Benchmarking Choice For The Communication Cable Company Using Dupont Analysis

Benchmarking is a kind of popular management tool, which can enhance the core competence and competitive advantages of an enterprise, and then it induce the perfect working performance. Nowadays it is used in many famous corporations and gains great effects. So, it can help the Chinese corporations to narrow the gap with the international excellent corporation. But benchmarking is just on the beginning stage in China, there are some deviation in the practicing process, especially in the choice of the Benchmarking object and indicators.This thesis outlines the basic principle of Benchmarking first, then we analyze the principle, the approach of the Benchmarking choice and the improvements of Dupont analysis and the Benchmarking performance appraisals. This thesis puts emphasis on the study of the application of Dupont in the Benchmarking choice.For the Benchmarking choice of the communication cable company, we first analyze the background of the communication cable industry, and choose nine listed companies as the research sample. Then we assess and compare the financial statements of the sample companies in recently two years using Dupont, and choose four as the leading companies. Next we compare the average level of the leading companies with ZTE, which have the same environment background, so that we could find the key factors of the cable company's profitability. At last , according to the compare of the average level of the leading companies and the object company, we choose three companies as the Benchmarking and five key indicators as the performance appraisals, which include Benchmarking operating profit ratio, Benchmarking sales gross margins, Benchmarking assets turnover, Benchmarking profit growth and Benchmarking asset-liability ratio.Finally, This thesis outlines the limits of Benchmarking choice using Dupont, and suggests to combining with the Balanced Scorecard to perfect the research method of Benchmarking choice.