Analysis of Bestway Holdings' Strengths, Weaknesses, and Performance

This report provides a comprehensive business analysis of Bestway Holdings Limited, a multinational conglomerate. It begins with an introduction to small businesses and the company profile, outlining its strengths (diversified operations, international reputation) and weaknesses (lack of research and development, high transport costs). The report includes a financial analysis using comparative measurements, focusing on liquidity and profitability ratios, comparing Bestway with WH Smith Limited. The analysis covers the years 2001, 2002 and 2003. The report calculates and interprets various financial ratios such as current ratio, quick ratio, gross profit margin, and net profit margin, and Return on Capital Employed. The report concludes with recommendations for addressing weaknesses and improving overall business performance.

Small Business
Enterprise

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Profile of the organisation and its strength and weakness....................................................1
1.2 Analysis by using comparative measurement of performance.............................................3
TASK 2............................................................................................................................................4
2.1 Recommendation and justification for weakness..................................................................4
2.2 Appropriate ways for retaining existing performance..........................................................5
2.3 Suggestion for new filed where company can be expanded ................................................6
TASK 3............................................................................................................................................6
3.1 Assessment of existing business objectives and plans..........................................................6
3.2 Revising business plan to incorporate appropriate changes..................................................8
3.3 Preparing an action plan to implement changes....................................................................9
TASK 4..........................................................................................................................................10
4.1 Impact of proposed changes on business and its personnel................................................10
4.2 Ways changes will be managed in business........................................................................11
4.3 Monitor improvements in performance of business over a given time scale......................12
CONCLUSION ............................................................................................................................13
REFERENCES..............................................................................................................................14
APPENDIX....................................................................................................................................16
.......................................................................................................................................................17

INTRODUCTION
Small businesses are privately owned sole proprietorships, partnership and corporation
that have minimum workers and less revenue (Definition of Small-Scale Enterprise, 2018). It is
identify as an enterprise which regulates on a micro scale and needed few labour, machines,
capital is known as small business. This type of company employ a few number of employees
and have minimum volume of sales (A. Harris, and Patten, 2014). In small organisation, different
kinds of micro scale are considered such as hair dressers, grocery stores, photographers, guest
houses, restaurants, barber shops and other stores.
This report is based on Dragon Dan series which is developed by BBC. The chosen
company is Bestway (Holdings) Limited, it is a British Multinational conglomerate company in
United Kingdom, London. This assignment discussed about the business profit and its strength
and weakness. Comparison between two organisation through income statement and balance
sheet also determined in this study. Company expand their business operation in new area so in
this they face different issues which is also determined in this report. Business and action plan to
incorporate appropriate changes on the company and its personal which is also shown in this
project.
TASK 1
1.1 Profile of the organisation and its strength and weakness
Bestway (Holdings) Limited is a British Multinational Conglomerate organisation based
in United Kingdom, London. It was founded in 1976 by Sir Anwar Pervez at UK, London. It is a
Pharmacy, banking, Cement and wholesale industry in all over the world. In the company, there
are approx 33,600 employees are work with the aim of achieving long term and desired goals or
objectives of respective business (Abebe, 2014). In wholesale business activities contains the
general food stores operations that sell different drinks, groceries items to the customers at
reasonable price. It also exports and manufactures cement for clients in Sri Lanka, Middle East,
South Africa, India and Afghanistan. In Addition, the organisation gives banking facilities to
customers or buyers in the Asian. They develops new & existing investments and commercial
properties, containing office space, big warehouse units, industrial estates, owner-occupied
warehouse and other aspects. Further, it directs their business operations and functions in the
pharmacy which covers different areas such as North America, South Asia, East Africa etc.
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Profit of company:
Company profile Description
Name Bestway (Holdings) Limited
Industry Banking, Cement, Pharmacy, Wholesale
Founded 1976
Founder Sir Anwar Pervez
Headquarters United Kingdom, London
Revenue £3.4 billion
Number of workers 33,600
Website Www.bestwaygroup.co.uk
Phone [phone]
Address Head Office, Abbey Road, Park Royal, London
NW10 7BW,UK
Strength and weakness of the Bestway (Holdings) Limited
Strength Weakness
 One of the main strength of such
business is operates in different fields
like Banking, Cement, Pharmacy,
Wholesale.
 Surplus Production for export and
local market.
 International reputation is very good.
 Easy accessibility of production
resources.
 High cost efficient production
management is a strong point of the
company.
 Lack of development and research
 One of the main weakness of such
organisation is cost of transport.
 Dependence on cartelisation for up to
revenue.
 Market share of the respective firm is
low in compare to the business target.
 Marketing program level is also very
low.
 Practices of management is very
traditional.
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 Good quality of cement and effective
control policy also a big strength of
business organisation.

1.2 Analysis by using comparative measurement of performance
Financial statement is identify as an essential technique which is used by each and every
organisation in order to evaluate business performance and profitability. In this, business entity
measure their all ratio in an effective and efficient which help manager and other stakeholders
can understand the real position of the company. Ratios are determined by the enterprise making
comparison of another organisation (Brustbauer, 2016). There are large number of the ratios that
can be utilised by the company such as current, liquidity and profitability ratio. Under this
scenario, comparison between two organisation such as Bestway (Holdings) Limited and WH
Smith Limited is going to be completed with the use of ratio analysis. All these are explain the
financial position and statement of those businesses.
Ratio Analysis: It comprises in order to analysis the financial efficacy and performance
of an enterprise by implementing all information from the historical and existing accounting
statements. Large number of the capitalist are common with similar ratios which assist to
analysis the profitability and performance of an enterprise. There are some ratios such as current,
liquidity and other profitability ratios. All these are determine as below:
Liquidity Ratio: These type of analysis assess the business capability in order to succeed
its short term liability as they are grow due to employing company's liquid or current assets.
Such type of ratio includes liquid, current and working capital ratio.
Profitability ratio: This analysis effects on business performance and profitability on
manufacturing the products or earnings maximum amount of profit (Burrows, 2015). This ratio
assist the managers and investors of the company to understand regarding which gain more. It
includes different ratios such as gross profit and net profit margin.1. Calculation of Gross profit margin: Gross profit/sales*1002. Measurement of Net profit ratio: Net profit/sales*1003. Calculation of current Ratio: Current Asserts / Current Liabilities
4. Measurement of Liquid Ratio: Current assets- Stock+ Prepaid expanses/ Current
Liabilities
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2002
Measure Bestway holding limited Smith retail limited
Liquidity Ratios
Current Ratio 146375/101169=1.44 627199/558118=1.123
Quick Ratio 92985/101169=0.92 598289/638910=0.94
Profitability Ratios
Gross Profit Margin 36710/ 724169 *100=5.069
%
82573/1483510*100= 5.56%
Net Profit Margin 16825/724169*100= 2.32% 59279/1483510= 3.99%
Interpretation of Liquidity ratio:
In the above measurement, this is seen that the respective firm current ratio is high as
compare to another organisation. So it is identify as Bestway is much efficient in order to
succeed its debts than the WH Smith Limited. In this liquid ratio of the respective organisation
is also much efficient as compare to other.
Interpretation of Profitability ratio:
As per the above calculation, it has been observed that Gross profit ratio of WH Smith
Limited is more efficient as compare to respective firm. According to the measurement of net
profit ratio the results are same to gross ratio.
Profit and loss statement of Bestway (Holding Limited) for the year 2002 and 2001
Particulars 2002
£'000
2001
'000
Turnover 724169 746251
Cost of sale -687459 -708587
Gross profit 36710 37644
Administrative expenses -18483 -17189
18277 20475
Other operating income 7740 5046
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Operating profit 25967 25521
Interest receivable 2098 2790
Interest payable -2735 -4200
Profit on ordinary activities before tax 25330 24111
Taxation -7419 -5150
Profit on ordinary activities after taxation 17911 18961
Minority interest -1086 -513
Retained profit or net profit 16825 18448
Profit and loss statement of WH Smith Retail Limted for the year 2003 and 2002
Particulars 2003
£'000
2002
'000
Turnover 1445637 1483510
Cost of sale 899255 911980
Expected cost of sales 35700 -
Total cost of sale -934955 -911980
Gross profit 510682 571530
Distribution cost -424904 -402001
Administration expenses before exceptional item -81760 -89956
Exceptional operating expenses -82310 -
Operating loss and profits -78292 79573
Net payables -1922 -7281
Profit and loss ordinary activities before taxation -80214 72292
Tax on profit and losses on ordinary activities -3763 -15113
Profit and loss on ordinary activities after tax -83977 57179
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Dividends - -100000
Net profit or retained profit -83977 -42821
Return on capital employed
Formula = Operating profit / Capital employed * 100
Bestway holding company
For the year 2002
Capital employed =153593
Operating profit = 25967
ROC = 25967 / 153593 * 100 = 16.90%
For the year 2001
Capital employed = 145117
Operating profit = 25521
ROC = 25521 / 145117 * 100 = 17.58%
ROC of WH Smith retail LTD
For the year 2003
Capital employed = 225761
Operating profit = -78292
ROC = -78292 / 225761* 100 = -34.68%
For the year 2002
Capital employed = 312348
Operating profit = 79573
ROC = 79573 / 312348 * 100 = 25.47%
Calculation of current ratio, gross profit margin and net profit marine of Best Way
company
For the year 2002
Current ratio: 146375/101169=1.44
Quick ratio: 92985/101169=0.92
Gross margin: Gross profit margin / turnover*100
= 36710/ 724169 *100=5.069 %
Net profit margin: net profit/ turnover *100
= 16825/724169*100= 2.32%
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For the year 2003
Current ratio: 111882/114446 = 0.977
Quick ratio: 34390 / 114446 = 0.30
Gross margin: Gross profit margin / turnover*100
= 37263 / 719058 *100=5.182%
Net profit margin: net profit/ turnover *100
= 19517 / 719058*100= 2.714%
as per above analysis it is seen that the quick ratio and current ratio goes down due to
investment in stocks and investment. Interest expenses and net profitability ratio. Profitability
ratio also get increased. With the optimum return on investment.
Calculation of current ratio, gross profit margin and net profit marine of WH smith
Limited for 2002 and 2003
For the year 2002
Current ratio: 627199/558118=1.123
Quick ratio: 598289/638910=0.94
Gross profit margin: 82573/1483510*100= 5.56%
Net profit Margin: 59279/1483510= 3.99%
Calculation for 2003
Current ratio: 568814 / 538529 = 1.056
Quick ratio: 423242 / 538529 = 0.789
Gross profit margin: 510682/1445637*100 = 35.325%
Net profit margin = -83977/1445637*100 = -5.80%
Comparison between ROI and financial performance of Bestway holding company
As per the analysis it is compared that the return on investment of best way company get
increased. The reason of increased ROI indicates towards the financial resources was utilised in
investments for the year 2002. it enhanced the liquidity and earning capacity of organisation with
its investments.
Comparison between ROI and financial performance of WH Smith retail LTD
Due to high debts and interest expenses organisation have to bear the loss for the year
ended 2003. however the operating profit was favourable in the year 2002. organisation positive
rate of return on investment as 25.47%. expected operative expenses become the reason of
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negative rate of return. It effected the profitability of organisation. It is estimated that this may
cause reduce the earning per share of WH smith retail LTD. In 2003 Loss occurred worth -83977
which causes the net profit margin -5.80%. and gross profit margin was 35.32%.
TASK 2
2.1 Recommendation and justification for weakness
In the company there are different weakness which are face by the business in their
operations and functions. It is necessary and essential for the company to overcomes their
weakness in an effective manner. From this business can do its operations and activities in an
accurate manner as well as maximise its functions in international level (Cowling and et. al.,
2015). Such kind of the organisation deals in different areas like Banking, Cement, Pharmacy,
Wholesale etc. So in this they face large number of the issue which hinder the business
performance and profitability in a positive and negative way.
In the organisation, there are different problems which is emphasised by the business
entity such as Lack of development and research, cost of transport, Dependence on cartelisation
for up to revenue and other problems. In order to overcome all weakness, they should try to
provide better facilities to fulfil basic needs and requirement of children in a quick manner. In
this they tries to provides different training and other programmes to their employees so they can
get higher knowledge and treat their all customers in a friendly way (Curran and Storey, eds.,
2016). So all employees are have better skills and talent, they try to perform their best and
achieve long term goals and objectives of company in limited time period. In order to decrease
all issues in an effective and efficient manner they should try to conduct research and
development program. Such kind of secession help the manager in regards to identify basic
needs and wants of the customers towards business products and services.
2.2 Appropriate ways for retaining existing performance
Bestway holding limited is a firm that provides different products and services to the
customers. Their long term goal is to enlarge business operations so that they can provide
services to large number of clients not even in their nation but also through out the world. There
are different ways through which their current performance can be more strengthened and
maintained. Some of them are listed below :
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 Maintaining proper record of Employees : Bestway holding limited should try to keep
records of their workers so that in the case of any need they easily search that information
and provides the same to the needy person. They have to maintain a sheet of activities
that they are going to provide to their workers in order to be clear about their work loads.
Besides this, they can also keep record of their performance as this helps them in
determining about the ability of any workers and after that they should offer them
services in accordance to that so that they can develop appropriately. Arranging learning based programmes : Bestway holding limited should conduct
several programmes to the employees so in which they can maximising their skills and
knowledge on particular matter. (Storey, 2016) Through this, performance of overall
corporation gets improved and by this way they can seek attention of large number of
customers. So it is essential for the organisation to achieve maximum profit and revenue
in limited time period.
 Developing sound relationship : In order to improve the working capabilities of their
enterprise, they have to maintain positive and healthy relationship among staff members
as well as directors. Apart from this, they can also motivate their employees for giving
proper information to the customers and inspire them to share all issues in an effective
manner. (Wajdi, Ummah and Sari, 2017). By creating sound relation, firm can make a
work like a family and each tasks gets accomplished more easily and also on correct time.
2.3 Suggestion for new filed where company can be expanded
Bestway holding limited provides their services and products in its different areas such as
cement, pharmacy, banking and wholesale. Main aim and objectives of such organisation is to
provide effective services or products to the customers in an effective and efficient manner. They
expand their business operations and function in various area where they maintain their strength
as well as achieve long term goals and objectives. There are different ways where company
enlarge their business operation and function in smooth way are describe as below:
New Avenues: It is identify as a large number of the attractive place where entity expand
their business operation and function in smooth manner. Such organisation dealing in different
field such as wholesale, banking, pharmacy and cement (Flynn, McKevitt and Davis, 2015).
They should covers all area for producing their quality products and effective services to the
customers in an effective and systematic manner. So in this revenue and sales of the company
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automatically increase essentially. They should opened its new branch and site at Plymount,
Burrington Way. These are attractive places where business organisation enlarge their all
activities as well as attain desired objectives in limited time duration.
New products and services: Bestway holding limited gives different types of goods and
services to the clients at affordable price. In this business should gives snacks, juices, biscuit,
tobacco and other beverages to the customers. They also provides cements and other effective
goods to their target and potentials clients at reasonable cost. They should merge their all
business operation and activities so they can increase their sales and revenues as compare to
another organisation. Company should try to give online facilities and home delivery of goods so
they can maintain long term relation with their customers.
Development in existing products or services: In order to develop existing services and
products in marketplace as well as customers mind, company should try to use different kind of
communication channel. It includes promotion, advertisement, public relation, posters and other
essential elements (Gërguri‐Rashiti and et. al., 2017). All this are help manager to introduce all
information and data about available commodity.
TASK 3
3.1 Assessment of existing business objectives and plans
Every organisation wants to achieve its goals in a set time frame. To attain targets in an
efficient and effective manner, corporations use different methods to analyse and research so that
they can find their current position in the market (Harris and Patten, 2014). A goal can be of both
short and long term which firms want to accomplish within stipulated time frame. All of these
things, a company can make huge profit and give tough competition to rivals in marketplace.
Bestway holding limited is a industry which deals in different products and service in the United
Kingdom, London. They give effective products and services to the target or potentials clients at
reasonable cost price. Also, this practice is giving them more earnings from others. This
company’s vision, mission and objectives are stated as below:
Business Objectives:
 Main objective of Bestway holding limited is to give effective and innovative products or
services to the customers.
 Building long term relations with customers by providing qualitative products and
effective services.
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