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BSG Performance Analyses

Blair Cannon Nikita Gowin Joey Fleming. BSG Performance Analyses. North America. Europe-Africa. Asia-Pacific. Latin America. BEST in Industry KSF- (FIRST ranked team) Economy of Scale. Costs/total assets $352,929,000/$832,080,000= .42 Lower EOS is better with growth strategy

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BSG Performance Analyses

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  1. Blair Cannon Nikita Gowin Joey Fleming BSG Performance Analyses

  2. North America

  3. Europe-Africa

  4. Asia-Pacific

  5. Latin America

  6. BEST in Industry KSF-(FIRST ranked team) Economy of Scale • Costs/total assets $352,929,000/$832,080,000= .42 • Lower EOS is better with growth strategy • Increased operating capacity • Built new plant in unsaturated market • Maintaining 3 manufacturing plants in 3 different regions • First mover’s into the Latin America region • Leads to lower costs/expenses per unit • More effective and efficient operations • Leads to more profit and increased profit margin

  7. BEST in Industry KSF-(FIRST ranked team) Celebrity Appeal • Multiple long-term contracts with celebrities • Effects: • Increased branded sales volume • Increased market share • Increased image rating

  8. BEST in Industry KSF–(FIRST ranked team)G* (index of sustainable growth) • G*=(1-dividend payout ratio)*ROE • G* = (1- 387/73174)30= 29.84 • Higher the G* the better it is for growth • Long term financing/debt • Used funding to increase capacity and equipment allowing for economy of scale • Financial leverage also helps in magnifying ROE

  9. BEST in Industry KSF- (Last ranked team) Economy of Scale • Costs/total assets $150,985,000/226,390,000= .67 • Have not achieved Economies of Scale • Increased their spending but not enough to meet Economies of Scale

  10. BEST in Industry (LAST ranked team) G*(index of sustainable growth) • Have a low G* because of their low ROE • G*=(1-dividend payout ratio)*ROE • G*=(1-0)*6.4= 6.4 • Compared to the first ranked company who has a G* equal to 29.84

  11. BEST in Industry KSF- (LAST ranked team) Celebrity Appeal • Have 2 celebrities in Europe, but not utilizing European market. • Not taking enough risks with investing in advertising. • Only increased by 1000 • Effects: • Increased market share in internet • Decreased market share in wholesale • Lost sales increased significantly

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