Importance of HR and Financial Management Strategies in Body Shop

This report discusses the importance of HR and financial management strategies in Body Shop, a cosmetics industry headquartered in London. It covers the role of HR in maximizing employee productivity, financial management strategies, SWOT analysis, and evaluation of the company.

Introduction to Business
Studies.

TABLE OF CONTENTS
INTRDOUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Presenting human resource strategies.........................................................................................3
Analysing various financial management strategies...................................................................4
Conducting SWOT analysis for Body shop................................................................................5
Evaluation of the company.........................................................................................................6
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8
APPENDIX......................................................................................................................................9

INTRDOUCTION.
Every business is concern with providing goods and services that are essential for
running the company in competitive manner. Further the present report is based on Body shop
that is cosmetics industry headquartered in London and is specialized in selling variety of
perfumes and skincare products. Also, the report will identify the importance of human resource
department in conducting various activities essential for the growth of the company. Further,
various finance functions crucial for company success will also be discussed in detail. Moreover,
the study will analyse importance of financial management through identifying various financial
strategies used by body shop. Furthermore, company strength and weakness while working in
complex business environment will also be covered under this report. Lastly, most important
strategies that will be helpful in growth of body shop in future will also be closely identified.
Also, such strategies will suggest corrective actions that needed to be taken by quoted firm in
against of market rivalries to stay ahead in competition.
MAIN BODY.
Presenting human resource strategies.
Akter (2021) defines HR as part of business that is responsible for screening, selecting
and hiring responsible candidates that would help business achieve specified goals and
objectives. This means that human resource department helps in maximizing the employee
productivity through developing various employee benefit programmes. Moreover, this division
of the business is responsible for managing and engaging people at the workplace in the most
effective manner. Thus, the business technology is also utilized in the best manner through
improving the communication, staffing and training of the employees (Liebl, 2018). Moreover,
the work culture of the company is also improved to greater extent for those business that are
having the best HR department. Hence, such companies are able to run for longer period due to
minimum employee turnover and maximum job satisfaction that helps is achieving unbelievable
targets.
Moreover, in context of body shop it can be said that HR department is very attentive that
business has all the right employees that are available at correct time and cost. Also, the
department ensures that all the business HR policies are updated in right manner as suggested by

top management so that certain analysis based on the profit and growth of the company could be
conducted. Further, HR department of body shop provides all it employees proper training and
support through conducting various programmes (Murphy, 2020). Also, it creates environment
where any queries and suggestions either personal or professional could be easily shared by the
all employees to the HR officers so that efficiency is not affected in any manner.
Analysing various financial management strategies.
AYDIN, ALAZMA and Çora (2020) defines finance as process in which funds are
properly managed for the business activities so that certain purchases and investment could be
made in future operations of the business. Thus, it means that function of finance in any
business is to closely monitor inflow and outflow of money so that maximum revenues for the
firm could be generated in specific time frame. Hence, in any company proper records of
revenues and expenses are made through book keeping so that better financial decisions could be
made in the future. Moreover, if finance department is working in most efficient (way) than
future risks could be avoided through by this division through creating risk mitigation
programmes so that firms activities could be continued in smooth manner.
In body shop, this department is responsible for handling large amount of money in well
manner so that operational excellence could be maintained across various regions. Also, in body
shop this division make sure that all employees are paid timely and accurately for the work that
is carried out and also ensures all financial process of body shop are being followed according to
the legal guidelines set by the government of the country (Sahaf, 2019). Furthermore, it also
looks at various projects that are available for future investment so that company growth could
be achieved. Also, proper investor relations are maintained so that continuous support could be
gained to the company. Moreover, role of this department in quoted firm in determining financial
planning, company budgets and corporate strategy is based on the analysing current changing
needs of the customers and business environment so that losses could be avoided for quoted firm.
Furthermore, there are different types of documents that are being used in financial
reporting so that there is systematic maintenance of records some of them are as follows :
Profit and loss: This type of account is helpful in providing useful information about
total income and expense that is required for analysing company current and future
performances. In company like body shop this is very crucial to identify whether the company is
generating enough sales and revenues along with identifying whether the firm expense is

managed effectively or not (What Does a Finance Department Do?, 2021). Also, the information
collected from this account help the quoted firm in setting and achieving various business targets
that would further help in global expansion and developing marketing policies accordingly.
Thus, the net profit of the company is find out at end of financial year through taking in account
all indirect expenses that are occurred during particular year.
Balance sheet: Its main purpose is to define the true financial position of the company
during given time period. Also, this statement shows total amount of assets and liabilities that are
owned by any company and the total amount invested in the business. Further, this document is
important for body shop company as it helps in determining the total assets value and thus
identify the possible future challenges that could be faced by the quoted firm to survive in the
industry (Al-Haddad and et.al., 2020). Moreover, it helps the company stakeholders in
undertaking various business decisions through the balance sheet information. Further, it helps
body shop in borrowing various short and long term loans that are important for company
success.
Cash flow statement: It is document that is responsible for identifying the movement of
money in the company. Thus, it helps in understanding how much money is making and
spending so that business cash positions could be identified. Furthermore, this document helps
body shop in determining working capital and optimum level of working capital required for
conducting daily operations of the business (Fischer, 2021). Also, it helps the quoted firm in
doing short term planning that so that sufficient amount of cash could be kept for any emergency
cases. Moreover, through this statement the quoted firm have details of total amount spend
during the year so that excess cash utilization could be done in most effective ways.
Conducting SWOT analysis for Body shop.
SWOT framework is basically used by most of the companies to identify the company
competitive position so that better strategic planning could be done. Further, it analysis the
internal factors that affects the efficiency of the business. For body shop it as follows:
Strengths
 This company has strong digital
presence that has further helped in
creating brand loyalty among the
customers.
Weakness
 There is very low advertising of
products.
 Retail outlets are very limited that also
impact the overall sales of the

 It has unique product portfolio that is
not easily available in local markets.
 A very high brand value due to the
strong supplier network across various
regions.
company.
 Very high prices of the product might
not attract new potential customers of
lower income groups.
Opportunities
 With the growing importance of health
eco friendly products could be launched
for skincare.
 Initiating free delivery system will
increase the revenue for the online
business of the company (The Body
Shop SWOT Analysis, Competitors &
USP,2021).
 Through building omni channel the
company would grow on higher levels.
Threats
 There is fear of changing customer
preferences that might impact the sales
of firm.
 Heavy competition in cosmetic market
by successful firms.
 Gathering raw materials at low cost is
challenge in markets that are not stable.
Evaluation of the company.
Thus, from the overall it can be said that body shop has been grown immensely grown all
around the world due to closely monitoring the business activities of itself and other rivalry firm
in the market so that better strategies could be developed in the future. However, is to be
recommended to the quoted firm that better strategies need to be developed by the firm in
opening stores in those areas where delivery of goods is not possible so that larger market areas
could be covered (Schlegelmilch and Winer, 2020). Moreover, the company needs to ensure that
faster deliveries are made through developing efficient supply channel so that goods could be
consumed at faster rates by the buyers. Furthermore, body shop should include more eco friendly
products' so that more success could be added to the current operations of the firm.
CONCLUSION.
From the above report it can be concluded that business need to be operated in manner
through closely analysing various factors that are present in any business environment. Also, the

report has identified various HR strategies that are adopted by body shop and importance of such
strategies on success of the company. Further, the study had analysed importance of profit and
loss, balance sheet and cash flow statement in identifying the true position of company against its
competitors. Moreover, the report had analysed the financial management strategies through
identifying the role of finance department in body shop. Lastly, the study had analysed strength
and weakness of the quoted firm through proper SWOT analysis along with presenting certain
suggestions for improvement in future conduct of activities.

REFERENCES
Books and Journals.
Akter, S., 2021. Companies’ vision, mission, and core values focus on human resource
management. International Journal of Financial, Accounting, and Management. 2(4).
pp.343-355.
Al-Haddad, S. and et.al., 2020. FACTORS AFFECTING GREEN COSMETICS PURCHASE
INTENTION. Journal of Management Information and Decision Sciences. 23(4).
pp.332-342.
AYDIN, S., ALAZMA, R. and Çora, H., 2020. The Influence of Price, Brand, and Store on
Turkish Women's Purchase Intention in Cosmetics Market. Turkish Studies-Economics,
Finance, Politics. 15(4). pp.1879-1898.
Fischer, M., 2021. 7 The future of personal finance management. In Fintech Business
Models (pp. 140-156). De Gruyter.
Liebl, F., 2018. What Is Strategic Marketing in an Innovation Society?. In Innovation Society
Today (pp. 165-181). Springer VS, Wiesbaden.
Murphy, K. R., 2020. Performance evaluation will not die, but it should. Human Resource
Management Journal. 30(1). pp.13-31.
Sahaf, M. A., 2019. Strategic marketing: making decisions for strategic advantage. PHI
Learning Pvt. Ltd.
Schlegelmilch, B. B. and Winer, R. S. eds., 2020. The Routledge Companion to Strategic
Marketing. Routledge.
Online.
The Body Shop SWOT Analysis, Competitors & USP. 2021. [Online]. Available
through :<https://www.mbaskool.com/brandguide/lifestyle-and-retail/9339-the-body-
shop.html>.
What Does a Finance Department Do?. 2021. [Online]. Available through
:<https://www.indeed.com/career-advice/career-development/what-does-finance-
department-do>.

APPENDIX.
BALANCE SHEET

PROFIT AND LOSS ACCOUNT

ANY OTHER RELEVANT PICTURES/GRAPHS/INFO