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MARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis Free essay! Download now

Home > A Level > Business studies > MARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis

MARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis

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MARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis essay previewMARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis essay previewMARKS & SPENCER Strategies, Policies and Financial Statements - ratio analysis essay preview

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This essay is about Ratio analysis of marks and Spensers

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MANAGEMENT OF FINANCIAL RESOURCES & PLANNING




ASSIGNMENT
ON
MARKS & SPENCER Strategies, Policies and Financial Statements.


This assignment is based on the policies and different strategies that are being adopted by the MARKS & SPENCER and we will also have a look and analysis on the key ratios of financial statements.

Introduction to MARKS & SPENCER

Mark & Spencer is one of the UK’s leading retailers. In 1884 Micheal Mark started a business in Leeds named Marks Penny Bazaar where all items were sold for one penny, including nails, screws, soap wooden spoons and luggage labels. In 1894 Thomas Spencer invested 300£ in the business and become partner. Marks & Spencer Limited was registered as a firm in 1903. In today’s world Marks & Spencer is a big name in food, clothing and home products. They have 21 million people visiting the store in a week. They have over 78,000 employees in the UK and abroad, and have over 700 UK stores, plus an expanding international business.

They are now the number one provider of womenswear and lingerie in the UK, and are rapidly growing their market share in menswear, kidswear and home, due in part to their growing online business. Overall, their clothing and homeware sales account for 49% of our business. The other 51% of our business is in food, where they sell everything from fresh produce and groceries, to partly-prepared meals and ready meals.

FINANCIALS

We will look into the financial statements and will do a small analysis in connection with ratios.

Ratios:

Profitability Ratios/Investment Ratios.
S.No.
Ratios
2011
2010
1
Return on Capital Employed
15.20%
13.35%
2
Net Profit
8.01%
7.36%
3
Gross Profit
38.23%
37.94%
4
Capital Employed Turnover Ratio
1.897 Times
1.812 Times
5
Asset Turnover Ratio
1.708 Times
1.693 Times

Comments:
The 1st ratio is return on capital employed is that is the performance of company which is return on equity before interest, tax and dividends deducted from capital employed. That capital employed may be borrowed or provided by owners.
As the figures shows that is an increases in 2011 by 1.85%. This shows that company has invested its capital in various projects and is earning good profit as compare to last years. This is also means t hat company is meeting its expenditures according to the investment made. When we see the net profit ratio that shows an increase of 0.65% in profit as compare to the previous year. That indicates the improvement of this year’s business strategies in comparison with the last year. The ratio shows that the company is earning 8 pound on sale of every 100 pound. Net profit margin can be improved by increasing selling price of the or by finding ways to reduce the costs.
Next ratio is of the capital turnover, which shows the number of times capital employed has ...

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