlington to be the two comparative companies. These companies are comparable due to the same SIC code of 5311 in the subgroup of department stores. These companies offer similar products and services with little differentiation between the three.

Hewlett Packard (HP) decided to produce 1.3-inch disk drives to become the market leader in a new market and increase HP’s revenue. Although the market for 1.3-inch disk drives was still unclear and still developing, HP decided to organize a special team to develop this new product. This group was multi-talented, with the best engineers from every department in the company. The group also had many priorities for the company. However, things didn’t develop as the Kittyhawk team expected. They failed to sell the new product to the customer they planned. Even though some new customers were interested in this

The launching of Kohls.com in 2001 has resulted in steady sales growth in the e-commerce portion of the company. To support the internet sales, a 940,000 square foot distribution center was opened in 2001 and a second one was opened in 2010. As internet sales continued to increase to more than 50% of its previous years sales, a third distribution plant has been acquired in Edgewood, Maryland (16). The new facility is 602,000 square feet but Kohl’s plans to expand the building to more than 1 million square feet by 2012. (15). This would indicate that Kohl’s intends to continue expanding the e-commerce portion of the corporation and is making all necessary preparations to support the growth.

As one of the major retailers in the United States, JCPenney has 1,104 department stores in 49 states and Puerto Rico as of February 2, 2013. The key success of its business is tremendously depending on the sales performance. However, the retail business is highly competitive, with low barriers to entry and low profit margin. Due to large sales plunge in 2012, the company is in financial trouble. The thorough analysis of JCPenney’s financial statements is vital to judge the future performance of its business.

Accordingly, “major new-product development activity was replaced by incremental product line extensions” (p.56) that resulted in a major revenue stall. The premature core abandonment cause is illustrated with the Kmart example. While the company was investing in a range of unrelated businesses searching for growth, Wal-Mart developed effective distribution and inventory systems. Kmart’s management failed to monitor and match these systems and fell far behind its rival. Hitachi’s example illustrates the talent bench shortfall. One of the leading causes of the stall was the company had executive management that lacked capabilities.

As mentioned in the introduction, due to the earlier stockpiling in the industry that had caused the sales to be artificially depressed, the company’s attempt to incorporate software into a computer system for signal handling had fallen behind schedule and for the first time Sigtek was challenged by new competitors in the industry and not to mention that the printed circuit boards that Sigtek was known for had become a commodity product, the customer focus was more on the price and delivery time, they were less concerned with quality. These factors caused Sigtek’s sales to crumble from $60 million to $400 million and the workforce was cut back from 1,000 to 800.

The Sonic firm would later have the opportunity to pursue either the Cost Leadership or Differentiation segment. It is important that the Sonic sustain the lowest cost to gain brand recognition in the market. Sonic can pursue targeting identified segments with multi – dimensional satisfaction that includes quality, differentiation, and price (Kotler). The Overall Cost Leadership states that firms work hard to achieve the lowest production and distribution cost. Sonic has not established their brand or image so their price for competing PDAs is lower than competitors. Differentiation sets the product apart and the firm must make the products with the best components. The Sonic PDA must be positioned as a versatile, convenient, and value added product. The focus would incorporate hands free operation for multiple communication, entertainment, and information capability.

However, an employee of Shun, Manjit, has decided to change the method in which Shun Electronics calculates its costs of its products. Manjit wants to expand the three departmental cost centers to eight, each with its own overhead cost allocation rate. As a result, it appears that the total costs for four of their six radios will increase, while two will decrease. This poses a great deal of issues concerning Shun Electronics:

The arrival of Gerald Kleisterlee in 2001 brought organizational changes to Philips that is evident in the marketplace today. The new CEO restructured the company by outsourcing mobile phone production to CEC of China and the production of VCRs to Funai in Japan. This was followed by the outsourcing of TVs, CD players and components with simultaneous movement of remaining in-house production to countries like China, Poland and Mexico, who had lower costs. He also sold off several businesses, including the core semi-conductor business. What evolved was Kleisterlee’s vision for a new Philips – a lifestyle company centered on health and well-being – which organized around healthcare, lighting and consumer lifestyle.

Arrow Electronics was founded in the early 1935 and grown to the number two position as a retailer of radio equipment by 1980. Arrow Electronics is broad-line distributor of electronic parts, including semiconductors and passive components. In 1982 Stephan Kaufman became a president of the company, couple years later and CEO. Then Arrow Electronics started to climb, reaching the number one position among electronics distributors by 1992. One of the Arrow’s five operating groups and the largest, was Arrow/Schweber. This group sells semiconductors to different customers’ bases, such as Original Equipment Manufacturers (OEM) and Contract Manufacturers (CM). They sell one third of all Arrow Electronics’ total sales (2.07 billion dollars of 6.5 billion dollars).

In his report he discovered that the products with fewer non-conformities (high quality) were the ones that performed well after delivery to the customer. It was accepted by everyone but the challenge that came in front of Motorola executives was to develop a solution to tackle this problem.