What the dupont identity tell you about your chosen company

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Reference no: EM131442912

Assessment Assignment - DuPont Identity as Strategic Planning Tool - Strategic Financial Planning

Company to Analyze: CVS Pharmacy

Competitor to Analyze: Rite Aid Pharmacy

Answer the Following Questions for Both Companies

Pages Required: 4 Pages

1. Calculate the DuPont Identity (Equation) for the past three years using VentureLine (or equivalent) for:

  • Your chosen company
  • A close competitor
  • Industry averages

2. Answer the following questions:

A. Using chapter 5 of Crafting and Executing Strategy, which generic competitive strategy does your chosen company employ? Justify your answer. The five strategies are:

  • Low-Cost Provider
  • Broad Differentiation
  • Focused Low-Cost Provider
  • Focused Differentiation
  • Best-Cost Provider

B. What does the DuPont Identity tell you about your chosen company's overall performance versus its competitor and industry benchmarks?

C. Using industry averages as a benchmark, what advice would you give your company in order to improve their ROE? What strategic moves could the company make to improve their competitive position? (Feel free to use other financial ratios to augment your analysis). Chapter 6 of Crafting & Executing Strategy contains the following categories of types of strategic moves the company can make to improve their competitive position such as:

  • Offensive- Strategic Option -Improve market position
  • Defensive Strategy - Protect market position and competitive Advantage
  • Scope of Operations - Should they alter range of products or services offered?
  • Merger and Acquisition - Acquire or merge with another company either horizontal or vertical
  • Outsource Strategy - Narrow scope of products/services
  • Strategic alliance or partnerships.

Reference no: EM131442912

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