Problem
I. How did Shoprite evolve with the current economic changes such as COVID, war driven countries and economic downfalls, briefly discuss the business analysis tools utilized to determine their core decision making and financial drivers in the business? What mechanisms has Shoprite adopted withing their organization to increase profits and keep costs at a minimum?
II. Based on current public information available on Shoprite what type of objective is the organization trying to achieve, namely: profit maximization or wealth maximation? Discuss in detail the benefits, drawbacks and explanations of both objectives in relation to Shoprite. In your opinion which objective would better suit the organization given the trade-off between customer satisfaction and maximizing profit?
III. Shoprite has multiple fixed assets and properties for the purpose of trading, please detail the need for capital budgeting within a retail store as Shoprite, and what are the various capital budgeting techniques that you propose that they utilise.
IV. Corporate governance plays a pivotal role in ensuring a profitable and well organized enterprise; please example the purpose and principles of corporate governance. Discuss the good corporate governance mechanisms that Shoprite has initiated within their organization in relation to their operations.
V. In 2021 Shoprite made a decision to acquire Massmarts non-core assets in a bid to to improve their low-price position in the market. "Shoprite said the transaction comprised 56 Cambridge Food business and Rhino Cash and Carry business, including 43 adjacent liquor stores, the Fruitspot business and Massfresh Meat business with a total of four facilities, and 12 Masscash Cash and Carry stores" Explain in detail whether the above transaction was a merger or acquisition and how would this particular transaction benefit Shoprite.