NEXT PLC
An introduction to the background of the company
NEXT PLC is a retailing company that primarily operates in the UK, and has been trading for almost 150 years; however, the brand itself was first created in 1982 (Next plc, 2010a). The company offers a range of clothing, accessories, home ware and footwear. The company’s headquarters is located in Leicester, UK and is currently run by Chief Executive Simon Wolfson. NEXT distributes through three main channels: NEXT Retail, operating in more than 500 stores around the UK and Ireland, NEXT Directory, a website and catalogue list for over 2 million active users. And NEXT International, with chains of over 180 stores worldwide including an international website. However, NEXT also
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The company needs to distribute stock from the warehouse to the stores every week, and costs will be incurred in doing so. Since NEXT has decreased in non-current assets; in particular Property, Plant and equipment, they would need to increase the productivity and space in order to operate in warehouses and distribute stock out to additional stores nationwide. Therefore, costs will be incurred when training the work force, and in order to meet the demands of consumers, wages and salaries will increase in time.
NEXT plc, has managed to make a few acquisitions, which affects the financial position in terms of cash considerations and return on investment when acquiring 100% share capital in Lipsy Ltd. The importance of financial resources to accommodate such acquisitions, points out how financial backing can introduce new revenue streams in the long term and can lead to an increase in profits as well as the brand image of NEXT.
A general understanding of the important financial statements
Figures are taken from the Income statement and Balance sheet as at 30 January 2009 and as at 30 January 2010.
Profit is a surplus in money after taking into account all costs incurred in buying and selling a product. Operating profit is the profit made after all direct and indirect costs have been paid. (Bized, 2010a) From NEXT’s company accounts, the operating profit has increased by £51.5m. This is a positive steady increase which has been achieved throughout the
There are two types of profits; the first is normal profit which is the level of profit that is required to keep
The company has been functioning well in terms of generating profit and demand so far. However, there will be a 20% increase in demand for the next month of operations as predicted by management, and the production and supply management's problems may come as a problem they can no longer afford.
Case Study of Boots Plc Boots Plc have various kinds of stakeholders in their business who do various kinds of jobs suitable for which group there are in. Like any other Plc their stakeholders at least have a say in the business depending their role. E.g. shareholders have a bigger say than the employees who have very little say in the business. Boots Plc have the following external stakeholders in their businesses that play different roles between them are: - Ø Pressure Groups
Users are likely interested in information that will assess the company's liquidity, solvency, risk and return, etc. Therefore, they can know more about how is the company financed and the availability of cash to pay debt from the balance sheet. They can know exactly about allocation of the use of cash for different activities from the statement of cash flows. Income statement will provide the information about the revenues and expenses of the company. They can also access information associated with dividend paid and retained earnings.
Current and historical Financial Statements (Income Statement (I/S), Balance Sheet (B/S) and Statement of Cash Flows) from the three most current years for the firm
The next step would be for management to know precisely how their decision to downsize capacity would impact the firm’s future operating costs, and also identify specific areas in which the firm could achieve additional cost reductions. Additionally, the cost analysis would help forecast the firm’s operating costs and projected profits (or losses) for the upcoming fiscal year. However, before we can proceed with such analysis, an examination of how the various categories of Continental’s costs behave is in order.
Because the product was leaving the warehouse and getting to stores quicker, I was able to reduce the storage space which was an initial problem so the increase of costs because of it decreased. The stores showed a moderate increase in profit.
The financial statements include profit-related elements such as operating cash flows from the statement of cash flows and retained earnings in the balance sheet the income statement shows the profit through the information it provides on net income during each year. There are different forms and different elements of income statement used depending on the company's business.
In this analysis I have used the balance sheet, the income statement and the statement of cash flows given in the financial statements for the year ended 2006, 2007 and 2008.
NEXT is a British brand, the main products of which include clothing, shoes, accessories and homewares. NEXT distributes its products through various channels. NEXT has more than 500 retail stores in its main market of Britain and Ireland meanwhile it also runs another 200 franchised stores in more than 40 countries overseas. In addition, NEXT operates online shopping website and home shopping catalogue with over 4 million active customers.
NEXT doesn't sell sportswear and this will give their regular customers room to buy from their competitors, I strongly recommend that NEXT should introduce a sportswear brand as it will help in improving their sales and will give room for new target market. They should introduce services like make-up studios as Debenhams, organize events like fashion shows, autographing sessions and book reviews as these will make them enjoy their shopping and also attract new ones. Like Marks and Spencer, NEXT should provide a resting place where customers can relax and drink.
This report will analyse the corporate activities and position of Next plc, focusing on clothing, which is the company’s main product area. The report firstly provides an overview of the history and background of the company as well as mentioned the state of the clothing retail market. Following the introduction the report then goes into deep analysis of Next, beginning with identifying the company’s key strengths and opportunities for future success, before going on to explore certain dangers with the corporate decisions and its market structure.
In this report I will be providing the UK’s largest supermarket, Tesco with advice on their performance. I have chosen to use two types of analytical models to review the company; I will be looking at the organisational structure of Tesco, as well as analysing their business and competitive strategy.
have explained that the Financial statements provide asummarized view of the financial position and operations of a firm. Therefore, much can belearnt about a firm from a careful examination of its financial statements as invaluabledocuments / performance reports. The analysis of financial statements is, thus, an important aidto financial analysis.
Ted Baker PLC is a high-end retail company based in the UK. The company offers a large range of luxury items from clothing and accessories to bedding and crockery. In the company’s annual report (2015/16) Ted Baker present their distribution as being managed through three main channels, retail (£348.4m), wholesale (£107.7m) and licencing (£14.4m). These operations take place in a large number of stores and outlets across the United Kingdom, Europe, Middle East, Asia and Australia. Ted Baker also have a successful e-commerce business which represents 15.4% of the company’s overall retail sales and which has sites serving America and Canada as well as the UK and Europe, with a separate site also set up for Australia.