Accounting Project in Retail Sector

Added on - 21 Apr 2020

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Running head: ACCOUNTING PROJECTAccounting ProjectName of the Student:Name of the University:Author’s Note:
1ACCOUNTING PROJECTTable of ContentsInterim Project........................................................................................................................3Introduction and Rationale......................................................................................................3Introduction and Rationale of Retail Sector.........................................................................3Justification for selecting the retail sector for this paper......................................................3Research Questions, Objectives and Aims.........................................................................5Research Questions........................................................................................................5Research Aims................................................................................................................5Research Objectives.......................................................................................................6Pattern of the Retail Sector in UK.......................................................................................7Essential Drivers of the Retail sector and the performance of the companies....................7Opportunities and challenges that are faced by the retail industry......................................7Transition in the pattern of telecommunication industry in the current years.......................7Essential themes rising from the research analysis and about the industry and company..8Critical Internal and External Environment Analysis............................................................8Industry Analysis and Overview......................................................................................8Industry Lifecycle............................................................................................................8Industry demand and the drivers of profitability...............................................................8External analysis of Tesco, Sainsbury and Morrison...........................................................9PEST Analysis................................................................................................................9Porter’s Five Forces......................................................................................................12Swot Analysis................................................................................................................14Financial ratios.....................................................................................................................16Activity ratios.....................................................................................................................16
2ACCOUNTING PROJECTLiquidity ratios...................................................................................................................17Solvency ratios.................................................................................................................17Profitability ratios..............................................................................................................18Non-financial ratio................................................................................................................18Retention turnover ratio....................................................................................................18Customer and clients........................................................................................................19Operations........................................................................................................................19Environment and citizenship.............................................................................................19Timetable to complete the project.....................................................................................19Conclusion........................................................................................................................20Reference List...................................................................................................................21
3ACCOUNTING PROJECTInterim ProjectIntroduction and RationaleIntroduction and Rationale of Retail SectorThe retail industry in UK have been gaining their presence as they have been gainingknowledge about the demands that are pertinent in the market as well as regulatorytransformations during the time of explaining the transparency with the help of which theyhave been incorporating new and improved services in the market as well as enhancing thelevel of customer satisfaction(Vries 2014). The characteristic of retail sector in UK has thecapability to provide various kinds of retail products and services to their consumers anddevelopment of supermarket chains has even enhanced this service as the consumers areable to attain various kinds of products under one roof thereby easing their life and reducingtheir consumption of time.Justification for selecting the retail sector for this paperIn this paper, retail sector has been chosen as the consumers have been facingrapid transition in their tastes and preferences with the advent of time. There have beenvarious new products and services that have evolved and therefore the taste andpreferences of the consumers have been changing(Cette, Fernald and Mojon 2016).Therefore, it has been significant to select this sector in order to understand the kind ofproducts that are demand and what is the business model that has been implemented by thevarious retail chains in order to retain their customer base and enhance their competitiveedge(Yu, Ramanathan and Nath 2014). The retail firms in UK have been facing toughcompetition among each other and therefore have been going through tough challenges withrespect to maintaining their customer base along with innovation in services and pressurewith respect to pricing of the products in order to improve their return with respect to theirinvestment.
4ACCOUNTING PROJECTTesco PlcTesco Plc trading as Tesco is a British multinational general and grocerymerchandise retailer which has their headquarters situated in Welwyn Garden City,Hertfordshire in United Kingdom. Tesco is the third largest retailer with respect to their profitsand is the ninth largest retail firm with respect to their revenue globally. It has their shops inover 12 countries in Europe and Asia and has been found to be the leader of the grocerymarket in UK.Wm Morrison Supermarket PlcWm Morrison Supermarkets Plc trades as Morrisons is seen to be the fourth largestsupermarket chain and is right behind Tesco, Sainsbury’s and Asda within UK. The companyhas their headquarters in Bradford, West Yorkshire in UK. The organization was establishedin the year 1899 and till now has been functioning effectively and has their stores mostly inUK, Scotland and Wales.J Sainsbury PlcJ Sainsbury Plc trading as Sainsbury’s is the second largest supermarket chain inUK. It has a market share of 16.9% in the sector of supermarket in UK. The firm wasestablished in the year 1869 and is currently headquartered in London UK.Explanation of the economic importanceThe retail industry in UK had an extensive level of curiosity for the financial processand hence the government of Britain mainly looks to manage the market scenarios for thedelivery of innovative information and retail expertise.
5ACCOUNTING PROJECTResearch Questions, Objectives and AimsResearch QuestionsQ1. How is the retail sector structured in UK?Q2. What are the main retail sector drivers and the degree of performance of the retail sectorin UK?Q3. What are the challenges and the opportunities that are faced by the retail industry?Q4. How has the retail industry transformed in the past few years?Q5. What are the current news that are disclosed in the news with respect to the threecompanies that is under consideration?Research AimsBy making use of both the economic and financial frameworks, the current study triesto bring out the worst or the best company with respect to their performance so that there isa transparent understanding of what actions must be taken by the ineffective organizationsin order to transform themselves into an effective one in order to retain their competitiveedge in the long run. The financial component is segmented into four classifications that areinclusive of solvency, profitability, liquidity and efficiency. Each of these sectors has variousworst and best performing organizations and thereby the conclusion section will define theoverall financial status of the selected organizations.The first objective of the paper is to highlight the external environmental factorsassociated with the retail industry in UL by exploiting frameworks like PESTLE as it aids inbringing out the information from the four aspects i.e political factors, social factors,economic factors and the technological factors.
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