Discuss about the Financial Analysis for West European Demographics.
The mortgage broker has selected target markets as Airport West, Gladstone Park etc. The Company is situated in Airport West that consists of one of the highly densely populated areas of the world in terms of Asian and West European Demographics. The company is aiming to target various ethnic groups within the airport that will give them a competitive advantage as their main providers of investment are banks and other financial institutes, mortgage bankers etc. The company is aiming to target the potential customers through referral codes and social media advertising so that they will be attracted if they get some amount of discount (Maynard, 2017). Most of the competitors are now focusing on the younger generation and thus BMF will focus on the customers that belongs to these target areas by providing them with wide variety of services. The focus of the company will be basically on two areas that would include:
Residential Mortgage – This is because people are always concerned about their security, and when they come to a new country their focus would be to get a place of their own where they can stay so this would increase the prospects of residential mortgage that companies can target for. People near the airports are mostly those that have come from other countries hence getting good business deals over there is easy.
Commercial Mortgage – The other prospective area that the BMS can target is commercial mortgage because people are of the view that they want to build in wealth not only for themselves but also for the people who they are connected to. Therefore, demand for loans and commercial investments are very high and as people are of the idea that the best way to earn revenue is to invest and make money so in that way the demand for commercial loans is very high and thus mortgage banks can make use of that.
On the above analysis it can be said that it would be best markets to target given the company is positioned near the airport so if they focus their business operations in providing mortgage loans in these two sectors the company will earn a lot of profit. Given to the fact that most of the mortgage companies are targeting areas that are more youth based, for BMS to channelize their energy to such sectors where the advent of profitability is more is a more informed and smart decision in all aspects (Gray, 2018).
Competitive advantage can be gained only when the companies work in a way that are different from their peers, they need to do something more which their competitors are not doing. BMS is providing its customers with discounts and coupons that would attract more customer as they would get more benefit because of this and thus that will generate more business. In all terms the company was smart enough to target such customers that would help them in generating business in the initial phases and once they get a peak they can get on their business prospects.
There is a lot of competition in the market with relation to the services that can be offered to the people. But there are not many mortgage bankers that are focusing on delivering specific loans to smaller companies and businesses. The company is aiming to provide the best business to their clients in real time finance by not only providing the customers with the loan but providing them with all around financing services, so that they have proper knowledge about the areas they are venturing into and the total amount of revenue that they can generate through these financing options through the brokers. BMF aims to speak the language of the clients in a way that they can get the best deals that are utmost profitable for the customers. There are so many brokers today in the market that are functioning extremely well in comparison to the traditional banks because they can get shorter periods loan for the customers in the best deals possible (Chariri, 2017). So, in the customers are also getting competitive advantage in the industry they are working for the. People are wanting loans for variety of purposes that includes areas related to residential needs, commercial needs. Some needs loan to start up their business. So, these are basically people who are looking for funds to deploy so that they can end up making revenue from the venture that they start. So, we see in a way if they get loans with heavy interest rates they will not be able to generate that much revenue from their ventures. So, the work of the mortgage bankers is to strike a deal as per which they can earn revenue and help the customers in getting their loans at the lowest cost possible. The BMF is targeting residential and commercial loans because people near the airports would be mostly interested in that. Given the fact that they would be looking for homes and setting some sort of business. The BMF is targeting these people as they would mostly be interested in getting small amount of loans that would basically be related to real estate and that in turn would help in getting the company their source of revenue which they desire. Thus, BMF would benefit from these actions and these commercial transactions would take the company to newer heights with more profitability. The company is also targeting to offer discount and coupons to the customer so that more people are attracted and the business will get the desired boast that it requires in the initial stages. The preliminary focus is the real estate business and providing such services that commercial business banks will take a lot of time to delegate. Thus the aim of BMF should be to provide such services that commercial banks are not able to and that too in a lesser time with more results for commercial success (Boghossian, 2017).
The SWOT analysis present a picture of the possible strengths and weakness of the company and why it will be a successful business in the future. The strengths refers to points that includes low overhead cost, limited risk, low overhead expenses etc and that will corelate to the possible strengths of the entity with respect to the target market as the BMF is targeting airport areas and people who are looking for loans for smaller businesses and amount so in that way the overall associated risk is very low and the company would be able to handle that. The set up cost is also low as the customers are mostly residing near the airport areas so the amount of cost that would go in market research and analysis would also decrease due to this approach of the management. One more aspect that SWOT refers to will include that the company is having multiple stream of revenue flowing from different avenues and this will help in the success of the company as they are targeting more people that are looking for commercial loans and residential loans. So in a way the business will experience an upsurge as they would have multiple options. The BMF also can take advantage of the growing of the social media sector that are used by young people a lot thus if the business develops in that aspect the company will able to capitalise on the same. Given the fact that level of risk involved is low the company will prosper in times to come (Abbott & Kantor, 2017).
The possible weakness and threats includes aspects like there is heavy competition in the market and it would difficult for single traders to compete with such institutions but given the fact that the target areas are different the company would be able to survive in its own niche. Also there are threats that are many regulatory issues that the company needs to abide with also the competitors can offer such products very easily and in order to fight all of this it is important that the management of the company needs to make changes in its overall policies so that there operated areas are not in danger (Alexander, 2016). The SWOT analysis provides a rough picture with relation to the possible strengths and weakness that the company might have in the new area and how they would deal with it so that in future the venture is a success.
References
Abbott, M. & Kantor, A., 2017. Fair Value Measurement and Mandated Accounting Changes: The Case of the Victorian Rail Track Corporation. Australian accounting Review.
Alexander, F., 2016. The Changing Face of Accountability. The Journal of Higher Education, 71(4), pp. 411-431.
Boghossian, P., 2017. The Socratic method, defeasibility, and doxastic responsibility. Educational Philosophy and Theory, 50(3), pp. 244-253.
Chariri, A., 2017. FINANCIAL REPORTING PRACTICE AS A RITUAL: UNDERSTANDING ACCOUNTING WITHIN INSTITUTIONAL FRAMEWORK. Journal of Economics, Business and Accountancy, 14(1).
Gray, D., 2018. ‘Extraordinary turnaround’: Big miners pushing ASX towards 10-year high. The Sydney Morning Herald.
Maynard, J., 2017. Financial accounting reporting and analysis. second ed. United Kingdom: Oxford University Press.
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