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Vol.8 No.1
March 2020

 Page Number

 Article Information

1-10

Calculation of Specific Company Risk Premium for Agricultural Business Valuation

Yuliia Sivitska and Khanlar Makhmudov

DOI: 10.15604/ejbm.2020.08.01.001

Abstract

The purpose of the article is to determine which method of company specific risk premium calculation for agricultural companies gives the most correct result in the process of a business valuation. We conduct a study on agricultural holdings valuation methodology and this article builds on our prior study to improve the methodology and justify the appropriate method of Company Specific Risk Premium calculation for agricultural business valuation because properly performed business valuation procedure increases the company’s value, its investment attractiveness. For our study, we select large agricultural holdings, leading daily stock trading, from top agricultural producing countries in different parts of the world: Brazil, USA, Ukraine and Australia. Costa Group Holding (CGC) is selected for this article as a company meeting all of the above-mentioned requirements. Compared with the recent researches, the main contributions of the paper are summarized as follows: justified and proved by calculations the correct methodology for calculating of Company Specific Risk Premium in agricultural business valuation for investment purposes.

Keywords: Company Specific Risk Premium, Business Valuation, Investment, Risk Factors, Specific Risks

11-20

The Importance of Creating Customer Loyalty in Achieving Sustainable Competitive Advantage

I. Kahraman Arslan

DOI: 10.15604/ejbm.2020.08.01.002

Abstract

In today’s competitive environment, where products and services have more and more similar features, and consumer demands and expectations are constantly changing and increasing, increasing the customer satisfaction in the marketing process and thus creating loyal customers have become the primary objectives of the businesses. In an environment where acquiring new customers is much more costly than holding customers at hand, the fact that businesses have loyal customers is a very important factor in terms of business continuity. Improving customer loyalty is possible by establishing strong long-term relationships between the business and the customer. These relationships with the customer can increase the order frequency and quantity of the customer from the business, provide economic benefits to the business, and recommend new businesses and products to the surrounding people, and gain new customers at less cost. The purpose of this research is to reveal the importance of creating customer loyalty in businesses, to determine the factors effective in creating customer loyalty, and to contribute to the strategy formation of the enterprises. For this purpose, the relationship between the value offered to the customer and customer satisfaction in terms of creating customer loyalty has been examined through the literature review method, which is one of the qualitative research methods. For this purpose, it has been concluded that using customer loyalty programs as an effective marketing technique and using relationship marketing method to develop a long-term and loyalty-based relationship with customers is an important factor.

Keywords: Customer, Competition, Customer Loyalty, Complaint

21-35

Effects of Implementing (Financial) Controlling on Business Performances of Small and Medium-Sized Enterprises in the Federal State of Bavaria

Emira Kozarevic and Zijad Vehabovic

DOI: 10.15604/ejbm.2020.08.01.003

Abstract

The goal of controlling as company’s function is to provide (through analysis, controls and recommendations on actions to be taken) company’s long-term economic stability, profitability, and competitiveness. Bearing in mind the aims of controlling and its effect on company’s business activities, the main research hypothesis was postulated for the research, stating that the introduction and implementation of financial controlling results in better performance in business activities of small and medium sized enterprises in the Federal State of Bavaria. In order to confirm the main research hypothesis, an empirical research consisted of two parts, primary and secondary, was conducted on the territory of this federal state. The realization of the primary research included the previously designed and analyzed questionnaire. The survey was conducted on the territory of the Federal State of Bavaria and it focused on small and medium sized companies in various sectors. The second, empirical part of the research included the analysis of financial reports taken from the Federal Gazette using financial indicators for 15 companies in the transport sector for three successive accounting periods (prior to, during, and after the introduction of controlling function). Both the results of the survey and the results of the financial analysis showed that the implementation of financial controlling in organizational structures of the companies surveyed had a significant effect on company`s business performances. In addition, the participants believed that financial controlling has a very important role in realizing company’s goals and that it positively influences internal and external transparency of a company.

Keywords: Financial Controlling, Small and Medium-sized Enterprises (SMEs), Federal State of Bavaria

36-50

The Effects of New Technologies on the Insurance Sector: A Proposition for Underwriting Qualifications for the Future

Deniz Guney Akkor and Suna Ozyuksel

DOI: 10.15604/ejbm.2020.08.01.004

Abstract

The aim of this study is to offer a pioneering perspective on how new technologies may affect the core business functions in industries, while presenting an example through the lens of the relationship between the insurance sector and underwriting. Unless otherwise noted, the scope of the study is international. In this article, new technologies and their use in the insurance sector will be discussed and the effects of these technologies on the underwriting process will be examined. Also, the study will investigate the effects of the digital transformation on the insurance sector workforce, especially on underwriters while new technologies and their use and effects that insurance companies should consider in order to assess their current state and improve their underwriting capabilities as organizations. In this respect, industrial revolutions, industry 4.0 and its effects on the workforce, digital transformation and its implementations in the insurance sector are examined. Relevant competencies are identified and categorized based on the current challenges posed by new technologies. A comparative literature analysis was performed to identify the existing qualifications of a competitive insurance underwriter. The competencies and skills that make up these qualifications are determined and logically matched with the new competencies which are created by the nascent challenges of the new technologies. According to the results of this study, gaps between the extant competencies of workers as compared to evolving required qualifications are widening very fast, which indicates an urgent need for an increased level of education for the workforce. In addition, the particular competencies of an insurance underwriter that should be prioritized for development are revealed. Based on our investigation of the insurance industry; preparedness for both disruptive and transformative challenges, better talent training programs, and increased up skilling training activities in order to maintain competition and furthermore, focus on building differentiating capabilities are recommended.

Keywords: New Technologies, Insurance, Underwriting, Skills, Competencies, Qualifications

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