Running Head: APP HOLSTER LLC

App Holster LLC

[Name of Student]
[Name of Instructor]
[Date]

App Holster LLC

2
Part Three

Based on your historical financial analysis, summarize your organization financial

performance over past 3 years
The financial performance of App Holster LLC is worst as compared to its competitor i.e.
Digitilus LLC. The annual profit of App Holster LLC is $50,000, whereas, its annual profit
increases over the time of three years as, $87,000 in 2014, and $240,000 in 2015. On the other
hand the annual profit of Digitilus LLC is $ 340,000, which is 85% of App Holster LLC in 2013,
and 74% and 29% greater than the profit of App Holster LLC. (App-Holster-LLC, Online). App
Holster operates with the total capacity of employee which are 3 from 2013 to 2014, and
increased to 6 in 2015 respectively, whereas as Digitilus LLC operates with the lesser number of
employees i.e. 5. According to the revenue of App Holster, it is managalbe for the company to
remain profitable with the current number of employee which includes outsource workforce too.
The revenue per employee of App Holster LLC is $ 8,333, which is increasing by 57% in 2014,
and by 73% in 2015. In 2013 the revenue per employee of App Holster LLC is 82% lower than
the Digitilus LLC, improving by 57% lower in 2014 and further improved by 41% in 2015. The
revenue per employee of Digitilus LLC is $68,000. To put this in perspective, a typical company
in the United States brings in $57,500 per employee, suggesting that companies in this industry
generate more revenue per employee on average.

Based on your analysis, what are the financial strength and weakness of your organization
today?
The financial strength of the App Holster is their innovative application for the smartphones, this
innovation can boost the sales of their application which will have direct impact over App

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Holster financial stability and can improve its yearly revenue from $ 50,000 (App-Holster-LLC,
Online). There are numerous financial weaknesses of App Holster LLC; the biggest pitfall of
App Holster LLC is the greater number of employees. According to the survey, the average
number of employees in the software development sector is 3 persons, whereas, the total number
of the employees in the App Holster LLC are 6 persons. This greater number of employees, as
compared to the market, results in higher salary cost and higher compliance cost. Lack of market
share is also another financial weakness of the App Holster LLC, which results in lesser revenue
as compared to its market competitor. It is surveyed that almost 66% of the market generates
higher revenue as compared to the revenue of the App Holster LLC. Therefore App Holster
should evaluate the technique which helps it to generate higher revenue and cope up with its
competitor to remain in the market.

What opportunities are available to improve financial performance?

There are numerous opportunities in the market for App Holster LLC to improve its financial
performance. First, App Holster LLC should focus on improving its strategies and adopt effective
software development plan to increase the sales of its Apps. Furthermore, the specialist of
Application development should be hired to reduce the number of employees; this will ultimately
result in the improvement of financial performance of App Holster LLC by increasing its revenue
and revenue per employee. Another opportunity is to develop wide range of application ranging
from gaming applications to educational applications, as there is a huge market for these apps in
California. There are many potential clients in the market, to whom App Holster LLC could
approach and present their custom mobile and web development projects and show their
specialty and highlight its core competencies. App Holster LLC could also depict their strong

App Holster LLC

execution but also their ideation skill to the market which will help them in improving their
financial performance. (Tunguz, n.d.)

App Holster LLC

What internal and/or external constraints will challenge your ability to improve financial
performance?
The biggest obstacle for the App holster LLC in improving its financial performance is its large
number of employees. Because of the large number of employees, App Holster LLC has to pay
huge cost in the form of salary to its employees, which is reducing its profitability. However, it
impacts App Holster in different ways, as it increases their number of employees whereas, in the
similar industry, the number of employees are three. The revenue per person is also lower than
the industry, which are operating in the similar sector. Another obstacle is the presence of large
application development companies, which holds major share in the market, limiting App Holster
LLCs ability to increase its revenue. Lack of innovative application and un-diversified
application portfolio also contribute as an obstacle in the way of App Holster to improve its
financial performance, as App Holster mostly develop application of same category not focusing
the requirement of the market, and maintaining the same category of application. By not
diversifying its portfolio, App holster will remain unable to enter into the competition that is
prevailing in the market and will remain unable to capture the market share in order to improve
its profitability and its financial performance (App-Holster-LLC, Online).

Evaluate your organizations financial prospects given these opportunities and constraints?
App Holster LLC has the financial prospects in improving its overall financial performance; this
can be evaluated by looking at their improved profitability form 2013-2015, and its improved
margin from 2013-2015. However, the necessary steps should be taken by the App Holster to
reduce the number of employees to the benchmark set in the industry, by hiring the specialist of
the application development which will reduce the number of employees. Through efficient sales

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planning, App Holster LLC will be able to determine its targeted segments, which can improve
its overall profitability. By developing innovative applications, App Holster will be able to
capture the market share that is being currently hold by some of the giants developers
companies, through this step App Holster will increase its market capitalization and its
performance. However, by evaluating the current financial prospects of the App Holster LLC, it
is easily concluded that, if App Holster will grap the opportunities in the near future enabling it
to improve its profitability and thus increasing its profitability margin.

App Holster LLC

Bibliography
App-Holster-LLC. (n.d.). Official Website of AAP-Holster, retrieved dated 11/15/2015 from
http://appholster.com/
Tunguz, T. (n.d.). 4 Major Competitive Trends. App Competition Website, retrieved dated
11/15/2015 from http://tomtunguz.com/app-store-competition/