Synchrony Financial operates as a consumer financial services company in the United States. The company offers private label credit cards, dual cards, and small and medium-sized business credit products; and promotional financing for consumer purchases, such as private label credit cards and installment loans. It also provides promotional financing to consumers for health and personal care procedures, products, or services, such as dental, veterinary, cosmetic, vision and audiology; debt cancellation products; and deposit products, including certificates of deposit, individual retirement, money market, and savings accounts, as well as accepts deposits through third-party securities brokerage firms. The company offers its credit products through programs established with a group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations, and healthcare service providers; and deposit products through multiple channels, including digital and print. Synchrony Financial was incorporated in 2003 and is headquartered in Stamford, Connecticut.
Business Analysis of Synchrony Financial
The Financial Services Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Synchrony Financial compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Synchrony Financial to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of Synchrony Financial with an interactive chart.
- Revenue Growth: Synchrony Financial reported a revenue growth of 2.8% year-on-year during 2016. Consumer Finance Industry grew at 5.0% in the same period
- COGS share of Revenues: Synchrony Financial COGS share of Revenues details are not available because either company does not share the data or we do not have it
- R&D share of Revenues: Synchrony Financial R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, Synchrony Financial spent 32.5% of its total revenues on Sales, Marketing, and General Administration (SG&A). Consumer Finance industry average SG&A spending in the same period was 43.3%
- Inventory share of Revenues: Synchrony Financial Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: Synchrony Financial Accounts Payable share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Receivable share of Revenues: Synchrony Financial Accounts Receivable share of Revenues details are not available because either company does not share the data or we do not have it
- PP&E share of Revenues: Synchrony Financial PP&E share of Revenues details are not available because either company does not share the data or we do not have it
- Intangibles share of Revenues: As a percentage of revenue, Synchrony Financial invested 23.8% of its total revenues on Intangibles. Consumer Finance industry average Intangibles investment in the same period was 71.0%
- Net Margins: Synchrony Financial Net Margins in the year 2016 were 32.2%. Consumer Finance industry average Net Margins in the same period were 22.9%
Sector and Industry Association of Synchrony Financial
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
Synchrony Financial is associated with Financials Sector Group, Financial Services Sector, and Consumer Finance Industry.
Financial Services sector is comprised of the following industries: Investment Services; Consumer Finance; Payment and Transaction Processing Services; Financial News, Research and Data. The definitions for each of the industries is as follows:
- Investment Services industry includes investment banking companies, asset management companies, securities brokers and dealers, online brokers, and security/commodity exchanges.
- Consumer Finance industry includes companies providing credit services and mortgage finance services.
- Payment and Transaction Processing Services industry includes companies providing financial news, research, and data services.
- Financial News, Research and Data industry includes companies providing payments and transaction processing services.
Industry Ranking of Synchrony Financial
With $7 billion revenues, Synchrony Financial ranked number 6 of all the companies in the US Consumer Finance industry. There were a total of 48 public companies in the US Consumer Finance industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Consumer Finance industry by revenues during 2016 were:
- American Express ($30.1 billion)
- Capital One Financial ($19 billion)
- Visa ($15.1 billion)
- Mastercard ($10.8 billion)
- Discover Financial Services ($7.2 billion)
- Synchrony Financial ($7 billion)
- Ally Financial ($5.4 billion)
- Equifax ($3.1 billion)
- Santander Consumer USA Holdings ($2.3 billion)
- CIT Group Inc ($2.1 billion)
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.
- Conduct a holistic benchmarking; to identify and target additional sources of value
- Get in touch with us to learn more about Business Model Analysis Framework
- Get free data, charts, and analysis of Synchrony Financialand its peers on select key performance indicators by clicking the reports provided below