Why Woolworths Failed as a Business

The business I have chosen for this investigation is ASDA superstore. This is a large chain of supermarkets throughout Britain which retails clothes, merchandise, food, and electronics etc. in this part of my course work I will briefly explain the aims and objectives of ASDA I will also explain the external factors which affect the aims and objectives of the business however I will first be talking about a brief history of ASDA.

Making a profit is usually the primary aim of running any business, and although this is normally achieved by increasing sales, it can also be enhanced through the careful control of costs. A business that keeps costs under control will be able to release more resources for growth and be better placed to survive in a downturn or recession. A structured and ongoing approach to cost control is an essential part of any well-managed business. Finding ways to reduce operating costs is typically a priority for Tesco. On our visit to Tesco we observed that Tesco can control its operating costs by reducing the number of staff especially

To achieve this report will be looked at in four main areas. Firstly, we will use financial ratios obtained from annual reports of 2008 and 2009 to analysis and appraise Morrison’s financial performance. This would be followed by a comparative analysis with Tesco, for the same period. In addition, a trend analysis will be done to show the pattern of Morrison’s financial performance over the years 2006 to 2009. Furthermore, a comparison will be made with industry average

All though the layout of the stores are pretty much the same, female wear on the left, male on the right shoes and accessories in the middle and the food store and coffee shop is located at the back, they all differ in the unique way the store owner wants them to.

As mentioned in the introduction of the mini case, Hobby Horse Company, Inc. (HH) experienced a tough year in 2011. HH opened up a number of new stores but experienced a poor Christmas season. Christmas season is the biggest sale period for retail stores. As a result, bad Christmas sales performance played a big part of HH’s loss for year 2011. As we computed the financial ratios for HH, we can see the effects from new stores openings and poor sales performance.

This report will entail whether or not it is a good idea for Erika Knolls to invest in Tesco. As a financial adviser I shall use ratio analysis to make a recommendation and support my decisions on whether Tesco will be a good beneficial long term investment.

For story 1, I have discussed two businesses which are Argos and Sainsbury’s who are undergoing an acquisition. Despite having a downturn in Sainsbury’s profits, they are still optimistic about this takeover. Reasoning behind such business deal, is to change their consumer habits, and help their purchasing process to be further accessible through help of technology. The economical approach suited for this case, is that Sainsbury has attempted to use external expansion, to grow their business further and monopolise their

Wesfarmers Limited, The largest company in Australia has reached a point in its main retail business from where further growth opportunity is difficult due to government restriction and market capitalization. Now it is thinking to go overseas with its home improvement and office supplies section but failure in past by Australian giants to penetrate foreign market has risen concerned. Though it had subsectors like department stores, industrials, resources and great workforce and financial management, it still have shareholders dissatisfaction issue regarding EPS and ROE relative to its giant acquisition of Coles brand period. New market threats like Aldi and existing competitors like Woolworths are causing headache for it. Because of supplier’s resistance and government intervention, it is too difficult to cut profit margin where price reduction became main survival technique. It now need a mix of strategy like niche market product line with personal labeling, local marketing and product development, investment is eco friendly and energy saving products, invest in developing countries. With financial wizard and proper marketing strategy, the company can reasonably do well in future in term of growth.

Sears grew up to the world’s largest retailer by expanding annual sales through diversifying sale products, such as apparel, cosmetics, jewelry, electronics, household appliances, cookware, bedding and hand-tools. This article shows that Sears suffered from a cost increase in 1997, including lawsuits, credit collectibles and sales in Mexico. Besides, the flexible payment facility that Sears offered is also a reason for cost increase. These problems brought Sears with bad debt and hence decreased the cash flow. The problems of the company came from the liquid market security, so I emphasize the flowing concepts:

Woolworths foods has the highest record of revenue. A very miner hike was visible in the gross profit margin from 2012 to 2013 only 0.04% hike

Until the beginning of the world economic recession in September 2008, John Lewis’s model could have been considered a very successful one. However, given the current economic climate, John Lewis has been forced to review their organizational structure with a view to the company’s survival in the future. For the first time in John Lewis’s history, partners have had concerns about their job security. Two events signalled a change in the outlook. Firstly, the company’s decision to close the Stevenage distribution plant which had become obsolete with the introduction of the new automated Milton Keynes plant. 200 partners were made redundant by the closure of the Stevenage plant. Secondly, as a result of the overall decline in the company’s performance in 2009, it was decided to make another 40 partners from the head office redundant. This has changed the overall mood of the partners, creating feelings of insecurity and questioning the model and their relationship to it. This kind of dissent in the ranks could have

For example, a recession in the economy, or drought in China which results to the delay in production of goods might ultimately force the business to shut down.

There is not an exclusive definition regarding what ‘corporate failure’ means (Rankin, Stanton, Ferlauto, McGowan, & Tilling, 2012, p. 365). In simple words, a company is said to have failed when it cannot repay its financial promises (Davis, 2004,

Business failure refers to a company ceasing operations following its inability to make a profit or to bring in enough revenue to cover its expenses. A profitable business can fail if it does not generate adequate cash flow to meet expenses. Arditi (2000), defines the failure of a company as an inability to pay its obligations when they are due (Frederikslust, 1978).

1. Economic Trigger: It lost money and market share in the 80s’. In 1987, performance was so low that it lost half of its equity.