Financial Analysis Project Essay

Todays personal products merchandise has become more competitive than ever. With economic and political uncertainty in many separate of the world, The Este extoller Companies Inc. has invoked a number of unique and diverse strategies in order to gain customer verity while attracting new customers for staying as a leader in personal products effort. This paper focuses on analyzing The Este Lauder Companies Inc., including familiarity overview and main strategies. The main purpose of this paper is using a series fiscal accounting ratios as tools to analyze the operation of this company from 2008 to 2012, the nearest five years. After researching of the strategies and data, I chafe a conclusion that this company is in a healthy financial bureau and has a large-mouthed capacity to develop well in the future.Overview After one quarter learning about financial accounting, I have some sort of concept about this course. In order to deeply realize the knowledge we have learned in c lass and have solid experience about on the whole of those formulas. I write this paper to turn abstract theory into practice. I choose The Este Lauder Companies Inc. as my analysis target, not only because I am a loyal consumer for this company, but in addition Im very interested in its unique business strategy. As we all know, The Este Lauder Companies Inc. is a family business and remains the leader in the global prestige looker market for a long history.Whats more, even though its a traditional company, it has not minify behind in the extreme competition nowadays. I think its success mainly contributed to four overcritical areas creativity and innovation, high-tough, local relevance and digital capabilities. This paper give focus on three parts to analyze The Este Lauder Companies Inc. First, I plan to say something about this company, including its development overview and strategies. Second, I will put this company in the whole industriousness to analyze its opportunitie s and challenges. The give-up the ghost but not the least, Id like to use financial accounting ratios as tools to deeply analyze the operation situation of this company.Company OutlineThe Este Lauder Companies Inc. is one of the leading manufacturers and sellers of skin plow, make up, fragrance and hairsbreadth care products in the world. The companys products are sold in over 150 countries and regions infra almost thirty brands. Among those brands, there are some big brands we are very familiar with, and actually, those brands so contributed a lot to the whole companys sales. They are Este Lauder, Clinique, Aramis, Origins, Prescriptives, MAC, Bobbi Brown, Tommy Hilfiger, Kiton, La Mer, American Beauty, Flirt , and AERIN Beauty. Taken together, sales of all the Companys brands comprise about twenty percent of the $40 billion global prestige beauty business.The Este Lauder Companies long-term strategy is to fulfil higher levels of sustainable, profitable growth to remain a le ader in global prestige beauty business. In that case, they use consumers as their muse to create products that really needed. Those educational beauty advisors always aliment a good connection with consumers, in order to inspire brand loyalty. Whats more, this company dedicated in creating certain products for specific markets and deeply immersed in the online world as well. At a glance, the company sells its products mainly through some kind of channels to keep their brands are easily accessible.These channels admit department stores, retailers, TV shopping, stores on ships, in-flight, duty-free shops in airports and the Internet. The Americas, definitely occupies their largest region of sales, accounting for about 42% of total global sales. Europe, the middle east and Africa owns the highest percentage of operating income, because those regions enjoyed huge sales growth during the last two years. Whats more, China has become a more and more important market in the Asia/ Pacifi c region after Japan, fueled by rapidly growing demand of luxury brands. manufacture AnalysisThe personal care industry concludes a variety of products, including fragrances, makeup, hair care, sunscreen, toothpaste, and products for bathing, nail care, and shaving. Major companies in this industry include Este Lauder, Johnson& Johnson, Procter& Gamble, LOreal, Shiseido and Unilever. The United States, Europe, UK, Brazil and Russia dominate the global personal care products. India and China are the fastest growing markets for personal care products. The global personal care products industry has revenue of about $250 billion annually. Major products include cosmetics (35% of industry revenue), hair products (25%), and creams and lotions (20%). Other products include nose (10%), toothpaste and mouthwashes (5%), and shaving preparations.The global personal care products industry is concentrated with the top 50 companies holding a combined market share of around 85%. The profitability of individual companies depends on product innovation, legal sales and marketing, and efficient operations. Large companies like The Este Lauder Companies Inc. have scale advantages in purchasing, manufacturing, distribution, and marketing. downhearted companies can compete effectively by offering specialized products. Over the coming years, the whole industry is likely to continue investing in eco-friendly practices.