A fictional company, the Granada Corporation, has hired you as an outside consultant to its investment committee, and has requested that you thoroughly analyze a company of your own choosing as a potential investment for the Granada Corporation. You are to use an Annual Report or a 10K from your selected company as the basis for your analysis as well as any other information that might be available – newspapers, magazines, the Internet including peer group data from Dun & Bradstreet, Moody’s, Standard & Poor’s. Don’t overlook other SEC disclosures such as information included in 8K filings.
Assume that the Granada Corporation is a national, publicly owned food products company, which is based outside Dallas, Texas. For 2017, it earned approximately $72,000,000 on sales of $500,000,000. At 12/31/17 its investments in marketable securities were $32,000,000 which represented 8% of total assets of $400,000,000.
The final product to be delivered to the investment committee of the Granada Corporation shall consist of the following:
A letter to the investment committee of the Granada Corporation with a recommendation as to whether the company that you have analyzed would be considered a safe and viable investment option. The letter should summarize the main reasons for your conclusion with detailed support to follow. In the letter speculate on the amount of earnings/loss for your company that you would expect to see in the near future. Also, give your impression of the three most important issues your company will face in the coming year. These are not restricted to the financial arena, but could be the result of changes in technology, the environment, health care, the legislative process, etc.
A thumbnail sketch of the company you have selected to include who the CEO and CFO are (a little of their background), headquarters, year founded, fiscal period, independent auditors, related parties etc.
Part III – Main Support
A. Financial statement analysis to include ratios and trends. Select only those ratios that are
relevant. You financial statement analysis should include a summary highlighting positive
and negative trends or strengths and weaknesses that you have identified.
B. Footnote analysis – comment on areas of concern based on your understanding of the
footnotes. (Hint – you may need to “read between the lines”.
C. Auditor’s Report – identify whether it’s the standard unqualified opinion or if it has been modified. If there has been a modification, discuss the nature of it.
D. Management’s Discussion and Analysis –state how you feel about MD&A. Does it seem to
be a fair representation of the company or do you think that it presents an inaccurate picture?
I want your opinion? Need horizontal
analysis for income
balance sheet for
My Company is Costco
E. Current Events – Is your company currently in the news? Identify issues currently affecting
companies, which are similar to your company, which have the potential to affect your
company as well. (Look at the BIG PICTURE and BE CREATIVE)
F. Social Responsibility – In what ways does the company you selected have a responsibility to
society? (e.g. Tobacco industry and consumer product safety) Does social responsibility
present a problem to your company?
Part IV – Non Financial
Investment decisions can be influenced by more than just financial results. Identify any non-financial issues facing your company, which tempered your conclusion.
3.Largest customer6.Employee issues
Remember that the letter to the investment committee of the Granada Corporation is the finished product. Make it persuasive and professional looking. The paper should be typed (double-spaced) and about 10 pages in length. You will be graded on your writing skills, the strength of your analysis, critical thinking skills, and the overall effectiveness of your presentation.
The information that I have provided to you should be used only as a guide, leaving much room for interpretation. I like ingenuity. Have fun and good luck!
The aggregate costs rates of Benihana comes up to 29% which made out of work, publicizing, administration and lease, in the mean time the working costs rates of a common eatery aggregate to 42.25-57%. It is evident that Benihana's administration idea, benefit task and its conveyance framework empower the eatery to fundamentally lessen expenses and increase higher benefits, along these lines turned out to be more focused than its rivals. The Chef's Salary Culinary experts were imperative component to the accomplishment of the Benihana. Hence, it is critical to assess the impact of their pay rates on the eatery gainfulness. The case gave that in one unit there were roughly 30 staff which were 6-8 culinary experts, 6-8 servers, 4-5 directors, 2-3 barman, and around 8-11 transport staff and dishwashers. The aggregate work cost as ascertained above was 10% of gross deals which is proportionate to $130,000 which must be separated among every one of the representatives barring the supervisors. Keeping in mind the end goal to appraise the culinary specialists' pay rates, every representative compensations will be first assessed. The suspicion is made that servers and barmen would have generally a similar measure of pay which is estimated $3,000-4,000 for every individual for every year or around 2-3% of aggregate work cost. The 6-11 transport staff and dishwashers could procure around $1,500-3,000 for every individual for each year or 1-2% of aggregate work cost for every individual. Given the suspicions over, the culinary specialists' compensation would be around $10,000-12,000/year. Benihana Production System Benihana has an effective procedure spill out of that of the generation procedure to the administration conveyed to the client, furnishing them with a definitive feasting knowledge. The normal feasting day and age is one hour which does exclude the bar time. This recognizes the effectiveness of the representatives, the hibachi style of cooking and seating game plan. The nourishment is set up before the situated visitor and is conveyed to them with a customized benefit; in the meantime guaranteeing that top notch benchmarks of sustenance creation are met. The eatery has an efficient design arrange for which improves their administration conveyance. It has been planned in an extremely orderly to encourage the smooth stream of the staff and the visitor entering the eatery. The creation framework has been engaged, which can be translated to mean, the whole generation benefit inside the eatery from time of bringing the visitor and staff together , seating them, taking their request, conveying the nourishment, setting up the sustenance till the season of visitor leaving the eatery. On painstakingly examination of the format for the Benihana, it can be seen that the passageway drives straightforwardly to the parlor. See Figure 1. The visitor can unwind and have a savor the parlor which has a seating limit of around 50, while a table is being sorted out for them as the turnover era reaches to around 60 minutes. They are then escorted to the feasting region in bunches 4, 8 or 16. The 112 seat eatery has again been arranged with incredible effectiveness. There is one culinary expert and one server for each two hibachi tables, in this way the outlining procedure has been made remembering this and in the meantime this decreases the work costs. The back region space has been effectively used. The kitchen incorporates a pre-readiness zone, hot territory and after creation zone, which are isolated to dodge disarray and confusion. The washing region is near the kitchen and the eatery to stay away from postponement of administration. The capacity zone has enough space to oblige both the kitchen and the drink territories what's more are intended to be simple access to both the zones. In the meantime there are a couple of adjustments that can be made to additionally upgrade the procedure. The passageway for the eatery devours a ton of room and can be adjusted to suit more visitors in the parlor. The Lounge territory setup can be revamped to oblige more visitor so that if the visitors eating in the eating zone need to invest some more energy in the eatery by having a couple of beverages they would thus be able to be Benihana a Japanese steakhouse eatery with hibachi idea started in 1964 in West Side, New York. This eatery was established by Hiroaki (Rocky) Aoki, an open door searcher, who recognized the undiscovered needs in the American eatery industry subsequent to having completed a careful investigation of the market. His idea serve the unfulfilled needs of the market particularly the center pay specialists by giving colorful environment, the bona fide Japanese climate, and in addition offering new understanding by having gourmet experts cooked before clients. The thought immediately picked up the ubiquity; brought about high benefits and quick development. This administration idea delivered the upper hand to Benihana eatery. By having culinary experts outside cooking; it enables the eatery to spare work expenses and offer more mindful administrations. The menu restriction likewise brings down the expenses. The space was completely used to augment the benefits. The costs structure and usage of room will be clarified in point by point. In addition, the exceptionally prepared talented culinary experts and imaginative PR and showcasing effort were likewise the key commitment to the achievement of the eatery. In spite of the achievement, the fast development can frequently time be an issue since, organization might not have the assets and the strong arrangement for the development system. Rough needed to broaden his business into retail and fast food chain. Moreover, this new imaginative administration idea may cause perplexity with respect to what the eatery center item or administrations truly are. This report means to address the issues specified by assessing Rocky's expansion design, distinguish the center items and administrations, think of options which were first to open new Beni Trendy eatery which target more youthful age and After Beni's for treat and concoct activity design. Issue Statement Rough Aika is a man of extraordinary dreams however his fantasies might be too enormous for him to have the capacity to accomplish it. He intends to develop his business to different areas of the market particularly the more youthful age however with the goal for Rocky to have the capacity to develop his business and to amplify the benefits, the extension designs should be deliberately updated and arranged. As of now, Rocky is arranging his broadening methodology, yet this must be assessed and with the end goal of effectively developing Rocky needs to first comprehend his business and market. Information Analysis Benihana, a Teppanyaki Japanese eatery with hibachi idea was a noteworthy achievement. The administration idea was new and special to the market which separated itself from the run of the mill existing eateries. The significant contrasts of the idea were: The eatery disposed of the back of house regular kitchen while rather giving hibachi tables all around prepared culinary specialists cooking before clients. This idea permits the work cost to be chopped down to 10-12% of gross deals and mindful administration. Benihana gave restricted menus, which brought about diminishment of sustenance stockpiling and wastage costs. The true Japanese atmosphere or Japanese touch was conveyed to the eatery through bringing in all furniture from Japan including dividers, roofs, shafts and enrichments. Benihana better use their space. Ordinary eateries require 30-35% space for back of the house in the mean time Benihana required just 22% of the aggregate space. By concentrating on the previously mentioned focuses, Benihana could lessen their costs, in this manner turn out to be more productive. For example, Chicago branch was the most productive unit with the gross benefit around 1.3 million every year. The purpose behind this was the administration's capacity to keep their costs to a negligible with nourishment - 30%, work - 10%, publicizing - 10%, administration - 4%, and lease - 5 %. Benihana Cost and Typical Restaurant Cost Structure The above pay explanation demonstrates the benefits that Benihana in Chicago was making amid the year 1972. A portion of the sums were at that point given including the gross deals, sustenance and drink deals, the level of nourishment cost, work cost, promoting costs, administration cost, and lease. Be that as it may, some different things should have been figured or expected, for example, the level of refreshment cost, the aggregate deals and the wage assess. The gross deals were given to be $1,300,000, subsequently the nourishment and drink would be $910,000 and $390,000 separately. The nourishment costs that are 30% of sustenance deals would give a measure of $273,000 and the drink costs that was found the middle value of to be 20% of the refreshment deals would equivalent to $78,000. Along these lines, the gross benefit would equivalent to net deals less aggregate expenses of merchandise sold which is equivalent to $949,000. The work, promoting, administration and lease costs are relied upon to be 10%, 10%, 4% and 5% of gross deals individually. The costs were ascertained to be $130,000, $130,000, $52,000, and $65,000 which totalled to $377,000 or add up to working expenses. The net benefit before salary charge then again is equivalent to net benefit short aggregate working costs or $949,000 less $377,000 which gives the estimation of $572,000. To figure the net benefit after duty, the suspicion was made that the salary assess was 14% which depends on the level of expense that should be charged must be given yet the case does not give any such data, so for the reason the supposition accept that the pay impose was at 14% so for this situation the esteem would be $80,080 which is $572,000*20/100. So the net benefit after expense will be $572,000 less $80,080 which computes to $491,920. So as to have a clearer photo of the distinction amongst Benihana and ordinary eatery the rates of every thing were thought about. The nourishment and drinks deals rates of Benihana are simlar to that of an ordinary eatery which were around 70% for sustenance and 30% for refreshments. By the by, the significant distinction lies in the nourishment and refreshment costs which was around half in Benihana while in commonplace eatery would be proportional to 73-88% or around 23-38% higher.>GET ANSWER