Financial Analysis of Wild Oats Essay
Top competitors of Wild Oats Market in selling organic products are GNC, Trader Joe’s, Whole Foods Markets, Wild by Nature and Mother’s Market and Kitchen. These companies are some of the names being trusted in the industry. Each has their own style of attracting customers and making their products seem better than that of the other. Among these companies the top competitor of Wild Oats is Whole Foods. Whole Foods started in Austin Texas in 1980. Most of its products are perishable meaning that there are no other chemicals added to their products.
They have a total of one hundred eighty-seven stores stationed in Canada, United Kingdom and thirty states in the United States of America. The company pride themselves in being in touch with Mother Nature and that consumers are sure that their products are as organic as it can get. In terms of stores, Whole Foods have conquered farther than that of Wild Oats. They too have more stores stationed than that of the latter. The oldest organic company is said to be GNC because it has been founded in 1935. Currently there are 5,853 stores worldwide with 12640 employees running the business.
They have been one of the trusted
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The first store was located in Los Angeles. Trader’s Joe was first handled by Joe Coulombe and was transferred to Karl and Theo Albrecht in 1979. Nowadays, there are more than two hundred fifty stores located in twenty states around America. They have upscale their products to include organic produce and nutritional supplements. They have recorded a revenue growth of sixty percent in 2004 with an income of 4000 million dollars. Trader’s Joe has concentrated their stores in the United States unlike that of its competitors that has conquered other countries as well. Read also Walmart Financial Analysis paper
Competition becomes beneficial for one company when because without it there will be no need for innovations and changes in the industry. Consumers have a choice thus companies are always evolving to make their products and company more appealing. Wild Oats has been showing a very good improvement in the income that they have generated since the day they started the business of organic products.
Five hundred forty-three stockholders have held common stocks as of February of this year. In 2001, the net sale of the company was $219.5 million which increased to $233. 0 million after one fiscal year. Sales for Wild Oats have recorded an increase of 7. 2% in the year 2005. Increases were attributable to comparable store sales growth of 3. 8% and the net increase of five stores in fiscal 2005. In the 21st century, Wild Oats economic trend has been going up and it has not come down since. This shows that the management is able to manage their finances well and that marketing strategies are helpful in making their business a huge success.
Part of the success in finances could also be attributed to the growing numbers of store and private labeled product that the company is venturing into. An example of a program that helps improve the sale of Wild Oats will be their Fresh Look marketing and merchandising program. This is a program done by the company to attract more customers and to further develop their credibility. Strategic Recommendations The key to a successful partnership is inter-dependency. A company must be willing to work in close relationship with some of its partners of they would like to win this type of war that they have.
Service transparency, everyone not only the direct consumers must know the worth of their product and the ethics of the company behind it. Nowadays, people are crucial about ethics behind the company and not the mere numbers or figures that they give. It would help a lot if one company has a positive image within the industry and throughout as well. Consumers would want something and would need something that they can use anytime and anywhere without so much conflict. A standard that is refined and implementable.
Stability of alliances another thing needed for a business to stay long. Sometimes even though you have the smartest idea or the greatest product, if that would not be supported, you are still at the loosing end. Coordination, cooperation and distribution these are the keys for a successful alliance to make one product win over the other. Marketing strategies should be well defined for the target population. Any business needs an amount of risk and determination to succeed.
The capital is one important factor that determines the future of one industry that is why it is important that the amount invested in any given company or business is carefully monitored if it is being use to the fullest and if it will augment to all the needs needed to make it. Capital Structure refers to the amount of debt financing as opposed to equity financing. Relying on own money is not enough, more than usual, a company needs to borrow money, maybe from a bank, in order to meet its objectives. This is called leverage in the financing world. Deciding on capital structure is critical.
Changing our financing weights can change the cost of capital. Determining the value of an investment and projects rely on the appropriate budget that one company allocate for his capital and the required return for it. It is easy to acquire a debt but maintaining its positive impact in one company needs a lot of effort and planning. Business risk should be managed well and risk should be realigned in a way to cut costs; Optimized firm’s operating and financing costs; Trade off fixed charge and variable charge costs; Risk management; and when to increase and decrease risk. (Brackers, 2004)