Financial ratio analysis can help businesses to analyze how well or poorly they are doing, by using their own financial data to work out all the ratios. These ratios can be used to measure performances of the companies, whether it is doing better this year than last, even whether it is doing better or worse than its competitors. (Anonymous, 2005) The main purpose of this report is going to analyze the overall performance of Finsbury Food Group PLC, by comparing financial ratios for this year with previous year and competitor. Moreover, disadvantages of using financial ratios and other non-financial methods for measuring company 's performance will be discussed.
Even though efficiency and effectiveness sound similar, effectiveness means something entirely different than efficiency.
Efficiency refers to doing the things right. It is defined as the output to input ratio and focus on getting the maximum output with minimum resources, such as time and cost. An excellent organization efficiency can improve the company 's performance.
In contrast, effectiveness refers to doing the right things in order to achieve its goals. It pays more attention on the output, sales, and quality. In another word, efficiency focuses on the process whereas effectiveness focuses on the end. (Bartuševičienė, 2013)
For example, a project in a clothing manufacture company was about producing 10,000 units of T-shirt with due date 5th April, the budget is ￡15,000. Eventually,