Business Analysis and Valuation of Qantas Airways

Running head: BUSINESS ANALYSIS AND VALUATION
BUSINESS ANALYSIS AND VALUATION
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1BUSINESS ANALYSIS AND VALUATION
Executive Summary
The report is based on the analysis of the industry in which Qantas Airways operates and the
levels of competitiveness in the industry as well. The internal environment of Qantas Airways
has been analysed in the report in detail. The corporate strategies which have been
implemented by the organization are considered to be an important part of the analysis. The
report is able to suggest the two major accounting policies that can be used by the auditors for
analysing the operations of the organization. The performance of Qantas Airways between
the years 2013 and 2017 has been discussed in the report and this has been able to show the
improvement of revenues and profitability levels of Qantas Airways.

2BUSINESS ANALYSIS AND VALUATION
Table of Contents
Competitive forces analysis of Qantas Airways............................................................3
SWOT analysis of Qantas Airways................................................................................4
Corporate strategy of Qantas Airways...........................................................................5
Two accounting policy choices for the organization.....................................................6
Evaluation of financial performance of Qantas Airways...............................................7
Differences and similarities in the findings in part (e)...................................................9
Recommendations........................................................................................................10
References....................................................................................................................11

3BUSINESS ANALYSIS AND VALUATION
Competitive forces analysis of Qantas Airways
Competitive forces in the environment that can influence an organization can be
analysed with the help of Porter’s five forces tool. This analysis plays an important role in
examining the external environment and industry in a detailed manner. The industry in which
Qantas operates can be analysed in the following way,
Threats of the new entrants – The threats based on entry of new organizations in the
airlines industry are low. The requirement of huge levels of investment is considered to be a
major factor that is able to affect the entry of new organizations. The development of
infrastructure by the organization requires huge levels of investment and is able to affect the
ways by which the operations can be developed in the airlines industry (Assets.kpmg. 2019).
Bargaining power of the suppliers – The bargaining based power of the suppliers in
airlines industry is lower due to the availability of huge number of suppliers who are able to
offer similar services to the organizations. The suppliers are thereby not able to affect the
prices of services that are offered by Qantas Airways. The presence of major organizations in
the same industry can be considered to be another major reason behind the lack of power of
the suppliers of Qantas Airways (Barros, Hernangómez and Martin-Cruz 2016).
Bargaining power of the buyers – The bargaining based power of the buyers in the
airlines industry is high due to the availability of huge number of options related to services
that are offered to them. The customers in the industry are provided with options related to
premium services and low cost based air travelling services as well. The service providers are
thereby able to offer the services which have been able to increase purchasing power of the
buyers (Business Insider Australia. 2017).
Threats of the substitutes – The threats based on substitutes in the airlines industry
are low as airlines can be considered to be the fastest method of travelling between