Tends Analysis Report of Wesfarmers on Price - News etc

Question: Discuss about the Trend Analysis Report for Wesfarmers. Answer: Introduction: The company is a diversified corporation and was originated in the year 1914 as the Western Australian farmers cooperative. Since last 100-year tenure, many of the significant changes took place in the operations and in the structural part of the company. Wesfarmers has grown as one of the largest listed company in Australia (Coates et al., 2014). The company is having its headquarters in the Western Australia and operates in the diverse business: liquor, supermarkets, convenience stores and hotels; office supplies; home improvement; department stores; and also division of an industrial dealing in the chemicals businesses, fertilizers, and energy, coal and safety products. The main objective of the organization is to generate the satisfactory return for its shareholders. For achieving the same company focuses on the customers satisfaction with the provision of the services and the goods on a professional and the competitive basis; it also provides the safe working environment to its employees and also motivates them by rewarding them for the good performance and the increased opportunities for growth. The company strongly emphasis on protecting the environment; dealing with the complete honesty and integrity in its dealings for both within and the outside the company. Wesfarmers is the Australia's only conglomerate Strategies of Wesfarmers The Wesfarmers aims and long tenure objective was to ensure that the returns which its shareholders get shall be as per their satisfaction and also there were main four corporate strategies as the case of the Wesfarmers in 2010. The Wesfarmers also makes use of the diversification strategy. The main focus of the company is to ensure that each and every of its divisions must have the strong capability of management which is accountable for the execution and the development of the business strategy, and also the day-to-day performance related to the operations. Each of the companies division is to be overseen by the divisional board of directors which also includes the Managing Director and Finance Director of the Wesfarmers, and is also guided by a wide operating cycle group and governance framework. (Club.ino.com, 2016). Each of the divisions was properly looked after and governed by a particular board of the executive members, which generally comprising of the executives refer its c orporate office, business in the division. Each and every company division was an autonomous body in its responsibility and the operations for the proper development of the companies strategies refer its business growth and fulfillment of its strategies. All of the decisions of the company were necessarily required to meet the goals of the organization and these were measured by the (ROE) which stands for the return on equity and also the (ROC) which implies the return on capital. Internal and External Analysis: Here, it contains the weaknesses, Strengths, Opportunities and Threats related to the company analysis. The Wesfarmers has always been a corporation with diverse functions. Wesfarmers various businesses are mainly comprised of the Coles, Resources, energy and so many of the other activities. Its strategy is engaged to work and to invest for the new fields, which shall enable it to get an experience of persistent growth irrespective of the impact of any kind of the industry downturn.According to the pie chart the company maximum involvement is in the Home improvement which is 50.6% and the next is the insurance segment almost 14.5%, and then is the industrial and the safety segment which is 12.4 %, then 11.6% it contributes in the coal segment, the fertilisers, and the energy contributes only minimal to the revenue segment of the company. Figure1: The revenue breakup segment of Wesfarmers. Strength Wesfarmers has been a competitive company.The company strengths are the wide experience of the company in the Australian market and the reasonable price offering of the company for its services and products. The companys good reputation in the market for the value of the money is also one of the biggest strength which enables the company to compete in the market with its rivals. The good industry skills the directors related to the different divisions of the Wesfarmers are ventured with the business skills and are both friendly and outgoing with the personal relation skills which are very helpful in the business growth. A Large number of stores and the strong workforce and the special discounts and offers also attracts the customers. Weaknesses The companys small business units and the cost structure of the company are one of the biggest weaknesses of the company. The company experiences are also limited within the area of the Australia and are not having the low geographical exposure. Being the leader of the market the company is always under the scrutiny for taking some critical decisions. Opportunities The Wesfarmers has always been able to do well while taking the advantage of the available opportunities. In November 2007, it spent$22 billion to buy the Coles Group whole of the retail services and later on it became the leader of the Australian retailer's markets (The Sydney Morning Herald, 2016). The Wesfarmers has opportunities to further develop its overall business outside Australia. The Wesfarmers Energy has been playing firm focuses on the protection refer the environment. The nature and the behavioral outcome of the environmental protection are enhancing and a matter of concern for the public, so the company is very much committed so as to develop this factor. Wesfarmers opportunities strategies are to build the solar energy station that has got the power to generate and produce around 600 kilowatts of the power by the cooperation plan by the South Australian government (Fool.com.au, 2016). The customer and the employee loyalty initiatives across the business are also one of the great opportunities for the company. Threats The Wesfarmers also has strong competition from the retailers, this growing competition and the lower rates of the profitability. The company also have the strong threat from the risks related to the external businesses. The rising cost of the raw materials also acts as one of the threats for the company. Big shareholders and the employees make the corporate governance of the Wesfarmerss very complex and difficult to manage and also efficiently communicate the ideas to all of the lower ranked employees. The other threat which the company has is from its changing prices, increasing costs and the regulations of the government (Klancko, 2006) The company also have the strong threat from its competitors such as the Costco, Woolworth, and Aldi. Wesfarmers PESTLE analysis This section, i.e. the PESTLE analysis is taken into use to create an assay of the Wesfarmers refer macro-environment, which includes the economic factors, political factors, the sociological, legal factors, technological factors and the environmental factors. Political factors The Australia government develops the legislative framework related to the mining atmosphere and the Federal government thus is able to make a different rule in their complex and the concrete situations. The main misuse of the mining companies shall base on the approval, refer the state (Gale and Rao, 2015). Economic factors The Australian nations, the sector related to the services is significant and also the rapid-growing sector, as it occupied around 71.4% GDP of the nation. The industry highest value service is the insurance and the financial; this also is accounted for the 8.1 % of the GDP (Global Finance Magazine, 2016). Sociological factors In Australia, almost all of the families have the habit of buying the basic necessities of life. Thus, they are much more in the habit of the one-stop shopping. This also assists the company to properly manage the department stores, supermarkets, and the home improvement. Technological factors Wesfarmers is also known for the advanced equipment, technology, services, products etc for the creation of the world's largest production in an efficient manner, it also promotes safe and new technology related to the environmental protection (Global Finance Magazine, 2016).The company is focusing on the technology of the solar energy which will not only benefit the company but also the society. Legal factors: The company will follow both the internal and there external legal factors related to the company which may include the labor law and the natural resources legal rules and regulations and the law related to business in the Australia. As a very big enterprise, the rules provide for the company management are very significant criteria (Fool.com.au, 2016) Environmental factors The company acts as the sustainable corporation and works for the betterment of the environment. Such policies and guidelines are issued by the organization which are helpful in saving the environment of the Australia. The regular natural resources and the maintenance of the atmospheric and the ecological regions include all of the aspects of the local area and the environment (Hannibal, Liu, and Vedlitz, 2016). Wesfarmers SMART analysis Specific The Wesfarmers provides vast and diverse operations, and its main aim is to generate the complete satisfactory profits to the shareholders. The total sales of the company are enhanced by 4.9 % on the 3rd quarter during the current year. The net sales of the company food have reached $3 million more as compared to its sales at the same time during the previous year (The Sydney Morning Herald, 2016). Measurable In the year 2010, the net earnings are very well expected to decrease to even less than twelve months and shall reduce the present price of the export demand. The position of the company in the market is pretty safe and credit of the Wesfarmers Company. Attainable It was expected that the company shall list its profit at $2.6 billion (Wesfarmers Limited). The report of the Mayer showed that the appropriate profit growth of the company is 14.8 percent to July, thus the surveyors expect that the company shall develop very optimistically (The Sydney Morning Herald, 2016). The company profits are attainable with the operational excellence and the entrepreneurial initiatives. Realistic The company has continued to reinforce the innovation and the boldness as the growth enablers for the company which is quite realistic in achieving the target of the company. Applying the methodologies related to the financial evaluation and the financial disciplines. Timely The company meets all kinds of the expectations of the competitive and the professional clients by offering the products and the services on time. Such strategies and processes are to be implemented which will help in the timely delivery of the products and services to the consumers (Holland, 2014). Conclusion Hence to conclude, the report mainly focuses on the three breakdown tools to elucidate multitude aspects of the company. The case will help to understand the potential opportunities, threats and the imperfections of the Wesfarmers with the SWOT analysis. Additional, the PESTLE analysis has an external influence on the organization. Finally, as per the SMART analysis some guidance direction to Wesfarmers, the company can shrink the cost of increasing the net income.The company for the growth of the company must focus on the entrepreneurial initiates who may include the new innovative products and services, the growth in the customer's programs which may also include the loyalty and the bonus programs. References Club.ino.com. (2016).Free Trend Analysis Report for WESFARMERS, WES - MarketClub. [online] Available at: https://club.ino.com/trend/analysis/equity/ASX_WES [Accessed 13 Sep. 2016]. Coates, L., Haynes, K., OBrien, J., McAneney, J. and de Oliveira, F. (2014). Exploring 167 years of vulnerability: An examination of extreme heat events in Australia 18442010.Environmental Science Policy, 42, pp.33-44. Fool.com.au. (2016).Wesfarmers Ltd: A retailing giant | Motley Fool Australia. [online] Available at: https://www.fool.com.au/2015/06/11/wesfarmers-ltd-a-retailing-giant/ [Accessed 13 Sep. 2016]. Gale, S., and Rao, B. (2015). The stratigraphy and sedimentology of the Waindalithi Conglomerate of northeast Viti Levu, Fiji: hyper-concentrated flows and Pliocene environmental history.Australian Journal of Earth Sciences, 62(8), pp.1009-1020. Global Finance Magazine. (2016).Global Finance Magazine - Australia GDP and Economic Data. [online] Available at: https://www.gfmag.com/global-data/country-data/australia-gdp-country-report [Accessed 13 Sep. 2016]. Hannibal, B., Liu, X. and Vedlitz, A. (2016). Personal characteristics, local environmental conditions, and individual environmental concern: a multilevel analysis.Environmental Sociology, pp.1-12. Holland, R. (2014). Smart energy technologies in everyday life: Smart Utopia?.Technology Analysis Strategic Management, 26(10), pp.1247-1250. Klancko, R. (2006). Environmental Instrumentation and Analysis Handbook.ENP, 8(02). The Sydney Morning Herald. (2016).Wesfarmers' Coles sales up 4.9% in Q3. [online] Available at: https://www.smh.com.au//breaking-news-business/wesfarmers-coles-sales-up-49-in-q3-20100422-td05.html [Accessed 13 Sep. 2016]. Wesfarmers.com.au. (2016).Home. [online] Available at: https://www.wesfarmers.com.au/ [Accessed 13 Sep. 2016].