Sainsbury Report

Shareholder is considered as one of the most common company structure within the United Kingdom’s industry. Sainsbury, one of the biggest grocery suppliers, is also known as a successful business using this structure. With the aim of analyzing different aspects of Sainsbury’s shareholder policy, it is crucial to look at current financial situation of Sainsbury and its contextual environment. In order to establish that issue, this essay will emphasize the company’s environment related to information and reference from Sainsbury’s annual report for shareholders’ point of view and come up with a comprehensive of Sainsbury’s performance with its competitors and managerial principally pursues.

First of all, J. Sainsbury plc is a giant retailer in the United Kingdom which has interests in supermarket, property and banking even though the most essential factor is the supermarket. In general, the current economic situation of Sainsbury is positive to invest, nevertheless, stockholders also need to consider carefully in some specific cases. Shareholders are defined as people who “share the ownership and share the profits of the good times and the losses of the bad times” (Pauline 2011, p. 10) therefore “they need to know how the company did to decide whether to continue to hold, sell or buy more shares” (Slav 2011). There are several types of financial aspects that frequently are useful for them.

The first one is Liquidity Ratios including Current Ratio and Quick Ratio which “vital to the survival of a business that there are sufficient liquid resources available to meet maturing obligations” (Eddie and Peter 2010, p. 232).

Current Ratio=Current AssetsCurrent Liabilities

Quick Ratio =Current Assets - InventoriesCurrent Liabilities

Sainsbury’s current ratio is the best one (0.87) and its quick ratio shows a significant proportion (0.40) among its main competitive companies (appendix 1) to probably make potential stockholders believe in the affordability of the...