Exploring Business Model Innovation in Retail: A Literature Review

The purpose of this assignment is to provide an overview of recent literature pertaining to business model innovation in the retail sector. The study examines various articles that discuss strategies for enhancing competitive advantage through innovative models. This includes works by Visnjic et al. (2016) which highlight product and service innovation's impact on performance, and O'Reilly & Tushman (2013), focusing on organizational ambidexterity as a strategic approach. Additionally, the literature covers how cultural integration in mergers can affect business outcomes, drawing insights from Stahl et al. (2013). Overall, this review synthesizes findings across different studies to offer comprehensive insights into effective innovation practices for modern retail businesses.

Running head: DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Determinants of profit in general retail sector
Name of the Student:
Name of the University:
Author’s Note:

1DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Executive Summary
This paper has been framed in order gain the understanding about the impact of financial differences that is prevalent in case of
home improvement retails of Kingfisher Company. The other three companies such as Home Depot Inc., Lowe’s Company Inc. and
TESCO are also discussed here. The introduction of the paper discusses about the financial condition and its different aspects that are
available in the home improvement retails. It is seen that there are various dimensions that have an impact on the financial condition
of the organization. With the advent of globalization, various employees enter the market of retail industry of Kingfisher. The problem
statement of the topic along with the aims and objectives of the research are even discussed in order to create a clear idea about the
factors that would be taken into consideration in this paper. The research questions would be answered in this paper and therefore are
constructed in this paper. The literature review reveals the suggestions that have been given out by the researchers who have
undertaken research on similar topics. The methodology of the research comprises of positivism philosophy, deductive approach and
quantitative research design for the completion of the paper in an effective manner. Descriptive research design is even used in order
to understand the responses of the participants explicitly. The data has been collected with the help of questionnaire and comprises of
the close-ended questions. Then, we start the secondary data research with the help of other three retail sectors of UK. The analysis of
the data has revealed that there is an impact on the financial marketing from retail industry and with the implementation of various
policies that could be implemented. The comparative study of budget of four retail sectors is provided in the report.

2DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Table of Contents
Chapter 1: Introduction................................................................................................................................................................................4
1.1. Background of the Study..................................................................................................................................................................4
1.2. Problem statement for the research...................................................................................................................................................5
1.3. Rationale for the Study.....................................................................................................................................................................5
1.4. Research Questions...........................................................................................................................................................................6
1.5. Research Aims and Objectives.........................................................................................................................................................6
1.6. Research Methodology:-...................................................................................................................................................................6
1.7. Structure of the Research paper........................................................................................................................................................7
Chapter 2: Literature Review.......................................................................................................................................................................7
2.1 Introduction of objective of chapter:.................................................................................................................................................7
2.2 Subject Matter of Research................................................................................................................................................................8
2.3 Elaboration of Research Question1.................................................................................................................................................10
2.4 Elaboration of Research Question2.................................................................................................................................................11
2.5Elaboration of Research Question3..................................................................................................................................................11
2.6. Elaboration of Research Question4:...............................................................................................................................................12
2.7. Elaboration of Research Question5................................................................................................................................................15
2.8. Conclusion of Literature Review....................................................................................................................................................16
Chapter 3: Research Methodology............................................................................................................................................................16
3.1. Introduction:...................................................................................................................................................................................16
3.2. Research Philosophies:...................................................................................................................................................................16
3.3. Justification of Research Philosophies:..........................................................................................................................................16
3.4. Research Design and Justification for choice:-..............................................................................................................................17
3.5. Qualitative and Quantitative data Collection: -..............................................................................................................................17
3.6. Research Methodology and Justification: -....................................................................................................................................18
3.7. Validity and Reliability of data: -...................................................................................................................................................18
3.8. Ethical Considerations: -.................................................................................................................................................................18
3.9. Limitations of the Study: -..............................................................................................................................................................18
3.10. Conclusion of the chapter: -..........................................................................................................................................................19
Chapter 4: Data Analysis and Findings.....................................................................................................................................................19
4.1. Introduction and Objective: -..........................................................................................................................................................19
4.2. Sample Characteristics: -................................................................................................................................................................19

3DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
4.3. Data Analysis for Objective1: -......................................................................................................................................................19
4.4. Data Analysis for Objective2: -......................................................................................................................................................21
4.5. Data Analysis for Objective3: -......................................................................................................................................................21
4.6. Data Analysis for Objective4: -......................................................................................................................................................24
4.7. Data Analysis for Objective5: -......................................................................................................................................................24
4.8. Conclusion: -...................................................................................................................................................................................25
Chapter 5: Conclusion and Recommendations..........................................................................................................................................26
5.1. Introduction and objectives.............................................................................................................................................................26
5.2. Review of Research Objectives......................................................................................................................................................26
5.3. Findings and Answers to the Research Questions..........................................................................................................................27
5.4. Recommendations...........................................................................................................................................................................27
Annotated Bibliography:...........................................................................................................................................................................28

4DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Chapter 1: Introduction
In the present consistently changing worldwide business environment especially in Europe, the issues related with influence of
retail industries in home development for knowing about these numerous outputs have gained significance. The reason is that the
companies operating in the economy have been able to attain success. The importance of culture and variations in types of home
development has turned out to be particularly essential especially for the companies performing in the global markets and comprising
of employees (Moran, Abramson and Moran 2014). It has been viewed home improvement retails have a significant impact on the
performance of Kingfisher and therefore the company needs to look into various aspects that are associated with home improvement
in their day-to-day activities in order to operate significantly in the worldwide economy (Burton 2004). Here, we are also interested in
three more home improvement retailing companies that are – 1) Home Depot Inc. (Home retail group). 2) Lowe’s Companies Inc 3)
TESCO
The influence of retail marketing strategies on profit performance was investigated for a sample of four companies for the
period of five years (2013-2017). Sales growth, market share, capital-to-labour-ratio and average inventory were found to be
significantly associated with profit performance as hypothesized (Burt and Limmack 2001). In this report, we are eager to evaluate the
factors and select retail-marketing strategies.
This section of the paper therefore would introduce the topic that is under consideration by discussing the home development
and even providing an elaborate idea about the background of the study. This would be influential for the construction of the research
objectives and the identification of the problem statements that would lead to the construction of the research questions (Reynolds et
al. 2005). The proper construction of the introduction of the paper would aid the researcher in completing the paper precisely. The
details of all four retail companies and their budget accounting factors are discussed below.
1.1. Background of the Study
Impact of retail market has significant factors for every single company that are functioning in every kind of industries. As
clarified by Hemmert, Bstieler and Okamuro (2014), these perceptions have turned out to be considerably more fundamental for the
construction of the paper with respect to the construction of the agreements, internationalization of the several procurements, joint
venturing and collaborating in accordance to the retail industries. The retail market depends upon customer loyalty. Home
improvement and furniture retailers have found the relation between customer loyalty and customer satisfaction with the help of extra
efforts (Casadesus‐Masanell and Zhu 2013). Corporate social responsibility (CSR) of the retailer influences the retail industry in case
of service quality (Buzzell et al. 1975). Service quality of a product can be perceived as the outcome of the assessment wherein
customer compares the expected product quality to the actual product quality (Alrubaiee & Al-Nazer 2010). The financial assessment
is done based on functional, technical quality and image of the retailer. The functional quality of the product evaluates the behaviourist
attitude and usability of the home furnishing. The technical quality relates to the end use of the products of Kingfisher. The image of
the retailer is also taken into consideration to assess the quality of the furnishing (Pahl and Richter 2007).
It has been viewed in accordance to the other industries there has been an ascent in the important coalitions in the retail
industries and this in a way has even raised the significance of the impact due to the interaction of the employees in the retail
industries. It can enhance the viability of the organizations and give the companies an effective edge in the economy. SWOT analyses
of the retail companies compare the interrelationship and competitions.
Kingfisher is one of the leading DIY retailers of UK employing about 27000 full time employees. In the UK, the group has
nearly 360 B&Q DIY superstores. It includes 29 former Focus stores and a rapidly expanding chain of 215 Screwfix trade counters.

5DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
The group is one of the UK’s most international retailers with extensive overseas DIY interests. Kingfisher has more than 950 stores
in eight countries in Europe and Asia.
Home Depot Inc. (Home retail group) owns Argos, the UK’s high street and catalogue retailer. The home-base have second
largest DIY specialist chain. Home Depot Inc. has almost 750 stores employing more than 30000 staffs. Its home base has more than
340 edge-town-superstores with about 19000 employees. Home Depot Retail also owns the Habitat brand that includes the UK
website and three London stores, and stocks its products in store and online at home base.
Lowe’s Companies Inc. is the UK’s largest home improvement chain and employs almost 75000 staffs. The retailer has close
to 2500 outlets. A vital piece of the company’s strategy is its advantage card that is thought to be the world’s largest smartcard loyalty
scheme with more than 17 million active holders in 2013.
The TESCO stores increased substantially over the period (2011-2017) to 3739 stores. The multinational operating grocery and
general merchandise retailer TESCO PLC founded in 1919, employs over 500000 people worldwide. The product portfolio of TESCO
includes food and beverages, home appliances and financial services. TESCO is one of the leading supermarket brands in UK,
consistently ranking highest in terms retail market share.
1.2. Problem statement for the research
The statement of the issues has been implemented the researcher to construct a research with respect to the topic under
consideration. It is observed that with the introduction of liberalization and globalization there has been entry of new retail companies
in the market of UK along with the financial gain is subjected to several obstacles. Therefore, determination of the effects of these
determinants is required to be detected in order to construct various strategies (Broeren and Mary Ann 1981). Retail industries are a
kind of industry that keeps on developing with the advent of new and improved technologies and mechanisms and hence the
management of the retail companies requires analyzing each aspect of their business (Rees-Caldwell and Pinnington 2013). The effect
of orientation system among the employees needs proper supervision so that the companies could make use their advantages and in
case of any discrepancies, the issues can be resolved and a better working environment along with a better bonding among the
employees could be established (Bauer and Matzler 2014). The present research aims to examine means of profit amount to advance
furniture and home improvement retail sector of Kingfisher between competitors that would lead to better economical and financial
benefits for the retailer. Due to entry of new retailers, employees with expertise in the arena of furniture manufacture and home
improvement in a state of dynamics hopping from one retailer to another (Padgett 2016).
Various limitations and constraints are related with every research thesis. With respect to this paper, it has been observed that
the restriction of time has been one of the key factors that have limited the analyst to collect the data from the respondents accurately.
It is even seen that gaining in-depth knowledge about the financial management of the retail industries has been significantly difficult
and obtaining the strategies that have been put forth by various retail organizations has been difficult (Ghobadi and Mathiassen 2016).
Hence, data has been gathered with the help of selected respondents and authenticity of the data has not been examined as the
respondents may be reluctant to share their personal feelings regarding any question and may have answered ambiguously to the
questions (Batjargal 2013). Hence, the recommendations for the future issues with respect to the financial management may not be an
accurate one and this may lead to discrepancies within the retail industries.
1.3. Rationale for the Study
The rationale for the study has been discovering the various aspects that exist in home improvement of retail industry. United
Kingdom is a developed country with a small amount of population. The country comprises of a population that has a variety of

6DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
requirements and therefore, undertaking the analysis with respect to the citizens of the United Kingdom would yield significant results
for the paper. With the advent of globalization and liberalisation of Europe, there has been entry of various multinational retail
companies in the country as the country has a broad prospect for retail marketing (Baltas et al. 1997). The country is utilising
segments in the home development industry and there is availability of sufficient and economical impacts that has influenced the
companies to establish themselves in the country (Chen, Lin and Yen 2014).
The multinational retailing companies even migrates employees from various parts of the world in order to fill the gap that is
available in their business. Every individual has their own preferences and how they behave and react is according to the cultures they
belong country wise and sub-continent wise. Interaction and communication among employees lead to mixture of various preferences
of UK, France, Germany and Netherlands. Such orientation system has certain influences that would be discussed in this report. Retail
industries require employees from various backgrounds and therefore the impact of varieties of home improvement are mainly
observed in this sector. Hence, the paper has been constructed with respect to this topic.
1.4. Research Questions
The research questions that have been framed are in respect to the problems that have been discovered by the researcher with
respect to the improvement retails of the Kingfisher. The research questions would be utilized in order to course the research and
determine the impact of financial analysis in retail industry of Kingfisher. The research questions are given as follows:
Q1. How can financial analysis have an impact on the four retail industries in Kingfisher?
Q2. What actions could be undertaken by the management in order to improve the impacts of financial analysis of four companies
except Kingfisher?
Q3. What are the measures of finance of Kingfisher have inter-relationship over the years?
Q4. What are the factors that influence of correlation in retail market year wise that help to undertake the market strategic variables?
Q5. What are the strength, weakness, opportunities and threats of four companies (SWOT) in the future retail sector and the
correlation between various measures?
1.5. Research Aims and Objectives
The objectives and aims of the paper has been the key and essential factors that would be effective for the construction of the
paper as these objectives would be supportive to the researcher for the conclusion of the research paper in an effective way. The aims
and objectives with respect to this paper are given as follows:
 To determine the influencing factors that influences the financial market in the retail sector and the association in the retail
management between the employees and the management.
 To determine the dimensions of retail marketing that have an influence on the outcome of the industries.
 The actions undertaken by the retail management in order to deal with the issues related to home improvement make the
product/service more attractive in the current market.
 To optimize the profit related to financial assessment of the Kingfisher from 2013 to 2017.
 To find the estimated size of the market, project market share, predictions under future trends and estimate the target market.
1.6. Research Methodology:-
The research methodology for the research study is quantitative with an exploratory approach. A deductive research approach
is used in this study.

7DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
1.7. Structure of the Research paper
This section provides a brief structure of the overall thesis paper that would be formulated later in this paper for the completion
of an authentic research. It has been noticed that the first segment of the paper comprises of the introduction of the paper where a brief
background about financial analysis and the meaning of retail management has been provided. The background of the country is even
discussed after which the aims and the objectives of the paper have been put forth so that the researcher can move ahead with the
paper precisely. The research questions as well as the statement of the problem have been constructed as it aids the researcher to
construct a course with the help of which the whole research paper would be completed effectively.
The next segment of the paper consists of the literature review with the help of which the researcher has gained knowledge
about the various processes and suggestions that have been put forth by researchers who have already undertaken similar researches
previously and have provided various effective results (O'Reilly and Tushman 2013). The research methodology provides the course
that the researcher has followed in order to complete the paper effectively and it has been seen that in this section that equipment and
tools that are used for gathering the data and the method of selecting these tools are even discussed. Hence, the author would provide
conclusive evidence for selecting these tools and how these tools would be used for gathering data that is essential for this paper. The
next chapter would provide in-depth analysis of the data that has been collected in order to reach results that would be influential for
this paper. The last section of the paper discusses the conclusion and the recommendation that is essential in order to find out the
results and whether the identified problems have been answered and rectified. The recommendations gathered from this paper can be
used by the retail industries for the improvement in their financial management.
Chapter 2: Literature Review
2.1 Introduction of objective of chapter:
The “Kingfisher” retail industry comprises the businesses relating to development, maintenance and the publication of
financial management scheme. These are utilised and apprehended in case of different business models that may be maintenance
based. Financial development in terms of profit and management is a human centric as also a socio managerial activity that is
influenced by factors like all other human practices, preferences, availability, furnishing choices (O’Reilly et al. 2014). The financial
condition of retail market has been affected more due to the nature of globalisation in the financial development. The retail industry
being a very intensive industry related to the human capital is experiencing a new era in which the financial development personnel
need to adapt to the multicultural service environments. In order to get benefits from the advancements in technology as well as the
finance accounting and analyze, the multicultural scenarios should be adopted. In Kingfisher, there is the existence of a multicultural

8DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
workforce and the employees need to adjust accordingly. The analytical finance influences need to be seamlessly incorporated into the
work environment so that the total output of the company does not suffer due to the financial crisis.
In this connection, it must also be mentioned that the understanding of the retail industry of Kingfisher as well as the nature of
the business need to be understood in order to ensure that the company prospers. No sort of glitches are encountered due to the
inexperience in financial management, lack of knowledge regarding the retail industry as also the inability to manage. These issues if
addressed in the correct amount of profit ensures that the overall company stability as well as the financial stability for the ultimate
betterment of the retail industry business (Buxmann, Diefenbach and Hess 2012).
Retail companies all around the World expand across the borders and this have led to the enhanced accessibility of the small as
well as the large businesses and deals. Multinational and cross-cultural teams are becoming common as the businesses are bound to
benefit from a knowledge base that is increasingly diverse as well as from insightful approaches to the challenges of business (Mertens
2014). Kingfisher is facing the benefits pertaining to insight as well as expertise along with the global obstacles. This is due to the case
of culture as well as in case of international business.
In case of traditional companies, the importance of retail sector is changing from being a supporting business of being a core
business. The state of finance development and retail services of Kingfisher is in a sorry state. There is a sense of disinterest or low
level of inclination of the Kingfisher professionals towards the processing and development management. This disinterest causes a
decline in the nature of the retail industry development. Due to this, people lose interest and trust in the business capabilities of
Kingfisher. It is necessary to first work towards the retail industry a dependable one in order to enhance the level of work or the
business. The retail industry business of Kingfisher requires to be improved in order to be widely accessible and beneficial to people
all around the World. There is no care or concern about the level of the performance of the employees.
In many cases, during the time of analysis of cost-effective as well as attractive options for the development of retail market,
the effect of the financial analysis is neglected or overlooked. The variability due to the crisis prevents the proper interaction of the
teams and their members and hence hampers the progress of the company. Kingfisher had a strong performance in the year 2013 to
2017 as it totalled group sale of 60% of generated overseas. The group’s domestic sales remained flat for the period, though B&Q UK
and Ireland’s retail profit increased by 10%. The damaged group sales are the reason behind percentage of dropping of retail
improvement. Kingfisher blamed wet weather in the UK and northern Europe for significantly affecting footfall. During this period,
the UK was particularly hit as retail profit plunged and like-for-like sales dropped. The wet weather also meant seasonal product sales
fell, forcing the retailer to slash prices to closer stock.
Tesco generated annual sales in 2016/17 of 75.17 billion pound, up 4.5%, for the financial year to February 2017. Of this
figure, 52.6 billion pound was generated in the UK, a rise of 5% year on year, while UK online sales rose 10% over the period 2013-
2017.
2.2 Subject Matter of Research
Financial analysis in simple terms could be defined as a crucial step before invest in a business opportunity or franchise. In
case of international business, there are different numbers of accepted norms that increase the chance of success by analyzing the
business concept. A feasibility analysis would evaluate a business concept to see if it is worth pursuing. The dynamics of the
differences of market structures are found at various levels of the organisation in which cases the subtle appearance is shown through
individualistic preferences. The findings of the surveys reveal that there have been several negative impacts on financial budget and on
organisation as well. Special skill, process, technology, knowledge, expertise and ability in unique to the business are done better than

Retailer Service Quality
Functional Quality
Technical Quality
Organizational Image
Customer Satisfaction
And Financial Profit
Customer Satisfaction
Managerial Policy
Customer Satisfying
Determinants
Financial Profit
Resource, Feasibility and
design Responsibility
9DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
any competitor. In order to understand the importance of the impact of the policies that actually affects the financial status of the
company. Increased level of proto-type of the product or service and competence prospective customers ensures that the barriers of
understanding are resolved. Our primary task is to identify a preliminary target, survey at least … people about their requirements, and
way of the product and service provide the benefits of the Kingfisher.
As our main aim and object is to obtain information about the current market by researching trends from 2013 to 2017 of
Kingfisher and analyzing the competition. We should determine the proposed business that has sufficient management expertise,
organizational competence and resources to be successful. Three other different companies like Lowe’s company and Home Depot
Inc. are taken into account and their customer satisfaction criteria and financial analysis was taken into account.
Figure: The flowchart represents that the quality of service comprises of three dimensions, which consists of the functional quality,
technical quality and retailers image. Furthermore, it highlights the impact created by retailer’s service quality dimensions on
customer’s satisfaction.
Evaluation of Management Expertise: -
The ability of the entrepreneur and management team is the reason of evaluation.
Design Responsibilities: -
We have to determine whether the responsibilities are too large or too small for the entrepreneur.

10DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Evaluate non-financial Resources: -
We are eager to find a sufficient employee pool, availability of office space, protection for properties, patents qualitatively and
quantitatively (Craven and Marston 1999).
Prepare a Financial Feasibility Analysis: -
Next, we are eager to start-up and other capital requirements including projected rate of return. The overall attractiveness of
the investment depends on three factors that are- Estimation of sales on annual basis, Estimation costs and budget, Estimation of
Break-even point and profitability.
After completing the financial feasibility analysis, we could consider personal income and financial needs (Chen and Miller
2015). Even, the best business concepts often need several years to take off and reach a desired profit. It might be best for us to permit
time to perform while beginning our business or put off the start-up until sufficient resources are on hand to supply us a regular source
of income.
2.3 Elaboration of Research Question1
Our research question is how financial analysis can have an impact on the Kingfisher industries in UK. We should also
understand the significance of association in the retail management between the employees and the management International business
deals are important part of any sort of business analyses and comprise of cross-cultural connectivity as well. Financial diagnostics and
consultation for businesses of all sizes would comprehend the immense profit of the Kingfisher. The factors include the concepts of
team unity, the risk taking capabilities, sensitivity towards particular cultures and so on (Moran, Abramson and Moran 2014).
We use extensive financial matrices to show the right business of future holds. The yearly report and consultation concentrates
on the current financial activities that need to be transformed, improved and maintained. A yearly financial analysis report and
walkthrough would guide the business away from financial pitfalls towards crucial scopes and onto the path of lower risk and
increased sustainable cash flow. Financial statements are simply that accept formatting to represent financial data from the income
statement and balance sheet. Statements display financial data in an accurate and uniform manner. The analyzed report gives the idea
about association and impact in a significant manner of Kingfisher Company.
These pre-conceived notions in case of the deal-sealing processes is destructive as some view it as a collaboration or a problem
solving process and the others consider it as a confrontational process. In case of the Kingfisher Company in UK, the people need to
understand that the sole importance needs to be given to the progress and the expansion of the business in terms of joint ventures as
well as sealed relationships instead of letting the differences conquer over the deals. It is done by making it difficult to overcome other
important hurdles already present in the retail industry (Lee, Trimi and Kim 2013).
Direct or the indirect forms of financial budget play a very important role in the successful development of the business in UK.
In certain cases, the customers may communicate based on their particular preferences that comprise of direct communicative
techniques. The confrontation of the different styles of furnishing and orientation in case of the business negotiations are bound to lead
to friction thus harming the overall business deals (Jansen, Cusumano and Brinkkemper 2013).
In the business world, the analysis is essential for the proper execution of the day-to-day operations. The meaning and the
necessity of the interpretation the overcome the barriers of choice that are the most important considerations that people need. In
several cases, business deals are lost due to the involved parties not taking the necessary time to learn about the cultures before their
interaction. The nature of the furnishing of different areas and several other differences of culture are responsible for the change in a

11DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
positive or a negative way in case of the different cultures. Thus, the change of the distinctive nature of the home improvement needs
to be kept in mind before the businesses are planned and conducted.
The building of an agreement is extremely essential in case of the business negotiations and the nature of the deals often vary.
The budget influences the ways in which the transactions and the negotiations are sealed. There are different ways in which a
transaction is processed. In case of different types of transactions, different sorts of inductive procedures are to be kept in mind
(Kirchmer 2012).
Another hugely important factor is the risk taking capabilities of organisation. The negotiating style needs to be understood,
the impact of the risk taking also needs to be utilised. The tendencies for the risk taking are dependent on the nature of the approaches
and the responses towards the states of the decision-making. These factors influence the business in the retail industry in UK.
2.4 Elaboration of Research Question2
Research question is to determine the dimensions of retail marketing that have an influence on the outcome of the industries.
Comprehensive financial analysis functions in a one-stop phase. Collaborating with the Kingfisher and other retail business has
provided the data and analytical tools necessary to a long-term strategy, growth planning and insights to avoid the potential turbulence
at the time of operating a business. An insight view of financial of company, yearly detailed analytics, analysis of future ventures and
scopes as well as assisting with managing the money would allow focusing opportunities.
In this process, evaluating business, projects, budgets and other finance-related entities to determine the performance and
stability, financial analysis is used to analyze some monetary investment. The entities should be stable, solvent, liquid or profitable in
nature. A financial analyst conducts analysis on the income statement, balance sheet and cash flow statement. The employee and
management team collaborate and influence the investment of Kingfisher and other Company. The result of association helps to
evaluate economic trends, set financial policy and build long-term plans for business activity. The identification of projects or
companies for investment is incorporated through the synthesis of financial numbers and data.
Sales of Home Depot Inc. have declined in three of the last four years with the rate of deterioration accelerating in financial
year of 2013 to 2017. During this period, Home Retail’s sales earned a huge total. The Company is dependent upon two segments that
are ‘Argos’ and ‘Homebase’. However, both the businesses suffered like-for-like sales declines. At Argos, laptops and tables sales
grew, but the decline in the consumer electronics market, especially TVs and video games systems, more than offset this rise. Overall,
group-operating profit has plummeted.
Lew’s companies Inc entered into a strategic partnership Walgreens, the largest drugstore operator in the US, to create a global
business. Walgreens has invested cash and shares to acquire equality interest in Boots and would acquire the remaining parts in next
few years. However, retail trading profit increased with its trading margin rising. International trading profit growth was significantly
more than domestic. During this period the group reported a decline in sales of retail health products while furniture and toiletry sales
increased.
2.5 Elaboration of Research Question3
Now we are interested to find the correlation undertaken by the retail management in order to deal with the issues related to
home improvement and make the product/service more attractive in the current market. Having a renowned hierarchy in the business
of Kingfisher, handling of disputes is a major issue. Businesses have a good combined effort that is originated by each individual
knowing what their job is and how to do it. Each person of the Kingfisher is expected to tactically deal with multi-tasks and issues

12DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
regarding particular job descriptions. The collaborative working environment between employees, officials and analysts give the
customer the feeling of teamwork and job satisfaction.
The actions that are to be undertaken in performance and dealing is appropriate customer service. Poor customer service
affects every aspects of the business and should be considered when company take action on any portion of the business. The purpose
of the business is to provide the service to a consumer who pays for the furnishing and home development. Few businesses operate in
a vacuum where money rolls in without having to deal with people.
Kingfisher rolled out the first own-brand range of clothing targeting tradesman and the “serious DIYer”. Home Depot Inc.
totalled sales up to the condition of Argos as a digital retailer. Argos aims to collect the product and customer service for sales that
would increasingly be managed online. Whereas, Lew’s company overhauled its consumer website and launched ‘order online, collect
in store’ concept, available in nearly all its UK stores. In addition, the retailer launched an extended offer in partnership.
2.6. Elaboration of Research Question4:
We are finding the scopes of improvement and the correlation of accounting factors in this segment.
Kingfisher:
Strengths-
1) Kingfisher is the market leader in DIY retailing in Europe via the dominant brands of in UK, France and Poland. Kingfisher is
the third largest DIY group in the world.
2) Chief executive of Kingfisher has given the company a strong sense of direction and delivered a step-change in operating
performance driving a strong recovery in profitability of UK.
3) Kingfisher did not have the structure and culture to maximize the opportunity to leverage the scale. However, it is not fully
targeted on a comprehensive programme of direct sourcing of products and furnishing common brands across the group.
Weakness-
1) DIY is a market whose underlying fortunes are tied to activity in the housing market and credit availability make outlook
problematic.
2) Estate size is relatively mature business and big out-of-town stores may have downsize the DIY market becomes more
multichannel.
3) Seasonal outdoor products are crucial businesses in northern Europe, making Kingfisher exposed to the vagaries of the
weather.
Opportunities-
1) Service innovation by targeting on product innovation and making the shopping method easier Kingfisher could grow its
business.
2) Kingfisher is developing an attractive new store format that focuses on stock availability and self-service with DIY lesson
workshops and elements.
3) There is a wide opportunity to grow the group’s share of the trade market, mainly via fast-growing chain in European countries
and the well-established chain in UK.
Threats-
1) Kingfisher is a natural beneficiary of sterling weakness in terms of the translation of non-UK earnings with most of its business
overseas.

13DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
2) The push to development common product ranges in the quest for sourcing efficiencies could hamper and overlook the
preferences of local consumer.
3) UK is an important contributor of group earnings.
4) Kingfisher has significant DIY competitors in UK. Leroy Martins is one of them. It could increase the differentiation and
effectiveness and exploit any weakness in Kingfisher’s operations.
Home Depot Inc.-
Strength-
1) UK home and general merchandise retailer Home Depot Group has a significant share of the market and leadership positions
in many product categories.
2) This company has a very strong record of delivering significant organisational and infrastructure transformations to decrease
operating costs, especially in the distribution and service chain.
3) Despite the recent pressures on profitability and dividend cover, home retail has a good record on working capital control and
cash generation. It also has net cash on the balance sheet as well as a significant receivables loan book.
4) The company is the best known brand in UK retailing and the group also owns some strong own-label brands.
Weaknesses-
1) Home retail’s strongest markets are under the year wise cyclical pressure of prolonged UK recession and the housing market
downturn, notably big-ticket furniture and furnishing and DIY.
2) Home retail has neglected making loss-making overseas acquisitions. However, it has also failed to decrease its dependency on
the UK market.
3) The typical customers of the company are much revealed to the job insecurity and credit availability constraints of mass-
market demographic.
4) Home Depot Inc. has avoided making loss-generating overseas acquisitions, but it has also failed to decrease ite dependency
on the UK market.
Opportunities-
1) The habitat brand re-launch should help to enhance customer loyalty in the form of booming sales of tablet PCs and e-readers.
2) The new US managing director of this company is very experienced in US multichannel retailing and brings a fresh approach
to the chain’s challenge.
3) They could enhance non-food retail range pursuing international market expansion strategy.
Threats-
1) Home retails claims that its rigid cost control has not hampered customer service standards.
2) Both Argos and Home base of Home Depot Inc. rely drastically on regular sales and price-cutting. However, inevitably
undermines customer confidence in initial pricing and encourages them to wait for the next promotional event.
3) Both the Home base’s principal competitors are well-managed while Home Depot faces myriad specialist and generalist
competition from Dixons and DFS to Amazon and Apple.
Lew’s Company Inc.:-
Strengths-
1) Lew’s Company Inc. has more than 2500 shops in Europe giving a dominant share of large and resilient market.

14DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
2) Lew’s is one of the most trusted brands in UK retailing, reflecting a strong heritage and the ethical image derived from a
financial operations.
3) The Lew’s dispensing business drives significant footfall from customers picking up prescriptions and seeking trade
opportunities.
4) The company has own-label brands, powerful loyalty cards and high margins.
Weaknesses-
1) Lew’s is so dominant that it would find hard to grow its UK market share further.
2) Despite the scale of economics, the business still struggles to make money and find a position in the market relative to
competitors.
3) Although the retail business has to be close to its customers, the declination may sometimes be exposed.
Opportunities:-
1) The increasing interest in personal health and wellbeing supplies plenty of potential developments.
2) The merger with the pharmaceutical whole sale of the retail company deals with chances of buying economics.
3) As well as contract manufacturing in furnishing, Lew’s company has further potential to sell the key product brands to
overseas and websites.
Threats-
1) All the big supermarket chains have considerably enhanced their furnishing departments in recent years. One-stop shopping at
supermarkets is a constant threat to Lew’s core business and customers.
2) Although the retail chain has failed to make much influence on Lew’s in current years, strong discount competitors are
appearing.
3) 3) They have diminished employee morale.
TESCO: -
Strength-
1) TESCO operates almost 7000 stores in the world. In the UK, TESCO provide about six different store formats to their
customers that vary in size and range of products.
2) TESCO superstores are standard large supermarkets that sell mostly food products and home improvements.
3) Most of TESCO’s annual revenue is generated from UK key market. Additionally, they sell products overseas too.
Weakness-
1) TESCO faces challenges of getting more and more market share in case of discount of outlets.
2) Their profit has been affected by bad debt from credit cards and high levels of household insurance claims.
3) TESCO’s lack of experience in some markets intends to enter, such as its own brand house furnishing and improvements.
4) Finally, TESCO needs to invest many cash in new web technologies for store refurbishment.
Opportunity-
1) The retailer profile of TESCO could prompt features, outlet contact details, management CEO, turnover development, banners,
website and web store.

15DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
2) They are trying to include the expansion of markets such as digital entertainment through the 80% investment in Blinkbox.
3) Online shopping can offer greater flexibility to customers who are leading busy family lives or have mobility issues.
Threat-
1) The current position as a number one the UK retail sector means that they are the target of consistent competition.
2) Wal-Mart and Lowe’s company Inc. are the TESCO’s largest global competitor and has necessary skills, resources, experience
and funds to cause TESCO problems.
3) The curry fluctuations in different markets over the countries are hampering the expansion effort of the company.
2.7. Elaboration of Research Question5
International business deals are crucial part of any sort of financial communications and comprise the cross-cultural connectivity
as well. We are eager to find the determining factors and its influential factors here. The immense diversity of the world’s cultures
makes it problematic for any negotiator no matter how well versed and experienced to comprehend all the retail companies of UK.
Globalization has led to the increased upbringing of the business in various countries including UK. The technology enables the
clients and customers to connect with the people easily all around the world. The availability before making a decision requires to be
understood in order to ensure the effective running of the companies. In various cases, the availability is not present so the businesses
are bound to suffer. The government of UK launched several harnessing technologies in order to improve the livelihood of the citizens
and create growing business opportunities.
Home development industry depends upon home building, remodelling, home furnishing, gardening appliances and home
maintenance. The factors are mainly of quantitative factors across categories like macro-economic, demographic/social, weather,
Real-estate market, company etc. are provided as input data at quarterly and yearly levels. Comparison of driver importance of Home
Depot, Low’s and Kingfisher is necessary. The task is to primarily understand which drivers are more crucial and less important for
the competing companies in the same industry. The Home Depot has market share of approximately 40% ahead of its closest
competitor Lowe’s. The factors that influence financial profit of retail market is known as-
1. Weather: - Abnormal weather events increase consolidated revenues for retail companies like Home Depot, Lowe’s company
and Kingfisher as consumers buy products to prepare themselves for bad weather.
2. Social: - Demographic transformations such as the number of first time buyers and percentage of young population
significantly associate Home Depot’s consolidated quarterly revenues.
3. Customer satisfaction and employee experience: - Customer satisfaction and employee experience of Kingfisher or
competitors also correlate with Home Depot’s consolidated revenues.
4. Macro-economic: - Macro-economic factors influenced all industries as an entire including Kingfisher.
5. Company and Competition: - Competitive factors significantly influenced the revenues of Home Depot Inc.
6. Real-estate Market: - Increase in home ownership as compared to renting trends positively influences annual revenues of the
organizations.
By expecting, the same type of effort out of every employee indicates how much company is demonstrating that employees
believe in their own words in all the four retail sectors.
7. The dealing of financial business depends upon six steps of home improvement. These are -
8. Set Goals: Company should set goals that are measurable, observable and have a specific period.

16DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
9. Teach Skills: Employees and labour need to learn in order to perform the job. Company should invite the sales associates to
ask questions when they have experienced a particularly difficult situation with respect to technicality.
10. Build Relationships: Kingfisher should build good relationship with employees in favour of trust.
11. Monitor Performance: When goals are set, officials of Kingfisher checklist should be set down on paper, creating an
agreement between the employer and employee.
2.8. Conclusion of Literature Review
We have to check the models and analyze the fulfilling objectives. Models would be developed to explain revenue that should
meet minimum accuracy of 95%. The analytic procedure would lead to solve leading factors and indicators of annual revenues of the
companies. Numerous variables are available with respect to this topic. The business decisions should be undertaken by looking at the
various intrinsic and extrinsic factors and therefore, it is seen that these factors requires extensive evaluation so that effective results
can be obtained. The literature review has even been ineffective in explaining the variable the consumer preferences as preferences of
the consumers have an impact on the business decisions of the retail industries. Hence, it has been observed that these gaps can be
rectified in latter researches so that effective results can be obtained.
Chapter 3: Research Methodology
3.1. Introduction:
The research methodology for the current paper has been computed in order to assist the researcher to construct a pathway or a
guideline that would be followed by the researcher for the collection of the data that would be effective for the conclusion of the
research paper. The methodology of the research assists the researcher find out the most effective tools that would be used for the
collection of the data (O'Reilly and Tushman 2013). The use of the most accurate tool would be discovered by analyzing the tools that
would be mostly effective (Ankrah and Omar 2015). The use of suitable equipment and tools would be helpful in mitigating the
problem statements and would aid the researcher to gather data from the respondents about the effect of general profit in the retail
industries in UK. The deductive and exploratory data analysis is incorporated to handle secondary data.
3.2. Research Philosophies:
During the development of the outline or the arrangement for the research, the researcher has depicted that it is vital to
have some understanding about the elements and the impacts that are associated with the paper and would be supporting in the
conclusion of the paper in an effective manner. Furthermore, there is a requirement for the researcher to use the expertise and the
knowledge of the mechanisms and techniques with the goal that explicit results can be accomplished (Crossan 2003). The research
topic is in relationship to the impact of profit in the general retail industry in UK and hence it is essential for the analyst to choose a
suitable philosophy that would be in nature positive and would search for the strategies. It would be reasonable and consequently
would give out the proficient and the innovative models for the methodology of the research (Kiesler 2014). Furthermore, the
deductive approach would be utilized as a part of completing the assessment, as this process would give out outcomes that are
demanded by the researcher in accordance to the objectives framed earlier. The deductive framework directs a pathway to collect the
result with respect to the parameters that have been developed. It is critical for the researcher to utilize a descriptive design for this
paper because an explained and comprehensive technique is required for the gathering of the coveted data of three other retail sectors
(Bauer and Matzler 2014). The approaches and the procedures that need to be utilized for finishing the paper has been constructed in
the numerous sections that are given below in explained details.

17DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
3.3. Justification of Research Philosophies:
For the recent years, sales growth has been the primary marketing objective of the retail sector. Growth in sales volume creates
economics in marketing and production operations. It is being viewed as an appropriate marketing strategy. The other philosophical
strategy that has gained prominence as a marketing target is increasing market share. The relevance of market share as a criteria for
success has been widely publicized. According to the Buzzell and Wiersma (1981), achievement of a high market share enhances the
scale of operations for the market share leader could lead to competitive advantages and operational economies that increase the profit
level. The different measure includes the study about average inventory per store and reflects the importance of merchandise as a
strategic tool in retail management (Dainty 2008). The importance of this measure is profitable that has been detailed.
A different philosophical outlook is the relative promotional effort utilized by the retailer. A major objective is to enhance the
net profits of Kingfisher, Home Depot Inc. and Lowe’s company by employing promotion. Promotion can increase the net profits of
the retail companies’ profitability by securing increased sales volume at a decreased total expense percentage and by speeding
turnover. The present study investigates the association between the amount spent per companies on promotion and profit
performance. The final marketing opportunity examined is the ratio of retailers of selling space to employees. This is a surrogate
measure of the retailer’s capital-to-labour ratio (Davidson, Sweeney, and Stampfle1984). Retailers can attempt to improve the profit
performance by enhancing the space productivity that is measured as net sales per square foot of selling space. Labour productivity is
measured as net sales per employee. The trend in retailing has been used to substitute capital amount for employees in an effort to
control and decrease expenses (Knox and Denison 2000).
3.4. Research Design and Justification for choice:-
Research methodologies have been seen as the distinctive mechanisms that can be realized by the researcher
remembering the ultimate objective to complete the paper according to the research aims and objectives of this paper. It has even been
seen that each technique has their unique qualities (Diener and Crandall 1978). In this way, assurance of the distinctive instruments
that should be consolidated into the research methodology depends on the traits of the researcher and the perception of the researcher
with respect to the topic of the paper. Hence, the construction is search onion is essential that would include the various layers that
would be pertinent for the conclusion of the paper in a genuine way (Lewis 2015). The number of layers in the research methodology

18DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
would depend on the reasonability of the researcher (Edwards, Charle and Lebowitz 1981). It is their decision to pick the diverse
instruments that would be used for completing of the paper with the target that a course for data collection and viable evaluation of the
collected data is possible.
3.5. Qualitative and Quantitative data Collection: -
Data is viewed as the genuine need to ensure the completion of a research paper where the collection of the desired data is
liable to the possibility of the proposition and the target results that is to be attained. In such way, we conveyed that data is assigned
into secondary one. Secondary data on the other hand are the information that is collected from a variety of sources and these are the
data that once has been used by other researchers. These kinds of data are generally available from the internet sources, journals,
articles and books. The impacts may change over a period and therefore fresh data is essential in order to discover the present impact
of profit management in the retail industry in UK (Kastalli and Van Looy 2013).
The quantitative data assembles the range of data, which could be assessed to acquire the data regarding the research
objectives. As indicated by Stromquist and Monkman (2014), the quantitative information gives the data with respect to the
knowledge of human responses concerning specific research topic (Fernie 1997). In this way, it requires unassumingly more
imperative case measure for its investigation. In this specific research, the data accumulated from the responses of the currently
working and the retired employees of the retail industry in UK would be used with the target that true results could be acquired
(Lafontaine and Slade 1997). Karl Pearson’s Correlation will be used to measure the statistical association between two variables.
Multiple regression analysis would be used to correlate the independent variables with the dependent variable. Finally, a test for
comparing the means (t-test, ANOVA) would be used to compare the different companies of customers and to determine the influence
of independent variables on the dependent variables (Jones et al. 2005).
The present research is a qualitative investigation in which opinions are assessed over a five points Likert scale. The collected
data should be analyzed statistically to be able to answer the research question and serve the research objective. MS Excel was used
for the statistical analysis of the secondary collected data (Bernard, Wutich and Ryan 2016). Graphical analysis of the collected data
was done to provide a general description of the data. To summarize the analysis of the research, the data generated would be
presented in the form of tables, figures and charts (Board 1980).
3.6. Research Methodology and Justification: -
In this paper, the determination of the research methodology is completely dependent on the researcher who is constructing the
paper. The analyst establishes a research onion in which they embed the various processes that would be used to finish the
methodology of the research. Therefore, concerning this research, the researcher has a concept of realizing a research onion that would
be comprehensive of five layers inside the research onion (Lyons and Kuron 2014). The five layers that would be consolidated are the
most productive tools that would be legitimate to accomplish the best results with respect to the research theme that has been taken
into consideration (Frynas and Mellahi 2015). Therefore, it is essential to initially depict the procedure of research onion according to
the present paper.
3.7. Validity and Reliability of data: -
The data has been evaluated with the help of various investigative methods. In such process, Heine (2015) delineated that
persuading assurance regarding demonstrative frameworks is vital to fulfil proper and opportune conclusion of the paper. The data is
collected from official websites of the retail companies and renowned journal (Roberts, Priest and Trayno, 2006).

19DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
3.8. Ethical Considerations: -
The researcher in order to make the research true and authentic has tried to collect all the data in an ethical manner and has
abided with the ethics code that has been laid in the international background. The researcher has restricted of making use of any
unethical means and has therefore looked to gather the information as well as the respondents after a proper background check and
authenticity of the results.
3.9. Limitations of the Study: -
The present study has some limitations. First, we considered that sample survey is incorporated over employees. Primarily the
questionnaire provided to the customers was closed-ended questions (Betancourt and Gautschi 1993). Thus, the option of the
responders to answers in an elaborate manner was restricted. Moreover, since the survey was conducted in United Kingdom, hence the
results of the survey represent the satisfaction of customers and trust for UK only. Moreover, the number of retailer being considered
was limited to only five. Branded furniture retailers were only considered for the study. More customers prefer branded products and
the market for the local manufacturers have shrunk (Levesque and McDougall 1996). However, Home Depot Inc, Lowe’s, TESCO
and Kingfisher retailers in our sample have created service-based advantage; these companies simultaneously leverage all components
of service system. Failure to simultaneously incorporate each of these facets prevents retailers from achieving expected returns from
the service production and can lead to relative under performance (Holden and Lynch 2004). Moreover, TESCO sells customer data
onto FMCG suppliers and producers thus creating an additional revenue channel for the business.
3.10. Conclusion of the chapter: -
In the retail sector of UK, it is imperative that they pay consideration to the interests of the customers so that the requirements
of the customers could be met. The main objective of Home Improvement retail sector is to target on ways to improve its performance
so that their presence in the market can be felt. The appropriate methodology of sample analysis on financial conditions of the
companies is expected to incorporate. Thus, it becomes imperative for the furniture retailers of UK companies to be methodically
mindful of the determinants. The conceptual model to study the determinants of the products was developed through done by previous
researchers with the help of secondary data of financial accounting of general retail sector.
Chapter 4: Data Analysis and Findings
4.1. Introduction and Objective: -
The present chapter presents a detailed explanation of the already collected survey data as well as the analysis of the data. First, chapter
four will introduce the different features of the sample, next it will test the surveyed data and finally the chapter will proceed with different
analysis. The investigation into the surveyed will demonstrate the financial profile of the companies, the correlation between the variables of the
study. The chapter will end with a discussion of the relevant findings as well as how much the findings are in conformity with present available
literature.
From the analysis, it is also seen that the advantages of working in a multicultural team is significant. The factors that are
responsible for providing the advantage are cultural, skills variety, understanding the global needs and flexibility. The literature review
shows that the advantages of working in a multicultural team are that it provides a better understanding of the global customers. This
provides the organization with a greater understanding of the culture of the customers. This provides the organization with the ability
to compete in the global market. Since, a multicultural team comprises of people of different nationalities, thus it provides the team to
understand the global needs of the retail industry (Levine, Berenson and Stephan 1999).

20DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
4.2. Sample Characteristics: -
Most of the data are numeric in nature. The sale functions, cost functions, gross profit functions, total amount functions and
other retails functions are quantitative in nature. We can perform the graphical representations of four retail companies’ data. The
numerical data indicates trend value from 2013-2017. Besides, the numerical data is used to find correlation coefficient. The data are
actually secondary in nature. That means it is collected by companies and structured; then uploaded online. We collected the data from
annual reports of corresponding companies and applied necessary analysis procedure.
4.3. Data Analysis for Objective1: -
Kingfisher Company:-
Intangible asssets and goodwill
Investments and other non-current assets
Total non-current assets
Inventory / Work in progress
Trade and other receivables
Cash and Equivalents
Other current assets and asset held for resale
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Year-2017
Year-2016
Year-2015
Year-2014
Year-2013
The multiple bar diagram indicates that Total amount of non-current assets is maximum in 2013 and minimum in 2015 in
Kingfisher Company. The intangible asset along with goodwill and Cash & equivalent are increasing year by year from 2013 to 2017.
Inventory/Work in progress and Trade & other receivables are more or less stable for Kingfisher Company. We cannot definitely
conclude about the trend of ‘Investment’ & ‘other non-current assets’ and ‘other current assets’ & ‘asset held for resale’ for Kingfisher
Company (Schwandt 2014).
Year-2017 Year-2016 Year-2015 Year-2014 Year-2013
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Short term liabilities
Long term liabilities
Other liabilites / pension etc
Total of all LIABILITIES
The multiple bar diagram indicate that Total liability is decreasing year after year. However, we cannot firmly interpret about
graphical interpretation about Long term liabilities. Other liabilities or pensions are absent in each year. Short-term liability is
gradually decreasing. However, year 2017 is an exception in that case.

21DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Net assets £(M) Share Capital Minority Interests Retained earnings Share premium
account Other Equity Total EQUITY
-1,000
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Year-2017
Year-2016
Year-2015
Year-2014
Year-2013
The multiple-column diagram interprets that Net assets is equal to the Total Equality. Overall, total equality amount and net
assets are increasing year after year. Equity amount, share capital and share premium account are almost equal in each years. The
amount of Minority interests and “Other equality” are insignificant in nature. It is important to note that Retained earnings are
significantly increasing from 2013 to 2017.
Cash from
operating
activities
Cashflow
before
financing
Increase /
Decrease in
Cash
Turnover Cost of sales Gross Profit Operating
Profit Pre-Tax profit Profit / Loss
for the year
-2000
0
2000
4000
6000
8000
10000
12000
Year-2017
Year-2016
Year-2015
Year-2014
Year-2013
The multiple-column diagram indicates that Turnover amount of income is increasing for all the five years of the study. The
amount of increase or decrease of cash is minor. We could observe a similar pattern of year wise variation of all other factors. The
Cost of sales and Gross Profit is significant in amount. The fact to note that, Gross profit is slowly increasing.
ROE CR LNS ATO gear gm eff
0
1
2
3
4
5
6
7
8
9
10
Year-2017
Year-2016
Year-2015
Year-2014
Year-2013
The Figures indicate the Year wise variation of several measures of financial data of Kingfisher Company. The amount of gm
and eff are almost equal in the years. The amount of LNS is significantly large in the five years. The amount of ROE is very lean. The
rate of growing of CR is very small but always positive. The amount of ATO is greater than gear, gm and eff in every year.

22DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
4.4. Data Analysis for Objective2: -
The Correlation Matrix of Year wise data of ROE, CR, LNS, ATO, gear, gm and eff: -
Year2017 Year2016 Year2015 Year2014 Year2013
Year2017 1
Year2016 0.999966 1
Year2015 0.999987 0.99997 1
Year2014 0.999936 0.999911 0.999963 1
Year2013 0.999628 0.99968 0.999684 0.999837 1
The correlation table indicates that there exists a high correlation among the factors such as ROE, CR, LNS, ATO, gear, gm
and eff. The correlation coefficient between 2017 and 2015 is maximum for all the assigned accounting variables. The correlation
coefficient between 2017 and 2013 is minimum for all the assigned accounting variables.
4.5. Data Analysis for Objective3: -
Lowe’s Company:-
Year-2017 Year-2016 Year-2015 Year-2014 Year-2013
0
5000
10000
15000
20000
25000
30000
35000
40000
Total of all ASSETS
Cost of sales
Cash from operating activities
Long term liabilities
The graph indicates the bar diagram of year wise total assets, total cost of sales and cash from operating activities from 2013-
2016. The data is absent for year 2017 in case of Lowe’s company. The total of all assets is maximum in case of Year-2016. Cost of
sales is significantly increasing in a high rate, from 2013 to 2016. The amount of cash from operating activities is gradually increasing
year after year slowly. Long-term liabilities are also increasing gradually from 2013 to 2015. The year 2016 has highest amount of
money in all segments of the accounting variables (Scott 1997).
Home Depot Inc.:-
Year-2017 Year-2016 Year-2015 Year-2014 Year-2013
38500
39000
39500
40000
40500
41000
41500
42000
42500
43000
Total of all ASSETS
Total of all ASSETS
The figure indicates the total amount of Assets year wise. In Home Depot Inc., the amount of total budget was decreasing year
after year from 2013 to 2017. However, suddenly in 2016, the amount of total assets got a hike and reached up to 43000 billion pound.
TESCO Company:-

23DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
Total of all
ASSETS Short term
liabilities Long term
liabilities Total EQUITY Cost of sales Operating
Profit Net assets £
(M) Gross Profit Profit / Loss
for the year
-30,000
-20,000
-10,000
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Year-2017
Year-2016
Year-2015
Year-2014
Year-2013
The figure indicates the year wise variability of different sectors of financial sectors of TESCO Company. It is a great matter
of concern that TESCO is facing loss in recent years. The reason is that the amount of total assets is reducing year after year from
2013 to 2017. Loss is very significant in 2016. Operating profit was least in 2015. ‘Short term’ and ‘Long-term’ liability both are
decreasing from 2016 to 2017. Operating profit and amount of “Total Equity” is in reducing situation. Gross profit and Cost of sale in
recent years are also not satisfactory.
1 2 3 4 5
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Average full-time equivalent employees (FTE)
Average employees
Total sales area – '000 sq. ft.(d)
Number of stores(d)
The line diagram indicates the four factors related the retail service of Group retail service of TESCO Company (1 for 2013
and 5 for 2017). The diagram indicates that number of stores has not significantly increased over years. All the other three factors such
as average full-time equivalent employees (FTE), average employees and Total sales area are considerably decreasing over the years.

24DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
UK & ROI retail
statistics Number of stores(d) Total sales area –
'000 sq. ft.(d) Average full-time
equivalent
employees (FTE)
Revenue (exc. fuel)
per FTE – £ Weekly revenue
(exc. fuel) per sq. ft.
– £
0
100000
200000
300000
400000
500000
600000
700000
800000
Series5
Series4
Series3
Series2
Series1
The line diagram indicates the six factors related the UK Retail service of TESCO Company (Series1 for year 2013 and
Series2 for year 2017). All the factors such as UK & ROI retail statistics, number of stores in UK, Total sales area, average full-time
equivalent employees, Revenue per FTE and Weekly revenue per square feet have increased and then again have downfallen in recent
years. The financial profit and performance is getting poorer year by year in recent years.
4.6. Data Analysis for Objective4: -
Year-2017 Year-2016 Year-2015 Year-2014 Year-2013
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Kingfisher
Home Depot Inc.
LOWE's Company
TESCO
The graph indicates the comparison of total assets of four assumed companies that are Kingfisher, Home Depot Inc., Lowe’s
Company Inc. and TESCO. The Kingfisher Company is showing almost equal amount of total assets over years. The same scenario is
presented for Home Depot Inc. too. Total amount of assets in Lowe’s company was getting reduced from 2013 to 2016, however,
4.7. Data Analysis for Objective5: -
The correlation coefficient is used to test relationship between quantitative variables or categorical variables. Pearson’s
correlation coefficient is a measure of how two variables are related to each other. We can make predictions and future behaviour with
this coefficient. Companies and businesses also use the statistics for budgets and business plans.
A correlation coefficient is a way to put a value to the relationship. Correlation coefficients have a value of between 1 to (-1).
The interpretations of the correlation values are provided in the following table-
Correlation Coefficient ( r ) Comment
1 Perfect Positive Correlation
0.7 to 1 Strong Positive Correlation
0.3 to 0.7 Moderate Positive Correlation
0 to 0.3 Weak Positive Correlation
0 Absolutely No Correlation (Uncorrelated)
0 to (-0.3) Weak Negative Correlation
(-0.3) to (-0.7) Moderate Negative Correlation
(-0.7) to (-1) Strong Negative Correlation
(-1) Perfect Negative Correlation

25DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
The correlation coefficients of total annual assets of Kingfisher, Home Depot Inc., Lowe’s Company Inc. and TESCO are
provided in the following Correlation matrix.
Year-2017 Year-2016 Year-2015 Year-2014 Year-2013
Year-2017 1
Year-2016 1 1
Year-2015 1 0.990316 1
Year-2014 1 0.975415 0.996445 1
Year-2013 1 0.979167 0.997707 0.999833 1
The correlation coefficients indicate a high correlation among the amount of total assets of four companies. The correlation is
high for Total assets of four companies between year 2014 and year 2013. The correlation is low for Total assets of four companies
between year 2015 and year 2016.
Determinants of companies’ profit risk in general retail sector of TESCO bank. The principal determinants of risks are
dependent upon several factors such as Liquidity, Safety, Competition and Markets, Customer proposition, Brand-Reputation-trust and
regularity and compliance (Higgins, Robert and Roger 1983).
4.8. Conclusion: -
According to the analysis of provided Kingfisher Company data and secondarily collected Home Depot Inc, TESCO and
Lowe’s Company data, it is seen that according to the total asset and gross profit, TESCO and Home Depot Inc are bigger companies
than Kingfisher and Lowe’s company. In recent years, all the companies except TESCO are showing their bright future. TESCO is
losing its royalty in market. Kingfisher is a slowly improving retail company that is emerging for a good future. Home Depot Inc is
stable retail sector that is maintaining its profit and priority. Lowe’s Company is rapidly prospering with respect to other three
companies. We can say that the poor performance of TESO is inviting other three companies to prosper.
The correlation tables are showing that the overall correlation between accounting variables in Kingfisher and The Total
amount of assets are very high. Therefore, the determinants and factors are highly correlated with respect to years.

26DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
The given chart gives an idea about UK retail Price Index Chart (YChart) over the period 2013 to 2017. Our reported four
retail companies are highlighting the same reflection of increasing Index chart. The data analysis of four companies is indicating
towards a promising future full of competition.
Chapter 5: Conclusion and Recommendations
5.1. Introduction and objectives
The retail landscape has rarely been as turbulent as it is being now days. With further economic uncertainty predicted
understanding what is happening with the big retailers that has never been more important (Sharma and Gera 2013). The completion
of the paper has indicated that factors and determinants play a crucial part in the development of any business sector ( Lewis and
Thomas 1990). It is even seen that determinants regarding retail sectors needs to be managed and supervised effectively so that
smooth functional activities can be maintained (Shepard 1993). With the rise in globalization and liberalization, the there has been
entry of various companies in the retail industry in UK has been entry of several individuals who hail from different parts of the
society and therefore have their various cultures (Lyons and Kuron 2014). In this respect, the research has been undertaken in order to
have a clear idea whether determinants have an impact over the retail industry (Ganesan 1994). The analyses of the results that have
been obtained from the respondents reveal that most of the employees are working in the retail industry in UK. The analysis of the
results that have been obtained from the secondary data reveal that the respondents feel that they are in an advantageous position while
working in a multicultural team as they are able to gain new skills, variety, flexibility and knowledge about the new cultures (Goodley
and Franklin 2015).
Furthermore, the attitude of the management and duration of the employees within the companies can have significant
challenges on the profit differences in the retail industry. Even though there is an existence of various challenges in the retail industry
in UK, these issues are minor and with the implementation of various strategies that issues could be mitigated. The respondents have
even explained that they would like to work in Kingfisher, Home Depot Inc, TESCO and Lowe’s company but the team should
comprise of employees (Gooris and Peeters 2014). It is even seen that responses from the participants has a key role to play and the
answers from the respondents reveal that there is a significant impact on the financial differences in the retail industry in UK.
5.2. Review of Research Objectives
There are several aspects in relation to the topic that would be undertaken in order to future researches with respect to
these research objectives. It has been observed that the research objectives may transform in the retail industry that would be
understood in an effective manner. The paper that has been completed could have been completed in a more precise manner. It has
been observed that the researcher could collect data that are more precise. Hence, future work with respect to this topic can be
undertaken which would be influential for the construction of a much more precise research paper. The objectives of future research

27DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
could be more comprehensible (Stahl et al. 2013). The other researchers at any future point of time can undertake similar researches in
order to undertake a comparison with respect to the current research and the future result so that impact of determinants can be
understood.
5.3. Findings and Answers to the Research Questions
The determining factors of researches in a multicultural team are the flexibility of work, adaptability, understanding the team
cohesion and expectation of alignment (Hammer 2015). The flexibility of work ensures that the management is able to carry out the
operations of the organization smoothly. Understanding the research questions would ensure that the organization understands the
individual needs based on expectation of the employees (Visnjic, Wiengarten and Neely 2016). Thus, the organization would be able
to connect with the employees through their different requirements. In addition, the organization by understanding flexibility of work
and understanding the cultural differences is able align the policies with the expectation of the employees (Hansen and Coenen 2015).
This could be beneficial for companies like Kingfisher, Home Depot Inc, Tesco or Lowe’s company Inc to grow and get success in
retail sector near future.
The employees in an organization with multicultural teams have differences in performances of the employees. In addition, the
challenges of such companies are also significant. There is also a high level of awareness about the competition in retail market needs
to be understood in a multicultural country like UK. This warrants that the management is able to ward of any friction that might arise
in coming future. Besides, management of financial interpretation along with appropriate objective interpretation also can pose
significant challenge (Voss and Seiders 2003). The findings indicate a successful conclusion drawing and enhance the testing of
interpretations along with proper visual representation.
Moreover, the secondary survey finds that most of the employees in the retail industry would like to work in a progressing
company. The success of a retailer of UK highly depends upon the customer satisfaction.
5.4. Recommendations
There are varieties of suggestions that can be given with respect to the research topic that has been taken into consideration in
this paper. It is recommended that the management of the organizations to undertake various strategies that would be influential for
improving the economical barriers among the employees of the organizations. The management should even undertake grooming
programs so that the employees would gain knowledge about interaction to all the employees (Zwikael et al. 2014). The management
should even undertake induction programs and should undertake various other programs for the employees so that they can interact
more and in that manner would be able to understand each other in a more effective manner (Zhang, van Doorn and Leeflang 2014).
The management even should portray their financial objectives and profit goals to their employees so that the employees overlook
their drawbacks and undertake actions that would be influential for the attainment of the targets for the four organizations. It is even
suggested that the management should even create a policy and a strategy where a sense of goodwill can be maintained so that the
employees would have a sense of togetherness and unity, which would influence the employees to help each other out (Hancock et al.
2013). The implementation these recommendations within the organizations would mitigate the problems that are existent in within
the retail industry and this in a way would lead to make the retail industry stay in line with the other industries that are functioning in
the UK economy. The management should even undertake frequent supervision over the employees and the teams in order to gain
knowledge about the impact of undertaking plans to rectify them.

28DETERMINANTS OF PROFIT IN GENERAL RETAIL SECTOR
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