complex economic analysis
INTRODUCTION
"Everything is subordinated in this world to nature laws: people are gifted with sufficient reason to comprehend these laws and to observe them" (F.Kene)).[ 1] The economic analysis dates back to the times of the Ancient Greece and Rome. As applied science, the economic analysis began to develop in process of development of human society and the type of economy accompanying it. What is a basis of human society in its economic way? Wealth? Prosperity for all? Personal benefit? Enrichment of the few about which great Aristotle wrote by generalizing rich people as "oligarchs". Many millennia back people opened such economic categories as "cost", "work", "price", "exchange" and by developing such categories, money appeared I the lives of humans. Money was means of a measure, an exchange, and accumulation. Ever since a little has changed in the meaning of economic theory. For instance, even in ancient time’s Greek fishermen, was interested to sell caught fish, quicker and as soon as possible, while it didn't deteriorate. On the other hand, the same fishermen sought to look for and note such places he could catch a plenty amount of fish. Is it possible to tell, that the fisherman thought for maximizing profit, and minimization of own expenses, including, time for search of a "fish" place? If it is possible, in that case it is an example of the elementary economic analysis from the independent economic person whose purpose was an increase of efficiency from the done work. Practical activities of people if it wasn't made on account of moral, the religious purposes and feelings, as a rule it was always directed on achievement of definite purposes and tasks, whether it be: hunger satisfying, construction of Parthenon, the basis of Ancient Greek colonies in new lands. No doubt, since ancient times a little has changed in the economic analysis. Aim has always been a leading motive and work has always been a key to achievements For instance, the person has always been trying to predict future crop of olives, to prevent a drought, which could ruin olive trees and to leave one without food in future time. Consequently it means that the person always strove for the analysis. Understanding that the nature is changeable, and a hunger instinct, on the contrary, is constant, the Ancient Greek farmer found ways of possible rescue of own agricultural enterprise, and sometimes to a course there were most improbable measures. On the one hand, the farmer could sacrifice to Zeus a bull; On the other hand, the same person could dig out small channels in order to make access of its olive trees to water. Thus, it means, the same person could find a solution to such problems by the rational administrative decision. Thus, it is possible to conclude, laws of the economic analysis – are fundamental, universal, for each country and each temporary era. At the same time, the principles of the economic analysis and accounting are individual concerning each concrete enterprise. Today experts allocate 4 main schools of accounting, each of which as it will be shown further, has own differences (see table 1).
Table 1. Features of leading national schools in the area of economic analysis and accounting.
Account and analysis problem definition
National schools
ITALY
FRANCE
GERMANY
USA
Purpose
Control of behavior of performers
Increase of efficiency of use of resources
Elaboration of rational registration and analytical procedures
Control of behavior of managers
Subject
Rights and obligations of persons
Stocks and streams of resources
Procedures
Behavior of managers
Basic science
Legal right
Political economy
Mathematics
Psychology
Analysis method
Induction
Induction
Deduction
Induction
The main object of the economic analysis is Enterprise, as it was shown on the example of a plantation of olive trees,. According to S. Ojegov's explanatory dictionary, the enterprise has some values: 1) "Production or economic establishment, plant, factory, workshop"; 2) "The conceived business undertaken by somebody". Proceeding from the given definitions, the enterprise can be both the subject of business, and a certain idea. The problem of any of four models given above is a providing the authentic forecast by means of which the person who has launch a certain enterprise, will be able to reach the planned goal. For creation of the forecast the businessman, the idea carrier, has to reveal first of all a circle of factors and the phenomena which have the direct or indirect relation to the core of business. First of all, by observing, investigating different factors that relates to business, a person who want to launch a business builds theoretical model of the analysis of business. Having created thus a certain theoretical baggage of data, the businessman can make the decision on the necessary practical actions promoting movement in the chosen direction. After the the purpose is reached production cycle becomes isolated. Let's generalize the main components of a such cycle: a) Facts / the phenomenon; b) Concepts/size; c) Laws / Forecasts. Direction of business model also subdivided by: a) Supervision; b) Measurement; c) Analysis; d) Synthesis; e) Choice of model of practical measures; e) Practical actions. It is natural to assume interrelation of the economic analysis with other scientific disciplines as operating by concepts, creation of the forecast, development of recommendations at initial unsuccessful actions, and many other factors can't exist only within one scientific discipline. Among disciplines with which the economic analysis is most closely bound, it is possible to call:
Statistics. The statistics is urged to help with creation of the forecast by means of certain categories, i.e. the concepts reflecting the most essential signs of a subject, or the world around phenomenon. Relative and average sizes, comparisons of individual and group factors, coefficients (indexes), or "weak" and "strong" links which represent a conceptual framework necessary within the economic analysis;
Accounting and audit. Researchers consider science of accounting as "elder sister" of the economic analysis. So, according to scientists, accounting was in use already in Ancient Egypt. In those days copyists of the Pharaoh carefully fixed by means of papyruses and clay plates key information on economic stocks (collecting grain, a fig, damage of products) and trade operations (trade between the cities of Egypt, trade with tribes in the territory modern Libya and the Sinai Peninsula). Let's notice, a basis for the economic analysis is information which can provide only accounting, in particular, financial statements of the enterprise (the balance sheet, income statement, the report on cash flow). Besides, the separate subgroup of accounting which is also demanded during carrying out the economic analysis is audit. Audit is an independent analysis of accounting reports which is carried according to the desire of director of the company or at will of external authorities;
Law. Criminal, civil and administrative law also plays a role when carrying out the economic analysis. This aspect depends on activity of the enterprise which can be as lawful, or legal, and illegal, which means breaking the adopted acts or amendments. Besides, procedure of payment by the enterprise of taxes and all due collecting, strict maintaining contractual obligations, also are spheres of contact of the economic analysis and jurisprudence. Subject of the real research is carrying out the complex economic analysis of the enterprise and delivery of an assessment of its efficiency. This area assumes initial research of theoretical aspects of the economic analysis, and also methods of an assessment of efficiency of the enterprise that means studying of a subject, object and tasks of the economic analysis as branches of economic science. Further – research of methods and receptions of an economic assessment of business in conclusion of what follows the analysis of competitiveness of the enterprise and development of an assessment of efficiency of business.
Chronologically research is subdivided into some scientific branches: 1) Theoretical branch (subject of the economic analysis, task, object of the economic analysis, technique and analysis of competitiveness of the enterprise, development of an assessment of efficiency of business); 2) The practical branch (collection of information and the complex characteristic of activity on the example of the concrete Kazakhstani enterprise that assumes the analysis of the external and internal environment of the enterprise, the internal analysis of the company, identification strong and weaknesses of the current provision of business. Further the analysis of competitiveness of the enterprise from a position of the main rival enterprise. The last stage is analysis of available financial statements of two enterprises for six year period Concerning a question of a subject of the research paper, it is necessary to notice that the subject includes both as theoretical disclosure of an essence and methods of the economic analysis and practical complex economic analysis of the enterprise, and also development of an assessment of efficiency of business. The last includes need of carrying out the comparative analysis of the main financial statements of the enterprise during six years. In this regard, is possible to claim that this work has own, specific component as during research I have used internal financial reports of the enterprise and also its main competitors, and periodic materials, electronic resources with the maintenance of a range of various scientific techniques of a complex assessment of the enterprise. The structure of the thesis includes the introduction, three heads, the conclusion, the list of the used literature and the appendix. Chapter 1 of work is devoted to disclosure of theoretical aspects of the economic analysis and study of methods of assessment of efficiency. In this section I uncover subject, object and tasks of the economic analysis as parts of economic science. In detail the technique of development of an assessment of efficiency of business by means of the analysis of competitiveness of the enterprise from a position of the independent participant of the market. Chapter 2 contains the complex economic analysis which has been carried out on the example of domestic production cooperative "Tselingidromash". Also one can find is the chapter 2 characteristic of the external, internal environment of the enterprise, identification of weaknesses and strengths, opportunities and threats of business and also the comparative analysis of all four factors is made. Further, in the analysis I analyze competitiveness of the enterprise, its products, calculation of the main finical ratios (coefficients of operational efficiency, strategic positioning, profitability indicators) and etc Further in a chapter 3 one can find recommendations in order to increase efficiency of business, to improve financial performance and to strength competitiveness of the Tselingidromash. Besides, ways to decrease production expenses are offered that in turn can lead to decrease in the general cost of products of the enterprise, which will allow to conduct more aggressive price policy and to lead to income growth, then, arrived, and as a result, the general profitability of the Tselingidromash.
CHAPTER 1. Theoretical aspects of the economic analysis of the company. Methods of an assessment of efficiency of the enterprise.
1.1. Subject, tasks and classifications of the economic analysis Subject of the economic analysis is the enterprise, organizational structure of the enterprise, and also it "financial health", represented as assets and liabilities. The economic analysis affects economic processes which can include purchase (import) of production, including not only created products, but also spare parts, accessories, production from accessories, and also production sale / realization with use of the fixed and current assets, profit formation, its distribution. Therefore, object of the study of the economic analysis are economic processes of the enterprise and its organization which develops under the influence of objective and biased factors. In particular, the change in price for the raw materials be an objective factor, because from this material an accessory, equipment or industrial machine is made. The change in price in turn is a consequence of activity of the market, or in other words it is eternal search of balance between supply and demand. Subjective factors, on the contrary, directly depend and are connected with activity of the person. For example, imagine that marketing service of the enterprise chose the tactics, aggressive campaign for advance of already known product in the stagnating market, and spend for these purposes the considerable budget. As the result, growth of sales volumes and scanty increase in net profit in view of large volume of expenses, and it didn’t lead to return of invested funds. Thus, incorrectly estimated tendency of development of the market could lead to recession in business work instead of growth Also, mistakes in forecasts and signals incorrectly interpreted by producers from buyers, could be examples of subjective factors. As a result it obvious that successful financial activity of the enterprise comprises a set of variable aspects, such as skillful planning of activity of the enterprise, forecasting of future condition of occupied branch, the competent analysis of strong sides and weaknesses of the main rivals of enterprise, quality of operational decisions, effective management and etc. Together with it, I will notice, that the economic analysis includes the analysis of only those economic processes which are suitably reflected in system of economic information. More precisely, I mean financial statements of the enterprise, and its compliance accepted by IFRS. In case the reporting is partially reflected, or reflected obviously incorrectly, the economic analysis of the enterprise is very difficult. Besides accounting, statistical account, and also the accounting of productions at the enterprise represents extreme importance. Moreover, among tasks of direct forecasting of financial and economic activity there can be following directions: Correct calculation of dynamics of the main financial performance of the enterprise includes: the output analysis, the analysis of volume of realization of production, the analysis of efficiency of work with a certain number of the personnel at the enterprise, the analysis of production cost, the analysis of a material capacity of production, the analysis of conditional expenses and profit for production, the profitability analysis, the profit analysis;
Quantitative assessment of changes in production ,technical, and organizational levels of the enterprise;
Definition of extent of use of the fixed production assets, labor and financial resources, the analysis of influence of labor / financial resources on economic efficiency of the enterprise, the general indicator of profitability;
Identification of the major factors which have entailed a deviation of the main actual indicators of activity of the enterprise (production import, production and production sale) from the planned indicators;
Research and measurement of the current and perspective reserves, methods to increase efficiency of the enterprise and decrease in production expenses of the enterprise;
Differentiation of sites of responsibility among specific managers, strengthening of corporate spirit of team. However, despite above-mentioned directions, the main objective of the economic analysis is a forecasting of expected results of economic activity. However, forecasting, or the analysis, is also possible to classify by a range of criteria. Classification of the economic analysis by types is defined, first of all, by the purposes, methods of research and generalization of studied materials. In turn, the purposes and methods for the different parties involved in activity of the enterprise (the state, shareholders, management, workers of shops) can differ from each other in view of interests of the parties. Division on character of the analysis can be the first classification of the economic analysis:
a) Theoretical and economic analysis;
b) Concrete and economic analysis. As the second classification division on production and management scale can serve:
a) Macroeconomic analysis. Mentions the industry as a whole or concrete branch, a market segment;
b) Microeconomic analysis. The enterprise, its organizational structure and activity in the market. Enterprise interaction with other market forces,competitors, buyers and etc Other factors, according to which classification of types of the economic analysis can be made, are:
1. The subject which carries the analysis;
2. Object studied during the analysis;
3. Purpose of carrying out analysis;
4. Range of studied problems;
5. Aspect of research;
6. Character of decisions made on the basis of the analysis and measures;
7. Degree of a computerization and automation of computing works.
Let's consider in more detail mentioned factors: 1. The subjects which are carrying out the economic analysis, i.e. persons performers of the analysis can be both internal departments of the enterprise, and external economic services (the auditor company, the financial, credit, tax organizations, etc.); 2. The objects studied during the analysis, can be as the independent enterprise, or its concrete division, and group of companies or their association (holding, industrial group); 3. The purpose of carrying out the analysis can include as the analysis for the purpose of definition of basic indicators for planning, and the analysis of results of internal and external activity of the company, leading of monthly / quarter / annual results, identification of reserves of the enterprise, search of increase of competitiveness of the enterprise, improvement of internal interaction between divisions, preparation of financial statements for external body (tax service, the auditor company, extraordinary meeting of shareholders), drawing up the business plan of the investment project, the conclusion of the credit agreement, etc.; 4. The aspect of research can be the following types: a) Financial and economic aspect; b) Technical and economic aspect; The financial and economic aspect opens interrelation of operational and financial performance, being guided by periodic financial statements of the enterprise before external bodies. In practice the financial and economic analysis is executed by managers of the company, or representatives of council of shareholders, the auditor companies. The technical and economic analysis is devoted to studying of economic activity of the enterprise on the basis of interrelation of economic indicators with technological equipment of the enterprise. The work organization, technologies applied in production, degree of efficiency of involvement of fixed assets, materials and manpower – the main objects of attention for the performer of the technical and economic analysis. Functional and cost the analysis is a method of system research of the enterprise which purpose is optimization of the price, expenses and the production technology. This type of the analysis is urged to provide the continuous growth of efficiency of activity of the enterprise; 5. The range of studied problems has the following subspecies: a) full, comprehensive analysis of economic activity; b) selective, thematic analysis of some kinds of activity; 6. Character of decisions made on the basis of the analysis is subdivided on:
a) The preliminary; b) The quick;
c) The overall;
d) The perspective. Let's notice if earlier the most demanded was total nature of accepted actions, in modern conditions into the forefront operational and perspective analyses act. The operational analysis, in particular, is directed on studying of system of the indicators reflecting the current activity of the enterprise. Indicators are based on daily results of work. Tasks of the operational analysis are daily control of a course of performance of planned indicators, identification of the current deviations from planned indicators, identification of the reasons of these deviations and their timely leveling, search of irrational use of resources, maximizing the current efficiency in involvement by the enterprise of fixed assets, timely generalization and providing the current reporting. The perspective analysis, in turn, forms a basis of strategic planning of activity of the company. Forecasting, scientific justification of accepted strategy are under construction not on the current day results, but on results of next week, decade, month, quarter, year; 7. Degree of a computerization and automation of computing works means the analysis made by means of electronic computer facilities or by means of a local network from several computers.
1.2. METHODS AND RECEPTIONS OF THE ECONOMIC ANALYSIS OF BUSINESS The economic analysis is a process of studying of economic subjects which includes a collection of information, its systematization, generalization and further use within achievement of the set purposes. Thus collection of information about concrete objects as a rule can be divided into collection of information about object components, or the phenomena. So, if the purpose is the analysis of profitability of sales, the performer has to isolate some categories from the financial characteristic of the enterprise which comparison will lead to the end result, namely return level, a percentage ratio of profit to total sales or gross revenue. Other example: production, dynamics of production. It means not only the production analysis of the enterprise as a whole, but also research of compound divisions. In a case with the production analysis in the “Tselingidromash”, the performer separately investigates all stages of a chain of production of the chemical pump AH 125-80-250, including production shop, assembly shop, a repair and experimental site, and also painting shop and department of pre-sale testing. Besides, the analysis of dynamics assumes involvements of data in various intervals of time (month, quarter, and year) that will allow the researcher to obtain more authentic data within the analysis. Along with the economic analysis, research and creation of the forecast, in practice companies use economic synthesis that allows making a complex picture of production on the basis of separate factors. It is possible to tell that if the analysis assumes following from the general to the particular as it was shown above, within economic synthesis the analyst has to investigate all stages of technical production. Besides, the performer shouldn't forget about economic indicators (the cost of purchase of spare parts, metals, import cost, labor input of a technological chain and number of the involved personnel that directly influences the salary size to the employees, other expenses, profit on sale, payment of taxes, net profit). Speaking differently, the method of the economic analysis can be compared by analogy to deduction which, as shown in table 1, most will apply at the German economic school. The course of research occurs from the general to the particular. For example, in the analysis of gross expenses of the Tselingidromash by production and realization AH 125-80-250, at first the assessment of the general prime cost of one unit of production then this category passes breakdown on the following articles of expenses is made:
1. "Costs of materials";
2. "An expense on salary payment";
3. "Transportation cost";
4. "Cost of payment of the customs duties and collecting";
5. "Business expenses";
6. "Management expenses". In process of carrying out the economic analysis one can find certain disagreements, contradictions causing deviations of production and a loss. In the light of it is possible to speak about development of the methods neutralizing negative factors. The following fact can be an example of a contradiction: dealers and outlets are interested if each chemical pump of the AH brand are completed with engines with average height of axis not less than 160 mm. While for the Tselingidromash the similar condition is unacceptable. First, engines with height of an axis are higher than 160 mm as a rule are more expensive, and can be got only by order, at the same time duration of transportation and route length not always guarantees quality. On the other hand, reorientation of all production only on one type of the electric motor will negatively affect a nomenclature line of cooperative, width of a choice of various production, client base, and competitiveness. Receptions of the economic analysis can be divided into the following types: a) Traditional receptions of the analysis; b) Nonconventional receptions of the analysis. The economic analysis combines several disciplines as it was shown above on the example of adjacent conceptual area between the economic analysis and statistics, the economic analysis and accounting, the economic analysis and audit. The natural science being in a basis of the analysis naturally is the mathematics This circumstance has an obvious historical explanation. Cave people, having learned to satisfy the hunger by means of wild-growing herbs, over time passed from work of daily, expeditious "hunting" behind blackberry, to its collecting and accumulation. Collecting was made not for a satisfying a momentary hunger, but for purpose of reserves, on a case if tomorrow bushes with berries will be eaten by animals, or will wither. People learnt how to overcome momentary instincts and to save something as reserves. In such way, ancient people could assume, how many capacities (baskets, bowls, bowls,) with blackberry berries are necessary for them to endure winter successfully. Thus, ability to count, planning, i.e. an initial form of the economic analysis had close interrelation with mathematics. However, as time passed, economic methods of the analysis were improved and became eventually more difficult. Therefore, that category of economic analysis which has changed from generation to generation can be called traditional.Among similar receptions: average sizes, relative sizes, groups, groups, comparisons, comparisons, coefficients (indexes), substitutions of variables. Speaking in more detail, as an example of traditional sizes we will allocate the following types:
Percent. For example, percent of the spoiled blackberry among total number of berries, or percent of performance of painting of the pump AH 125-80-160.For instance, if the plan of realization of the chemical pump of the real brand for 1 quarter 2013 provides sale of 5 units for total amount of 12 500 000 tenges, and the fact makes 3 for a total cost of production of 7 500 000 tenges, the plan is executed for 60,0%;
Coefficients (indexes). For example, the index of realization of production for March, 2013 tells about growth of number of sold pumps of the AH brand in comparison with basic month. January 2013, initial stage of sales is accepted asbasis. The pump AH 125-80-160 isn't seasonal type of the pump, unlike submersible pumps of the brands "ETsV", "BTsP", owing to basic any financially successful interval of time can be considered. So, if in January, 2013. Management of sale of the Tselingidromash realized to clients 2 pumps AH 125-80-160, and in March, 2013 – 1 pump, the coefficient of growth is equal ½ = 0,5. The gain coefficient, in turn, makes-0,5;
Share (specific weight). This indicator characterizes set structure, i.e. realized production, the relation of the chosen category to the nomenclature to total. For example, during 1 quarter 2013. Management of sale of the Tselingidromash sold about 15 chemical pumps of the AH brand, the share of the pump AH 125-80-160 in the general structure makes 3/15 * 100% = 20%;
Average size. This concept allows making a general characteristic of the phenomenon in time or space. For example, the average monthly payment of the collector of the pump AH 125-8-160, consisting of a salary and variable part (award) makes 85 000 tenges. In practice some types of comparisons are applied: Comparison of uniform indicators. For example, the average monthly salary of the collector of the chemical pump makes 85 000 tenges while the salary of the senior economist of Department of management and planning is equal 160 000 tenges;
Comparison of changes of interdependent diverse indicators. For example, in March, 2013 the average size of variable part of managers of Management of the sale, chemical pumps engaged in realization, decreased by 50% in comparison with the size of bonus part in January of the same year. The reason consists in falling of sales volumes of pumps of this group;
Dynamic comparison of uniform indicators depending on the period. For example, in 1 quarter 2012 6 pumps of the AH brand 125-80-160 while the similar indicator in 2013 equals to 3 units that below basis for 50% were realized;
Branch comparisons. For example, in 1 quarter 2013 of the Tselingidromash I realized 15 chemical pumps while JSC Gidromashservice I could realize 12 similar pumps. Having made simple calculations, it is possible to claim, the share of the Tselingidromash in branch for 1 quarter 2013 made 15/27 * 100% = 55,56%.
Also specification, i.e. a considered indicator belongs to number of receptions of the economic analysis
1.3. THE METHOTODOLOGY AND ANALYSIS OF THE COMPETITIVNESS OF THE ENTERPRISE.
"The competition – life of trade and death of dealers". [2]
Elbert Green Hubbard (1856-1915), American writer, publisher, philosopher The opinion, according to which competition – the progress engine, basis of market economy, eternal incentive for the businessman to development is widespread. Frank Borman, the American figure, spoke: "Capitalism without bankruptcy is all the same that Christianity without an underworld". [3] Maxim Zvonarev who supported this idea also claimed that the economy without bankrupts herself will sometime go out of business. David Sarnov (1981-1971), the American operator and the businessman, fairly believed: "The competition provides the best quality of products and develops the worst qualities of people". [4]. The competition by consumers, the competition between producers, the competition between supply and demand, suggest human society, and first of all each individual person, after having become free from fetters of the wild nature, , took out with itself the main lesson -the competition became this lesson. It is possible to claim that the competition between plants, individuals, fight for the best at cellular level appeared before the appearance of humankind who became subsequently her pupil and the adherent. In practice when speak about the competition, authors mean the competition, i.e. a form of the rivalry hidden or open, between the companies, producers, subjects of the economic category ". Actually, as we know, the competition, or spirit of rivalry can be and among buyers of hypermarket in Seoul, the capital of South Korea, the right to possession new model of the android-device of famous Korean brand becomes a subject of fight. The competition between ask and the offer, in turn, gives rise to the balance, which is the "market price". As already it was told earlier, the competition is not a constant, because supply and demand are in perpetual motion, producers constantly invent new ways of involvement of new clients, fixing of traditional sales markets of production, producers infinitely look for new ways of increase of a margin and decrease in expenses. The competition allows the producer to understand better the advantages and shortcomings, to consider possible pluses of the competitor, to find ways of their neutralization, or loan. The producer, being provided to itself, and without having any competitors in the market as in a case with monopoly, it is inclined to revaluation of the opportunities. So, having once won the market, the producer loses interest to decrease in expenses, prime cost reduction, and consequently, and to reduction of price, i.e. satisfaction of the consumer. In de facto monopoly, the buyer in any case, at any price, has no alternative. Therefore, value of an indicator of competitiveness of the enterprise calculated concerning one competitors, can significantly differ from value of the same indicator calculated in comparison with other competitors. In a view of use of such conceptual concepts as "profit", "competitiveness", "a competitiveness assessment", it is expedient to open the real concepts, and also some economic categories which have been closely interconnected with them. So, what is it a profit? Let's consider some variations of profit, such as "gross profit", "profit before payment of taxes and percent", "net profit": 1) The gross profit represents a difference in terms of money, being formed by a deduction from proceeds of the company or from realization of certain production in the market of goods. Let's explain, cost of production comprise a complex of expenses of the enterprise on purchase of materials, accessories, their transportation on the enterprise, transportation costs, assembly cost, expenses on salary payment to workers, cost of pre-sale service; 2) The profit before payment of taxes and percent ("EBIT") is a gross profit minus business and management expenses; 3) The net profit is formed by receiving a residual part of profit before payment of taxes and percent after payment of the last two sizes; 4) Competitiveness is a measure which shows how effectively company uses available resources in comparison with competitor. Therefore, competitiveness is an indicator of firm for the firm; it is criterion of comparison of efficiency of use by resources two rival companies. Sources of competitiveness are an operational efficiency and strategic positioning; 5) The assessment of competitiveness allows to make a conclusion, or how competitive the enterprise in the market. As a rule, the similar conclusion represents the list of the actions directed on strengthening market positions of the company. On the other hand, the assessment of competitiveness forms a methodological basis for carrying out by experts of firm of the analysis, how successfully paid off in practice of action. The purposes of work of an assessment of competitiveness can be: a) drawing up list of actions for competitiveness increase; b) multiplication of information on competitors (by a benchmarking, the comparative analysis); c) revision of operating strategic policy of firm (updating of the program of further expansion to branches, etc.); d) acceptance by investors of the decision on capital investments in the company (in case of high competitiveness of the company, steady financial performance, etc.); 6) Operational efficiency is a percentage ratio of revenue to expenses. If the profit is a physical amount of money, operational efficiency represents coefficient of, how successfully the company consults with satisfaction demand, maximizing profit. This criterion shows that, how effectively the enterprise spends the capital and returns it by means of receiving revenue; 7) Strategic positioning is a percentage ratio of efficiency of functioning of the company in the market. This criterion uses two components: revenue and general size of the market (both indicators in terms of money). The coefficient shows, what part of monetary market size belongs to the company. Coming back to concept of the economic analysis considered by us earlier in the present chapter, we will explain that the analysis of competitiveness of the enterprise is understood as the following directions of research and the analysis:
The Analysis of competitiveness of the enterprise within branch. More precisely, a segment of the industrial equipment, namely, production and realization of chemical and monoblock pumps. This segment includes such pumps of such brands as "KM", "AH", "AHI", "H-R", "AHP", "HP", "THI", "AHO";
The analysis of competitiveness of the enterprise concerning its main rivals. As it is inexpedient to compare companies from different industries, I will consider those enterprises which represent branch of production and sale of industrial pumps of monoblock and chemical types;
The analysis of competitiveness of the enterprise within the comparative characteristic of production. Production realized by the companies, namely monoblock pumps and chemical pumps is subject to comparison. As criterion can act both production characteristics, and economic criteria: supply of liquid, pump pressure, electric motor capacity (in case it is a question of the pump unit), number of revolutions per minute at the electric motor, the mass of the pump / the pump unit, pump dimensions / the pump unit, the pump / unit price.
CHAPTER 2. COMPREHENSIVE ECONOMIC AND FINANCIAL ANLYSIS OF THE PC “Tselingidromash”
2.1. Mission and tasks of PC "Tselingidromash" The productive cooperative "Tselingidromash" was formed in 1941 in the period of Second World War, when industrial powers being based in Ukrainian SSR were in the zone of danger because of sudden encroachment of the German troops. In decision of government of the USSR many industrial machine-tools were kicked in the central region of Kazakh SSR, what gave birth to PC " "Tselingidromash". So, created in 1941 on the base of the evacuated Melitopol plant for performing the soldiery orders, a plant in 1960 started producing chemical pumps. PC "Tselingidromash"" engages in a production and supplying with the pumps of next types :
1) Chemical Pumps. Chemical pumps are applied in the industry of the same name to safe pumping of acids, alkalis and other aggressive liquids. Besides, they used at a modulation of oil products, paints, varnishes, solvents. Production of chemical pumps lets out models different in execution, and unlike usual pump systems, at their classification properties of pumped-over substances which can strongly differ from properties of ordinary water have special value. Depending on chemical activity and aggression, and also such parameters as density, temperature etc., is defined a design of the unit. Materials among which special grades carbonaceous and chromic steels, chromic and molybdenum alloys, siliceous cast iron, hi-tech polymeric materials are used are various also. The Tselingidromash releases chemical pumps of the following brands:
a) Pumps of the AH type. Units electric pump centrifugal the AH type are intended for pumping of chemically active and neutral liquids with a density no more than 1850 kg/m3 having firm inclusions up to 1 mm in size which volume concentration doesn't exceed 1.5%, with a temperature from -40 °C to +120 °C, the speed of penetration of corrosion of a material of flowing part doesn't exceed 0.1 mm/year. Kinematic viscosity of pumped-over liquid no more than 30х10-6 sq.m/with;
b) "HO" pumps. Units centrifugal, horizontal, console, one-stage are intended for pumping of chemically active and neutral liquids with a density no more than 1850 kg/m3 containing firm inclusions in number of no more than 0,1% on volume with a size of particles no more than 0,2 mm, kinematic viscosity to 30х10-6 sq.m/with, and also the liquids crystallizing at a temperature of the surrounding environment for what on a soaking-up branch pipe of the pump the heating camera is provided;
c) "AHO" pumps. Units electric. Scope: pumping of chemically active and neutral liquids with a density no more than 1850 kg/cm3 having firm inclusions up to 1 mm in size, which volume concentration doesn't exceed 1,5%. Temperature of pumped-over liquid: from 30 to 200 0C. Speed of penetration of corrosion of a material of flowing part: no more than 1 mm/year;
d) "HD" pumps. Units centrifugal. Horizontal, console, one-stage. Scope: pumping of chemically active and neutral liquids with a density no more than 1850 kg/cm3 having firm inclusions up to 1 mm in size, which volume concentration doesn't exceed 0,1%. Temperature of pumped-over liquid: from 30 to 200 0C; 2) Monoblock Pumps. Pumps monoblock. Pumps of this type are intended for pure pumping of technological appointment (except sea) with рН 6-9 in stationary conditions. Temperature of pumped-over liquid: from 0 to + 85 0C. Pumps with an unary soft epiploon and with face consolidation intend for pumping not only water, but also other liquids similar to water on density, viscosity and the chemical activity, containing the firm inclusions up to 0,2 mm in size which volume concentration doesn't exceed 0,1%. Consolidation of a shaft of the "KM" electric pump - unary stuffing or unary face. The greatest allowed excessive pressure on an entrance to the pump: for pumps with an epiploon of 0,35 MPas (3,5 kgfs/cm2), with face consolidation of 0,8 MPas (8,0 kgfs/cm2). The material of flowing part is carried out from gray cast iron. The geography of export of the Tselingidromash includes both regions of the Republic of Kazakhstan, and the CIS country (Ukraine, Lithuania, Latvia, Estonia, Uzbekistan). By means of import and also independent production of demanded accessories and the main parts of pumps, the Tselingidromash is an example of a full production chain, from bed smelting up to pump sale through an available dealer network. Providing the Republic of Kazakhstan with the manufacturing pump equipment, the Tselingidromash helps with the solution of the major strategic tasks on development of the industry and country agriculture. So, deliveries of monoblock pumps Tselingidromash helps the Government of the Republic of Kazakhstan with providing the population of all areas with drinking water, with the solution of questions of an irrigation of agricultural fields and grounds, increases of productivity of crops. At the same time, realization of pumps of chemical type promotes updating and expansion available in the territory of the republic of the enterprises of ferrous and nonferrous metallurgy, the chemical industry. Basis of policy of the company is observance of the principles of honesty and decency in relation to the consumer, the business partner, to the employees. The policy of the Tselingidromash consists of several sections:
1 . Tselingidromash mission:
Address to the benefit of the consumer of water resources, assistance to development of the industry of the Republic of Kazakhstan.
2 . Principles of the Tselingidromash:
The consumer – the most important person for whom the enterprise personnel works;
Worthy service to interests of society and state;
Continuous improvement of processes of production and service;
Honesty is the base on which the success of the enterprise is under construction, it is a basis of production of high-quality production and services, the sincere relations of the enterprise with consumers and suppliers;
Continuous and continuous professional development, competence, experience of experts.
3 . Purposes of activity of the Tselingidromash:
The maximum satisfaction of the established expected requirements of consumers;
Gain of a leading role in the market of the common industrial and household pump equipment for houses and productions of the Republic of Kazakhstan;
Granting to consumers of goods and quality service and for reasonable prices;
Obtaining income necessary for development of the enterprise and ensuring achievement of the reasonable personal purposes of employees and shareholders of the Tselingidromash.
4. Tasks of the Tselingidromash:
Preservation and strengthening of image of the enterprise, as honest and reliable partner before clients and suppliers of products;
Development of new types of production on the basis of the analysis of data of marketing;
Continuous collecting and the analysis of information on satisfaction and wishes of the consumers concerning production and services Tselingidromash;
Fast response to change of requirements and expectations of the consumer.
5. Methods of realization of policy of the Tselingidromash:
Continuous increase of productivity and efficiency of SMK Tselingidromash;
Increase of competitiveness of production and services at the expense of improvement of designs, manufacturing techniques of products, use of achievements of science and technology;
Active participation of all employees in work on improvement of quality of production, goods and services, to increase of satisfaction of consumers;
Systematic training and personnel professional development. From the date Tselingidromash was founded it protects invaluable property, namely, reputation of the reliable and decent partner adhering to the high moral and business principles and standards. Honesty is the base on which the success of the Tselingidromash is under construction. 2012 became in the history of the company as year of practical realization of export strategy of the organization. Past year the Tselingidromash made for the first time external export trade operations with countries of Eastern Europe (Poland, Hungary, Romania). Thus, the enterprise considered in the real work, being focused on the maximum satisfaction of requirements domestic, and the foreign consumer, and also having at the order numerous resources, both human, and material, there have to be most interested in search of suitable model of management, the models, capable to give the greatest advantage as in monetary, and a moral equivalent. It should be noted that considered by us in the previous chapter of a matrix of strategy take away a considerable place not only to directly financial and economic indicators of the enterprise, but also the motivation of the personnel on which, in particular, the above-named indicators depend.
2.2 . Financial analysis of MC "Tselingidromash” and its main rival JSC “Gidromashservice”
"You study at the competitor because he will study at you". Jeff O'Leary, the writer, the analyst, the colonel of army of the USA in resignation.[5]
Within the analysis of competitiveness of the Tselingidromash, besides the real enterprise the analysis of the main financial performance, and also indicators of competitiveness of the first leading enterprise of branch – JSC Gidromashservice will be made. Thus, data of the following enterprises will be compared:
Tselingidromash. Site: Republic of Kazakhstan, Astana, Zh. Omarov St., 111. The Tselingidromash specializes on release of pumps since 1960, being, thus, one of the oldest productions in RK territory. The Tselingidromash is one of the largest suppliers of pumps for pumping of aggressive liquids, pumps for pumping of water, pumps for pumping of easily boiling liquids (type ammonia), pumps for pumping of the polluted liquids, pumps for pumping of hot and crystallizing liquids, pumps for work in fire and explosion hazardous conditions.
JSC Gidromashservice o. Site: Russian Federation, Moscow, Aircraft Designer Mikoyan St., 12. JSC Gidromashservice was founded in 1993. For more than 20-year per work iodine in JSC Gidromashservice was created harmonious group of engineers, designers, technologists and specialists in development, production and sale of the various pump, compressor and block and modular oil and gas equipment. JSC Gidromashservice has experience of supplies of equipment and implementation of complex decisions for oil and gas branch, thermal and nuclear power, a water management, housing and communal services, metallurgy, the chemical industry and shipbuilding. Kinds of activity of the company include the following directions:
1. Delivery of the wide nomenclature of pumps, pumps units, blocks and complete equipment;
2. Delivery of the wide nomenclature of the compressor equipment;
3. Installation, commissioning, service;
4. Development of pumps, pump units;
5. Engineering and implementation of "turnkey" complex projects;
6. Repair and modernization of the pump equipment.
Let's present the main indicators of financial and economic activity of the Tselingidromash and JSC Gidromashservice. Let's notice that data are calculated in thousand tenges (see table 13). Besides, chronologically financial performance represents some periods from history of development of data of the companies:
a) Pre-crisis period. The analysis of financial and economic indicators for 2007;
b) Crisis period. The analysis of financial and economic indicators for 2008;
c) Post-crisis period. The analysis of financial and economic indicators for 2010;
As it will be shown below, the main documents of financial statements of the companies on the basis of which all current calculations were made, balance sheets of both companies for the aforesaid periods, and also profit and loss reports of the considered companies for the similar periods were.
As it will be shown below, the main documents of financial statements of the companies on the basis of which all current calculations were made, balance sheets of both companies for the aforesaid periods, and also profit and loss reports of the considered companies for the similar periods were.
Table 1. Indicators of revenue, prime cost and gross profit of the MC Tselingidromash and JSC Gidromashservice for 2007, 2008 and 2010 according to financial statements of the companies.
Company/Criterion
MC Tselingidromash
JSC GidromashService
Year
Revenue, thousands tenge
1 145 943
1 345 778
2007
Prime Cost, thousands tenge
526 328
693 467
Gross Profit thousands tenge
619 615
652 311
Revenue, thousands tenge
2 537 390
2 105 234
2008
Prime Cost, thousands tenge
1 385 985
1 156 453
Gross Profit thousands tenge
1 151 405
948 781
Revenue, thousands tenge
2 098 942
4 154 942
2010
Prime Cost, thousands tenge
1 409 001
2 565 987
Revenue, thousands tenge
689 941
1 588 955
Total enterprise revenue
5 782 275
7 605 954
Total enterprise revenue 2007-2010 гг7
Total enterprise prime cost
3 321 314
4 415 907
Total enterprise prime cost 2007-2010 гг.,
Total enterprise gross profit
2 460 961
3 190 047
Total enterprise prime cost 2007-2010
On the basis of table 1 we will reflect dynamics of growth of indicators of revenue, prime cost and gross profit of the considered enterprises in 2006, 2008 and 2010 (see figures 1, 2).
Table2 Coefficients of operational , strategic and competitiveness positions
Enterprise/Criterion
MC Tselingidromash
JSC GidromashService
Coefficient of operational efficiency, Kr
2,18
1,94
Coefficient of strategic positioning, KI
1,06
0,97
Competitiveness coefficient, To
2,32
1,88
Kr
1,83
1,82
KI
1,49
1,25
To
2,72
2,28
Kr
1,49
1,62
KI
0,91
1,40
To
1,35
2,27
Kr
1,83
1,79
KI
1,15
1,21
To
2,13
2,14
Figure 1. Dynamics of indicators of revenue, prime cost and gross profit of the Tselingidromashin 2007, 2008 and 2010
Figure 2. Dynamics of indicators of revenue, prime cost and gross profit of JSC Gidromashservice in 2006, 2008 and 2010.
Apparently from the above-stated materials, a gain of the above-stated indicators in 2010 in comparison with basic 2006th year at the companies made the following values:
1. Tselingidromash. Revenue gain: 952 999 thousand tenges or 83,16%. Gain of gross profit: 70 326 thousand tenges or 11,35%;
2. JSC Gidromashservice. Revenue gain: 2 809 164 thousand tenges or 208,74%. Gain of gross profit: 936 644 thousand tenges or 143, 59%.
3.
Let's note, the concept "prime cost" is understood as production expenses (import of accessories, purchase of details, a salary to the personnel) without business and management expenses, operating and realizatsionny expenses, and also the sum of payment of tax obligations. The concept "revenue" is meant as gross revenues of the enterprise from all kinds of activity (resale of the imported equipment, realization of production of own production, etc.). Concerning dynamics of the presented indicators of the companies it should be noted that at both considered enterprises in considered years growth of revenue and gross profit was observed.
Further we will settle an invoice coefficients of operational efficiency and strategic positioning for both enterprises (see table 14).
Let's present visually to the loudspeaker of values of coefficients of operational efficiency, strategic positioning and coefficient of competitiveness of the companies (see figures 3, 4).
Figure 3. Dynamics of coefficients of competitiveness of the Tselingidromash in 2007, 2008 and 2010.
Analyzing the developed trends at the companies, we will explain the following:
a) Tselingidromash. The general decrease in coefficient of competitiveness in 2008-2010 in comparison with the basic period is caused first of all by falling of coefficient of operational efficiency. The last index is the relation of revenue of the company to product cost which, as we know, grew in 2008 in comparison with 2006 by 859 567 thousand tenges or 163,33%! As a result, the growth rate of revenue concedes to the growth rate of product cost that can be explained with change of suppliers of materials and completing in view of bankruptcy of former suppliers. As a result, the cooperative was compelled to buy necessary for production of pumps materials at higher prices, at the same time having raised the prices of own production, however, apparently from an index of operational efficiency, the raising of the price didn't pay back fully growth of prime cost of 1 unit of goods;
JSC Gidromashservice. Let's notice that according to the company, prime cost in 2008 also considerably grew in comparison with 2006 by 462 986 thousand tenges or 66,76%. However, growth of costs of production was completely compensated by growth of revenue of the enterprise the same year and during the subsequent period. In particular, in the same 2008 growth of revenue made 759 456 thousand tenges or 56,43%. However, business isn't put only into correlations of growth rates of revenue and prime cost. If to analyse rates of a gain of indicators in 2008-2010, JSC Gidromashservice has a decrease in coefficient of operating profit from an indicator 1,82 in 2008 to 1,62 in 2010 was compensated by growth of an index of strategic positioning, whose value in 2008 made 1,25, and in 2010 – 1,4. As a result, the index of competitiveness of the enterprise underwent
"Everything is subordinated in this world to nature laws: people are gifted with sufficient reason to comprehend these laws and to observe them" (F.Kene)).[ 1] The economic analysis dates back to the times of the Ancient Greece and Rome. As applied science, the economic analysis began to develop in process of development of human society and the type of economy accompanying it. What is a basis of human society in its economic way? Wealth? Prosperity for all? Personal benefit? Enrichment of the few about which great Aristotle wrote by generalizing rich people as "oligarchs". Many millennia back people opened such economic categories as "cost", "work", "price", "exchange" and by developing such categories, money appeared I the lives of humans. Money was means of a measure, an exchange, and accumulation. Ever since a little has changed in the meaning of economic theory. For instance, even in ancient time’s Greek fishermen, was interested to sell caught fish, quicker and as soon as possible, while it didn't deteriorate. On the other hand, the same fishermen sought to look for and note such places he could catch a plenty amount of fish. Is it possible to tell, that the fisherman thought for maximizing profit, and minimization of own expenses, including, time for search of a "fish" place? If it is possible, in that case it is an example of the elementary economic analysis from the independent economic person whose purpose was an increase of efficiency from the done work. Practical activities of people if it wasn't made on account of moral, the religious purposes and feelings, as a rule it was always directed on achievement of definite purposes and tasks, whether it be: hunger satisfying, construction of Parthenon, the basis of Ancient Greek colonies in new lands. No doubt, since ancient times a little has changed in the economic analysis. Aim has always been a leading motive and work has always been a key to achievements For instance, the person has always been trying to predict future crop of olives, to prevent a drought, which could ruin olive trees and to leave one without food in future time. Consequently it means that the person always strove for the analysis. Understanding that the nature is changeable, and a hunger instinct, on the contrary, is constant, the Ancient Greek farmer found ways of possible rescue of own agricultural enterprise, and sometimes to a course there were most improbable measures. On the one hand, the farmer could sacrifice to Zeus a bull; On the other hand, the same person could dig out small channels in order to make access of its olive trees to water. Thus, it means, the same person could find a solution to such problems by the rational administrative decision. Thus, it is possible to conclude, laws of the economic analysis – are fundamental, universal, for each country and each temporary era. At the same time, the principles of the economic analysis and accounting are individual concerning each concrete enterprise. Today experts allocate 4 main schools of accounting, each of which as it will be shown further, has own differences (see table 1).
Table 1. Features of leading national schools in the area of economic analysis and accounting.
Account and analysis problem definition
National schools
ITALY
FRANCE
GERMANY
USA
Purpose
Control of behavior of performers
Increase of efficiency of use of resources
Elaboration of rational registration and analytical procedures
Control of behavior of managers
Subject
Rights and obligations of persons
Stocks and streams of resources
Procedures
Behavior of managers
Basic science
Legal right
Political economy
Mathematics
Psychology
Analysis method
Induction
Induction
Deduction
Induction
The main object of the economic analysis is Enterprise, as it was shown on the example of a plantation of olive trees,. According to S. Ojegov's explanatory dictionary, the enterprise has some values: 1) "Production or economic establishment, plant, factory, workshop"; 2) "The conceived business undertaken by somebody". Proceeding from the given definitions, the enterprise can be both the subject of business, and a certain idea. The problem of any of four models given above is a providing the authentic forecast by means of which the person who has launch a certain enterprise, will be able to reach the planned goal. For creation of the forecast the businessman, the idea carrier, has to reveal first of all a circle of factors and the phenomena which have the direct or indirect relation to the core of business. First of all, by observing, investigating different factors that relates to business, a person who want to launch a business builds theoretical model of the analysis of business. Having created thus a certain theoretical baggage of data, the businessman can make the decision on the necessary practical actions promoting movement in the chosen direction. After the the purpose is reached production cycle becomes isolated. Let's generalize the main components of a such cycle: a) Facts / the phenomenon; b) Concepts/size; c) Laws / Forecasts. Direction of business model also subdivided by: a) Supervision; b) Measurement; c) Analysis; d) Synthesis; e) Choice of model of practical measures; e) Practical actions. It is natural to assume interrelation of the economic analysis with other scientific disciplines as operating by concepts, creation of the forecast, development of recommendations at initial unsuccessful actions, and many other factors can't exist only within one scientific discipline. Among disciplines with which the economic analysis is most closely bound, it is possible to call:
Statistics. The statistics is urged to help with creation of the forecast by means of certain categories, i.e. the concepts reflecting the most essential signs of a subject, or the world around phenomenon. Relative and average sizes, comparisons of individual and group factors, coefficients (indexes), or "weak" and "strong" links which represent a conceptual framework necessary within the economic analysis;
Accounting and audit. Researchers consider science of accounting as "elder sister" of the economic analysis. So, according to scientists, accounting was in use already in Ancient Egypt. In those days copyists of the Pharaoh carefully fixed by means of papyruses and clay plates key information on economic stocks (collecting grain, a fig, damage of products) and trade operations (trade between the cities of Egypt, trade with tribes in the territory modern Libya and the Sinai Peninsula). Let's notice, a basis for the economic analysis is information which can provide only accounting, in particular, financial statements of the enterprise (the balance sheet, income statement, the report on cash flow). Besides, the separate subgroup of accounting which is also demanded during carrying out the economic analysis is audit. Audit is an independent analysis of accounting reports which is carried according to the desire of director of the company or at will of external authorities;
Law. Criminal, civil and administrative law also plays a role when carrying out the economic analysis. This aspect depends on activity of the enterprise which can be as lawful, or legal, and illegal, which means breaking the adopted acts or amendments. Besides, procedure of payment by the enterprise of taxes and all due collecting, strict maintaining contractual obligations, also are spheres of contact of the economic analysis and jurisprudence. Subject of the real research is carrying out the complex economic analysis of the enterprise and delivery of an assessment of its efficiency. This area assumes initial research of theoretical aspects of the economic analysis, and also methods of an assessment of efficiency of the enterprise that means studying of a subject, object and tasks of the economic analysis as branches of economic science. Further – research of methods and receptions of an economic assessment of business in conclusion of what follows the analysis of competitiveness of the enterprise and development of an assessment of efficiency of business.
Chronologically research is subdivided into some scientific branches: 1) Theoretical branch (subject of the economic analysis, task, object of the economic analysis, technique and analysis of competitiveness of the enterprise, development of an assessment of efficiency of business); 2) The practical branch (collection of information and the complex characteristic of activity on the example of the concrete Kazakhstani enterprise that assumes the analysis of the external and internal environment of the enterprise, the internal analysis of the company, identification strong and weaknesses of the current provision of business. Further the analysis of competitiveness of the enterprise from a position of the main rival enterprise. The last stage is analysis of available financial statements of two enterprises for six year period Concerning a question of a subject of the research paper, it is necessary to notice that the subject includes both as theoretical disclosure of an essence and methods of the economic analysis and practical complex economic analysis of the enterprise, and also development of an assessment of efficiency of business. The last includes need of carrying out the comparative analysis of the main financial statements of the enterprise during six years. In this regard, is possible to claim that this work has own, specific component as during research I have used internal financial reports of the enterprise and also its main competitors, and periodic materials, electronic resources with the maintenance of a range of various scientific techniques of a complex assessment of the enterprise. The structure of the thesis includes the introduction, three heads, the conclusion, the list of the used literature and the appendix. Chapter 1 of work is devoted to disclosure of theoretical aspects of the economic analysis and study of methods of assessment of efficiency. In this section I uncover subject, object and tasks of the economic analysis as parts of economic science. In detail the technique of development of an assessment of efficiency of business by means of the analysis of competitiveness of the enterprise from a position of the independent participant of the market. Chapter 2 contains the complex economic analysis which has been carried out on the example of domestic production cooperative "Tselingidromash". Also one can find is the chapter 2 characteristic of the external, internal environment of the enterprise, identification of weaknesses and strengths, opportunities and threats of business and also the comparative analysis of all four factors is made. Further, in the analysis I analyze competitiveness of the enterprise, its products, calculation of the main finical ratios (coefficients of operational efficiency, strategic positioning, profitability indicators) and etc Further in a chapter 3 one can find recommendations in order to increase efficiency of business, to improve financial performance and to strength competitiveness of the Tselingidromash. Besides, ways to decrease production expenses are offered that in turn can lead to decrease in the general cost of products of the enterprise, which will allow to conduct more aggressive price policy and to lead to income growth, then, arrived, and as a result, the general profitability of the Tselingidromash.
CHAPTER 1. Theoretical aspects of the economic analysis of the company. Methods of an assessment of efficiency of the enterprise.
1.1. Subject, tasks and classifications of the economic analysis Subject of the economic analysis is the enterprise, organizational structure of the enterprise, and also it "financial health", represented as assets and liabilities. The economic analysis affects economic processes which can include purchase (import) of production, including not only created products, but also spare parts, accessories, production from accessories, and also production sale / realization with use of the fixed and current assets, profit formation, its distribution. Therefore, object of the study of the economic analysis are economic processes of the enterprise and its organization which develops under the influence of objective and biased factors. In particular, the change in price for the raw materials be an objective factor, because from this material an accessory, equipment or industrial machine is made. The change in price in turn is a consequence of activity of the market, or in other words it is eternal search of balance between supply and demand. Subjective factors, on the contrary, directly depend and are connected with activity of the person. For example, imagine that marketing service of the enterprise chose the tactics, aggressive campaign for advance of already known product in the stagnating market, and spend for these purposes the considerable budget. As the result, growth of sales volumes and scanty increase in net profit in view of large volume of expenses, and it didn’t lead to return of invested funds. Thus, incorrectly estimated tendency of development of the market could lead to recession in business work instead of growth Also, mistakes in forecasts and signals incorrectly interpreted by producers from buyers, could be examples of subjective factors. As a result it obvious that successful financial activity of the enterprise comprises a set of variable aspects, such as skillful planning of activity of the enterprise, forecasting of future condition of occupied branch, the competent analysis of strong sides and weaknesses of the main rivals of enterprise, quality of operational decisions, effective management and etc. Together with it, I will notice, that the economic analysis includes the analysis of only those economic processes which are suitably reflected in system of economic information. More precisely, I mean financial statements of the enterprise, and its compliance accepted by IFRS. In case the reporting is partially reflected, or reflected obviously incorrectly, the economic analysis of the enterprise is very difficult. Besides accounting, statistical account, and also the accounting of productions at the enterprise represents extreme importance. Moreover, among tasks of direct forecasting of financial and economic activity there can be following directions: Correct calculation of dynamics of the main financial performance of the enterprise includes: the output analysis, the analysis of volume of realization of production, the analysis of efficiency of work with a certain number of the personnel at the enterprise, the analysis of production cost, the analysis of a material capacity of production, the analysis of conditional expenses and profit for production, the profitability analysis, the profit analysis;
Quantitative assessment of changes in production ,technical, and organizational levels of the enterprise;
Definition of extent of use of the fixed production assets, labor and financial resources, the analysis of influence of labor / financial resources on economic efficiency of the enterprise, the general indicator of profitability;
Identification of the major factors which have entailed a deviation of the main actual indicators of activity of the enterprise (production import, production and production sale) from the planned indicators;
Research and measurement of the current and perspective reserves, methods to increase efficiency of the enterprise and decrease in production expenses of the enterprise;
Differentiation of sites of responsibility among specific managers, strengthening of corporate spirit of team. However, despite above-mentioned directions, the main objective of the economic analysis is a forecasting of expected results of economic activity. However, forecasting, or the analysis, is also possible to classify by a range of criteria. Classification of the economic analysis by types is defined, first of all, by the purposes, methods of research and generalization of studied materials. In turn, the purposes and methods for the different parties involved in activity of the enterprise (the state, shareholders, management, workers of shops) can differ from each other in view of interests of the parties. Division on character of the analysis can be the first classification of the economic analysis:
a) Theoretical and economic analysis;
b) Concrete and economic analysis. As the second classification division on production and management scale can serve:
a) Macroeconomic analysis. Mentions the industry as a whole or concrete branch, a market segment;
b) Microeconomic analysis. The enterprise, its organizational structure and activity in the market. Enterprise interaction with other market forces,competitors, buyers and etc Other factors, according to which classification of types of the economic analysis can be made, are:
1. The subject which carries the analysis;
2. Object studied during the analysis;
3. Purpose of carrying out analysis;
4. Range of studied problems;
5. Aspect of research;
6. Character of decisions made on the basis of the analysis and measures;
7. Degree of a computerization and automation of computing works.
Let's consider in more detail mentioned factors: 1. The subjects which are carrying out the economic analysis, i.e. persons performers of the analysis can be both internal departments of the enterprise, and external economic services (the auditor company, the financial, credit, tax organizations, etc.); 2. The objects studied during the analysis, can be as the independent enterprise, or its concrete division, and group of companies or their association (holding, industrial group); 3. The purpose of carrying out the analysis can include as the analysis for the purpose of definition of basic indicators for planning, and the analysis of results of internal and external activity of the company, leading of monthly / quarter / annual results, identification of reserves of the enterprise, search of increase of competitiveness of the enterprise, improvement of internal interaction between divisions, preparation of financial statements for external body (tax service, the auditor company, extraordinary meeting of shareholders), drawing up the business plan of the investment project, the conclusion of the credit agreement, etc.; 4. The aspect of research can be the following types: a) Financial and economic aspect; b) Technical and economic aspect; The financial and economic aspect opens interrelation of operational and financial performance, being guided by periodic financial statements of the enterprise before external bodies. In practice the financial and economic analysis is executed by managers of the company, or representatives of council of shareholders, the auditor companies. The technical and economic analysis is devoted to studying of economic activity of the enterprise on the basis of interrelation of economic indicators with technological equipment of the enterprise. The work organization, technologies applied in production, degree of efficiency of involvement of fixed assets, materials and manpower – the main objects of attention for the performer of the technical and economic analysis. Functional and cost the analysis is a method of system research of the enterprise which purpose is optimization of the price, expenses and the production technology. This type of the analysis is urged to provide the continuous growth of efficiency of activity of the enterprise; 5. The range of studied problems has the following subspecies: a) full, comprehensive analysis of economic activity; b) selective, thematic analysis of some kinds of activity; 6. Character of decisions made on the basis of the analysis is subdivided on:
a) The preliminary; b) The quick;
c) The overall;
d) The perspective. Let's notice if earlier the most demanded was total nature of accepted actions, in modern conditions into the forefront operational and perspective analyses act. The operational analysis, in particular, is directed on studying of system of the indicators reflecting the current activity of the enterprise. Indicators are based on daily results of work. Tasks of the operational analysis are daily control of a course of performance of planned indicators, identification of the current deviations from planned indicators, identification of the reasons of these deviations and their timely leveling, search of irrational use of resources, maximizing the current efficiency in involvement by the enterprise of fixed assets, timely generalization and providing the current reporting. The perspective analysis, in turn, forms a basis of strategic planning of activity of the company. Forecasting, scientific justification of accepted strategy are under construction not on the current day results, but on results of next week, decade, month, quarter, year; 7. Degree of a computerization and automation of computing works means the analysis made by means of electronic computer facilities or by means of a local network from several computers.
1.2. METHODS AND RECEPTIONS OF THE ECONOMIC ANALYSIS OF BUSINESS The economic analysis is a process of studying of economic subjects which includes a collection of information, its systematization, generalization and further use within achievement of the set purposes. Thus collection of information about concrete objects as a rule can be divided into collection of information about object components, or the phenomena. So, if the purpose is the analysis of profitability of sales, the performer has to isolate some categories from the financial characteristic of the enterprise which comparison will lead to the end result, namely return level, a percentage ratio of profit to total sales or gross revenue. Other example: production, dynamics of production. It means not only the production analysis of the enterprise as a whole, but also research of compound divisions. In a case with the production analysis in the “Tselingidromash”, the performer separately investigates all stages of a chain of production of the chemical pump AH 125-80-250, including production shop, assembly shop, a repair and experimental site, and also painting shop and department of pre-sale testing. Besides, the analysis of dynamics assumes involvements of data in various intervals of time (month, quarter, and year) that will allow the researcher to obtain more authentic data within the analysis. Along with the economic analysis, research and creation of the forecast, in practice companies use economic synthesis that allows making a complex picture of production on the basis of separate factors. It is possible to tell that if the analysis assumes following from the general to the particular as it was shown above, within economic synthesis the analyst has to investigate all stages of technical production. Besides, the performer shouldn't forget about economic indicators (the cost of purchase of spare parts, metals, import cost, labor input of a technological chain and number of the involved personnel that directly influences the salary size to the employees, other expenses, profit on sale, payment of taxes, net profit). Speaking differently, the method of the economic analysis can be compared by analogy to deduction which, as shown in table 1, most will apply at the German economic school. The course of research occurs from the general to the particular. For example, in the analysis of gross expenses of the Tselingidromash by production and realization AH 125-80-250, at first the assessment of the general prime cost of one unit of production then this category passes breakdown on the following articles of expenses is made:
1. "Costs of materials";
2. "An expense on salary payment";
3. "Transportation cost";
4. "Cost of payment of the customs duties and collecting";
5. "Business expenses";
6. "Management expenses". In process of carrying out the economic analysis one can find certain disagreements, contradictions causing deviations of production and a loss. In the light of it is possible to speak about development of the methods neutralizing negative factors. The following fact can be an example of a contradiction: dealers and outlets are interested if each chemical pump of the AH brand are completed with engines with average height of axis not less than 160 mm. While for the Tselingidromash the similar condition is unacceptable. First, engines with height of an axis are higher than 160 mm as a rule are more expensive, and can be got only by order, at the same time duration of transportation and route length not always guarantees quality. On the other hand, reorientation of all production only on one type of the electric motor will negatively affect a nomenclature line of cooperative, width of a choice of various production, client base, and competitiveness. Receptions of the economic analysis can be divided into the following types: a) Traditional receptions of the analysis; b) Nonconventional receptions of the analysis. The economic analysis combines several disciplines as it was shown above on the example of adjacent conceptual area between the economic analysis and statistics, the economic analysis and accounting, the economic analysis and audit. The natural science being in a basis of the analysis naturally is the mathematics This circumstance has an obvious historical explanation. Cave people, having learned to satisfy the hunger by means of wild-growing herbs, over time passed from work of daily, expeditious "hunting" behind blackberry, to its collecting and accumulation. Collecting was made not for a satisfying a momentary hunger, but for purpose of reserves, on a case if tomorrow bushes with berries will be eaten by animals, or will wither. People learnt how to overcome momentary instincts and to save something as reserves. In such way, ancient people could assume, how many capacities (baskets, bowls, bowls,) with blackberry berries are necessary for them to endure winter successfully. Thus, ability to count, planning, i.e. an initial form of the economic analysis had close interrelation with mathematics. However, as time passed, economic methods of the analysis were improved and became eventually more difficult. Therefore, that category of economic analysis which has changed from generation to generation can be called traditional.Among similar receptions: average sizes, relative sizes, groups, groups, comparisons, comparisons, coefficients (indexes), substitutions of variables. Speaking in more detail, as an example of traditional sizes we will allocate the following types:
Percent. For example, percent of the spoiled blackberry among total number of berries, or percent of performance of painting of the pump AH 125-80-160.For instance, if the plan of realization of the chemical pump of the real brand for 1 quarter 2013 provides sale of 5 units for total amount of 12 500 000 tenges, and the fact makes 3 for a total cost of production of 7 500 000 tenges, the plan is executed for 60,0%;
Coefficients (indexes). For example, the index of realization of production for March, 2013 tells about growth of number of sold pumps of the AH brand in comparison with basic month. January 2013, initial stage of sales is accepted asbasis. The pump AH 125-80-160 isn't seasonal type of the pump, unlike submersible pumps of the brands "ETsV", "BTsP", owing to basic any financially successful interval of time can be considered. So, if in January, 2013. Management of sale of the Tselingidromash realized to clients 2 pumps AH 125-80-160, and in March, 2013 – 1 pump, the coefficient of growth is equal ½ = 0,5. The gain coefficient, in turn, makes-0,5;
Share (specific weight). This indicator characterizes set structure, i.e. realized production, the relation of the chosen category to the nomenclature to total. For example, during 1 quarter 2013. Management of sale of the Tselingidromash sold about 15 chemical pumps of the AH brand, the share of the pump AH 125-80-160 in the general structure makes 3/15 * 100% = 20%;
Average size. This concept allows making a general characteristic of the phenomenon in time or space. For example, the average monthly payment of the collector of the pump AH 125-8-160, consisting of a salary and variable part (award) makes 85 000 tenges. In practice some types of comparisons are applied: Comparison of uniform indicators. For example, the average monthly salary of the collector of the chemical pump makes 85 000 tenges while the salary of the senior economist of Department of management and planning is equal 160 000 tenges;
Comparison of changes of interdependent diverse indicators. For example, in March, 2013 the average size of variable part of managers of Management of the sale, chemical pumps engaged in realization, decreased by 50% in comparison with the size of bonus part in January of the same year. The reason consists in falling of sales volumes of pumps of this group;
Dynamic comparison of uniform indicators depending on the period. For example, in 1 quarter 2012 6 pumps of the AH brand 125-80-160 while the similar indicator in 2013 equals to 3 units that below basis for 50% were realized;
Branch comparisons. For example, in 1 quarter 2013 of the Tselingidromash I realized 15 chemical pumps while JSC Gidromashservice I could realize 12 similar pumps. Having made simple calculations, it is possible to claim, the share of the Tselingidromash in branch for 1 quarter 2013 made 15/27 * 100% = 55,56%.
Also specification, i.e. a considered indicator belongs to number of receptions of the economic analysis
1.3. THE METHOTODOLOGY AND ANALYSIS OF THE COMPETITIVNESS OF THE ENTERPRISE.
"The competition – life of trade and death of dealers". [2]
Elbert Green Hubbard (1856-1915), American writer, publisher, philosopher The opinion, according to which competition – the progress engine, basis of market economy, eternal incentive for the businessman to development is widespread. Frank Borman, the American figure, spoke: "Capitalism without bankruptcy is all the same that Christianity without an underworld". [3] Maxim Zvonarev who supported this idea also claimed that the economy without bankrupts herself will sometime go out of business. David Sarnov (1981-1971), the American operator and the businessman, fairly believed: "The competition provides the best quality of products and develops the worst qualities of people". [4]. The competition by consumers, the competition between producers, the competition between supply and demand, suggest human society, and first of all each individual person, after having become free from fetters of the wild nature, , took out with itself the main lesson -the competition became this lesson. It is possible to claim that the competition between plants, individuals, fight for the best at cellular level appeared before the appearance of humankind who became subsequently her pupil and the adherent. In practice when speak about the competition, authors mean the competition, i.e. a form of the rivalry hidden or open, between the companies, producers, subjects of the economic category ". Actually, as we know, the competition, or spirit of rivalry can be and among buyers of hypermarket in Seoul, the capital of South Korea, the right to possession new model of the android-device of famous Korean brand becomes a subject of fight. The competition between ask and the offer, in turn, gives rise to the balance, which is the "market price". As already it was told earlier, the competition is not a constant, because supply and demand are in perpetual motion, producers constantly invent new ways of involvement of new clients, fixing of traditional sales markets of production, producers infinitely look for new ways of increase of a margin and decrease in expenses. The competition allows the producer to understand better the advantages and shortcomings, to consider possible pluses of the competitor, to find ways of their neutralization, or loan. The producer, being provided to itself, and without having any competitors in the market as in a case with monopoly, it is inclined to revaluation of the opportunities. So, having once won the market, the producer loses interest to decrease in expenses, prime cost reduction, and consequently, and to reduction of price, i.e. satisfaction of the consumer. In de facto monopoly, the buyer in any case, at any price, has no alternative. Therefore, value of an indicator of competitiveness of the enterprise calculated concerning one competitors, can significantly differ from value of the same indicator calculated in comparison with other competitors. In a view of use of such conceptual concepts as "profit", "competitiveness", "a competitiveness assessment", it is expedient to open the real concepts, and also some economic categories which have been closely interconnected with them. So, what is it a profit? Let's consider some variations of profit, such as "gross profit", "profit before payment of taxes and percent", "net profit": 1) The gross profit represents a difference in terms of money, being formed by a deduction from proceeds of the company or from realization of certain production in the market of goods. Let's explain, cost of production comprise a complex of expenses of the enterprise on purchase of materials, accessories, their transportation on the enterprise, transportation costs, assembly cost, expenses on salary payment to workers, cost of pre-sale service; 2) The profit before payment of taxes and percent ("EBIT") is a gross profit minus business and management expenses; 3) The net profit is formed by receiving a residual part of profit before payment of taxes and percent after payment of the last two sizes; 4) Competitiveness is a measure which shows how effectively company uses available resources in comparison with competitor. Therefore, competitiveness is an indicator of firm for the firm; it is criterion of comparison of efficiency of use by resources two rival companies. Sources of competitiveness are an operational efficiency and strategic positioning; 5) The assessment of competitiveness allows to make a conclusion, or how competitive the enterprise in the market. As a rule, the similar conclusion represents the list of the actions directed on strengthening market positions of the company. On the other hand, the assessment of competitiveness forms a methodological basis for carrying out by experts of firm of the analysis, how successfully paid off in practice of action. The purposes of work of an assessment of competitiveness can be: a) drawing up list of actions for competitiveness increase; b) multiplication of information on competitors (by a benchmarking, the comparative analysis); c) revision of operating strategic policy of firm (updating of the program of further expansion to branches, etc.); d) acceptance by investors of the decision on capital investments in the company (in case of high competitiveness of the company, steady financial performance, etc.); 6) Operational efficiency is a percentage ratio of revenue to expenses. If the profit is a physical amount of money, operational efficiency represents coefficient of, how successfully the company consults with satisfaction demand, maximizing profit. This criterion shows that, how effectively the enterprise spends the capital and returns it by means of receiving revenue; 7) Strategic positioning is a percentage ratio of efficiency of functioning of the company in the market. This criterion uses two components: revenue and general size of the market (both indicators in terms of money). The coefficient shows, what part of monetary market size belongs to the company. Coming back to concept of the economic analysis considered by us earlier in the present chapter, we will explain that the analysis of competitiveness of the enterprise is understood as the following directions of research and the analysis:
The Analysis of competitiveness of the enterprise within branch. More precisely, a segment of the industrial equipment, namely, production and realization of chemical and monoblock pumps. This segment includes such pumps of such brands as "KM", "AH", "AHI", "H-R", "AHP", "HP", "THI", "AHO";
The analysis of competitiveness of the enterprise concerning its main rivals. As it is inexpedient to compare companies from different industries, I will consider those enterprises which represent branch of production and sale of industrial pumps of monoblock and chemical types;
The analysis of competitiveness of the enterprise within the comparative characteristic of production. Production realized by the companies, namely monoblock pumps and chemical pumps is subject to comparison. As criterion can act both production characteristics, and economic criteria: supply of liquid, pump pressure, electric motor capacity (in case it is a question of the pump unit), number of revolutions per minute at the electric motor, the mass of the pump / the pump unit, pump dimensions / the pump unit, the pump / unit price.
CHAPTER 2. COMPREHENSIVE ECONOMIC AND FINANCIAL ANLYSIS OF THE PC “Tselingidromash”
2.1. Mission and tasks of PC "Tselingidromash" The productive cooperative "Tselingidromash" was formed in 1941 in the period of Second World War, when industrial powers being based in Ukrainian SSR were in the zone of danger because of sudden encroachment of the German troops. In decision of government of the USSR many industrial machine-tools were kicked in the central region of Kazakh SSR, what gave birth to PC " "Tselingidromash". So, created in 1941 on the base of the evacuated Melitopol plant for performing the soldiery orders, a plant in 1960 started producing chemical pumps. PC "Tselingidromash"" engages in a production and supplying with the pumps of next types :
1) Chemical Pumps. Chemical pumps are applied in the industry of the same name to safe pumping of acids, alkalis and other aggressive liquids. Besides, they used at a modulation of oil products, paints, varnishes, solvents. Production of chemical pumps lets out models different in execution, and unlike usual pump systems, at their classification properties of pumped-over substances which can strongly differ from properties of ordinary water have special value. Depending on chemical activity and aggression, and also such parameters as density, temperature etc., is defined a design of the unit. Materials among which special grades carbonaceous and chromic steels, chromic and molybdenum alloys, siliceous cast iron, hi-tech polymeric materials are used are various also. The Tselingidromash releases chemical pumps of the following brands:
a) Pumps of the AH type. Units electric pump centrifugal the AH type are intended for pumping of chemically active and neutral liquids with a density no more than 1850 kg/m3 having firm inclusions up to 1 mm in size which volume concentration doesn't exceed 1.5%, with a temperature from -40 °C to +120 °C, the speed of penetration of corrosion of a material of flowing part doesn't exceed 0.1 mm/year. Kinematic viscosity of pumped-over liquid no more than 30х10-6 sq.m/with;
b) "HO" pumps. Units centrifugal, horizontal, console, one-stage are intended for pumping of chemically active and neutral liquids with a density no more than 1850 kg/m3 containing firm inclusions in number of no more than 0,1% on volume with a size of particles no more than 0,2 mm, kinematic viscosity to 30х10-6 sq.m/with, and also the liquids crystallizing at a temperature of the surrounding environment for what on a soaking-up branch pipe of the pump the heating camera is provided;
c) "AHO" pumps. Units electric. Scope: pumping of chemically active and neutral liquids with a density no more than 1850 kg/cm3 having firm inclusions up to 1 mm in size, which volume concentration doesn't exceed 1,5%. Temperature of pumped-over liquid: from 30 to 200 0C. Speed of penetration of corrosion of a material of flowing part: no more than 1 mm/year;
d) "HD" pumps. Units centrifugal. Horizontal, console, one-stage. Scope: pumping of chemically active and neutral liquids with a density no more than 1850 kg/cm3 having firm inclusions up to 1 mm in size, which volume concentration doesn't exceed 0,1%. Temperature of pumped-over liquid: from 30 to 200 0C; 2) Monoblock Pumps. Pumps monoblock. Pumps of this type are intended for pure pumping of technological appointment (except sea) with рН 6-9 in stationary conditions. Temperature of pumped-over liquid: from 0 to + 85 0C. Pumps with an unary soft epiploon and with face consolidation intend for pumping not only water, but also other liquids similar to water on density, viscosity and the chemical activity, containing the firm inclusions up to 0,2 mm in size which volume concentration doesn't exceed 0,1%. Consolidation of a shaft of the "KM" electric pump - unary stuffing or unary face. The greatest allowed excessive pressure on an entrance to the pump: for pumps with an epiploon of 0,35 MPas (3,5 kgfs/cm2), with face consolidation of 0,8 MPas (8,0 kgfs/cm2). The material of flowing part is carried out from gray cast iron. The geography of export of the Tselingidromash includes both regions of the Republic of Kazakhstan, and the CIS country (Ukraine, Lithuania, Latvia, Estonia, Uzbekistan). By means of import and also independent production of demanded accessories and the main parts of pumps, the Tselingidromash is an example of a full production chain, from bed smelting up to pump sale through an available dealer network. Providing the Republic of Kazakhstan with the manufacturing pump equipment, the Tselingidromash helps with the solution of the major strategic tasks on development of the industry and country agriculture. So, deliveries of monoblock pumps Tselingidromash helps the Government of the Republic of Kazakhstan with providing the population of all areas with drinking water, with the solution of questions of an irrigation of agricultural fields and grounds, increases of productivity of crops. At the same time, realization of pumps of chemical type promotes updating and expansion available in the territory of the republic of the enterprises of ferrous and nonferrous metallurgy, the chemical industry. Basis of policy of the company is observance of the principles of honesty and decency in relation to the consumer, the business partner, to the employees. The policy of the Tselingidromash consists of several sections:
1 . Tselingidromash mission:
Address to the benefit of the consumer of water resources, assistance to development of the industry of the Republic of Kazakhstan.
2 . Principles of the Tselingidromash:
The consumer – the most important person for whom the enterprise personnel works;
Worthy service to interests of society and state;
Continuous improvement of processes of production and service;
Honesty is the base on which the success of the enterprise is under construction, it is a basis of production of high-quality production and services, the sincere relations of the enterprise with consumers and suppliers;
Continuous and continuous professional development, competence, experience of experts.
3 . Purposes of activity of the Tselingidromash:
The maximum satisfaction of the established expected requirements of consumers;
Gain of a leading role in the market of the common industrial and household pump equipment for houses and productions of the Republic of Kazakhstan;
Granting to consumers of goods and quality service and for reasonable prices;
Obtaining income necessary for development of the enterprise and ensuring achievement of the reasonable personal purposes of employees and shareholders of the Tselingidromash.
4. Tasks of the Tselingidromash:
Preservation and strengthening of image of the enterprise, as honest and reliable partner before clients and suppliers of products;
Development of new types of production on the basis of the analysis of data of marketing;
Continuous collecting and the analysis of information on satisfaction and wishes of the consumers concerning production and services Tselingidromash;
Fast response to change of requirements and expectations of the consumer.
5. Methods of realization of policy of the Tselingidromash:
Continuous increase of productivity and efficiency of SMK Tselingidromash;
Increase of competitiveness of production and services at the expense of improvement of designs, manufacturing techniques of products, use of achievements of science and technology;
Active participation of all employees in work on improvement of quality of production, goods and services, to increase of satisfaction of consumers;
Systematic training and personnel professional development. From the date Tselingidromash was founded it protects invaluable property, namely, reputation of the reliable and decent partner adhering to the high moral and business principles and standards. Honesty is the base on which the success of the Tselingidromash is under construction. 2012 became in the history of the company as year of practical realization of export strategy of the organization. Past year the Tselingidromash made for the first time external export trade operations with countries of Eastern Europe (Poland, Hungary, Romania). Thus, the enterprise considered in the real work, being focused on the maximum satisfaction of requirements domestic, and the foreign consumer, and also having at the order numerous resources, both human, and material, there have to be most interested in search of suitable model of management, the models, capable to give the greatest advantage as in monetary, and a moral equivalent. It should be noted that considered by us in the previous chapter of a matrix of strategy take away a considerable place not only to directly financial and economic indicators of the enterprise, but also the motivation of the personnel on which, in particular, the above-named indicators depend.
2.2 . Financial analysis of MC "Tselingidromash” and its main rival JSC “Gidromashservice”
"You study at the competitor because he will study at you". Jeff O'Leary, the writer, the analyst, the colonel of army of the USA in resignation.[5]
Within the analysis of competitiveness of the Tselingidromash, besides the real enterprise the analysis of the main financial performance, and also indicators of competitiveness of the first leading enterprise of branch – JSC Gidromashservice will be made. Thus, data of the following enterprises will be compared:
Tselingidromash. Site: Republic of Kazakhstan, Astana, Zh. Omarov St., 111. The Tselingidromash specializes on release of pumps since 1960, being, thus, one of the oldest productions in RK territory. The Tselingidromash is one of the largest suppliers of pumps for pumping of aggressive liquids, pumps for pumping of water, pumps for pumping of easily boiling liquids (type ammonia), pumps for pumping of the polluted liquids, pumps for pumping of hot and crystallizing liquids, pumps for work in fire and explosion hazardous conditions.
JSC Gidromashservice o. Site: Russian Federation, Moscow, Aircraft Designer Mikoyan St., 12. JSC Gidromashservice was founded in 1993. For more than 20-year per work iodine in JSC Gidromashservice was created harmonious group of engineers, designers, technologists and specialists in development, production and sale of the various pump, compressor and block and modular oil and gas equipment. JSC Gidromashservice has experience of supplies of equipment and implementation of complex decisions for oil and gas branch, thermal and nuclear power, a water management, housing and communal services, metallurgy, the chemical industry and shipbuilding. Kinds of activity of the company include the following directions:
1. Delivery of the wide nomenclature of pumps, pumps units, blocks and complete equipment;
2. Delivery of the wide nomenclature of the compressor equipment;
3. Installation, commissioning, service;
4. Development of pumps, pump units;
5. Engineering and implementation of "turnkey" complex projects;
6. Repair and modernization of the pump equipment.
Let's present the main indicators of financial and economic activity of the Tselingidromash and JSC Gidromashservice. Let's notice that data are calculated in thousand tenges (see table 13). Besides, chronologically financial performance represents some periods from history of development of data of the companies:
a) Pre-crisis period. The analysis of financial and economic indicators for 2007;
b) Crisis period. The analysis of financial and economic indicators for 2008;
c) Post-crisis period. The analysis of financial and economic indicators for 2010;
As it will be shown below, the main documents of financial statements of the companies on the basis of which all current calculations were made, balance sheets of both companies for the aforesaid periods, and also profit and loss reports of the considered companies for the similar periods were.
As it will be shown below, the main documents of financial statements of the companies on the basis of which all current calculations were made, balance sheets of both companies for the aforesaid periods, and also profit and loss reports of the considered companies for the similar periods were.
Table 1. Indicators of revenue, prime cost and gross profit of the MC Tselingidromash and JSC Gidromashservice for 2007, 2008 and 2010 according to financial statements of the companies.
Company/Criterion
MC Tselingidromash
JSC GidromashService
Year
Revenue, thousands tenge
1 145 943
1 345 778
2007
Prime Cost, thousands tenge
526 328
693 467
Gross Profit thousands tenge
619 615
652 311
Revenue, thousands tenge
2 537 390
2 105 234
2008
Prime Cost, thousands tenge
1 385 985
1 156 453
Gross Profit thousands tenge
1 151 405
948 781
Revenue, thousands tenge
2 098 942
4 154 942
2010
Prime Cost, thousands tenge
1 409 001
2 565 987
Revenue, thousands tenge
689 941
1 588 955
Total enterprise revenue
5 782 275
7 605 954
Total enterprise revenue 2007-2010 гг7
Total enterprise prime cost
3 321 314
4 415 907
Total enterprise prime cost 2007-2010 гг.,
Total enterprise gross profit
2 460 961
3 190 047
Total enterprise prime cost 2007-2010
On the basis of table 1 we will reflect dynamics of growth of indicators of revenue, prime cost and gross profit of the considered enterprises in 2006, 2008 and 2010 (see figures 1, 2).
Table2 Coefficients of operational , strategic and competitiveness positions
Enterprise/Criterion
MC Tselingidromash
JSC GidromashService
Coefficient of operational efficiency, Kr
2,18
1,94
Coefficient of strategic positioning, KI
1,06
0,97
Competitiveness coefficient, To
2,32
1,88
Kr
1,83
1,82
KI
1,49
1,25
To
2,72
2,28
Kr
1,49
1,62
KI
0,91
1,40
To
1,35
2,27
Kr
1,83
1,79
KI
1,15
1,21
To
2,13
2,14
Figure 1. Dynamics of indicators of revenue, prime cost and gross profit of the Tselingidromashin 2007, 2008 and 2010
Figure 2. Dynamics of indicators of revenue, prime cost and gross profit of JSC Gidromashservice in 2006, 2008 and 2010.
Apparently from the above-stated materials, a gain of the above-stated indicators in 2010 in comparison with basic 2006th year at the companies made the following values:
1. Tselingidromash. Revenue gain: 952 999 thousand tenges or 83,16%. Gain of gross profit: 70 326 thousand tenges or 11,35%;
2. JSC Gidromashservice. Revenue gain: 2 809 164 thousand tenges or 208,74%. Gain of gross profit: 936 644 thousand tenges or 143, 59%.
3.
Let's note, the concept "prime cost" is understood as production expenses (import of accessories, purchase of details, a salary to the personnel) without business and management expenses, operating and realizatsionny expenses, and also the sum of payment of tax obligations. The concept "revenue" is meant as gross revenues of the enterprise from all kinds of activity (resale of the imported equipment, realization of production of own production, etc.). Concerning dynamics of the presented indicators of the companies it should be noted that at both considered enterprises in considered years growth of revenue and gross profit was observed.
Further we will settle an invoice coefficients of operational efficiency and strategic positioning for both enterprises (see table 14).
Let's present visually to the loudspeaker of values of coefficients of operational efficiency, strategic positioning and coefficient of competitiveness of the companies (see figures 3, 4).
Figure 3. Dynamics of coefficients of competitiveness of the Tselingidromash in 2007, 2008 and 2010.
Analyzing the developed trends at the companies, we will explain the following:
a) Tselingidromash. The general decrease in coefficient of competitiveness in 2008-2010 in comparison with the basic period is caused first of all by falling of coefficient of operational efficiency. The last index is the relation of revenue of the company to product cost which, as we know, grew in 2008 in comparison with 2006 by 859 567 thousand tenges or 163,33%! As a result, the growth rate of revenue concedes to the growth rate of product cost that can be explained with change of suppliers of materials and completing in view of bankruptcy of former suppliers. As a result, the cooperative was compelled to buy necessary for production of pumps materials at higher prices, at the same time having raised the prices of own production, however, apparently from an index of operational efficiency, the raising of the price didn't pay back fully growth of prime cost of 1 unit of goods;
JSC Gidromashservice. Let's notice that according to the company, prime cost in 2008 also considerably grew in comparison with 2006 by 462 986 thousand tenges or 66,76%. However, growth of costs of production was completely compensated by growth of revenue of the enterprise the same year and during the subsequent period. In particular, in the same 2008 growth of revenue made 759 456 thousand tenges or 56,43%. However, business isn't put only into correlations of growth rates of revenue and prime cost. If to analyse rates of a gain of indicators in 2008-2010, JSC Gidromashservice has a decrease in coefficient of operating profit from an indicator 1,82 in 2008 to 1,62 in 2010 was compensated by growth of an index of strategic positioning, whose value in 2008 made 1,25, and in 2010 – 1,4. As a result, the index of competitiveness of the enterprise underwent
You May Also Find These Documents Helpful
-
Colander (2010) stated, “Economics is the study of how human beings coordinate their wants and desires, given the decision-making mechanisms, social customs, and political realities of the society” (p. 4).…
- 943 Words
- 4 Pages
Good Essays -
According to an article on wcax.com, “more Vermonters died from opiate overdoses last year [2011] than murders and traffic fatalities combined.” Some opiates have medically valid uses, while others are recreational drugs of abuse. All are physically addictive, and it has become evident that many people have begun to abuse them. Pharmaceutical drugs have taken over the minds of many Vermonters.…
- 1773 Words
- 8 Pages
Better Essays -
Though it should be universally accepted that nature is of a divine origin, today’s society has lost that principle. Now, as a supreme being, nature can control itself and manipulate everything within it. Through my observations in…
- 793 Words
- 4 Pages
Good Essays -
According to Alexander Hamilton the law of nature is the law, "which, being coeval with mankind, and dictated by God himself, is, of course, superior in obligation to any other. It is binding over the entire globe, in all countries, and at all times. No human laws are of any validity, if contrary to this; and such of them as are valid, derive all their authority, mediately, or immediately, from this original." (The Farmer Refuted,…
- 1000 Words
- 4 Pages
Good Essays -
In United Kingdom and Europe, the adults and volunteers working around the school, paid or not, have various names: learning support assistant, classroom assistant, special needs assistant, but the most common term is the one of teaching assistant.…
- 572 Words
- 3 Pages
Good Essays -
In 1919 World War I had come to an end. Ten years later the stock market crashed throwing the United States into a Great Depression. The time period in between was a time that was classified by a boom in the economy and prohibition legalized by the eighteenth amendment. This amendment had lead to an increase of organized crime nationwide. In that time span of these two prominent moments in American history was one of the most scandalous presidencies in American history. It came from no other than Ohioan Warren G. Harding.…
- 2148 Words
- 9 Pages
Powerful Essays -
Nature law is said to be from a higher being (God) and deals with things that morally wrong. Man-made laws are made by man does not have to be morally wrong like a parking in a no parking zone.…
- 805 Words
- 4 Pages
Good Essays -
The theory of natural law originates from Aristotle’s idea of goodness as fitness for purpose and stoic’s concept of a universal law of reason which is in agreement with nature. What we now call human nature. This point is then furthered by Aquinas who agrees with the argument but furthers it by linking it with his Christian belief by saying following this law is equivalent to following the command of God as human nature is in us inbuilt into us from when God created us.…
- 1800 Words
- 8 Pages
Better Essays -
When Jefferson speaks of laws of nature he is referring to the laws entitled to all men by God.…
- 695 Words
- 3 Pages
Good Essays -
In earliest times, economics was not distinct from other social sciences or even philosophy. Aristotle…
- 18830 Words
- 76 Pages
Powerful Essays -
iv. Natural law theory: the laws should just pop out from within us because they just occur w/in us. By our close observation of nature we see what they should be. Almost as if they occur within us.…
- 14111 Words
- 57 Pages
Powerful Essays -
Nature contains a perfect amount of order and chaos allowing it to sustain itself in perfect balance and harmony for eons. Many people strive to achieve this balance of order and chaos, however, very few ever succeed. This relationship with nature is a fundamental part of our human lives, although, very few people ever realize…
- 666 Words
- 3 Pages
Good Essays -
Aristotle is classified among the most vital thinker ever to exist in the economic sector. He advanced and analyzed economic processes within his surroundings to determine the position of the economy (buying and selling) in the society. Aristotle’s writings on economics continue to attract the attention of many contemporary thinkers. He developed many insightful economic thoughts especially the value theory. The most important topics related to economics covered by Aristotle’s include human action and political economy. In these topics, he provides his philosophical analysis of human ends and means. He expounds how valuable means of production (in terms of their end products) are to the society. High value of the means of production defines how usefulness of the end products. Aristotle’s continues with derivation of numerous economic ideas from axiomatic concepts such as human action on necessity, end pursuits through ordering and allocation of scarce means, and the reality of human inequality and diversity (Scott, 1997).…
- 1183 Words
- 5 Pages
Better Essays -
in the face of which we with our modest powers must feel humble. The scientists’ religious feeling takes form of a rapturous amazement at the harmony of natural law, which reveals an intelligence of such superiority that, compared with it, all the systematic thinking and acting of human beings is an utterly insignificant reflection.”…
- 1829 Words
- 8 Pages
Powerful Essays -
Extensions of knowledge do not always enlarge our capacity for control. This holds true for our relation to nature, some of whose phenomena are alterable by man while others are not. Despite all increase in our information about heavenly phenomena, some lie entirely beyond human influence. For instance a geologist studies the nature of the earthquakes but he cannot cause or prevent this occurrence. In some cases, we are ourselves the determinants of nature, since the use we make of natural forces produces the result we have caused. One such recent matter is the use of plastic.…
- 487 Words
- 2 Pages
Satisfactory Essays