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Business Report Woolworths

1614 words - 7 pages

Business Report |
Woolworths |
|
Jiaye Li (Paul) 31757 |
BAE-7 |
2013/6/10 |
Word count: 1210 |

Table of contents
Executive Summary 1
1 Introduction 2
2 Evaluation of the Woolworths in terms of ethic 3
3 Evaluation of the Woolworths in terms of share price history 5
3.1 A brief description of the trends 5
3.2 An evaluation based on the trends 6
4 Recommendations 6
References List 8

Executive Summary
The purpose of this report is to evaluate whether Woolworths is worth for invest and offer some suggestions to the client who is concerned about Woolworths in terms of ethical and share price.

First of all, it provides the definition of ethical investing ...view middle of the document...

Since Woolworths was founded in Sydney in 1924, it has developed into one of the largest supermarkets in Australia (Woolworths n.d.). Woolworths provides fresh food such as poultry, meat, fruit and vegetable which is Australia grown due to strong partnerships with Australian farmers.

The aim of this report is to critically evaluate Woolworths in terms of ethical and business issue. Therefore, after providing some background information of ethical investing and Woolworths, this report will evaluate Woolworths in terms of ethic and share price history. At the end, the recommendation will be given to the client that whether Woolworths is worth investment.

2 Evaluation of Woolworths in terms of ethic
Woolworths has long been known as supermarket which provide fresh food to consumers; however, more than 12,000 pokies machines are operated by Woolworths in Australia, which means it is one of the largest pokies proprietor in Australia (Mayne 2011, para. 4). According to Kruger (2012, para. 4), Woolworths made profit of more than $200 million from gambling. More specifically, in Victoria, over one-third of the machines (4677) are owned by Woolworths (Kruger 2012, para. 8). The reason why Woolworths earns so much money from gambling is that the change of Victoria's poker licence system, which broke the monopoly of gambling tycoon Tabcorp and Tatts. Furthermore, Woolworths plan to purchase new pokies machines with $26.2 million and spend more than $164.3 million on the maintenance of old pokies machines (Kruger 2012, para. 14). Nevertheless, gambling causes a number of problems which have negative impacts on individuals and the society.

Gambling addiction can lead to serious harm such as financial loss, bankruptcy, the abuse of children, crime, divorce, and suicide (Livingstone 2008, para.4). Schwartz (2003, p. 205) also states that some of the population is seriously addicted to gambling which was recognized as an official illness in the DSM-III in 1980. For example, problem gamblers, who spend more than they can afford, are addicted to pokies machines (Productivity Commission, cited in Valenzuela & Fisher 2012, p. 73). More specifically, Livingstone (2008, para. 3) states that problem gambler spent the large amount of money on pokies machines and he estimated the proportion of money from problem gamblers is about 53% in 2008. In addition, there are approximate 280,000 Australians who are consider as having gambling problems and 115,000 problem gamblers (Valenzuela & Fisher 2012, p. 73).

Furthermore, problem gamblers who come from low-income areas and socially disadvantaged minority groups are more likely to be influenced by gambling (Valenzuela & Fisher 2012, p. 73). For example, Woolworths earned $313 million in net revenue a year from low-income areas in Victoria because there are 1867 pokies machines which are owned by Woolworths (Peatling 2012, paras 8-9). Problem gamblers not only have the economic difficulties, but...

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