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Essay / Research Paper Abstract
This 14 page paper examines the financial performance and health of Indetix for financial years 2006 - 2008, the parent company of brands such as Zara, Oysho, Pull and Bear and Massimo Dutti and compares the performance to the Swedish firm Hennes and Mauritz, better known as H&M and the industry as a whole. The bibliography cites 8 sources.
Page Count:
14 pages (~225 words per page)
File: TS14_TEInditex.rtf
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Unformatted sample text from the term paper:
Zara, Oysho, Pull and Bear and Massimo Dutti (Inditex, 2009). The firm is well known and has a high level of control over their supply chain which they exercise in
order to try and create value and profits in the way that they operate. If the strategy of adding value is successful the firm should be doing well financially. When
considering a firm and its economic health it is important to consider the firm looking at the trends and patterns over the last few years, as well as the performance
of the firm against competitors and the industry as a whole. There are a number of ways that the firm can be assessed, looking at past and current performance and
looking forward using discounted forecasting cash flow methods. Inditex is an international business it is competing with a range of firms from different countries. This means that the
most effective way to assess performance in the context of the wider environment is not with numerical values if there are comparisons made across currency boarders, but with ratio analysis.
The first consideration of any firm is the level of profit that is made. Looking at Inditex a major competitor is H&M1, the Swedish firm that competes in many
of the same markets and also prides itself in the way it manages its supply chain. The use of ratio analysis is essential as Inditex reports in Euros and H&M
report in the Swedish Krona. The first profit measure is that of the gross profit margin; the gross margin is expressed as a percentage. This is the level of
revenue that remains when all of the direct costs for producing the goods or services are deducted form the revenue. This indicates the level at which direct costs account take
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