本文是留学生assignment范例，题目是“Wesfarmers Business and Competitive Environment（澳大利亚西农集团的商业和竞争环境）”，这份报告对澳大利亚西农集团进行了深入的分析。它给出了一个综合企业的总体概念和组织的简短历史，以及它是如何开始的，然后组织如何在多年的发展成为澳大利亚的巨头之一。公司不仅涉及一个行业，而且涉及多个行业，主要是零售，还涉及化工、保险、家用产品、采矿和化肥。作为一个在许多行业都有运作的组织，澳大利亚西农集团正在一天天成长壮大。
This report provides a deep analysis of Wesfarmers. It gives a general idea about the conglomerate and a brief history about the organisation and where it started then how the organisation has evolved over the years to become one of Australia’s giant company. The Company Involved in not only one industry but several industries mainly retail but also in chemicals, insurance, home products, mining and fertilisers. Being an organisation that operates in many industries Wesfarmers is growing and getting bigger day by day.
The report has focused on three key areas of Wesfarmers which are its financial performance, its marketing strategy and its human resources management. It starts with a brief idea about the main competitors of Wesfarmers, then go more into depth by stating the financial strategies of Wesfarmers in order to expand into international markets. The report also has addressed the sources and the applications of funds of the major company revealing.
1.Wesfarmers Ltd. Background Wesfarmers公司背景
Wesfarmers group is operating some segments that are managed and organised separately based on the products and services nature. The board and executive management team is responsible for monitoring the operating results and making the decisions about the performance assessment and resources allocation. The management team is evaluating the segments performance based on their operating profit or loss. When the company’s finance costs are incurred, they are recognised as expenses. At the time that the effect of the time value of money is significant, the provisions and some other payables are deducted to their present value.
This deductions are known as the discount rate adjustment in finance costs (Omics International 2014). Wesfarmers employees in Australia and New Zealand receive fixed benefits from the company and they are part of a defined contribution scheme. The employees emoluments are recognised as expenses when they become payable and the prepaid emoluments are recognised as assets to the level that a cash refund in the future payment is available.
Wesfarmers also operates the superannuation benefits for the employees. The group’s international operations are according to the agreement with the host countries regulations. In terms of international financial instruments, Wesfarmers presents its derived assets and liabilities on the gross basis. The derived financial instruments are matter to applicable master netting arrangements such as (ISDA) the International Swaps and Derivatives Association (Wesfarmers 2018). In regard to the Company’s international operations, its primary currency exposure is to US dollar and Euro. It is generated from sales and purchases by a division in currencies instead of the division’s functional currency. In case of the company’s operation with New Zealand, it uses the exchange rate between Australia and NZ. It means the company mitigates the effect of its conversion currency exposure by borrowing in New Zealand dollars (Hill et Al. 2017).
In some cases the Wesfarmers decided to disposal some of its resources such as disposal of Curragh Pty Ltd on December 2017 that the company entered into an agreement to sell it. The Curragh coal mine business has presented as the discontinued operation on March 2018 for FY2018. Wesfarmers entered to another agreement contract to dispose the Bunnings Warehouse in United Kingdom and Ireland on 25 May 2018. Wesfarmers has divested the assets of the BUKI operation to a company that is attached with Hilco Capital for a nominal amount. This agreement contract included a value share system that Wesfarmers can participate in any of profitable divestment of the business in the long-term (Wesfarmers 2018).
2.Type of Industry and Business Environment行业类型和商业环境
Western Australian farmers’ cooperative, which is known as Wesfarmers has found in 1914 and has grown to one of the largest companies in Australia. Its managing director is Rob Scott and company’s annual revenue is $68.4 B. Wesfarmers Limited is a Public Company and most of its income is generated from grocery stores and supermarkets. The company operates the largest retail stores and departments in the Australia. Its operation includes: supermarkets, liquor, hotels, department stores, office supplies, home improvement, and convenience stores.
西澳大利亚州农民合作社，简称Wesfarmers，成立于1914年，现已发展成为澳大利亚最大的公司之一。其董事总经理是Rob Scott，公司的年收入为68.4美元。Wesfarmers Limited是一家上市公司，其大部分收入来自杂货店和超市。该公司经营着澳大利亚最大的零售商店和部门。经营范围包括:超市、酒类、酒店、百货、办公用品、家居、便利店等。
The company also operates in industrials division such as energy, chemical, and fertilisers, coal, and safety product. Wesfarmers is also known as one of Australia’s major private sector employers that has almost 220,000 stuff and employees. The company has a shareholder base around 530,000 and the business’s first objective is to produce sufficient return to the shareholders (Wesfarmers Ltd 2016).
3.Wesfarmers Major Competitors Wesfarmers的主要竞争对手
According to the IBIS WORLD Australia’s top ten companies are indicated in the table below. Wesfarmers as the first top company has some major competitors that Woolworths Limited is the main competitor by $55.9 B revenue. Common Wealth Bank of Australia is the second main competitor by $44.9 B revenue. The third competitor of Wesfarmers is BHP by $39.2 B revenue. The other main competitors of Wesfarmers Limited are Westpac Banking Corporation, Rio Tinto, ANZ Banking Group, Nab, Telstra, and NSW Health (Arvanis 2018).
根据IBIS的世界排名，澳大利亚排名前十的公司如下表所示。westfarmers作为第一家顶级公司有一些主要的竞争对手，沃尔沃斯有限公司是主要的竞争对手，收入为559亿美元。澳大利亚共同财富银行是第二大主要竞争对手，收入达449亿美元。Wesfarmers的第三个竞争对手是BHP，收入为392亿美元。westfarmers Limited的其他主要竞争对手是西太平洋银行(Westpac Banking Corporation)、里约热内卢Tinto、澳新银行集团(ANZ Banking Group)、Nab、Telstra和NSW Health (Arvanis 2018)。
4.Financial Strategies to expand to International Markets 拓展国际市场的财务策略
Expanding to international markets and taking the brands overseas is difficult. To expand to global markets every company needs sufficient financial strategies to follow. Wesfarmers has expanded its home improvement business through the Bunnings store overseas (United Kingdom and Ireland) and in Australia. On February 2016 Wesfarmers bought the UK based hardware chain and by April 2017 the company has launched 24 Bunnings store in different cities in UK and Ireland. Unfortunately, the company sold some of the Bunnings stores on 25 May 2018 due to underperforming (Blake 2018).
The Wesfarmers Company has employed some financial strategies to follow in its expansion to international markets. In regard to customer’s convenience the stores were open for long hours 7 am to 9 pm, 7 days a week. The lowest prices has guaranteed with the good quality and they targeted broad market. The company has followed global strategies but unfortunately it has underestimated the UK customer’s expectations due to their different life style from Australians (Wesfarmers 2018).
5.Sources and Applications of Funds资金来源及用途
Assessing the Wesfarmers wide portfolio is very complicated and difficult. Identifying the segments that commit the most to the Wesfarmers portfolio is the first step to start assessing the company’s fund providing parts (Boha 2018). The chart below shows the Wesfarmers’ major revenue contributor. Coles is the main fund provider for the Wesfarmers by having almost 57% of its revenue. The Coles earnings includes the revenue from the supermarket, liquor, and hotel operations. Home improvement is the second fund provider to the Wesfarmers.
评估Wesfarmers的投资组合非常复杂和困难。确定在西农投资组合中投入最多的部门是开始评估该公司提供零部件的基金的第一步(Boha 2018)。下面的图表显示了西部农民的主要收入来源。Coles是Wesfarmers的主要资金提供者，其收入占其总收入的57%。 Coles的收入包括超市、酒类和酒店运营的收入。改善住房是Wesfarmers的第二个资金来源。
The Bunnings Warehouses have around 20% of the Company’s revenue. The department stores are sitting in the third level of revenue contribution margin. Kmart and Target make up 12% of the Company’s revenue. Industrials and historic products such as chemicals, fertilisers, and energy show up are contributing to the Company’s revenue by 8%. Officeworks is the 5th revenue contributor by having 3% revenue of the Company (Wesfarmers 2017).
6.Financial Performance in the last three years过去三年的财务表现
A company’s financial position is clarified by its assets, liabilities, and shareholder’s equity. To assess the Wesfarmers financial performance in the last 3 years, the annual report of the company has included all the required information. The company’s balance sheet provides the assets, liabilities, and shareholder’s equity to analyse (Cunningham 2019). Wesfarmers balance sheet indicates that in the last three years, the company’s total current assets and total assets have both decreased since 2016.
Total assets of company was 41,394b at 2016 that has decreased to 40,837b at 2017 and at the end of June 2018 has decreased to 37,606b. This is the result of selling lands and buildings due to the Bunnings stores underperforming in the UK. The company’s total current liabilities and total liabilities both have decreased from 44.56% at 2016 to 39.49% at 2018. Wesfarmers had total liabilities of 18,445b at 2016 which has decreased to 16,896b at 2017 and again decreased to 14,852b at 2018. This means that the company’s account payables have increased and the company has paid more of its liabilities. Wesfarmers annual report indicates that the total shareholder’s equity in the last three years had some up and downs. Total equity at 2016 was 22,949b that has increased to 23,941b at 2017 but then has decreased to 22,754 at 2018 (Investing.com 2018).
Generally, the company’s most fund providers in the Australia are performing well. Especially Coles that has the most profit and Bunnings stores also doing well in Australia. However, the Bunnings store in the UK and Ireland did not performed as the estimated plan and made a big loss for the company in the last few years. In case of department stores Kmart is performing very well and increasing the company’s profit but Target did not performed as well as Kmart in the last few years but the company’s Managing Director indicates that the Target stores are getting back to track in 2018. Wesfarmers is still one of the largest Company’s in Australia and trying to achieve its main objective that is providing satisfactory return to the shareholders (Dow 2018).
This report has discussed the Wesfarmers operations and assessed its international performance. Wesfarmers is performing as one of the largest Australian companies and found on 1914 in Western Australia. Wesfarmers group is a public company and most of its income is from supermarkets. The company’s operation includes: supermarkets (Cole’s), Department stores (Target and Kmart), Office supplies (Office works), home improvement (Bunnings Ware house), hotels, and liquor. The company operates in industrials division such as energy, fertilisers, chemical, coal, and safety products as well. Wesfarmers major competitor is Woolworths Ltd. and Amazon as an online competitor. Wesfarmers as a private sector has employed around 220,000 employees in Australia and also has a shareholder base around 530,000. The Business’s primary objective is to provide a sufficient return to the shareholders. Wesfarmers has following some strategies to expand the business. The company performs effectively to meet customer’s needs and adopts entrepreneurial initiative to secure growth opportunities. The company restates its portfolio by value-adding enterprises and ensures sustainability through sufficient management plans.
本报告讨论了Wesfarmers组织的运作，并评估了其国际业绩。westfarmers是澳大利亚最大的公司之一，成立于1914年的西澳大利亚。Wesfarmers是一家上市公司，其大部分收入来自超市。公司经营范围包括:超市(Cole’s)、百货商店(Target和Kmart)、办公用品(Office works)、家居装修(Bunnings Ware house)、酒店和酒类。该公司经营的工业部门，如能源、化肥、化工、煤炭和安全产品等。westfarmers的主要竞争对手是Woolworths Ltd.和亚马逊作为在线竞争对手。westfarmers是一家私营企业，在澳大利亚拥有约22万名员工，股东基数约为53万。企业的主要目标是为股东提供足够的回报。Wesfarmers采取了一些策略来扩大业务。公司有效地满足客户的需求，并采取进取精神确保增长机会。公司通过增值企业重申其投资组合，并通过充分的管理计划确保可持续性。