CAT PROJECT 1

INK PPT
D5
 Problem Statement
• INK PPT is a presentation consulting outsourcing and design company,
which specializes in serving Clients (Corporate and Event
Management Companies) with their presentation needs. However, it
has been facing stiff competition recently and the Covid-19 Pandemic
has further impacted the businesses adversely.
• Aayush Jain, founder of INK PPT, has been left with a daunting
decision to whether accept the job offer as Head of a Business Unit in
one of his friend’s start-up or to continue with his struggling
bootstrapped Venture.
 Problem Statement
What is the complication (or problem) with what is happening now:
• The existing business and work has plummeted because of shortage of work with
client’s themselves and acquiring new clients has become very tedious.
• Business decision to rent a new office space was made just a month before the
Covid-19 outbreak which led to expenses of 2.5m INR in renovations and 6months
advance rent, only for the space to be left unused for an indefinite period of time.
• The financial loss of approx. 3m INR (renting new office space), burnt a hole in the
pockets of the Co-founder, making it difficult to manage basic expenditures like
paying salary or operations.
• They might have to compromise with their core value of PRIDE and 5-D methodology,
which majorly focused on providing exceptional quality and efficient services.
 Solution
Continue to work on INK PPT

Positive implication: Its a pre existing business, with an

established client base and a structured organizational
hierarchy.
Diversity in services offered.
Proven track record.
High Quality service offered

Negative implication: Budget crunch, Uncertainty due

to covid, Operational challenges, Privacy concerns by
client, Client retention issue. Shortage of projects
given by client due to cost cutting. Expensive services
offered compared to competitors.
 Relevant Data
DATA
FULL TIME EMPLOYEES 15
FREELANCERS 10
RENTAL EXPENSE 3000000
PRICE PER SLIDE 2000
CLIENTS IN 2019-2020 75+

SALARIES
POSITION SALARY/MONTH NO. OF EMPLOYEES SALARY/YEAR REDUCED SALARY/YEAR

FOUNDERS ₹ 80,000 1₹ 80,000 ₹ 60,000

DESIGN TEAM ₹ 42,500 3₹ 1,27,500 ₹ 95,625

ANIMATION TEAM ₹ 30,000 3₹ 90,000 ₹ 67,500

EDITORIAL TEAM ₹ 45,000 2₹ 90,000 ₹ 67,500

BUSINESS DEVELOP. TEAM ₹ 40,000 4₹ 1,60,000 ₹ 1,20,000

CLIENT SERVICING TEAM ₹ 37,500 3₹ 1,12,500 ₹ 84,375

TOTAL ₹ 2,75,000.00 16 ₹ 6,60,000 ₹ 4,95,000

 Relevant Data
PROJECTED P/L STATEMENT
PARTICULARS AS OF 31 MARCH, 2022 AS OF 31 MARCH, 2021 AS OF 31 MARCH, 2020
REVENUE:
NET SALES ₹ 1,23,45,891 ₹ 1,37,17,657 ₹ 1,90,54,028
OTHER INCOME ₹ 35 ₹ 68,620
TOTAL REVENUE ₹ 1,23,45,891 ₹ 1,37,17,692 ₹ 1,91,22,648
EXPENSES:
COGS ₹ - ₹ - ₹ -
EMPLOYEE BENEFIT EXPENSE ₹ 21,57,708 ₹ 39,85,416 ₹ 42,99,516
FINANCIAL COST ₹ 3,71,817 ₹ 3,71,817 ₹ 3,04,903
DEPRECIATION AND AMORTI. ₹ 2,44,782 ₹ 2,44,782 ₹ 2,44,578
OTHER EXPENSES ₹ 76,61,492 ₹ 76,61,492 ₹ 1,14,06,495
TOTAL EXPENSES ₹ 1,04,35,799 ₹ 1,22,63,507 ₹ 1,62,55,492
PROFIT BEFORE EXP, EXT. AND TAX ₹ 19,10,092 ₹ 14,54,185 ₹ 28,67,156
PROFIT BEFORE TAX ₹ 19,10,092 ₹ 14,54,185 ₹ 28,67,156
CURRENT TAX ₹ 4,96,624 ₹ 3,80,000 ₹ 7,45,460
EXCESS PROVISION ₹ - ₹ - ₹ 1,14,973
PROFIT FOR THE PERIOD ₹ 14,13,468 ₹ 10,74,185 ₹ 20,06,723
 Analysis and Inference
• High quality service- INK PPT provides their customers with high
quality services but it comes with the cost of paying comparatively
higher salaries to employees resulting in increase in cost.
• Growth opportunities- Companies were realizing the importance of
tools like PPTs to better communicate with their stakeholders, clients ,
media and hiring agencies to provide the expertise. But with the
pandemic hitting, companies have to do cost cutting and the future
looks bleak for INK PPT.
 Analysis and Inference
• Uncertainty due to pandemic- In the post pandemic era companies
started to face cash flow problems, budget constraints and they
resorted to cost cutting which severely impacted the quality of service
provided by businesses. The business might not be feasible to
continue.
• Privacy Concern- Large corporations are reluctant to share their
business details with outside agencies, hence growth opportunities
might be limited.
• Price war- Pre existing startups providing services at low price,
creating a price war scenario.
 SWOT Analysis
Strengths:
1) Aayush Jain's already existing expertise and experience in the field.
2) High quality and better services provided by INK PPT than their
competitors.
3) Unique 5-D methodology, PRIDE philosophy and operational vertical
followed by the firm.
4) Diversity of services provided by the company, not following a single
service line.
SWOT ANALYSIS
Opportunities:
1) Opportunity to tap the unconsolidated market with
less market players and provide superior services than
the competitors.
2) Bag big Corporate Giants which are more focused on
the quality of the services than the pricing.
Weaknesses:
1) Competitors are charging lower prices for similar kind of
services.
2) High operational cost with increase in number of employees
and their expertise in the field.
3) Loss of clients due to pandemic.
4) Privacy issues due to sensitive business details.
Threats:
1) Uncertainty of the business after the pandemic.
2) Rent of independent office space.
3) India as a market is not fully comfortable with the
idea of outsourcing of the design of presentations.
 Issue tree
Clients Funds Competition
• Existing Clients were • Higher salaries offered • Pricing issues,
withdrawing ongoing to the permanent competitors offer similar
projects during covid 19 employees and services at a relatively
• Privacy concerns posed freelancers than the cheaper price.
by the clients competitors
• Lack of awareness • Expenditure of more
regarding INK-PPT's than 2.5 million for
business renting the office.
• Only a few large
corporations were their
clients
 Issue tree solution
Provide discount to Accrue a part of Adapt to the competitive

Funds

Competition
Client

existing clients on their employees current salary pricing by offering

subsequent orders
Hire a legal team to
ensure privacy of clients
transactions
Inform the public about
the benefits of an
efficient PPT
and pay it off next year services at a discount to
The founder could cut the clients.
salaries by 25% across the To attract the old and
whole organization new clients, the
including himself price/slide should be cut
To cut down the down by 25%
additional cost. The
management can cut
down the other employee
benefits expense by 50%
for a temporary period.
 Suggestions
• By reducing the salaries, price, and other employee benefits we can
easily target the survival in this downward phase.
• By targeting new clients specially those whose business has shifted
online and by reducing the price we can expect a 15-20% increase in
sales as shown in the excel file.
• By reducing the cost for the temporary period we can easily manage
the coming cost.
• We can see a 38-40% rise in the net profits. It may actually be lower
because of the other expenses which I considered as same as the last
year because of lack of data.
 Assumptions
• It is assumed that all other expenses remain same as the last year, but if the
management pays off some debt then it will further reduce the expenses.
• Tax is assumed to be of the same percentage in relation to profit as in last year
i.e., (380000/1454185)*100= 26%
• To make sure "INK PPT" will survive this downfall. The founder could cut the
salaries by 25% across the whole organization including himself.
• To attract the old and new clients price/slide should be cut down by 25% i.e.,
from Rs. 2000 to Rs. 1500. We will target new clients like- EdTech companies so,
it is assumed that by reducing the price by 25%, demand will increase by 20%.
• To cut down the additional cost. The management can cut down the other
employee benefits expense by 50% for a temporary period.
 Conclusion
• After analyzing all the factors involved, Aayush Jain should come to the
conclusion of continuing his work with INK PPT . The company has taken a
hit due to the pandemic, but after making the suggested changes, it should
be able to recover in a few years.
• There is still great potential for the company to grow in the future, and the
demand for the work of INK PPT could only increase with time .
• Though there is heavy competition in the market, there will still be a high
demand for INK PPT for its high quality work .
• With the large debt incurred, it might be tempting to sell off the company
and take the lucrative job offer. But the decision to stick with the company
should be more beneficial in the long run .