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Accounting and Finance in Sainsbury's and Tesco

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Added on  2021-02-21

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Accounting and Finance TABLE OF CONTENTS INTRODUCTION 1 Company background 1 Competitor's company profile- 2 Financial analysis of Sainsbury's and Tesco 3 Working note:-8 CONCLUSION 11 REFERENCES 12 INTRODUCTION Accounting and finance, both containsdifferentmeaningsas accounting refers to the art of reporting and recording the business transactions that are in monetary terms while Finance is considered as the science in managing the funds of the business. 1 Company background Sainsbury's is a second leading chain in terms

Accounting and Finance in Sainsbury's and Tesco

   Added on 2021-02-21

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Accounting and Finance
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TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1Company background ................................................................................................................1Competitor's company profile-....................................................................................................2Financial analysis of Sainsbury's and Tesco...............................................................................3Working note:-............................................................................................................................8CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INTRODUCTIONAccounting and finance, both contains different meanings as accounting refers to the artof reporting and recording the business transactions that are in monetary terms while Finance isconsidered as the science in managing the funds of the business. The present study is based onSainsbury's, largest retailer in supermarket, in the UK. Furthermore, comparative analysis hasbeen made in between Sainsbury's and its competitor that is Tesco. Company background Sainsbury's is a second leading chain in terms of the supermarkets within the entire UK,with having a market share of 15.3% of supermarket segment (Sainsbury's Wikipedia,2019). Itwas founded in the year 1869, by the John James. Sainsbury having the shop in the Drury Lane,situated in London. It became the largest organization in terms of the grocery retailer during theyear 1922. This company was counted as an early adopter in context of the self-service retailingin overall UK. The operating income of the Sainsbury' s in the year 2018 resulted as £518million and the revenue gained from its sales was £28.45 billion (Kozubíková, Homolka andKristalas, 2017). It has its shop in around 1415 locations where it runs its business. The no. ofemployees that are working with the company are stated as 186,900 during the year 2018. Thecompany deals in the Hypermarket, supermarket, superstore and the convenience shop. The objectives, opportunities and the problems that are been faced by the firms could beassessed through its SWOT analysis. One of the main objective of the Sainsbury's is to survive inthe competitive world by meeting the desire of all its customers so that it could achieve thecompetitive edge against its competitors called as Tesco. The other objective of an entity is toachieve increased profits by making the reinvestment of the profits into the growing sector forbecoming a best or leading marketer in supermarket segment. It also aims at providing thesustainable and good financial returns to its shareholders (Ryan and Deci, 2017). Providing greatservices with the outstanding quality to the customers is also one of the major objective of thebusiness. The company aims for exceeding the expectations of the customers and setting up thepromotional campaigns in order to create positioning in minds of the new as well as the existingcustomers. The strengths of the Sainsbury's helped it in reaching to its objectives effectively andefficiently. It has automation of its activities which enables the firm in bringing out the1
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consistency in terms of the quality within its products which in turn enhances the demand of itsproduct in the market (Steiss, 2019). The workforce of the company is highly skilled because itprovides proper training and the learning programs to its employees by developing themotivation among them in achieving more. The major weaknesses or the problems that are facedby the enterprise is attained limited success from its core business in the outside market andrequires to do more investment in the research and development projects with technologicaladvancements (SWOT Analysis, 2019). The company also faces problem in forecasting itsproduct's demand as it has missed many of the opportunities in comparison to its rivalry. Theopportunities that the entity can grab includes the new trends within the behaviour of theconsumers could be a great opportunity for Sainsbury's in respect of opening up of the newmarket so that it could diversify its revenue streams by producing the new products (Gürel andTat, 2017). Online platform is also a larger opportunity for the company as it could attract largecustomers and new channels for increasing the sales can be achieved. Competitor's company profile-Tesco, a multinational British groceries company, called as the retailer in the generalmerchandise items, headquartered in the city called as Welwyn Garden, Hertfordshire, England,UK. It operates as the third biggest retailer within the world in terms of its gross revenues andranked as the ninth largest firm in respect of its revenues. It has its outlets or shops in around 7countries across the Asia and the Europe. It is also a market leader in dealing with the groceryitems as like Sainsbury's in entire UK (Abuhamdeh, Csikszentmihalyi and Jalal, 2015). It isfounded in the year 1919 by the founder named as Jack Cohen. The operating income of thecompany in the year 2018 resulted as £ 2206 million and the net income gained amounting to £1320 million. The total no. of employees in the company resulted as 450000 and has around6800 shops at different locations. The revenue attained by the enterprise from its sales equatedto £ 63,911 million presently. The key people who runs and manages the company are JohnAllan as Non-executive chairman and Dave Lewis as the CEO group. The main objective of the Tesco is to become a leading retailer in the supermarket. Heother objectives of the company includes maximising the sales in order to gain larger profits anddeveloping a large online platform (Phadermrod, Crowder and Wills, 2019). Providing the jobto the local community and introducing the healthy and the quality products with wide range toits customers at affordable prices. Tesco has achieved strength in terms of winning numerous2
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