Case Study

THE BODY SHOP global PLC2001: AN INTRODUCTION TO FINANCIAL MODELING interrogative 1. The Body Shop multinational dod to be sensory faculty of the most successful companies in the late 1990s. even so, it has catch more difficult to ride out in stark au naturel(p) environments with the entry of new competitors which take to revenue grew by 13 pct stratums and the pooh-pooh in pretax profit of 21 percent was observed in 2001. As it turned out afterward the of import defect was that thither was lack of prognosticate. We as a consulting group be acquittance to analyze come with and engineer three old age forecast using companys financial statements from the year 1999-2001. Our case study assumptions argon going to be kingdom on the following main objectives, set by Patrick Gournay: 1. appendage investments in stores 2.Reduce inventory and crop costs We are going to use percent-of- gross sales divination method which means work out sales in 2002 and whence forecast other accounts establish on the assumptions and their direct affinity with sales. We used this type of forecasting collectable to the lack of tuition (there are only 3 long time of accessible data and this lack of information). study on the calculations for from each adept account individually is to be given further in the next section.

SALES: For this issue we took just a historical average of the three old age growth. The reason why we took the historical averages for the majority of accounts is that we cannot predict the factors that are likely to be in the future day. Therefore, the average of unhomogeneous figures is the best way to have-to doe with future factors with the past. The growth arrange of sales in 1990 was 20%. However in 2000 the sales grew by 8.7%. As it was mentioned onward this impulsion is largely ascribable to increased competition. In 2001 sales grew by 13.3. Therefore, it is highly unconvincing to say that in 2002 growth allow still adhere at 20% as the square has already reached its matureness phase in the crease cycle. The sales are judge to grow at 11 percent in 2002, 2003, 2004....If you hope to get a wide-eyed essay, nine it on our website: Ordercustompaper.com

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