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The Financial Metrics Of Wal Mart

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The table above details the financial metrics of Wal-Mart and Amazon for the years 2009 and 2010. We can describe the financial performance of both the companies based on the table above.
Before comparing metrics of both the companies we should know that supply chains of both companies are slightly different. Amazon is a mixture of efficient and responsive supply chain while Wal-Mart shifts slightly towards efficient. Wal-Mart’s main mode of business is bricks and mortar while Amazon is an online store. Amazon needs large number of warehouses in order to distribute products
When we look at Wal-Mart’s increased ROA which increased by 1.2% from 2009 to 2010, it is mainly due to an increase in the net income generated which in turn leads …show more content…

Amazon’s main aim is to deliver a product to a customer to their doorstep at the best possible price. Though there was a significant increase in the revenue generated by Amazon, it’s ROE and ROA dipped by 2.2% and 6.43% respectively. On the other hand even though Wal-Mart’s ROE saw a dip of 1.71%, its ROA rose by 1.2%. This difference is due to a considerable increase in the assets of Amazon in comparison to those of Wal-Mart’s. A high account payable turnover (APT) is an indicator that shows that the firm is running its operatives based on its supplier’s money. Amazon has higher APT when compared to Wal-Mart when compared to Wal-Mart. Amazon used its supplier’s money for performing its operations for around 20 weeks in 2009 and 2010 while Wal-Mart used its supplier’s money to perform its operations 8.62 in 2009 and got worse to 8.15 in 2010. A low value of APT improves Amazon’s financial performance. Wal-Mart’s high APT is due to its inventory storage and transportation. Amazon holds inventory for longer periods of time which can be obtained by looking at INVT (about 5.6 weeks for Wal-Mart and over 6 weeks for Amazon) values when compared to Wal-Mart due to which the APT of Wal-Mart is higher. It can also be seen that Wal-Mart has extremely high accounts receivable turnover (ART) at every 3 to 4 days which means it collects its money from sale at an extremely rapid pace when compared to Amazon who collected its money at

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