Santana competes in the retail industry supplying electrical products online and through physical stores Operating Activities Appendix 1 The market is competitive as all competitors reduced their prices at the start of 2016 to gain customers Since the market hasn't grown considerably the competitors have had to compete on price Santana has profitable operating activities because of its 35 increase in operating profit since 2015 whereas their competitors have all experienced a decrease therefore Santana is operating much more efficiently than its competitors The increase in profit would be due to the closure of the central warehouse reducing selling and distribution costs significantly by 283k increasing profit Even though Santana s operating profit margin is increasing it is still very low at 17 5 in 2016 However this can be expected for a retailer as the cost of sales is high Santana has a high market share with approximately 40 in both years and is looking to increase further by creating their own unique branded products which justifies the 52 increase in inventory from 354k to 538k With the brand and technological expertise from G plc Santana can charge premium prices resulting in an increase in revenue and market share Financial Performance Appendix