Navigating Market Trends: Insights into Company Performance from 2018 to 2021

This blog post shares an excerpt from my 2023 research on a company's business performance analysed through Tableau. You can find a detailed breakdown of my analysis on my GitHub profile.

In this report, we explore the study of sales performance in the EMEA market. Our research reveals that the EMEA market has generated one of the lowest sales figures compared to other markets. Russia and the Middle East countries within the EMEA market have a total population of over 600 million inhabitants (United Nations, 2022) while the EU has a population of roughly 446.8 million inhabitants as of 2022 (Statistics Explained, 2022). With that said, it would be expected for the EMEA market to deliver higher revenue, however the opposite stands to be true.

The figure above shows that the EMEA market had an impressive revenue growth of nearly 121% in three years. However, despite the significant increase in revenue, the EMEA market has one of the lowest total sales. Additionally, the EMEA market has the lowest return-on-sales ratio ranging between 3.0 to 8.0. It was also found that the market experienced a fall in ratio in 2019, suggesting that there was a decrease in profits relative to total sales in said year.

Customer analysis is a powerful tool that can give us a better understanding of our customers’ behaviour. To have a clearer insight of the standing issue, we have restricted the measurements within the EMEA market.

The second figure shows that the EMEA market experienced a decline in new customers between 2018 and 2019 and has had no new customers for two consecutive years. However, the number of repeated customers has consistently increased, indicating that the EMEA market is good at maintaining the loyalty of their current customers but needs to work on attracting new ones.

Next, we assess how well the company's shipping process is working in the EMEA market, with a focus on the cost of shipping office supplies.

The average shipping costs show a discrepancy, as critical-priority second-class orders cost almost 64% more than critical-priority same-day orders, even though the latter is shipped 2 days faster. High-priority standard-class and medium-priority second-class orders take the same time to ship, but the former is more expensive. The same is true for critical-priority first-class and second-class orders. This indicates redundancy in shipping categories, which can cause delays in order processing. The bottleneck issue refers to a situation where a specific process becomes a constraint that slows down the entire production or delivery process (Barone, 2022). Eliminating bottlenecks in business operations can lead to enhanced productivity, amplified output capacity, and improved outcomes.

A discount analysis involves studying the financial implications of providing discounts on the company's sales revenue and profitability.

The figure shows that there are more non-discounted orders than discounted ones in the EMEA market, indicating that discounts are not very effective. The product category with the largest difference between discounted and non-discounted orders is Office Supplies, which is also the best-selling category. This suggests that customers may not be fully aware of the discounts offered. Offering discounts often aims to boost sales and thus, profits. However, discounted orders seem to generate losses instead, with the largest loss being close to $15,000 for Furniture, in 2021.

We proceed with a comparison of a cost analysis between the EMEA and the EU markets.

When the shipping-cost-to-sales ratio is high, it suggests that a considerable portion of the sales revenue is being allocated to shipping, potentially leading to lower profit margins. Based on the analysis in the figure above, the EMEA market has a higher ratio as compared to the EU market, apart from 2020.

Our analysis also found that the EU market has a profit higher than the difference in sales and shipping costs. This implies that the EU market is earning extra profits beyond sales. Conversely, we discovered that the EMEA market has a profit significantly lower than the difference in sales and shipping costs, indicating that a large proportion of revenue from the EMEA market may be used for other costs besides shipping. This disparity is concerning as, assuming resources are equally distributed to all markets, the proportion of the expenses and hence the gap between both measurements should be alike.

Low sales in the EMEA market may be attributed to shipping and discount inefficiencies, as well as cost disparities. Additionally, intense competition could be a contributing factor. Price wars driven by competition can lead to decreased revenue, forcing businesses to allocate more resources toward advertising to maintain their market position, which in turn raises expenses.

To address low sales in the EMEA market, the company can implement several strategies:

1. Enhance Marketing Efforts: Utilise social media platforms and targeted advertising to effectively reach a larger audience.

2. Adapt to Consumer Preferences: Gather customer feedback to refine the product range, focusing on best-sellers while reducing underperforming items to improve efficiency.

3. Optimise Shipping Procedures: Simplify shipping options by offering only Same Day and Standard shipping, categorising orders into Critical, Normal, and Low priorities, and selecting the most cost-effective shipping carriers.

By adopting a more customer-centric and data-driven approach, the company can continue to provide value to customers and achieve its business objectives.