Business and Management HL

Internal Assessment

Which step should Arroba web follow to reinforce its e-commerce?

Research proposal word count: 486

IA Word count: 1991
Candidate number: klm260

Acknowledgements:

I would like to thank the owner of Arroba Web SL for providing and attending me the
necessary information and its time though the process of the project.

Also, I would like to thank my supervisor for the guidance and his help during the project.

Pd: All the information provided from Arroba Web SL belongs from the year that Covid- 19
begins, therefore, analysis and forecast from this point may be significant and reflective from
other moments of the year.

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Index

Research Proposal……………………………………………………………………………3

Executive Summary…………………………………………………………………………7

Introduction……………………………………………………………………………8

Methodology…………………………………………………………………………9

Main results and findings…………………………………………………………………10

Analysis and Discussion……………………………………………………………………13

Conclusión……………………………………………………………………………16

Recommendations……………………………………………………………………………17

Bibliography…………………………………………………………………………………17

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Research Proposal:

Research question:

Which step should Arroba web follow to reinforce each e-commerce?

Rationale:

Arroba Web SL has been one of the companies that without a brand logo had a special
recognition in the world of e-commerce. In today's report, all the information that I will take
is from an interview with Jorge Bosqued, the owner of Arroba Web SL.

In 2010 the brand started as a corporate limited liability company. Nowadays this business
has not only debt but also huge achievements as a start-up. Otherwise, Arroba Web SL is a
small company, in the past years it has gained in lots of the products that they export
premium position making a business with much more self-motivation and a sell in the current
market platitudes of the products with the diversification of products.
On the other hand, this brand has not been affected by the pandemic situation that we lived in
in 2019 named Covid 19 because it has always worked at home including fewer expenses on
their employees and their fixed cost.

One of the topics that I am going to talk about in this report is, Which Step Arroba web
should follow to reinforce each e-commerce? to improve the diverse difficulties of the
business and how to reinforce it and in this way how the start-up can avoid losing the
patrimony of the company.

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Theoretical Framework:

Swot analysis: a mind which I will establish the next themes of the company: strength,
witnesses, opportunities, threats

Ansoff matrix: A graphic depiction that contributes to establishing the future direction of the
business, bearing the risks and benefits attached to each of these endeavors, one being the
launch of a new line and the second the maintenance of current products.

Ratios: its a tool that measures the profitability of a company.

Data Collection: Rationale Linkage:

Primary Data: Interview:

Interview: Owner of Arroba Web SL ( Jorge
Bosqued)
Observation: Difficulties that have the
business in the e-commerce sector.
Discussion about the difficulties of the
business that can provoke consideration for
this change.
Observation:

Questionnaire: Improve e-commerce and Weakness in Social networks, countability,

advise the director. and a rapid updating of the websites.

Questionnaire:

Take the different areas of e-commerce and

try to improve them.

Secondary Data: Financial account:

Financial accounts (Balance sheet) Enable investigation of the financial

position and what projects can afford of.

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Planning: ae ae ae ae ae ae a e ae ae ae ae

Anticipated difficulties Anticipated solutions

The results are not exact Read and investigate the most recent sales
form the business

Confidentiality Ask ex- workers from the company to

interview them in order to see the view of
the company.

I can ́t form a questionnaire about the Send emails to the few workers of the
opinion of most of the employees because company and extend the questions
there have only been 2 workers

Lack of available information on Search on the internet as much as

competitors. information of competitors

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 Action Plan:

Action plan January February April May June July September October November December January

First Interview 25-22

Research
question and areas to
study

Research topic

Research proposal 19-2

2
Objectives and
Methodology

First draft 19-22

Recommendations
Conclusion

Final draft 21-22

PDF IA 16-23

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Executive Summary

Arroba Web SL is a corporate limited liability company located in Madrid, Spain. Since its
creation in 2010, one of its principal problems has been a rapid updating of the products on
websites and sales platforms, a lack of sales in some moments of the year or penetration in
the social market. I suggest the owner of the business starts a new strategy that will give the
company more sales in order to get more profit. Which step should Arroba web follow to
reinforce its e-commerce?

For the development of the study, I think it is really important to find the main difficulties of
the company, in this case the lack of sales in some moments of the year could deliver an
economic crisis with lots of losses and not paying its debts coming into poverty.
On the other hand, a strategy has been developed at the social market, solving its doubt and in
this way giving up brand recognition and potential to Arroba Web, earnings will come up and
a future prospecting will be.

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Introduction

Arroba Web SL is a corporate limited liability company located in Madrid, Spain. This
business has been running since 2010 as a partnership when two friends decided to start a
commerce, as the years have passed, due to internal problems in the company, we have been
able to locate that this same company has been left with a simple member and thus giving rise
to a corporate limited liability. Arroba Web SL is dedicated to selling products from an online
page, specially home, wellness and health where its objectives are to meet their consumer
needs and have a premium position on the online fairing. Mainly, this business operates in the
Spanish market and to a lesser extent in the European economic community.

Recently, we had perceived that the progress from the company has been upward, nowadays
the business is considered to improve its growth in order to raise money for future operations.
As a consequence of this situation, a business plan has been developed, in a way to achieve
successfully precise methods such as a SWOT analysis, a ratio analysis or Ansoff Matrix
model.

Which step should Arroba web follow to reinforce its e-commerce?

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Methodology

With the goal of obtaining the most objective and precise results, we had divided into two
groups, primary and secondary sources of information.

Firstly, the primary sources were used mainly through an interview with the owner of the
business in order to get an understanding and a first view of the company, in addition to that,
knowing its main difficulties and problems. Although, as he is my father, I have used him to
clarify information that is confusing in a fast way. Therefore, as I had a close relationship
with the owner of the business, I had really closeful information where its main problem was
a rapid updating of the products on websites and sales platforms, a lack of sales in some
moments of the year or penetration in the social market with its own objective to have
recognition.

On the other side, the secondary resources that I have employed were the key for me to
understand how the company really works. Although I am thankful of the principal website
of the business, this has helped me in order to see business expansions or marketing in the
company, where there has been none and it's a problem for future earnings of the company.
Therefore, with this information I had the idea that this manufacturer had a problem on their
social network, where a long term goal could be as a consequence of losses.

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Main results and findings

Swot Analysis

A SWOT is a business tool that assesses the strengths, weaknesses, opportunities and threats
of an entitle (Teoli, 2019). It is compulsory to argue that this type of analysis comes from the
interview done, so at the ending conclusions might not be precise and accurate.

Strengths → On one hand the principal features that we can perceive as important and header
for the company is that it is a business with very low fixed costs, not to say that it does not
have, where it gives us a monthly guaranteed profit. As a second point of view of this
business we have estimated that it is a corporation with very low indebtedness, as it does not
have to give money to other social enterprises a monthly profit will increase. Therefore, since
Arroba Web was created we have perceived that the service and the product given were very
satisfied by their clients, where in the past months the word of mouth has had success for the
company development.

Weakness → On the other hand, one of the principal discrepancies of Arroba Web SL are that
we have locate is that it doesn t have a rapid updating of your products on websites and sales
platforms, this can cause a loss of profitability in the company cause of the inflation that is
affecting ourselves and is making us much more poor. Although, other points that should be
noted is the lack of positioning in their products on the internet, there is where it can be
difficult to sell some of the products on stock and give liquidity to the company. 10
Opportunities → Thirly, the different opportunities that can have this business in the next
months are making different collaborations with other companies and in this way have a
globally national recognition in the country. Another of the important points to touch on is
that it doesn't have a debt to pay one of principal extensions is to invert in publicity, in this
way we will have more visibility and we will increase the earnings of the business.

Threats→ Finally, on the last point to argue about, one of the main threats that Arroba Web
has are the Cyber attacks, although this business has experienced some of these situations
when 3 years ago a hacker came in and almost ruined the company, so it's a good point to
come over to it. Other points that are mainly important are the lack of supplies in the
factories, as a consequence of this situation, the business may vary their profits and in this
way make them in a crisis. Nowadays, most of the materials that we buy abroad are
becoming a more difficult material to obtain and with an even higher cost due to the
environment, so a long term menace could be destructive.

Ansoff Matrix

A Ansoff Matrix method evaluates the different options that have a business in growth. These
different alternatives are named market penetration, product development, market
development and diversification.

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Market Penetration → This first option on the company is not an alternative since during the
whole year Arroba Web had already tried to sell their services in the market and it will be
very difficult to improve it.

Product development → Secondly, this is one of the possible choices to increase profitability
in their existing market as they have some difficulties to sell in some moments of the year,
where including new articles will improve cash flow business.

Diversification → This is one of the most riskier alternatives where you are knowing a new
market with new products to trade. Therefore, this could be one of the options to increase
your public and have a nationally brand recognition in the country. Although, all the methods
should proceed slowly and right because one wrong movement could ruin the company.

Market development → Finally, this option will be going on an expansion to some of the
countries that the company has already experienced but does not sell in large quantities, there
are places like France, Germany, Italy and Portugal. This operation can contain certain risks
with limits that each country established.

For the reasons established above, the appropriate method to process will be product
development in order to give many more alternatives to your clients and to increase
profitability in the next following months.

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Analysis and Discussion
In order to evaluate the main issue, I have ordered my data into a quantitative analysis.

Quantitative analysis

On the other hand, thanks to the financial information provided, I have been able to analyze
the situation from the company by comparing a balance sheet of 2021 and 2020 in order to
see progress from the business and assess it as a long term goal.

Balance Sheet 2020

Assets
Fixed Assets 3020,01

Intangible assets 1886,24

Deferred tax assets 6004,85

Financial Investments 4500

Total fixed Assets 15.411,10

Current Assets:

Inventories 4.462,64

Cash 710,39

net worth 4.772,35

Total current assets 9945,38

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Current liabilities:

Short term loan 9.811,78

Long term loan 6.000,00

Total current liabilities 15.811,78

Total net assets 133,6

Long term loans 6.000,00

Balance Sheet 2021

Assets $

Fixed Assets 2.989,39

Intangible assets 1236,49

Deferred tax assets 6004,85

Total fixed Assets 10.230,73

Current Assets:

Inventories 4.462,64

Financial investments 192,74

Cash 1090,11

net worth 4.974,58

Total current assets 10720,07

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 Current liabilities:

Short term loan 5976,85

Long term loan 5024,79

Total Current liabilities 11001,64

Total net assets 5695,28

Long term loans 5024,79

Ratio Analysis

Working Capital: Current Assets - Current liabilities

Working Capital 2020: 9945,38 - 9.811,78= 133,6 €
Working Capital: 2021: 10720,07-5976,85= 5695,28 €

Current Ratio: Current Assets ÷ Current liabilities

Current Ratio 2020: 9945,38 ÷ 9.811,78= 1,013%
Current Ratio 2021: 10720,07 ÷ 5976,85= 1,793%

Liquid Assets: Current Assets - inventories

Liquid Assets 2020: 9945,38 - 4.462,64= 5.482,74 €
Liquid Assets 2021: 10720,07 - 4.462,64= 6.257,43 €

Acid test Ratio: liquid Assets ÷ Current liabilities

Acid test Ratio 2020: 5.482,74 ÷ 9.811,78= 0,55%
Acid test Ratio 2021: 6.257,43 ÷ 5976,85= 1,04%

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Based on the Balance sheet of 2021 and 2020, Arroba Web has increased more than 200%,
coming from 2020 with a total of assets of 133,6 to 5695,28 of 2021. Overdue, in 2020
because of an emerging pandemic situation, data is not as precise, which could cause
differences of sales in the next few years.

Moreover, the balance sheet of 2021 shows how the business has decreased its debts by
4.810, 14 euros. Nevertheless, it is also important to highlight that the cost of the raw material
has also increased by 60% or 70% which gives us the perception of the earnings in the past
years.

Therefore, as I couldn't have the chance of making a Balance sheet of 2022, we have
perceived that the war with Russia and Ukraine raw materials and inflation has also harmed
the company. The rapid updating of the products on websites and sales platforms are making
the business win less money and in this way making less profitability.

Finally, between all the finance problems that the company had passed, one of the principal's
dilemma that Arroba Web has passed is the strategy employed in order to sell in the different
platforms. There is where, applying to the statistics in these two years, results are not secured
enough. This kind of obstacle is making the business to decrease its liquidity and causing less
profitability.

CONCLUSION

The question initially proposed has been studied through three main tools. Therefore, it can
be concluded that Arroba Web SL is financially capable of carrying on an expansion of his
business growth. His adaptation with the diverse products within the existing market will
provide finance and huge brand recognition in order to set up a premium position in each e-
commerce.

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RECOMMENDATIONS

1- In order to improve the earnings from the company I would rather choose a product
development and in this way control its proper market and include much more products to
have much more variety.

2- As a second point of view, we can perceive that in order to improve its penetration in the
social market the problem has been solved. A procedure has been developed and we have
located a significant brand recognition in his current market, higher probabilities of the social
media it will have.

3- Finally, as we have observe the importance of finance in the brand, the future decision and
management of the new products can project new roles in his current market, and in order to
commit the necessities of its employees.

Bibliography

Teoli D, Sanvictores T, An J. 2020. SWOT Analysis. StatPearls Publishing, Treasure Island

(FL)

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