You are on page 1of 10

Internal Factor Evaluation Matrix

Key Internal Factors Weight Rating Weighted Score

Opportunities
Global Leader in Market Represented in Over 100 Countries 5.5 million Avon Representativies Brand Recogonition Worldwide High Internal Revenue Promotions 0.10 0.10 0.05 0.10 0.05 0.05 4 3 3 3 2 3 0.40 0.30 0.15 0.30 0.10 0.15 0.00 0.00 0.00 0.00 0.20 0.45 0.30 0.20 0.20 0.00 0.00 0.00 0.00 0.00 2.75

Threats
Cost of Advertising Customer loyality Low Product differentiation between competitors Customer satisfaction Some Customers hesitant of dealing with sales rep 0.10 0.15 0.10 0.10 0.10 2 3 3 2 2

Total

1.00

Analysis: 1- major weakness, 2-minor weakness, 3-minor strength, 4-major strength. The overall weighted score of Avon Products Internal factor Analysis (IFE) is 2.75 which indicated that the internal functions of Avon Products are decenlty strong.

BUS 481 Business Strategy and Policy

Competitive Profile Matrix


Company 1 Critical Success Factors Weight Rating Weighted Score 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total 0.00 0.00 Company 2 Rating Weighted Score 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Company 3 Rating Weighted Score 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Discussion and Analysis

75661994.xls.ms_office

5/1/2012

3:10 PM

Internal Factor Evaluation Matrix Key Internal Factors Strengths Weight Rating Weighted Score
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Weaknesses

Total Discussion and Analysis

0.00

\\vboxsrv\conversion_tmp\scratch23918\75661994.xls.ms_office ]

5/1/2012

Key Financial Ratios


a.Liquidityratiosmeasureafirmsability to meet maturing short-term obligations. 1. Current ratio 2. Quick (acid-test) ratio b. Leverage ratios measure the extent to which a firm has been financed by debt. 1. Debt-to-total assets ratio 2. Debt-to-equity ratio 3. Long-term debt-to-equity ratio 4. Times-interest-earned (coverage) ratio c. Activity ratios measure how effectively a firm is using its resources. 1. Inventory turnover 2. Fixed assets turnover 3. Total assets turnover 4. Accounts receivable turnover 5. Average collection period Numerator Denominator Ratio Analysis

d. Profitability ratios measure a managementsoveralleffectivenessasshown by returns generated on sales and investment. 1. Gross profit margin 2. Operating profit margin 3. Net profit margin 4. Return on total assets 5.Returnonstockholdersequity 6. Earnings per share 7. Price-earnings ratio e.Growthratiosmeasurethefirmsability to maintain its economic position in the growth of the economy and industry. 1. Sales 2. Net income 3. Earnings per share 4. Dividends per share

The Quantitative Strategic Planning Matrix -- QSPM


1 2 Use the internet more effectively to sell Expand the potential customer products. Allow customers full access spectrum to include younger and older to full Avon product line, and eliminate women, and men. the requirement of buying in bulk. Key Factors Weight AS TAS AS TAS

Opportunities
Expand globally into developing countries Better use of Internet Expand potential customer age spectrum Become more male friendly Social Trend: Youthful appearance Steady market in unsure economy Social Trend: Healthy living "Green" 0.10 0.10 0.15 0.10 0.05 0.10 0.05 2 2 4 4 4 3 3 0.20 0.20 0.60 0.40 0.20 0.30 0.15 3 4 2 2 3 2 2 0.30 0.40 0.30 0.20 0.10 0.20 0.10

Threats
Competitors Increased cost of production Inflation Decrease in Sales Increase in the cost of supplies 0.10 0.10 0.05 0.05 0.05 1.00 2 3 0.15 0.20 4 4 0.20 0.40

Strengths
Represented in over 140 countries Great Internal structure Over 6 million sales representatives Strong brand recognition Empowering of Women High Internal Revenue Social Trend: No Animal Testing 0.10 0.05 0.10 0.10 0.05 0.10 0.05 2 3 4 4 2 3 2 0.20 0.15 0.40 0.40 0.10 0.30 0.10 3 2 1 3 1 4 1 0.30 0.10 0.10 0.30 0.05 0.40 0.05

Weaknesses
Advertising Customer Satisfaction/Loyality Product Differentation Distribution Total 0.10 0.10 0.10 0.15 1 3 4 4 3 0.30 0.40 0.40 0.45 5.55 4 3 3 4 0.40 0.30 0.30 0.60 5.1

5/1/20123:10 PM

75661994.xls.ms_office

QSPM

Company Worth Analysis **In Millions


1. Determine Net Worth or Stockholders Equity
Sum of Common Stock, Additional Paid-in Capital, and Retained Earnings

Total common stock Additional paid-in capital Retained Earnings Goodwill? Overvalued assets? Undervalued assets? Intangibles? Sum of above 2. Five Times the Current Annual Profit Five times net income Net income X5 Total 3. The Price-Earnings Ratio (Stock Price/Earnings Per Share)*Net Income Stock price (last trade) EPS Net Income (average for previous five years) Calculation 4. The Outstanding Shares Method Number of shares outstanding * Stock Price Stock price + premium (if any) Average number of shares outstanding Product Four Method Average #1 #2 #3 #4 Sum Divided by 4 Discussion and Analysis

Growth Rates % Sales (Qtr vs year ago qtr) Net Income (YTD vs YTD) Net Income (Qtr vs year ago qtr) Sales (5-Year Annual Avg.) Net Income (5-Year Annual Avg.) Dividends (5-Year Annual Avg.) Price Ratios Current P/E Ratio P/E Ratio 5-Year High P/E Ratio 5-Year Low Price/Sales Ratio Price/Book Value Price/Cash Flow Ratio Profit Margins Gross Margin Pre-Tax Margin Net Profit Margin 5Yr Gross Margin (5-Year Avg.) 5Yr PreTax Margin (5-Year Avg.) 5Yr Net Profit Margin (5-Year Avg.) Financial Condition Debt/Equity Ratio Current Ratio Quick Ratio Interest Coverage Leverage Ratio Book Value/Share Investment Returns % Return On Equity Return On Assets Return On Capital Return On Equity (5-Year Avg.) Return On Assets (5-Year Avg.) Return On Capital (5-Year Avg.) Management Efficiency Income/Employee Revenue/Employee Receivable Turnover Inventory Turnover Asset Turnover Discussion and Analysis

Company name

Industry

SP-500

Income Statement (in thousands) Period Ending Total Revenue Cost of Goods Sold Gross Profit Selling, General & Admin Exp Depreciation Other Expenses Operating Income or loss Interest expense Gain on sale of assets Income InterestTaxes Before Expense Taxes Net Income Earnings per share Dividends Paid Dividends per Share Retained Earnings Shares Outstanding

2008

2009

Remarks

Growth rate of sales

Use Percent of Sales method for all other Income Statement items.

\\vboxsrv\conversion_tmp\scratch23918\75661994.xls.ms_office

5/1/20123:10 PM

Balance Sheet (in Thousands) Period Ending ASSETS Current Assets Cash Total receivables Net Receivables Total Inventory Total Current Assets Intangible Assets Property, Plant, Equipment Accl. Depn. & Amortization Net PP&E Total Assets LIABILITIES Current Liabilities Accounts Payable Other Current Liabilities Total Currrent Liabilities LTD Other Liabilities Deferred Income Taxes Total Liabilities STOCKHOLDERS' EQUITY Common Stock ($0.01 par) Additional Paid-in capital Treasury Stock Retained Earnings Other Stockholders' Equity TOTAL LIABILITIES AND SE

2008

2009 Remarks

\\vboxsrv\conversion_tmp\scratch23918\75661994.xls.ms_office

5/1/20123:10 PM

2008 Growth Ratios Sales Growth Profitability Ratios Net Profit Margin Return on assets Return on Equity Earnings per Share Dividends per Share Leverage Ratios Debt to Equity Long Term Debt to Equity Times Interest Earned Efficiency Ratios Total Asset Turnover

2009

2010 Remarks