Professional Documents
Culture Documents
MNGT 130
ACADEMIC YEAR 2015-2016
BUSINESS ANALYST
JATIN MITTAL
LIBRARY CARD NUMBER-34097953
PAGE NUMBER | 1
EXECUTIVE SUMMARY-
The report analyses the market situation of current network of the developments on annual
revenue and profitability of each area. In general it has been seen that with the increase in
population, greater revenue can be obtained. Most efficient staff are in area ink whereas
area Kat has been noted as a least productive. It helps us to understand how some branches
manage to have a high productivity and how learning from such areas could be used for the
branches with productivity in decline.
However, to increase the profit it is necessary to decrease the cost in certain branches as
their annual cost is much higher than the revenue they are generating. It is also necessary to
increase number of Flats/offices in areas with population as from the analysis made it has
been noticed that highly populated area got the potential to earn more of revenues.
All in all, Employees in area Kat, Tin and Rat have been recorded as unhappy as productivity
per employee is negative in these areas. The reasons to expand in residential development
makes some sense for the company in some degree. The report explains with more details
these outcomes stated above accompanied by recommendations.
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Contents -
Executive Summary ......................................................................................2
Introduction...................................................................................................4
Conclusion..................................................................................................... 11
Recommendations ..................................................................................... 11
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INTRODUCTION-
MIN: -£457,477; Max: £256,240 (Fig 1.1 shows the annual profit earned by the company in
different areas)
£300,000
£200,000
£100,000
ANNUAL PROFIT
£0
Gre
Pur
Wet
Ink
Qed
Ufo
Jin
Tin
One
Eat
Lot
Zan
Yet
Fur
Kat
Net
Rat
Vue
Arm
Sad
Bro
Man
Can
Hen
Xon
Dim
(£100,000)
annual profit
(£200,000)
(£300,000)
(£400,000)
(£500,000)
AREA/LOCATION
Firstly, it is important to summarize the annual profit from the data with the help of
clustered column. fig 1.1 simply represents the annual profit earned by the company in the
various areas it operates. From the previous year it can be concluded that areas of Kat’ tin
and rat have not yielded profit for the company, instead these areas incurred huge losses
including few other locations with minor losses and there is a need to pay special focus on
these areas to turn them into profitable state.
It can also be seen that area’s like tin, bro, vue and ink lie in the bracket of areas that
yielded profit of at least £150,000 or above which covers almost half of the total profit. So
there is need to learn from the manager of these areas and apply the learning to the area
who are yielding either low profit or running in Loss.
It can be noticed that most of the locations irrespective of development type, earned profit
below 1 million pounds although maximum of the profit in general was generated by
residential development which in total summed up to be £696,122 and on the other hand
commercial development generated profit of just £389,222 in total.
PAGE NUMBER | 4
This symmetrically distributed data informs us about the values around the mean and which
come out to be 3.4%; therefore, it can be concluded that there is quite a similarity between
profits earned by different areas where property management companyis operating.
£1,002,960
£984,984
£631,461
£608,125
ANNUAL REVENUE
£538,140
£484,861
£474,428
£469,667
£456,447
£452,919
£441,261
£439,497
£429,628
£411,722
£368,766
£282,981
£273,977
£258,885
£241,106
£206,938
£201,915
£173,714
£145,964
£137,808
£112,599
£52,533
DEVELOPMENT TYPE
MIN-£52533 MAX-£1002960
(fig 1.2 shows the graphical representation of REVENUE generated by company in
residential and commercial development)
Fig 1.2 shows the graphical representation of revenue earned by the company previous year
more precisely per development type i.e. commercial or residential. This helps us to observe
that even though in some areas the company incurred a loss or lower profits, revenue
earned by the company is much higher which clearly shows that due to high costs the
company is not able to make higher profits. If we see the area Kat company incurred a
negative profit of £457477, but if we look at the revenue of the same area it was in positive
i.e. £52533 and the cost itself was £510010 which seem to be the main reason behind such
a huge loss. Alternatively, if we look at the area zan, here the company earned its highest
revenue in the whole year, but due to high annual costs it could not make that much of
profit.
2.Over-capacitated developments. –
PAGE NUMBER | 5
another such aspect to quantify financial performance. In this case one of the advantages in
calculating profit per employee hour is that it does not require any kind of adjustment for
accounting principles and it fixates on altitudinal people, who with some investment can
increment the value of intangibles for the company.
By utilizing profit per employee hour, a company can genuinely increase their profit by
abstracting the less efficient employees. For better understanding fig1.3 shows the profit
earned by the company’s employee per hour in each area, which can indeed help to study
employee efficiency which therefore means greater the data higher the employee efficiency
that area possesses. As it can be clearly seen that area net has the highest potential to earn
the profits, therefore, the company should increase the number of employees which may
lead to increase of its profits. In addition, area bro has shown an outstanding performance
in term of profits so the company should increase the numbers of employees here as well.
In contrast the company should decrease some of its employees from area Kat and area tin
as the per employee productivity is less that the average mean which is 1.56.
10.00
PROFIT PER HOUR
0.00
Gre
Eat
Arm
Net
Rat
Tin
Bro
Jin
Man
Vue
Kat
Fur
Qed
Yet
One
Ufo
Can
Zan
Hen
Pur
Wet
Lot
Dim
Ink
Xon
Sad
-10.00
-20.00
-30.00
-40.00
PROFIIT PER HOUR AND NUMBER OF employee hour
(fig1.3 shows the relationship between number of employees and profit per employee
hour)
From fig1.4 we can make the comparison between revenue and cost per flat size which will
help to identify the area where the company should contract and decrease the number of
flat/office size due to high cost per flat/office over revenue earned, which ultimately is
leading to decreases net profit.
From the line graph below we can see that in area Kat, Tin, Net and rat the cost of building
one flat or office is higher than the revenue the company is earning; for this reason the
company should decrease the number of flats or offices in these areas. From fig 1.3 it is
noticeable that total productivity per employee hour is also not good in these areas, which
can also be the possible reason behind low or negative net profits these areas are making,
hence the company should contract its operations and flat/offices from these areas.
PAGE NUMBER | 6
Comparison between revenue and cost per flat size
£5,000.00
£4,500.00
£4,000.00
£3,500.00
£3,000.00
REVENUE
£2,500.00
£2,000.00
£1,500.00
£1,000.00
£500.00
£0.00
Gre
Rat
Arm
Tin
Net
Eat
Jin
Man
Hen
Kat
Fur
Qed
Yet
One
Ufo
Bro
Pur
Wet
Lot
Can
Zan
Vue
Dim
Ink
Xon
Sad
REVENUE AND COST PER FLAT IN EACH AREA
(fig1.4 shows the comparison between revenue and cost per flat size)
3.Underperforming developments –
To think about increasing the number of flats/offices we need to see if we can get the
considerable revenue; regression line can help to forecast weather a company should think
about expanding in particular areas or not. From fig 1.5 we can depict that as the regression
line is linear and upward sloping this shows that the increase in population is ultimately
leading to an increase in revenue by steady rate. In other words this means that areas with
higher populations have the highest potential to earn profits, so a company can think about
expansion in number of flats or offices.
Fig 1.5 shows a relationship between annual revenues and population as the correlation of
R2 IS 0.46971 is close to 1. Interestingly, area yet as a predicted outlier with population of
just 7800 earned 8th highest revenue among all the branches. The possible reason behind
this is that area yet being a commercial hub with high property rates and also recourses
being utilized properly as productivity per employee is also good in this area.
But the number of Flats/offices should be increased in area’s zan, bro, sad and hen as these
areas had a high potential to increase the company’s revenue and profit which can only be
achieved by increasing the total number of flats or offices.
From the analysis of data we found that area tin is the 6th most densely populated area, yet
the company is still running in loss in this area, but if the company can change its focus from
turning the property to residential from commercial development it could lead to
substantial increase in revenue, thus increasing its net profit. From fig1.5 we analyzed that
an increase in population can lead to an increase in overall revenue thus area tin being the
6th most populated area holds the potential to earn more of revenue .
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RELATIONSHIP BETWEEN ANNUAL REVENUE AND AREA
POPULATION
Annual revenues Linear (Annual revenues)
£1,200,000
£1,000,000
ANNUAL REVENUE
£800,000
£600,000
£400,000
£200,000
£0
0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000
AREA POPULATION
(fig1.5 shows the relationship between annual revenues and population points in the circle
are the outliers)
difference
difference
(fig1.6)
Box plot in fig1.6 has been constructed using the minimum, median and maximum value
in each data set, both annual cost and annual revenue per inhabitant 1 st and 3rd quartile has
also been used to create this box plot. As we can see, the line passing through the box the
median of each data set is quite close to each other with median of annual cost per
inhabitant being 3 and median of annual revenue per inhabitant being 3.77 which makes
the mere difference of 77.
From the analysis made in fig1.3 we can see how important employee productivity is to
making more of profit and it could be only achieved if the employee is fully satisfied with
the job he/she is doing, and are completely motivated towards the work. From the chart we
PAGE NUMBER | 8
can make out that area Cat, Tin and Rat have the least employee productivity, so there is
need for the company to lay special emphasis in these areas. This situation could be
improved either by providing the employees with proper training to make them more
efficient, or by recruiting more employees into these areas.
We can see that area ink has the highest productivity per employee, making a profit of
£8.61 every hour which clearly depicts the satisfaction level of employees. This shows that a
high wage could be the possible reason behind such a high level of satisfaction. However,
high wage rates could not be the only reason behind high level of satisfaction, we have to
make sure their wages match with the minimum wage rate in that particular area and to
gives bonuses whenever high revenue is achieved, due to staff which will help us judge their
actual index of satisfaction.
We analyzed performance of each employee by finding out productivity of employee per
hour in every area, this can also help us to find out the company’s possibility to expand
further which is also important.
From the pie chart above we can analyze that profit in residential development is 28% more
than profit earned in the commercial developments, therefore, there is a need for the
company to change its focus from commercial developments to residential developments.
From fig1.2 we have also noticed that revenue from selling flats is much higher than as
compared to revenue generated from the sales of office spaces.
36%
64%
(pie chart in fig1.7 shows the share of profit on the basis of development type
i.e. residential or commercial)
4 Marketing actions-
4.1 Sample questioner
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1) What marketing is most interesting to you and which do you most frequently
notice?
A) Newspaper advertisements (regular newspaper)
B) magazines
C) Radio station
D) Other (please explain)
Please specify -
B) NO
4) According to you is their any form of marketing you feel is irrelevant and no longer
appealing to the general public?
Please explain -
5) Do you think that price of the Flat or office is higher than the services offered by company
in return.
A) YES
B) NO
6) Please specify to us what kind of property development you are interested in?
A) Flat (Residential development)
B) Office space (Commercial development)
C) Land
D) Others: Please write-
7) Choose your Budget for Proceed Further to Purchase a property you are interested in:
A) Between £5000 - £10000
PAGE NUMBER | 10
B) Between £11000-£20000
C) Between £21000-£30000
D) Between £31000-£40000
E) More than this- Please mention:
Stratified sampling –
We can divide the population into strata in every area and take samples from that
particular strata on behalf of the whole population in that area.
With the help of stratified sampling we can observe the relationship between strata
or subgroup of every area.
From the data given we can see that there are some areas where the population is
quite small so stratified sampling can help us to collect samples from such areas.
We have to define our strata geographically as it is one of the practical approaches
to collecting the data we need e.g.- price of each flat or office.
From the given data we can also analyze that the population in each area differs
from each other. Therefore, we have to use the disproportionate stratified sampling
as in our case every stratum will have a different fraction of population.
One of the advantage of using stratified sampling procedure in our case is that
collected sample are more exemplary due to which we can make estimate from the
past results.
Conclusion -
In conclusion, we can increase the profits in some branches by cutting down the costs and
making marginal revenue equals to or more than marginal costs which may offer a sense of
motivation to employees. Moreover, the working models of the locations that are earning
more profit can be used at the areas which are running in losses. Lastly, shifting the
company’s focus from commercial development to residential could be an advantage and
source of earning higher profits.
RECOMMENDATION-
Cut down the cost per flat/office wherever possible.
PAGE NUMBER | 11
Provide bonuses and salaries to employees on the basis of their productivity to keep
them motivated and satisfied.
Use effective marketing strategies to attract more target customers from
neighbouring locations as well.
Expand or contract its operations on the basis of population in that area.
Shift its focus more from commercial developments to residential developments as
residential developments have proven to be more profitable.
PAGE NUMBER | 12