Benchmarking exercise
Identify two companies that operate within the same sector (or two companies that have divisions or business units that operate within the same sector). Familiarise yourself with the operations of both companies by researching their activities.
Conduct a comparative analysis of the two companies you have chosen. The analysis should be both financial and non-financial and should make use of appropriate sources of information such as company reports, articles in the press, brochures, advertising literature etc.
The financial analysis should be based on appropriate use of horizontal, trend, vertical and ratio analyses of the financial statements for each company for a period of at least two consecutive years and finishing with the most recent year for which company accounts are within the public domain and readily accessible.
The non-financial analysis should be based on evidence of business performance that is primarily non-financial in nature such as delivery performance (delivery reliability and/or lead time), quality, new product introduction time, market share, productivity, staff turnover, salaries, R& D statistics, brand image etc. Trends and patterns of non-financial performance should also be established.
Notes:
• Follow the standard structure of academic reports as recommended above, and by including the references you have used in the right place, checking for grammatical problems and word processing for spelling mistakes.
• You should target for a maximum of 23 pages for your report. This does not include appendices.
• Plagiarism (copying whole or parts of material from other works without making reference to them) is forbidden and means are set in place in the university to detect them and there are strict rules for punishing those who commit this act.
• Submission: ONE hard copy with cover sheet to be submitted to the Student Support Office, and electronic copy to be submitted via Turnitinuk link in VITAL.
Complete the analysis in the form of a report with the following headings and format:
1. Company names (and registered addresses) and industrial classification (product tree).
2. Types of business activities (for both companies).
A short paragraph summarising the products produced or services provided (for each company).
P1&2: 3 marks
3. Financial analysis (for a minimum of 2 years).
Analysis of the financial performance of each company. Appropriate use of horizontal, trend, vertical and ratio analyses (show all calculations).
P3: 15 marks
4. Non-financial analysis (for a minimum of 2 years).
Analysis of the non-financial performance of each company. Appropriate use of non-financial performance metrics and evidence of business health.
P4: 15 marks
5. Company potential.
Comparison of strengths, weaknesses and future prospects of both companies (considering opportunities and threats) based on both financial and non-financial analyses.
6. Investor potential.
Comparison of the attractiveness of investment in both companies.
P5: 8 marks
P6: 8 marks
7. Employee potential.
Comparison of the attractiveness of employment in both companies.
8. Limitations of the analysis.
P7: 8 marks
Discussion of the factors inhibiting the effective comparison of any aspect of company performance and wellbeing.
P8: 3 marks
9. Conclusions.
An Executive Summary; ONE Page Summary for the use of Company Directors
A POWERPOINT Presentation to use for a potential presentation to the companies’ boards (in 10 minutes)
P9: 10 marks
