Tài liệu Generals of footprint vietnam travel’s business opreation

HANOI UNIVERSITY OF AGRICULTURE FACULTY OF ACCOUNTING AND BUSINESS MANAGEMENT ---------------------- INTERNSHIP PROJECT REPORT STAGE 1 PROJECT TITLE: “GENERALS OF FOOTPRINT VIETNAM TRAVEL’S BUSINESS OPREATION” Student Name Major : BUSINESS ADMINISTRATION Instructor: MASTER NGUYEN QUOC CHINH HANOI - 2011 i INDEX Page Acknowledge Table of Contents List of tables List of figures Abstract PART 1. RESEARCH BACKGROUND 1.1. Introduction 1.2. Research objective 1.3. Object and scope of research 1.4. Methodology PART 2. BUSINESS DESCRIPTION 2.1. History of development 2.2. Organizational structure 2.3. Human resources 2.4. Financial resources PART 3. OPERATION RESULTS AND EVALUATION 3.1. Financial performance and productivity of Footprint 3.2. Footprint’s SWOT matrix 3.3. Methods to promote Footprint’s operation PART 4. CONCLUSION AND RECOMMENDATION 4.1. Conclusion 4.2. Recommendation Reference ii i ii iii iii iv 1 1 2 3 3 5 5 7 10 11 16 16 20 21 23 23 23 26 ACKNOWLEDGEMENT We would like to express our sincere thanks to all those who gave us the possibility to complete this report. We want to thank Footprint Vietnam Travel for giving us permission to do internship at the company, to do the necessary research work and to use company’s data. We have furthermore to thank two founders of Footprint, Dang Xuan Son and Nguyen Quang Thanh, who gave and confirmed this permission and supported us at all times to complete our report. We also would like to show our gratitude to our instructor, Master Nguyen Quoc Chinh, for his instructions and suggestions in all the time of research for and writing of this report. Our friends from QTKDT53 class supported us in orientation of our internship. We want to thank them for all their help, support and valuable hints. Especially, we would like to give our special thanks to our parents who encouraged us to complete this work. i TABLE OF CONTENTS PART I: RESEARCH BACKGROUND................................................................................1 1.1.Introduction...........................................................................................................................1 1.2.Research objective................................................................................................................2 1.2.1.General objectives..............................................................................................................3 1.2.2.Specific objectives.............................................................................................................3 1.3.Object and scope of research................................................................................................3 1.3.1.Object of research..............................................................................................................3 1.3.2.Scope of research...............................................................................................................3 1.4.Methodology.........................................................................................................................3 PART II: BUSINESS DESCRIPTION...................................................................................5 2.1. History of development........................................................................................................5 2.2. Organizational structure.......................................................................................................7 2.3. Human resources................................................................................................................10 2.4. Financial resources.............................................................................................................11 PART III: OPERATION RESULTS AND EVALUATION..............................................16 3.1. Financial performance and productivity of Footprint........................................................16 3.1.1. Financial performance of Footprint................................................................................16 3.1.2. Productivity of Footprint.................................................................................................18 3.1.2.1. Indicators to evaluate productivity of the company.....................................................18 3.1.2.2. Footprint’s productivity...............................................................................................19 3.2. Footprint’s SWOT matrix..................................................................................................20 3.3. Methods to promote Footprint’s operation........................................................................21 PART IV: CONCLUSION AND RECOMMENDATION.................................................23 4.1. Conclusion.........................................................................................................................23 4.2. Recommendation...............................................................................................................23 4.2.1. To government................................................................................................................23 4.2.2. To Footprint Travel Company........................................................................................24 ii LIST OF TABLES Table 2.1: Overview of Footprint Vietnam Travel.....................................................................5 Table 2.2: Human resources of Footprint Vietnam Travel in 3 years......................................10 Table 2.3: Balance sheet of Footprint in 3 years......................................................................12 Table 2.4: Footprint’s balance sheet data in 3 years based comparison...................................14 Table 3.1: Footprint’s income statement in 3 years..................................................................16 Table 3.2: International visitors to Vietnam in 3 year 2008, 2009 and 2010...........................17 Table 3.3: Exchange rate of USD to VND...............................................................................18 Table 3.4: Employee Productivity and Profit per Employee of Footprint in 3 years...............19 Table 3.5: SWOT matrix of Footprint......................................................................................20 LIST OF FIGURES Figure 1: Organizational structure of Footprint..........................................................................8 iii ABSTRACT Tourism plays an important role in modern Vietnamese economy. Indeed, tourism has contributed around 5% in total GDP and created jobs for almost 10% of total labor force of Vietnam. Vietnam has emerged itself as a new tourist destination and the tourism offer has been increasingly diversified. Local and international tour operators has been the wings for the lift of the giant bird named tourism. For this reason, authors have applied to intern in Footprint Vietnam Travel Company and chose this topic “Generals of Footprint Vietnam Travel’s business operation”. In fact, Footprint has its own difference in comparison with most Vietnam tour operators in the basket which is their commitment to responsible tourism, a current new trend of travel that has been encouraged all over the world for the community and environment’s sake. The report first gives a brief introduction about Footprint and Footprint staff and tells Footprint’s story based on the timeline from the very beginning of Footprint until now, how Footprint has developed and successfully coped with its difficulties. It also mentions the efficient allocation of the resources and how it results in the income statements. Authors examine the firm operation based on the balance sheet and income statement in 3-year basis from 2008 to 2010. A SWOT analysis of the business operation is done to support the report. Ultimately, recommendations are made for the firm itself and for the authorities based on the analysis facts. In general, Footprint Vietnam Travel Company has appeared as a profitable, meanwhile responsible travel agency, with very promise future of tremendous opportunities. Footprint is on the right track, though quite tough sometimes. Moreover, it’s in a great position to strengthen its foothold and true values in this non-smoke, high competitive industry, and possible to increase its market share with the appropriate strategies. iv PART I RESEARCH BACKGROUND 1.1. Introduction The world has been changing. Urbanization, industrialization, globalization are the terms that has been using and implementing in most parts of the world. The quality of life has improved. More and more people are capable of affording not only their basic needs, but also their individual needs. However, the more urbanized, industrialized the world is, the more stressful people are, and the more people want to pack their bags for an escape from their habitat. And tourism in all over the world has been drastically developing for such reason. In term of external factors, Vietnam has what it takes to develop tourism. Vietnam is located in the favorable area where more than half of the national border is next to the West Sea, and open to Pacific Ocean. Moreover, Vietnam was born with various natural sites, from mountains to beaches with historical heritages and has thousand years of history with diversified cultures which could be ideal destinations for all who’re looking for a place to relax on vacation, to run away from the hustle and bustle of city life. In fact, the profit from tourism has contributed 5.25% for Vietnam GDP in 2010 with the growth of 16.9% per year. Also in 2010, domestic tourists were 28 million and 5 million international tourist. As such, tourism has created 480,000 direct jobs and one million indirect jobs for Vietnamese labor force (Source: ITDR in 2010). As a result of this significant growth in tourism, travel agencies have been springing up like weeds in order to satisfy all customer needs. However, this non-smoke industry has turned out to be one of the factors that destroy the environment due to its booming from coastal cities to inland villages. The World Bank, in a report in 2008, said that Vietnam suffered losses of some $70 million a year due to poor waste treatment solutions for the hospitality industry. And environmental pollution also makes Vietnam less attractive in competing with other countries since international tourists are more concerned about the environment. With such raising issue, travel agencies in 1 Vietnam have paid more attention to the so-called term “Ecotourism” which has been successfully implemented in some nations such as Japan, Singapore, Netherlands, Sweden, etc. Though ecotourism in Vietnam is at a beginning stage of development, there’re number of providers out of hundred thousand travel agencies with specific programs implementing ecotourism. And Footprint Travel agency is one of those providers. Not as big as Hanoi Toserco, Hanoi Tourist and Saigon Tourist, Footprint Travel is just a small-sized company but has enough courage and confidence to commit Responsible Travel as their value and business ethic. In fact, Footprint is highly recommended by Footprint Travel Guides, Lonely Planet, Trip Advisor, Ethical Travel Guide and Frommer’s. Footprint also values in being member of Responsibletravel.com, ASR, and RTC Vietnam. Especially, Footprint is the company who first came up with the idea of organizing RTC Vietnam (Responsible Travel Club of Vietnam) as membership association dedicated to building responsible travel and sustainable tourism to all regions in Vietnam. Ecotourism has numerous strictly requirements. Not only do visitors want Vietnam ecotourism planning to involve exotic sightseeing and cultural experiences, but they want the interactions with local people and the environment to be socially responsible, limiting waste and ensuring economic benefit to the Vietnamese people. Authors’ wonder is how a smallsize business as Footprint runs their ecotourism based business profitably and responsibly at the same time. That’s the urge to the decision of choosing this topic: “Footprint Travel Company’s business activity analysis” 1.2. Research objective 2 1.2.1. General objectives - Study about organizational structure of a partnership travel agency and analyze its business activities 1.2.2. Specific objectives - Study about organizational structure of Footprint and how each department in the 1.3. company functions Analyze Footprint’s business activities about how they allocate their resources which are human and finance Evaluate financial performance of Footprint based on three-years basis Assess Footprint’s operation through their using of resources Comment and recommend to Footprint’s development Proposal to the authorities Object and scope of research 1.3.1. Object of research - Business activities of Footprint Travel Company - The outcome and efficiency of Footprint’s business activities - Factors driving the outcome and efficiency of Footprint’s business activities 1.3.2. Scope of research - Content: Business activities of Footprint Travel Company - Date: 27/9 – 9/10/2011 - Scope: Footprint Travel Company 1.4. Methodology - Data collection and statistical analysis + Primary data is information collected by the researcher directly through instruments such as surveys, interviews, focus groups or observation. To do this report, we have used interviews, observation as tools to collect the data. + Secondary data, on the other hand, is basically primary data collected by someone else. Data such as the balance sheet, income statement, Footprint’s history of development, etc, are all secondary data. + Data processing is used to extract the colleted information in forms of figures and - tables. Methodology of analysis + Methodology of descriptive statistics is used to describe what the data shows, for instance, reading a balance sheet and income statement to understand what those numbers showed on the balance sheet and income statement imply about the company’s situation. + Methodology of comparison is a method to compare the data in different years. By doing that, we will have a clearer understanding of how the company has done as the year passed. 3 + Expert method is also used in a way of collecting expert’s opinions and then building an estimation based on weighted averaging. PART II BUSINESS DESCRIPTION 2.1. History of development Table 2.1: Overview of Footprint Vietnam Travel 4 Name Footprint Vietnam Travel Location 4th floor, number 10A1 Ly Nam De Street, Hanoi Date of business May 2001 Phone number (84-4) 933 2844 Fax number (84-4) 933 2855 Website http://www.footprint.vn Email [email protected] Business field Custom-made Vietnam tour and Vietnam travel packages Mission and vision - Mission: focusing on responsible travel, provide guests with safe, high-quality travel and adventure with a healthy dose of fun - Vision: to be a bridge between host and visitor, strive to travel in a way that respects culture, protects environment and supports the communities. In 1999, the dream began, when two students, from Hanoi Open University (Faculty of Tourism), met and began to design a travel company that would show Vietnam to the World. With passion, Dang Xuan Son and Nguyen Quang Thanh worked with other companies as guides and tour operators, paying off student loans and saving money to start their own business. Their experience in the field allowed them to travel extensively to isolated destinations in Vietnam, and learn the roles tourism played there. In the evenings, with an old computer and a few thousand dollars borrowed from friends, they designed the beginnings of Footprint Vietnam Travel. In May 2001, the company was established. It would be a company built on pride, honesty, passion and adventure. Footprint registered with registration No 0102002791 and license 0591 issued by Vietnam National Administration of Tourism (VNAT). One of the many terms and conditions to be license by VNAT is that it is required to place a substantial cash bond in a secure account. The bond account has two signatures – VNAT and Footprint. 5 Actually Footprint is a co-founded companion of 4 shareholders, but only 2 of them (Son and Thanh) involve in managing the company, with the capital of 120 millions VND. Profit divided equally for each shareholders, 25% per person. The business field of the company is providing the specialist custom-made Vietnam tour and Vietnam travel packages. Footprint provides guests with safe, high-quality travel and adventure with a healthy dose of fun. Footprintters see themselves as the bridge between host and visitor. Meanwhile, focusing on responsible travel, they try to travel in a way that respects culture, protects environment and supports the communities they visit. Since 2003, Footprint have chosen to design and operate personalized tours for independent travelers and private group tours that have the same passion for travel and want to learn about the World around them. Footprintters want customers to witness the unspoiled Vietnam where the warmth of the people and richness of culture surrounds them with flavor. Then why does Footprint focus on responsible travel? As you may know, responsible travel is a new way of traveling for those who’ve had enough of mass tourism. It’s about respecting and benefiting local people and the environment. At Footprint, they do not want to see the people of Vietnam exploited nor do 6 they want to see the country’s environment suffer from unsustainable tourism. By treading lightly, customers can minimize their impacts while gaining maximum enjoyment from traveling experience. And when they leave, they will not only leave with an abundance of great memories but with knowing that as a visitor they have actually played a role in benefiting the area they visit. Protecting these destinations and working to keep them unspoiled will insure that the customers, their children and future generations will also have the opportunity to visit and learn.  First and foremost, it is important to realize that what you do makes a difference.  It doesn’t cost a lot and it doesn’t require a revolutionary adjustment. Small changes can add up to a significant overall positive impact.  You are not the only visitor to Vietnam - your impact on the environment is multiplied a million- fold by other people every year. Because of those reasons above, Footprint chooses to focus on responsible travel with the hope of letting customers know “true value in travel”. 2.2. Organizational structure Through over ten years of running a travel agency, Footprint organizational structure has improved enormously. The structure has been quite changed due to the nature of each different work and the raising competitiveness over the past ten years. At the very beginning years of Footprint, the two founders has took care most of the work of the company which turned out to be overload for them. Those two founders didn’t assign the work properly to their staff; which certainly caused conflicts and leaded to the inefficiency in work. However, they have re-organized their organizational structure to be more professional and efficient. Figure 1: Organizational structure of Footprint 7 Currently, the two founders, as board of directors, also do the management of the company as manager 1 and manager 2. Each manager is in charge of three different departments. For manager 1, those three sectors are sales, accounting, and human resource. The other manages product, marketing and operation. There are 3 salesmen at Footprint and there are two forms of sales: Sales agency and sales on-line. Sales agency is the activity between two agencies in order to hand over customers from one to another. Clearly, Footprint receives bookings from another travel agency, indirectly from the customers. Normally, the bookings from sales agency are big in number and relatively stable. Another kind of sale is sales on-line which gets bookings directly from customer’s orders. Sales on-line is not favorable for most of small travel agencies in Vietnam, including Footprint due to its small in number which would increase the production cost and decrease the profit. According to Wikipedia, accounting is the measurement, disclosure and provision of assurance about financial information that helps managers, investors, tax authorities and others make decisions about allocating resources. The job of an accountant in Footprint is more or less the same. Practically, that accountant takes all the numbers, cooks them up, calculates them, and posts them to all kinds of financial statements which would be sending to managers and tax authorities. Plus, the accountant works with invoices for pay-in and payout transaction. With the limited size of Footprint, having only one accountant is reasonable. With total staff of 10, resourcing the labor force is a four five years in a row kind of job. Hence, the current key functions of Human Resource department in Footprint are staff performance evaluation, conduct and behavior 8 management, employee relations, compensation and employee benefit management, training and motivation, further are organizational design and development. As a travel agency, Footprint provides tourism products which are intangible product to their customers. Department of product is in the area of product design, product development, and product system development. In other word, such department does A through Z logistics of every single tour or the so-called tour operator. As having said that, an A through Z logistics consists of at least eleven steps. In general, after receiving information about customers and their booking tour, they need to digest all those info to have a vision of services in detail they need to prepare for such tour and coding that tour. Then they need to contact service suppliers to book services and to create a table of estimated costs. After the deal is made, the file will be recorded for manager’s checking and approval. Next, all the booked services and tour info will be handed over to the guide who is in charge of that tour. Observing and inspecting while running the tour in order to solve any contingency. Finally, they need to work with that guide in order to account for the tour and the guide’s remuneration, draw the balance sheet, including inflows and outflows, and hand it to the accountant. And that process is repeated exactly the same way when the next tour coming. In Footprint, due to the average of 20 to 25 tours per month, the sales also do the tasks of product department under the supervising and supporting of manager 2. Marketing is a complicated and wide kind of term. In fact, a marketer in Footprint needs to determine what kind of tour and which destination may be of interest to customers, targeted markets, price, sale techniques, business communication and business developments. Plus, in Footprint, promotion and commitment are highly considered as very important criteria for the development of a company. The effectiveness and success of marketing result in the company values through customer’s eyes. The business operation in Footprint covers macro issues and does macro activities for the purpose of producing value, either physical or intangible, for the stakeholders, especially profit. The task is to generate recurring income, increase the value of the business, and secure the income and value of the business. In the case of Footprint, both manager 1 and manager 2 directly do the operation without any other employee. In short, Footprint has all required functions for the run of a partnership company. However, the tasks of a certain job are unclearly assigned to the staff. One needs to do other tasks out of their job responsibility. 9 2.3. Human resources In 3 years from 2008 to 2010, Footprint’s labor force has a small change. The number of staff decreased from 14 in 2008 to 11 in 2009 and stayed at 10 in 2010. That change happened because Footprint is a small company, so the staff wants to have a more profitable job to earn more money. That’s why they left the company to seek for another job. Especially in 2009, the inflation rate in Vietnam is high (6.88%), while the salary paid for staff remain the same. Therefore, there were 3 people left the company. The table below shows the company’s labor structure from 2008 to 2010: Table 2.2: Human resources of Footprint Vietnam Travel in 3 years Unit: people Labor structure Gender Education level Job’s description Working-age Details Male Female University College Professional secondary school High school Direct Indirect Under 30 From 31 to 45 Above 45 Total 2008 3 13 12 2 0 0 12 2 9 5 0 14 Year 2009 2 9 10 1 0 0 9 2 7 4 0 11 2010 3 7 10 0 0 0 8 2 6 4 0 10 Looking at the table, we can see that Footprint has a young labor force with high education level. To obtain a deeper understanding about Footprint’s human resources, we will divide the labor force into 4 criteria: gender, education level, job’s description and working-age. Firstly, the gender proportion between female and male staff of the company is unequal: the number of female staff is greater than the number of male staff. In 2008 and 2009, the proportion was over 4 times, and it decreased to 2 times in 2010. The great difference between male and female in the company is understandable because females are usually more skillful, gentle with customers. However, a travel consultant often has to go far away from home in a long period. That’s inconvenient for females because they have to take care of their family. Eventually, male are more suitable for a job with long distance travel 10 and required a great endurance. At Footprint, there are only 3 males, and only one person works as a travel consultant. That’s one big problem which the company has to cope with. Secondly, all Footprintters have high education level. All of them are graduated from University and College. The number of staff graduated from University was 12 in 2008 and 10 in 2009. And the number of staff graduated from College was 4 in 2008 and 2 in 2009. However, in 2010, the education level was even higher with no College degree and all 10 University degrees. With such great staffs, Footprint has the potential of developing faster in the future. Next, we will look at the job’s description of Footprint. Based on job’s description, the company has divided into 2 kinds of labor: direct labor and indirect labor. The number of direct labor is 4 times greater than the number of indirect labor in 2010. Because Footprint is a small travel company, so almost all of the staffs are travel consultant. Finally, Footprint’s working-age ranges from 23 to 35. Generally, the company has young staffs that are always enthusiastic, energetic, ambitious, and studious. Their youth are suited with their job as a travel consultant. That’s the reason why over half of the staffs are travel consultant. Besides, 2 co-founders of Footprint, Dang Xuan Son and Nguyen Quang Thanh, are over 30. With much work and life experiences, they deserve to be the leaders of the company. Although Footprint is only a small company with a small number of staffs (10 staffs currently), the company has used effectively all of the staffs and their abilities. At the same time, the company has had a reasonable labor structure with a young and potential staff. 2.4. Financial resources Asset and equity are always in the top priorities when going through a company’s financial situation. Those elements are the key to the question where do they get that money and how are they going to spend it. Footprint Travel Company, like other travel agencies in the market, plays a role as a broker institution. They don’t make tangible products such as resorts, hotels, transports, etc, but they design full-packaged products which include those things to sell to their customers. Thus, their capital structure would look relatively different from the general one of other professions. As such, we’re going to break down the balance sheet using vertical analysis and horizontal analysis to see how different it would be. Table 2.3: Balance sheet of Footprint in 3 years 11 Unit: VND Content ASSETS A. Current assets 1. Cash 2. Short-term investments 3. Account receivables 4. Inventory 5. Other current assets B. Non-current assets 1. Fixed assets 2. Long-term investments 3. Other non-current assets Total assets LIABILITIES AND OWNER’S EQUITY A. Liabilities 1. Current liability 2. Long-term debt B. Owner’s equity 1. Invested capital 2. Retained earnings Total liabilities and owner's equity 2008 Year 2009 2010 2,882,835,172 2,811,731,859 2,579,488,387 2,518,940,229 3,729,159,060 3,662,413,400 63,432,559 51,632,090 55,117,092 7,670,754 309,098,793 97,670,754 8,916,068 411,582,464 179,085,822 11,628,568 531,232,597 311,768,723 211,428,039 3,191,933,965 232,496,642 2,991,070,851 319,463,874 4,260,391,657 55,014,171 55,014,171 71,439,194 71,439,194 238,800,000 238,800,000 3,136,919,794 1,156,919,794 1,980,000,000 2,919,631,657 1,239,631,657 1,680,000,000 4,021,591,657 886,591,657 3,135,000,000 3,191,933,965 2,991,070,851 4,260,391,657 Vertically, it’s obvious from the current assets column that Footprint’s current assets are mostly cash which accounts for 97.53% in 2008. This amount of money seems to get a slight drop in 2009 and a dramatically lift of approximately 45% in 2010. It’s quite understandable if we come back to the point where we defined a travel agency as a broker institution who build a bridge for sellers and buyers and pocket the tolls. And the toll is always money stated in a piece of paper. The reason for a decrease in 2009 was due to the late 2008 economic crisis which started from America and spread to some European countries such as France, England, Germany, etc. Those are the top markets of Footprint. As a result, the retained earnings went down, either the cash which partly comes from profit after tax. In 2010, the global economy seemed to be recovered from the recession, American people and Westerners came back to their annual routine of travel which made Footprint 12 come back to their busy working. At the very beginning years of company development, Footprint has invested in a hotel with same name. It wasn’t their idea of investing in hotel as a long-term investment. The idea was to utilize their renting office. Son, one of the two founders, thought that it would be a waste if he pays one fixed amount of money for the whole building without using all of its corners. And there came the Footprint backpackers’ hotel. Unfortunately, within ten years presence, Footprint has been moving their office three times and the location as well as the place weren’t in a good deal as the first lease. Thus, they have to give up on investing in hotel. And that explains why there’s no short-term investment in the balance sheet from 2008 to 2010. The account receivables are around 2% out of total current assets. Account receivables in Footprint include trade account receivables and advances to suppliers. The trade account receivables are relatively small while advances to suppliers are in contrast. It’s due to the tour operation which receives the booking from customers without payment in advance and calls the services with their own money for customers’ reservation. Other current assets are, as well, small, the ratio of other current assets and total current assets wasn’t over 0.5% ever. Non-current assets which added 9.7% to total assets in 2008 and 13,7% in 2010, consisted of fixed assets and other non-current assets. Footprint’s most valuable tangible assets, as other small travel agency, are always its office and everything inside which have cost 97,670,754, around 31.6% of non-current assets in 2008 and increased to 43.5% in 2009 and another significantly increase in 2010 at 58.7%. That explains the higher work productivity and the better quality of tours. In terms of liabilities and owner’s equity, there were a huge difference between the liabilities and owner’s equity which clearly shows the difference from other small company in different industry. Footprint, as its small size, isn’t necessary to buy the cars, build the hotel, make the food, etc. Practically, they don’t need to invest on any big thing for doing their business if they don’t feel like doing it. They just do the transaction of services from service providers to the ones who need it. Simply, they use the money of customers, keep some for good and pay the rest on the customer’s behalf for the services. The profit directly comes to retained earnings, plus legal capital to make the owner’s equity of 3,136,919,794 in 2008. Table 2.4: Footprint’s balance sheet data in 3 years based comparison 13 Unit: Percent (%) Content ASSETS A. Current assets 1. Cash 2. Short-term investments 3. Account receivable 4. Inventory 5. Other current assets B. Non-current assets 1. Fixed assets 2. Long-term investments 3. Other non-current assets Total assets LIABILITIES AND OWNER'S EQUITY A. Liabilities 1. Current liability 2. Long-term debt B. Owner's equity 1. Invested capital 2. Retained earnings Total liabilities and owner's equity 09/08 Rate 10/09 Average 0.89 0.90 1.45 1.45 1.17 1.17 0.81 1.07 0.94 1.16 1.33 1.83 1.30 1.29 1.74 1.23 1.31 1.79 1.10 0.94 1.37 1.42 1.24 1.18 1.30 1.30 3.34 3.34 2.32 2.32 0.93 1.07 0.85 0.94 1.38 0.72 1.87 1.42 1.15 0.89 1.36 1.18 Horizontally, there was a fluctuation in each element of the balance sheet. Surprisingly, the average rates are very positive. Most of the numbers are greater than one which means the profit has been generating through years. Indeed, owner’s equity average growth rate was 1.09 with the increase in retained earnings from 2008 to 2010. However, liabilities were remarkable high at 2.32 which might be a threat to the company’s business effectiveness in long run. Another noticing factor is that the account receivables seemed to be smaller while the cash had its uprising. Regarding non-current assets, the rate for fixed assets was high with the average of almost 1.8. Looks like Footprint has started paying more attention on boosting the company efficiency from the inside which is internal factor that would raise the company value and reputation in customers’ view. 14