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Blue Nile, Inc - Southern Utah University - Cedar City, Utah

By Kelly Nelson,2014-05-17 06:06
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What does a SWOT analysis of Blue Nile reveal about the overall attractiveness of its situation? 3. What is your appraisal of Blue Nile's financial

Blue Nile, Inc. Case Assignment Questions

    1. What is Blue Nile’s strategy? Which of the four generic competitive strategies discussed in

    Chapter 3 most closely fit the competitive approach that Blue Nile is taking?

    2. What does a SWOT analysis of Blue Nile reveal about the overall attractiveness of its

    situation?

    3. What is your appraisal of Blue Nile’s financial performance based on the data in case Exhibit

    4? How well is the company doing financially? Is there evidence that blue Nile’s strategy is

    workingwhat is the story of the numbers in case Exhibit 4? Use the financial ratios in Table

    5.1 of chapter 5 as a guide in doing the calculations needed to arrive at an analysis-based answer

    to your assessment of Blue Nile’s recent financial performance.

     2006 2005 2004 2003 2002 2001 Cost of sales as a

     % of net sales

    Gross profit margin

    SG&A expenses as a % of net sales

    Operating income as a % of net sales

    (operating profit margin)

    Net income as a % of net sales (net profit margin)

    Current ratio n.a. n.a.

    Net income as a % of stockholders’ n.m. n.m. n.m. equity (return on equity)

    Days of inventory

    Inventory turnover

n.a. = not available

    n.m. = not meaningful (due to negative stockholders’ equity in 2001-2003)

    5. What strategic issues and problems does Blue Nile management need to address?

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