Best Financial Services Inc. Harvard Case Solution & Analysis

Best Financial Services Inc. Case Solution


The best financial services Inc. is the financial service provider that deals with the management of the money. The types of services include; leasing services including plant and machinery leasing, hire purchase by the corporate body, merchandising services, data processing and transfer of information and most importantly asset management such as portfolio (that diversify the investment among equities, bonds, and other money market instruments), advice, mergers and acquisition and the corporate restructuring strategy to other companies.

The case focuses on financial planning that is the most important segment of financial services industry, which would help them to increase the ability of management of assets. The planning is based on evaluating each client's goal and risk exposure level of each organization with respect to its industry comparison that would help the company to grow and maximize the shareholder's wealth by minimizing the costs and taxes.

The founder and the shareholder of the Best Financial Service Inc. had lost their client of the asset management, and the client moved to the company's strong rival. Therefore, the objective of the case is to make proper industry analysis to compare the Best Company Inc. With the other companies in the same industry, the consumer analysis, the differential analysis, the marketing plan and the projection of financial statement to identify the prospects of the company.

Along with this, based on the above analysis, the company has to decide either to hire a new financial advisor (as this company is providing financial services to its clients) or to purchase the new block of the business to preserve the future growth and increase the profitability of the company.

The Consumer Analysis:

The consumer analysis depends on the customers’ profiles that help the business to understand and evaluate the current and the potential customers that would help the business to grow its customer that will lead them to increase the company’s sales and profitability ultimately.

The consumer is analyzed in financial services by the two factors, which includes:

  • Demographic factors: These factorsconsider the consumers’ income, type of business for which the services are acquired and other geographical factors where the client is located.
  • Behavioral factors: These factors consider the intention of the client to offer that particular service that helps the business to evaluate the options for which client is accepting these types of services instead of alternatives.

The companies in financial services monitor and examine the whole industry trends by comparing the companies within the industry both globally and internationally. Moreover, this could be possible by collecting the consumers’ data, and analysis would be made on the basis of market size and market share.

The Industry Analysis/Differential Analysis:

All the financial service providers require a proper financial planning process to attract the customers with proper documentation and responsibilities distribution that help the financial planners to approach the proper strategy that would help to increase the value of the assets. This could be possible by comparing the companies in the same industry as per the case the Best Inc. would compare its results with Sun Life Financial Inc. because of the same industry. The industry analysis is made by considering factors such as net profit margin, sales growth, total assets growth, debt to equity and interest coverage ratio.

The company’s higher net profit margin in 2006 was of about 21% and increased in 2007 to 31% as compared to other company in the same industry that is 11% that shows the Best is performing better in its profitability. The company’s sales growth increased to 31% with respect to change from last year sales and comparing it to the other company in the same industry in which sales growth is negative, which shows that the sales are satisfactory of Best Inc.....................

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