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Solution

1. Continue with the Packaging Systems/ solutions even if that means diversion of the sales force
as this is the vertical which is growing at the maximum rate. Also continue with the adhesive
tapes (carbon sealing and industrial) as even that segment is growing.

2008 2012 % Increase


Adhesive Tapes (Carbon Sealing & Industrial) 51143 93034 16.4%
Packaging Systems/ Solution 8263 105153 234.5%
Other Adhesives 12339 9994 -3.8%
Other Packaging 7268 31916 84.8%
Earnings before income tax 9104 34872 56.6%

2. Increase the margin being provided to the distributor for the products: RD-48 and RDS -72. PST
obtains a huge margin on these products whereas the margins provided to the distributors are
less when compared to the competitors of these products (Ecoslim and Ecoplus simultaneously).
Giving greater margins to distributors will ensure that they push these products to the
customers.

RD-48 EcoSlim RDS-72 EcoPlus


Variable Cost 76.72 80 135.49 110
Price To distributor 162.31 118.02 243.85 134.44
Resale Price 200.56 159.85 303.73 212.95
PST Margin 85.59 38.02 108.36 24.44
Distributor Margin 38.25 41.83 59.88 78.51

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