Brand value impact on company's economic value added evaluation model

Research output: Contribution to journalArticle


Purpose – The aim of the paper is to examine how the brand value would influence economic value added (EVA) of the natural mineral water producers in Lithuania. Design/methodology/approach – A research methodology composed of two main stages (brand evaluation and brand value impact on EVA). Factor analysis and multiple regression analysis are used to determine how the factors are formed and what their relative weights are. Brand value and the other factors influence on economic value added was assessed using multivariable linear regression model. Findings – The results of research have showed that Lithuanian natural mineral water sector is mature market, dominated by two strong brands whose profitability are steady growing annually. The customer brand value of Lithuania natural mineral water sector is influenced by brand awareness and loyalty and financial performance of the brand is heavily dependent on market growth ability and marketing investments on the brand. It also drew the conclusion that sector company’s brand value and profit before interest and taxes (EBIT) had positive influence and capital structure or weighted average cost of capital (WACC) has negative influence on EVA, indicating that these factors had an active influence on EVA. The intangible and tangible assets has poor negative or no influence on EVA. The other factors as size, growth ability and industry’s return on equity should be evaluated further in other researches. The possible reasons were discussed later and some advice was given in order to increase the company’s economic value.
Research limitations/implications – The research focused on Lithuania market and one sector. Although social and economic background of Lithuania is quite differentiates from western countries. The discrepancy of capital markets is also distinct. Therefore, it would be very useful to compare the research results with foreign countries, within different industries in the future studies. Practical implications – The paper provides the opportunity to assess the brand value of SME’s and evaluate other factors influencing EVA in process of company growth. According to the study strong positive relationship between the EVA, brand value and EBITA, negative - with the capital structure was observed. This is partly confirmed by foreign scientists on the survey findings. In particular, when assessing the company generated revenues, net profit, brand value dynamics show a positive trend to economic added value of the company. Therefore, some advice can be given in order to increase the company’s economic value added. Originality/Value – The research paper is the first paper in Lithuania investigating factors influencing EVA with a special focus on brand value. The evaluation model of brand value impact on EVA was created.
Original languageEnglish
Pages (from-to)77-84
JournalContemporary research on organization management and administration
Issue number3
Publication statusPublished - 2015



  • Brand value
  • Brand equity and financial value
  • Economic value added

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