Debenhams Business Analysis and Strategy

This business assignment delves into the operational and financial aspects of Debenhams. It analyzes the company's various business activities, presenting its financial statements (balance sheet and profit and loss account) in a clear manner. The analysis further explores Debenhams' competitive landscape, highlighting key opportunities and challenges facing the business.

Business Resources

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1- Describe the recruitment documentation used in a selected organisation............................3
P2 Describe the main employability, personal and communication skills required...................4
TASK 2............................................................................................................................................4
P3 Describe the main physical and technological resources required in the operation .............4
TASK 3............................................................................................................................................5
P4 Describe sources of internal and external finance for a selected business.............................5
P5 Interpret the contents of a trading and profit and loss account and balance sheet................6
P6 Illustrate the use of budgets as a means of exercising financial control .............................10
P7 Illustrate the financial state of a given business...................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13
.........................................................................................................................................................1

INTRODUCTION
In this recent time period, for achieving the long and short term goals and objectives of
any business firm, business resources are plays important role. Business resource are assist to
complete all organisation's activities and operations in appropriate manner with better outcomes.
Due to, it is very important to properly managed them with the help of smart techniques and
methods. This research project will be defining about recruitment documentation which will
used in a selected organisation. In the addition of this, employability, personal and
communication skills will be discussing of an individual person which is required to effectively
perform decided task (Chaffey and White, 2010). Moreover, physical and technological
resources necessary for every business firm which will explaining in a significant way. In the
context of Debenhams, financial statements, profit and loss account and balance sheet will be
representing as per that easy to identify current position and status of firm.
TASK 1
P1- Describe the recruitment documentation used in a selected organisation
The preferred organization in this assignment is Debenhams. Debenhams’s is the 4th
biggest chain of retail supermarket in the UK. The headquarters of the Debenhams are located in
UK. The corporation's officially permitted identity is Debenhams superstores plc. Debenhams’s'
share of the market in the financial year of 2015 was 11%, losing 0.3% from the year 2014 - they
are at the back of Debenhams, ASDA and Sainsbury. If Debenhams makes a decision on
appointing employees for their numerous divisions positioned across the UK they have to firstly
publicize this opportunity. There can be numerous methods to publicize this job, beyond the
numerous some possibly will be used through newspaper, advertisements, website, as well as
current employees (Montgomery, 2011).
Subsequent to the vacancy has been publicized, concerned candidates will throw their CV
to the specified address which will affirm their identity, learning requirement, understanding,
profession purpose and anticipation, individual abilities, an individual declaration etc. on support
of the CV’s the favoured applicants will be informed by the manager for a meeting. This is the
division in which the boss gets to assemble the applicants personally and have a chat with them
furthermore prefer the most excellent fitting person for the job. So after the candidate will be

selected, the Company will inform him through letter or notice. This is entire recruitment
documentation used in Debenhams. (Bae, Rowley and Sohn, 2012).
P2 Describe the main employability, personal and communication skills required
Employability skills: Employability skills can be defined as a skills that a person needs
to have in order to get a job and/or be effective in the job role he or she has. Such skills allow the
employee or person to have a mutual and friendly relationship with colleagues or the manager
thus if there are any problems that arise they will be resolved efficiently. There are many
examples of employability skills that employees or people applying for jobs should possess
which include; qualification and experience that are directly linked to the job that is being
applied for (De Clercq, Lim and Oh, 2013).
Personal skills: Personal skills can be defined as a skills that a person may possess but
doesn’t necessarily need when applying for a specific job role. There are many examples of such
skills which would benefit the business including; speaking different languages, trustworthy and
having a sense a humour. It is good if employees or applicants possess such sills when applying
for a job as it will make them more likely to get the job as it shows the employer other skills that
the employee/applicant have that can help the business; these skills are useful for a lot of
different jobs.
Communication skills: Communication skills can be defined as a skills that help a
person convey information to another person efficiently and with ease. Managers or employees
with good written or verbal communication skills will benefit the business; this is because they
will be able to talk and understand each other properly (Zikmund and et.al., 2013).
TASK 2
P3 Describe the main physical and technological resources required in the operation
Physical resources: At Debenhams the building they use is essential towards the day to
day running of the business. In order for the business to provide products and services to its
customers they will need different in-house resources to facilitate the smooth running of the
business. A building on its own would not be enough for the store to be fully operational, they
need materials such as; shelves (to display items), fridges and freezers (to keep cold and frozen
items in the right condition until they are sold), tills (so they have a recorded system of what is
sold and how much it costs), lighting, computers (for administration) etc.

Technological resources: Debenhams uses software that is loaded on to all their
technology. The software is the programme that tells the technological items, like tills, what to
do, it is loaded with all the barcodes of items the store sells which means employees can quickly
and easily scan items and the tills will add it up with the least human labour possible,
Debenhams would not be able to operate well if it didn’t have the specific software because the
software keeps everything in check with what’s coming in and what’s coming out ( Osterwalder
and Pigneur, 2010).
TASK 3
P4 Describe sources of internal and external finance for a selected business.
Internal sources of finance The founder of Debenhams used his own personal savings
(owner’s savings) to start up business, he used the money to pay for war-surplus groceries which
was what the business started out selling, he also used his own money to pay for the market stall
that he used to sell the goods he bought. The founder then used profits (capital from profits) of
the business to expand the company which means that the profits would increase as they would
be selling more stock because they had more variety and were in different areas which made it
accessible to more people, in 2014 (Baxter, 2012).
Illustration 1: Financial sources, 2017
(Source- Financial sources, 2017)
External sources of finance Debenhams now is a very large company so not all forms of
external finance don’t apply to them, such as money from banks, building societies, government
grants and money from friends and family. Debenhams could’ve got money from banks in the

form of a business loan or the use of an overdraft facility on the business account, an overdraft
facility means that you can withdraw money from your account up to a point without having
money in it, this would be set when the account is set up and is called an overdraft limit
( Sekaran and Bougie, 2016).
P5 Interpret the contents of a trading and profit and loss account and balance sheet
PROFIT AND LOSS STATEMENT
particular 2014 2015 2016
Revenue 41055 45327 51243
Cost of Revenue 33310 36113 40256
Gross Operating
Profit 7745 9214 10987
Operating expenses
Research and
development 1721 2075 2370
Sales, general and
administrative 4415 4819 5335
Staff cost - - -
Depreciation and
amortization - - -
Other Operating
Expenses 504 199 -1
Total Operating
Expenses 6640 7093 7704
Operating income
before interest and
taxes 1105 2121 3283
Non-operating
income 1029 1150 1315
Income before
income taxes 2134 3271 4598

Provision for
income taxes 136 311 1055
Net income from
continuing
operations 1998 2960 3543
Net Income 1890 2823 3419
Net income
available for
common
shareholders 1890 2823 341
Earnings per share
Basic 6.92 10.35 12.57
Diluted 6.89 10.29 12.46
Interpretation of P&L Account
As per the result of profit and loss account of Debenhams Ltd. There were shows last
three years statements in tabular formate, which is categorised into two major parts one is
operating expenses and another one is earning per share of cited company (Zott and Amit, 2010).
Last three Revenue of the enterprise is regularly increase such as 2014- 41055, 2015- 45327 and
2016- 51243. along with this gross profit is also increased in last three years 2014- 7745, 2015-
9214 and 2016- 10987. P&L accounts helps to shows actual and reliable financial position of
company as per that will easy to analyse.
BALNACE SHEET
2014 2015 2016
Assets
Current Assets
Cash, cash equivalents, and short-term investments

Total cash,
cash
equivalents,
and short-
term
investments 14027 15893 15761
Accounts
receivable - - -
Inventory 3391 4128 5821
Other
Current
Assets 29620 32997 39928
Total
current
assets 47038 53018 61510
Non Current Assets
Total non-
current
assets 34513 37587 40593
Total Assets 81551 90605 102103
Liabilities and stockholders' equity
Liabilities
Current Liabilities
Accounts
Payable 7094 8295 9533
Taxes
Payable 162 219 321
Current
Debt 28501 34412 39796

Other
current
liabilities 9091 9363 12103
Total
current
liabilities 44848 52289 61753
Non-current liabilities
Deferred
taxes
liabilities 141 122 124
Long Term
Debt 7255 5645 3105
Other long-
term
liabilities 4831 4557 6378
Total non-
current
liabilities 12227 10324 9607
Total
Liabilities 57075 62613 71360
Stockholders' equity
Common
stock - - -
Additional
paid-in
capital 3785 3785 3785
Other 20381 21653 23643

reserves
Retained
earnings 1890 2823 3419
Minority
Interests 422 482 152
Total
stockholder
s' equity 24476 27992 30743
Total
liabilities
and
stockholder
s' equity 81551 90605 102103
Interpretation of Balance sheet
Balance sheet of Debenhams, is assist to show actual current assets and liability. As per
that easy to determine how much company liable to pay as well as how much having their own
equity fund. Balance sheet mainly divided into two parts such as current assets and current
liability. Last three years of current assets is 2014- 47038, 2015- 53018 and 2016 – 61510. Along
with this current liability is 2014- 44848, 2015- 52289 and 2016- 61753. as compare with current
assets of this company's result firm is more liable to pay (Ciabuschi, Perna and Snehota, 2012).
P6 Illustrate the use of budgets as a means of exercising financial control
An allocated budget it the opposite to a zero-based budget, an allocated budget is what
cited company uses, it is figured out by deciding upon the amount of money that is the budget
and then using analyst figures of forecasted costs, revenues and resources (Korunka and et.al.,
2010). A budget is an estimate of the costs, revenues and resources that are going to be needed in
the future over a set period of time. Debenhams uses an allocated budget to:
 Get all the facts the business needs to ensure that the money they have is going to the
right place to ensure that the company grows as quickly and efficiently as possible
 Limit expenditures that are unnecessary

 Create a “financial roadmap”
Financial control is exercised in planning, performance, evaluation and coordination,
these are points that are demonstrated when creating a budget:
 Planning – Demonstrated due to the fact that the whole point of the budget is planning for
the future using the break-even chart to show at which point the business is no longer
making a loss
 Performance – A budget takes into account how well cited company has performed
previously to forecast how well Debenhams will do in the future (Ward, 2016).
 Evaluation – The analyst consensus is figured out by using previous figures that are
evaluated by looking at the difference Debenhams is doing now from the time the figures.
P7 Illustrate the financial state of a given business
Financial statement of Debenhams Ltd
Margins % of sales 2015 2016 2017
Revenue 100 100 100
Gross margin 33.59 34.78 33.84
Operating margin 20.3 20.76 20.2
EBT margin 19.87 20.02 19.29
Profitability 2015 2016 2017
Net margin% 15.87 15.96 15.51
Assets turnover 1.8 1.81 1.73
Return on assets% 28.68 28.91 26.83
Return on Equity% 208.75 210.41 154.52
Return on invested
capital%
58.47 56.89 48.78
Interest Coverage 26.97 27.21 21.9

Interpretation
Debenhams Ltd of total revenue is 2017 is £100, in which gross margin of the company
is 33.84 of 2017 and EBT margin is 19.29. on the other hand, net margin is 15.51 of 2017 in
percentage, return on assets is 26.83 and return of equity is 154.52 in percentage. This financial
statement help to define margin of sales in % and profitability of the company in the financial
term.
CONCLUSION
From the above represented this research project it has been concluded that, business
resources which played important role in every business firm. Because with the help of them,
easy to completed all business operations and activities with better result. In the addition of this,
financial statements, balance sheet and profit and loss account of Debenhams has been
represented in appropriate manner.

REFERENCES
Books and Journals
Bae, J., Rowley, C. and Sohn, T. W. eds., 2012. Managing Korean business: Organization,
culture, human resources and change. Routledge.
Baxter, R., 2012. How can business buyers attract sellers' resources?: Empirical evidence for
preferred customer treatment from suppliers. Industrial Marketing Management. 41(8).
pp.1249-1258.
Chaffey, D. and White, G., 2010. Business information management: Improving performance
using information systems. Pearson Education.
Ciabuschi, F., Perna, A. and Snehota, I., 2012. Assembling resources when forming a new
business. Journal of Business Research. 65(2). pp.220-229.
De Clercq, D., Lim, D. S. and Oh, C. H., 2013. Individual‐level resources and new business
activity: The contingent role of institutional context. Entrepreneurship Theory and
Practice. 37(2). pp.303-330.
Korunka, C., and et.al., 2010. Personal characteristics, resources, and environment as predictors
of business survival. Journal of Occupational and Organizational Psychology. 83(4).
pp.1025-1051.
Montgomery, C. A. ed., 2011. Resource-based and evolutionary theories of the firm: towards a
synthesis. Springer Science & Business Media.
Osterwalder, A. and Pigneur, Y., 2010. Business model generation: a handbook for visionaries,
game changers, and challengers. John Wiley & Sons.
Sekaran, U. and Bougie, R., 2016. Research methods for business: A skill building approach.
John Wiley & Sons.
Ward, J., 2016. Keeping the family business healthy: How to plan for continuing growth,
profitability, and family leadership. Springer.
Zikmund, W.G., and et.al., 2013. Business research methods. Cengage Learning.
Zott, C. and Amit, R., 2010. Business model design: an activity system perspective. Long range
planning. 43(2). pp.216-226.

Online
Global Business Environment, 2017. [Online]. Available through:
<https://www.novascotiabusiness.com/export/fittskills/global-business-environment>.
[Accessed on 21st August 2017]