Comparison of financial performance to Amil decision
In this era of growing technology cpata increasingly competitive business world, it is very important for us to assess the strengths, weaknesses, opportunities and acaman incestor. by analyzing comparative financial performance it is useful to assess and compare the financial performance of two or more industrial companies, the purpose of which is to identify the trends, strengths and weaknesses on which investment decisions are based
In the business environment itself is divided into two camps, namely companies engaged in manufacturing and companies engaged in services, in manufacturing itself the main focus is to make physical goods, while in service companies offer intangible services. it is this difference that determines the cost structure, sources of income and indicators of financial performance in accordance with the type of enterprise
Idikator used for analysis perbangindan include
Liquidity ratio shows the company’s ability to carry out its short-term obligations
The profitability ratio measures the efficiency of the company in generating profits
Solvency ratio assessment of the company’s ability to meet long-term obligations
Activity ratio an estimate of how effectively a company utilizes its assets to generate revenue
The use of this indicator is adjusted to the company and the purpose of the analysis, inventory measurement is more suitable for manufacturing companies than service companies
Some of the obstacles faced in analyzing the comparison of the size of a small company, business model, and industry factors, how to overcome these obstacles structuring is recommended to expand the settlement with a comparison of comparable companies in terms of size, sector and business model
Performance Metrics
Manufacturing Companies
Service Company
Gross Profit Margin
Lower
Higher
Operating Margin
Lower
Higher
Current Ratio
Lower
Higher
Debt to equity ratio
Higher
Low
Revenue Growth
Volatile
Stable
Profit Stability
Volatile
Stable
Internal and external factors affecting financial performance
Manufacturing companies are determined from the cost of raw materials, efficient production and inventory levels dalma
Service companies are determined from baiaya dikularkan to membyar employee wages, customer satisfaction levels, and also the reputation of the business
External influencing factors such as economic conditions, competition and government regulations that affect both types of business
By doing ivestor comparison can assess the risk and potential obtained from the money being spent for managers by comparing performance with other companies can make it easier to evaluate ongoing improvements in order to maximize the company’s finances in presenting the results of analysis that can feketif using table charts or narratives that are easy to understand tailored to the audience. again the data provided is now accurate data and the underlying assumptions are important for the data to be valid and relevant in the context of the analysis
Trend movement keunagn performance depends on many factors including socio-political and economic factors, dngen berkemabang technology makes it easier for entrepreneurs to memotmatisakn process menginkatan efficiency also creates a new model bsinsi, management needs to consider factors lingkugan, can be ascertained if a company menimbulakn environmental damage as a result of aktivitask bsisnisnya will interfere with business sustainability, serpti reprimand from the authorities
Some of the resources needed to do this comparison by examining some of the financial performance in the form of corporate finance, financial platforms and financial consultants with appropriate funds will increase the accuracy and relevance of the analysis conducted
With understanding and penreapan financial comparison analysis accurately, will make it easier for companies and investors to make strategic decisions in facing the challenges of a growing market