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Entrepreneurship and Sustainability Issues Open access
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DOI 10.9770/jesi.2022.10.2(23)
Reference to this article should be made as follows:
Bartoš, V.; Vochozka, M.; Škopková, K. 2022. Assessment of financial health of service sector companies in the Central European region, Entrepreneurship and Sustainability Issues 10(2): 375-393. https://doi.org/10.9770/jesi.2022.10.2(23)
Received: 2022-09-18  |  Accepted: 2022-12-05  |  Published: 2022-12-30

Title

Assessment of financial health of service sector companies in the Central European region

Abstract

The objective was to evaluate the financial development of the service sector affected by anti-pandemic measures against COVID-19, and to propose a strategy for the sector´s further development. To fulfil the objective, the following indicators were used: return on assets (or total capital), return on equity, return on sales, share of sales per employee, cash liquidity, current liquidity and total liquidity. Overall, the service sector in Central Europe can be assessed as being in good economic shape. In terms of profitability indicators, companies in the service sector in Central Europe are above the EU average. All can be summarized quite briefly. In the near future, the Czech Republic must address stabilization of return on sales (which is extremely volatile). Close attention must also be drawn to labour productivity, which is half the European Union average. Finally yet importantly, it is evident that companies use too many fixed assets. Slovakia, Hungary and Poland can be considered stable countries that were not harmed by the COVID-19 pandemic, or were able to quickly eliminate the consequences. They can thus focus on the overall improvement of financial health indicators and sustainable development. Germany, and particularly Austria, can be found at the top of the group. Companies in the service sector are very stable, well above average compared to the EU. However, a certain degree of caution can be observed in relation to them. They can be advised to reduce liquidity of companies, which nowadays works against profitability indicators.

Keywords

service sector, COVID-19, financial indicators, strategy for further development

JEL classifications

L89 , M21

URI

http://jssidoi.org/jesi/article/1031

DOI

DOI 10.9770/jesi.2022.10.2(23)

Pages

375-393

Funding

This is an open access issue and all published articles are licensed under a
Creative Commons Attribution 4.0 International License

Authors

Bartoš, Vojtěch
Brno University of Technology, Brno, Czech Republic https://www.vutbr.cz
Articles by this author in: CrossRef |  Google Scholar
Vochozka, Marek
Institute of Technology and Business in České Budějovice, České Budějovice, Czech Republic https://www.vstecb.cz
Articles by this author in: CrossRef |  Google Scholar
Škopková, Kateřina
Institute of Technology and Business in České Budějovice, České Budějovice, Czech Republic https://www.vstecb.cz
Articles by this author in: CrossRef |  Google Scholar

Journal title

Entrepreneurship and Sustainability Issues

Volume

10

Number

2

Issue date

December 2022

Issue DOI

DOI 10.9770/jesi.2022.10.2

ISSN

ISSN 2345-0282 (online)

Publisher

VšĮ Entrepreneurship and Sustainability Center, Vilnius, Lithuania

Cited

Google Scholar

Article views & downloads

HTML views: 1246  |  PDF downloads: 445

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