The supply chain with Target is at higher risk than Walmart. This is again, Walmart is well known and well established the supply chain and have a better way of keeping control of their supplies. It is very important to keep promises made to the customers because the smallest mistake can ruin the reputation on either company. It is very important for both companies to consider the ecommerce and online and invest into the technology that would help both companies grow and make more of a profit. Plus, providing the best customer service to all people whether in a brick and mortar or an online store. The bottom line is the customer.
Financial Analysis.
Working with the ratio type analysis is actually the best to perform the comparison because the size of each store is quite different, this will be easy for the logical comparisons. .
Performance measurement:.
Target 2013 sales = $71,279 million Walmart 2014 sales = $473,076 million.
Sales growth formula = (Current year sales Previous year sales) - 1.
(All values are in $millions).
Target.
Walmart.
2015.
2014.
2016.
2015.
Revenue I.
$73,785 .
$72,618 .
$478,614 .
$482,229 .
Operating profit II.
$5,530 .
$4,535 .
$24,105 .
$27,147 .
Net income III.
$3,363 .
($1,636).
$14,694 .
$16,363 .
Shareholders' equity IV.
$12,957 .
$13,997 .
$83,611 .
$85,937 .
Total assets V.
$40,262 .
$41,172 .
$199,581 .
$203,490 .
Sales growth .
1.61%.
1.88%.
-0.75%.
1.93%.
Operating profit margin VI = II/I.
7.49%.
6.25%.
5.04%.
5.63%.
Net profit margin VII = III/I.
4.56%.
-2.25%.
3.07%.
3.39%.
Asset turnover ratio VIII = I/V.
1.833.
1.764.
2.398.
2.370.
ROE IX = III/IV.
25.96%.
-11.69%.
17.57%.
19.04%.
ROA X = III/V.
8.35%.
-3.97%.
7.36%.
8.04%.
These ratios show each company for two years. Target has continued to grow above Walmart. But there is a sign of growth with both companies. Both are continuing to keep their eyes on the economics which should be given higher revenues for each company and even making a greater profit.
