INSTRUCTIONS BEFORE STARTING THE SIMULATION
To: All Participants
Your team has been placed in charge as Directors on the Board of a company. The rules for
managing your business are explained in the Participant Manual. These rules would be clarified,
amplified and may be modified by another documents and instructions by the Simulation
Administrator from time to time. He will also inform you the tenure of your team’s appointment.
Please be guided by the following, too:
1. The winning Criterion for evaluation of the performance of your Team is the Cumulative
Profit after Tax (Cum PAT) at the end of the last quarter of this event.
2. Your team will be given a unique Team ID and Group ID. These would identify your team in
all decision forms, reports and communications from and to you, during the event.
3. You will also receive login id and password for downloading and uploading information as
well as Decision Form. The safety of login and password will be the sole responsibility of
the team. In case of loss, these will not be changed. However, the same login password
will be provided to your team.
4. Your team will be given a Standard Decision Form in Excel Format for each Quarter. You
will submit the same on time through the method explained by the Games Administrator at
the end of every Quarter. Once the time is closed, it is not available for revision, modification
of entries or for any other reason. On e-submission of form, if you submit a blank form, the
previous Qtr decisions will be taken automatically. No request for filled form will be
entertained. Please maintain the backup for your record.
5. Chairperson must authorize the decisions of his Team for each quarter.
6. The length of each Quarter may range from 30 minutes to 40 minutes. Please submit the
Decision Form within the stipulated deadline as announced. You will not be allowed to get
any extension in time limit for submission of the Decision Form.
7. The Sector Analysis Report (SAR) gives you an overview of the industry. Cost and other
constraints for the case are shown in the Starting Conditions. The financial position of your
Company at the beginning of the Game (Quarter zero) is given in the Management Report
(MR). A comparative statement of the Teams competing in your Group is given in the
Sector Update (SU). More information would be made available to you at prices mentioned
in the Information Packages section of the Starting Conditions or as decided by the
Simulation Administrator.
8. Changes in the external environment and some managerial proposal may be communicated
through the quarterly Gazettes. Please note that it is your responsibility to ensure that you
received a set of Decision Forms and copies of the Gazette for every Quarter.
9. On receipt of the Management Report and Sector Update of any Quarter, you must
verify their contents against the Decisions taken by you. If you do not report any
unexplainable discrepancy between your decision data and your results within 10
minutes thereafter, the data used for the process will be considered good and binding
on the Team. No change will be accepted, thereafter. However, the SIMULATION
ADMINISTRATOR RESERVES THE RIGHT TO REPROCESS THE RESULT OF ANY
QUARTER. HIS DECISIONS ARE FINAL AND BINDING ON ALL PARTICIPANTS, THEIR
TEAMS AND SPONSORING BODIES.
Page 1
Sector Analysis Report – MPX13.0
MPX –Mobile Music player Industry
We will be evaluating performance based on Cumulative Profit after
Tax (CumPAT). As always the interest on the shark loans in the
Last Quarter will be deducted from your winning criteria in the Last
Qtr. The team with the highest Cumulative Profit at the end of Last
Quarter will be declared the winner.
*****************************************************************************
Job Description
1. Decide within the team who will play the following roles
a. CEO
Your job description is to
• Assess the economy, (GDP, inflation etc) and business cycle and draw up a
long term plan for your company
• Facilitate the budgeting and review process
• Reconcile conflicting demands of operations, marketing and finance
• Motivate and lead your team through the minefield of quarter to quarter
business decisions
b. CMO
Your job description is to
• Forecast product demand and overall market size
• Establish a pricing and sales policy as well as brand propositions for your
products
• Establish product mix policy
• Establish a collection policy for the market
c. COO
Your job description is to
• Decide on the level of production and overall production capacity
• Ensure availability of raw materials for production
• Evaluate capital expenditure and process improvement proposals
d. CFO
Your job description is to
• Report on figures in the financial statements
• Trace these to operational as well as long term decisions
• Ensure availability of cash to meet operational and long term requirements
Page 2
-2-
Sector Analysis Report – MPX13.0
Introduction
The report highlights some of the basic features of the market for MPXs.
Following the
emergence of the Internet as key enabler technology, the music industry has seen turbulent
time. As an initial entrant into the Internet area, the music industry has, to a more or less
extent, shaped critical social, legal and business issues in the area of Internet enabled
businesses. The evolution of the industry has seen a constant struggle for supremacy between
content providers, channels and consumer electronics and technology that enable users to
enjoy the benefit of high quality and speed enabled by the Internet. The emergence of the MPX
has enhanced mobility and is viewed as a critical technological component of the music
industry. To what extent will MPX revolutionize the music industry? How will its emergence
affect other portable media players? Will technological convergence support or harm the MPX
industry?
The Product
MPXs are mobile music players. Unlike the “walkmans” of the 1970s – the primary function of
walkmans and MPXs are inherently the same – MPXs have the capability to store large volumes
of music content and thus are considered as an important enhancement over cassette-playing
walkmans. The evolution of the MPXs can be traced to the early 90s, when flash memory was
first integrated with music amplifiers– as a storage device. Since then developments in the
semiconductor industry, software and electronic industries has tended to reduce the form factor
of music playing and storing devices and led to the emergence of the modern MPX players.
Although MPXs have been around for over 10 years now, the introduction of the iPODs in the
early 2000s has galvanized the industry which has since shown impressive growth rates.
MPXs is a generic name for mobile media players that employ the MPEG x format.
These
players come in different sizes and with varying add-on functionalities. Increasingly, unlike the
earlier generation mobile music players (Walkmans), this class of products are closely aligned
with the developments in the computer technology and are viewed as a mobile accessory to a
desktop or a laptop computer. This association is natural since the new generation mobile
media players get their content from CDs/DVDs and most importantly, the Internet. Post
Napster, the re-organization of the music industry, has made the Internet, the largest channel
of music sales globally.
The challenge of the MPX manufacturer/designer has always been trying to get the combination
of form factor and functionalities that appeal to the target population. When they do get it
right, growth has been astronomical; where they haven’t got it right, the products have bombed
Page 3
-3-
Sector Analysis Report – MPX13.0
in the market. The key combinations that have emerged over the years as “winning”
combinations are
•
Form factor [The shape, size of the device]
•
In built FM radio tuner [Yes, No]
•
Size of the LC Display device [Small, Medium, Large]
•
Storage Size [0.5 to 5 GB ]
•
Output devices [Earphone types, Hi Definition etc]
•
Energy Source [Power adapters, USB, Battery type]
The various classes of products in the MPX industry revolve around the combinations that have
found to be “hits” with specific market segments. The classes of products are:
PALMs
– are that class of MPX players that have found to be the most commonly accepted
design of mobile media players. These have fairly large LCD
displays, have medium sized storage capacity 1-2 GB, are sold
along with Hi Definition earphones and are powered by Li
batteries – charged through a USB power source.
This
combination underlines the key value proposition that the MPX
player provides to the end customer – ability to store large
number of songs, organize and play on request, easy to carry and
easy to buy .
Also, as PALMs have diffused into the market, the
MPX manufacturers have sought to position this as a substitute for existing home entertainment
systems. In order to be able to do this, the PALM has been engineered with a host of interfaces
that make it possible for it to serve as the “brain” behind the home/car/mobile media player.
As a result, the PALM is considered to be the largest segment of the MPX market.
MILLI – While PALM caters to the young music connoisseur, its price
point has found to be beyond the reach of a large number of teenage
and college kids. Keeping this in mind, the MILLI has been designed to
retain the key value proposition, but engineered to meet the needs of
this market. It has a smaller display (a major cost component in MPX
players), smaller form factor and hence smaller storage capacity (1-1.5
GB). Since it is targeted at younger audiences, the need to link with
accessory devices has been eliminated, thus bringing down the cost substantially.
Page 4
-4-
Sector Analysis Report – MPX13.0
STICKs
–are mobile music players – as opposed to media
players. They focus primarily on customers who want to hear to
music. As a result STICKs do not have display devices – which are
eliminated to further reduce the cost to customers. This product
has been envisioned as one that will be used by computer/laptop
owners who wish to use the MPX primarily for music while they are
mobile and are able to use their computers/laptops for all other
media playing applications. Also, since they are more dependent on the computing interface, it
is presumed that their primary storage devices is the computer and are able to replenish songs
in the STICK in a fairly regular manner. Thus the STICK is a temporary storage of music that is
of current interest. This has resulted in STICKS having small storage capacity and has made it
possible to reduce the size of the MPX player as well.
BONEs –
This is a class of MPX players that are now sold in the market directly but are
wrapped around other mobile devices and are embedded in them. This product consists of a
storage and media playing software. The display unit
and the output units are integrated by the buyer with
their existing products (say, mobile phones, smart
phones, cameras, toys etc). The customers of this
product demand high level engineering content in the
product so as to be able to integrate it with their
other devices. The entry into this market has been
difficult since manufacturers need a strong design competency to be able to support the needs
of the customers in this segment.
Current Price Bands for the products in the MPX industry. Firms with prices outside
this band will receive no sales.
Limits
PALM
MILLI
STICK
Upper
Lower
550
400
500
350
350
250
Page 5
-5-
Sector Analysis Report – MPX13.0
About MP3 from Wikipedia
MP3 is a compression format. It provides a representation of pulse-code modulation-encoded (PCM) audio data in a much
smaller size by discarding portions that are considered less important to human hearing (similar to JPEG, a glossy
compression for images). A number of techniques are employed in MP3 to determine which portions of the audio can be
discarded, including psychoacoustics. MP3 audio can be compressed with different bit rates, providing a range of
tradeoffs between data size and sound quality.
The MP3 format uses a hybrid transformation to transform a time domain signal into a frequency domain signal:
32-band polyphase quadrature filter 36 or 12 tap MDCT; size can be selected independent for sub-band 0...1 and 2...31
Aliasing reduction post processing
In terms of the MPEG specifications, AAC (Advanced audio coding) from MPEG-4 is to be the successor of the MP3
format, although there has been a significant movement to create and popularize other audio formats. Nevertheless, any
succession is not likely to happen for a significant amount of time due to MP3's overwhelming popularity. MP3 enjoys
extremely wide popularity and support, not just by end-users and software but by hardware such as portable media
players (referred to as MP3 players) DVD and CD players
Inputs for MPXs
The two key raw materials used in the making of MPXs are Wafers and Wraps. These Wafers
and Wraps in varying proportions are used to assemble MPXs of various types.
This has been
made possible by the concerted efforts in modularization of these materials. The economies of
scale associated with the manufacturer of Wafer have made it concentrated in a few countries
and is primarily imported into the country. Wraps are available domestically and consist of
electronic display and output devices.
Nature of the Market and Competition
The MPX industry is fairly a new industry, but has close association with several existing
industry segments. While the product definitions described above have evolved in the last few
years, industry sources are convinced that they are by no means stable. The pace of
technological change, the potential for technological convergence, the emergence of new
business models around the Internet and changing life styles are constantly putting pressure on
the prevailing dominant designs. This is reflected in the results of a recent survey, displayed
below, by several market research firms on the future expectations of market share amongst
the four segments. While there is a general agreement on the direction, there is no consensus
on the pace of change.
Page 6
-6-
Sector Analysis Report – MPX13.0
The emergence of the dominant market segments has played an important role in stabilizing
the basis of competition in this industry. In the earlier years, price variations amongst products
with similar features were quite common, making it difficult for the consumer to make choices.
Now, each market segment is characterized by a price band and the battle for supremacy is
within this band. While price continues to be the key basis of competition, the perception of a
company in terms of brand, has increasingly started to play a role. Companies which invest
consistently in brand building – through advertising, co-branding with accessory manufacturers
and content providers, technology tie-ups with complementers etc are likely to benefit in the
market. Chanakya is gradually emerging as the global hub for the manufacture of MPX players.
Annual Market Size for MPXs in Chanakya
1,400,000
No of Units
1,200,000
1,000,000
800,000
600,000
400,000
200,000
-3
-2
-1
Current
1
2
Year
The Strategic Question
Will the MPX industry retain its position amongst consumer electronics companies or will it be
subsumed as an OEM to this industry? This question has been debated at length at various fora
and jury on this is still out. On the one hand, analysts believe that MPXs have come to stay and
has become a lifestyle product. Currently penetration of MPX is around the 20-30% of the
potential market. With the relatively rapid growth that has been witnessed over the past few
years, the market is likely to get saturated in about a year or so. Given the changes in
Page 7
-7-
Sector Analysis Report – MPX13.0
technology, there exists a potential for a good replacement market to thrive. Thus, one school
of thought believes that MPXs are here to stay and substantial investments in brand building
are likely to be the key strategic initiative adopted by manufacturers for years to come. On the
other hand, the sceptics in this industry believe that the 20-30% penetration will grow to
around 50-60% in the next few years and even there, the available market is likely to shrink –
primarily due to cannibalization of this market by higher end electronic devices that would
embed MPX players within them. Thus, they question the very existence of the replacement
market – since according to them, the 20-30% of initial adopters will replace their need for
MPXs through other products. They are encouraged by the increased convergence of
technology and the belief that size of the consumer’s pocket is constrained – not in terms of
money (which is not a constraint) - but the physical space available to handle more than one
mobile electronic equipment. These analysts are prevailing upon the industry to focus on
growing the BONE market and focus on building a strong technology competency to be able to
benefit from this eventual transition of the industry.
*****************************************************************************
Page 8
-8-
MANAGEMENT
REPORT
CHANAKYA
AIMA
Cash Statement
Ltd.
THE BUSINESS DECISION GAME
A0
Income Statement
Results of Quarter
CU
DESCRIPTION
0
INCOME
Balance Sheet
Net Sales Revenue
Other Income
CU
DESCRIPTION
Share Holders' Funds
Equity Share Capital (FV=1)
Res & Surplus or Ret Earnings
(Eq share prem:
0.00 )
Preference Share capital
(
)
0.00 )
(Pr. share prem:
Loan Funds
Two Year Term Loan
Three Year Term Loan
Bonds
Total Income
7,000,000
346,115
0
0
0
Total Sources
7,346,115
5,400,000
0
Investments & Vendor Deposits
1,946,115
Current Assets
RM+FG Inv
Accounts Receivables
Cash on Hand
Less Current Liabilities
Accounts Payables
0
0
1,946,115
0
0
0
0
0
0
Maturing Term Loans
Bonds maturing
Bank Overdraft
Shark Loans
Total Net Current Assets
Total Application of Funds
0
3,080,000
232,000
1,343,000
1,094,450
600,000
494,450
0
0
0
0
0
AMOUNT
#
INTRATE
Report on the Market submitted by :
AMOUNT DUE
ENDS IN
EQI
Your Corporate Planning Dept
Forecast of General Economic Environment
Qrtr->
Index (Base )
GDP
STK IDX
CPI
IIP
CIBOR/PLR (%pa)
0
1
2
3
104
13000
101
102
10.0
105
13500
104
104
10.0
106
13650
105
106
10.0
4
109
13750
106
108
10.0
Actual Or Forecasted Demand for the Domestic Sector; Export, Tenders etc is extra and as given in Gz, emails
(in Units)
Qrtr->
Product
0
1
2
3
4
PALM
58,000
60,800
63,360
67,900
MILLI
STICK
BONE
43,500
29,000
14,500
44,800
32,000
22,400
45,760
35,200
31,680
40,740
Warehousing Charges
Production Overheads
Selling, Dist and Admin costs
Information Package
Product Design & Certification
Interest Flows
Net Interest Paid
Interest on Bank OD
Interest on Term loans
Interest on Bonds
232,000
0
0
200,000
248,550
0
0
0
0
0
0
0
0
Corporate Tax
Ext item,inv writeoff, disband(+/-)
Net Operational Flows
Appropriations
Preference Dividend
Equity Dividend
Capital Inflows
Overdraft and Loans Taken
Capital Raised
Pref Shares Issued
Equity Shares Issued
148,335
0
946,115
0
0
0
0
0
0
0
0
0
Net Capital Flows
346,115
0
0
0
Misc Exp, Royalty, Ins. etc
0
1,000,000
0
1,946,115
Opening Balance Cash
Shark Loans Raised
Closing Balance
346,115
Finished Goods
PALM
MILLI
STICK
Order Enq Recd Dom(units)
Opening Inventory (units)
Actual Production (units)
Equivalent Capacity Used
5,000
4,000
2,600
5,000
5,000
4,000
4,000
2,600
2,600
5,000
4,000
2,600
Proc from Contract Mfg (units)
Sale Dom + Export+Var
(units)
FG Closing Inventory (units)
Material Consumed / unit
WAFER
WRAP
Material Consumed (units)
WAFER
WRAP
3.00
2.00
2.00
2.00
1.00
2.00
15,000
10,000
8,000
8,000
2,600
5,200
Manpower Cost/Unit
Your Direct Cost pu
Avg Ind Selling Price CU
Your Market Share (%)(units)
20.00
345.00
475.00
10.00
20.00
270.00
425.00
10.00
20.00
195.00
300.00
10.00
Raw Material
102
12900
100
100
10.0
3,760,550
3,080,000
0
Inventory Data (ID)
SUMMARY OF OUTSTANDING TERM LOANS & BONDS (PLR + %)
DURATION
Operation Cash Outflows
RM & Contract Mfg payment
Current Quarter
Previous Quarter
Manpower
Current Quarter
Previous Quarter
Capital Outflows
Investments
Principal Repayments
LC Amount Repayed
Cap Expenditure
0
148,335
0
Net Income to Retained Earnings
4,855,000
4,855,000
0
Shark Loan Interest
Income from Investments (+)
0
248,550
0
0
0
0
Total Financial Expenses
Corporate Tax
Ext item,Inv write off, disband
Profit After Tax (PAT)
Appropriations
Dividend on Preference Shares
Dividend on Equity Shares
1,946,115
7,346,115
3,312,000
0
200,000
3,512,000
3,512,000
3,512,000
=Cost of Goods Sold
Gross Profits
Selling, Dist & Admin Expenses
Bad Debts
Cash Discount+Bill Disc Chges
Information Package
Research & Develpment
EBITDA
Depreciation & GW amortization
EBIT
Bank Overdraft Interest
Shark Loan Interest
2/3 year Term Loan Interest
Bond Interest
Misc Exp, Royalty, Ins etc
3,000,000
300,000
3,000,000
300,000
Total Fixed Assets
4,855,000
=Total Direct Costs
+Warehousing Charges
+Production Overheads
=Cost of Production (CoP)
Goods Available for Sale (Op+CoP)
Less FG Closing Inventory
0
Fixed Assets
Assembly Plant (incl Plant under inst)
less Accumulated Depreciation
Machinery (incl Mach under instal)
less Accumulated Depreciation
4,855,000
0
EXPENSES
FG Op Inv (incl Contract Mfg)
Raw Materials Consumed
+Manpower
CU
DESCRIPTION
Operation Cash Inflows
Sales Revenue Collection
Current Quarter
Previous Quarter
Messages
Page 9
Opening Inventory
Fresh Purchases
Consumption
Closing Inventory
WtAvg Proc Price pu
WAvg Cons Price pu
Numbers
WAFER
WRAP
25,600
25,600
23,200
23,200
75.00
75.00
50.00
50.00
Value Cu.
WAFER
1,920,000
1,920,000
BONE
20.00
WRAP
1,160,000
1,160,000
Sector
Update
Plant Capacity (for next qtr)
Machine Capacity (for next qtr)
Plant Capacity thru Productivity Gains
Machine Capacity thru Productivity Gains
Equity Share Price on Stk Exc
Winning Criterion
0
Issued at the end of Quarter No:
Company Name
(CUMPAT(000
)
00)
Team 0
15000
15000
Team 1
15000
15000
Team No:
Team 2
15000
15000
Team 3
15000
15000
Team 4
15000
15000
AIMA
A0
Team 5
15000
15000
Team 6
15000
15000
Team 7
15000
15000
Team 8
15000
15000
Team 9
15000
15000
1.03
1.03
1.03
1.03
1.03
1.03
1.03
1.03
1.03
1.03
3.461
3.461
3.461
3.461
3.461
3.461
3.461
3.461
3.461
3.461
Key Performance Data (Information Package # 6 - Price Cu.50,000)
Average Manpower Cost
Net Income Margin
Debt to Equity Ratio
Current Ratio
Earnings Per Share
Return on Equity
Return on Investment
Collection in Curr Qtr/Sales
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
20.00
0.0713
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
*****.**
0.0494
0.0471
0.0471
1.00
Efficiency and Activity Ratios ((Information Package # 7 - Price Cu.40,000)
Prod Dev /Sales
S & D & Info Pack Cost/Sales
Material Cost/Sales
Financial Cost/Sales
Days Sales Outstanding
FG Inventory Holding Days
Sales/Total Assets
0.05
0.63
0.66
0.05
0.63
0.66
0.05
0.63
0.05
0.63
0.05
0.63
0.05
0.63
0.05
0.63
0.05
0.63
0.05
0.63
0.05
0.63
0.66
0.66
0.66
0.66
0.66
0.66
0.66
0.66
Market Share Data (Information Package # 8 - Price Cu.125,000)
PALM
Market Share % units
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
0.10
475
1.00
Avg Price / Unit
Sale/Ord Enq
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
0.10
425
1.00
Avg Price / Unit
Sale/Ord Enq
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
300
1.00
0.10
0.10
0.10
0.10
0.10
0.10
0.10
0.10
Avg Price / Unit
Sale/Ord Enq
MILLI
Market Share % units
STICK
BONE
Avg Price / Unit
Sale/Ord Enq
Market Share (Rs Sales)
0.10
0.10
Contract Sales (no charge)
PALM
MILLI
STICK
BONE
Price Quotation
Qty Awarded
Price Quotation
Qty Awarded
Price Quotation
Qty Awarded
Price Quotation
Qty Awarded
Industry Wide Inventory Levels (Information Package # 9
- Price Cu.25,000)
PALM
MILLI
STICK
WAFER
BONE
WRAPA
Asset List (no Charge)
Plant #
Capacity (units)
Remaining Life (qtrs)
Machine #
Capacity (units)
Remaining Life (qtrs)
1
15000
9
1
15000
9
Page 10
Abridged Balance Sheet and Income Statement at the end of Quarter
(Information Package # 10 Price Cu.125,000)
06/15/13
0
Group
TEAM 0 TEAM 1 TEAM 2 TEAM 3
A
6
TEAM 4 TEAM 5 TEAM 6
TEAM 7 TEAM 8 TEAM 9
All Figures are in Cu 000)
Balance Sheet
Equity Share Capital
7,000
7,000
7,000
7,000
7,000
7,000
7,000
7,000
7,000
7,000
346
346
346
346
346
346
346
346
346
346
Preference Share Cap
Reserves and Surplus
Total Long Term Liab
Total Sources
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
Total Fixed Assets
5,400
5,400
5,400
5,400
5,400
5,400
5,400
5,400
5,400
5,400
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
Total Investments
Receivables
RM+FG Inventory
Cash In Hand
Account Payables
Bank Overdraft
Maturing Term Loans
Maturing Bonds
Shark Loans
Net Current Assets
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
1,946
Total Application
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
7,346
All Figures are in Cu 000)
Income Statement
Sales
4,855
4,855
4,855
4,855
4,855
4,855
4,855
4,855
4,855
4,855
Production Cost
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
Goods Available for
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
3,512
1,343
1,343
1,343
1,343
1,343
1,343
1,343
1,343
1,343
1,343
249
249
249
249
249
249
249
249
249
249
148
148
148
148
148
148
148
148
148
148
346
346
346
346
346
346
346
346
346
346
Other Income
Opening Inventory
FG Closing Inventory
Gross Profit
Bad Debts
S & D Expenses
R & D Expenses
MR Expenses
Total Financial Expe
Income Tax
Equity Dividend
Preference Dividend
Transfer to R & S
Page 11
STARTING CONDITIONS
RAW MATERIAL COSTS
(Consumption of Raw Material for one unit of Product)
WAFER
WRAP
PALM
3
2
MILLI
2
2
STICK
1
2
BONE
1
2
Raw Material Costs Per Unit
Cu 75
Cu 50
Spot Rates
Cu 100
Cu 75
Constraint on Purchase of Raw Material
+ or - 50% of previous quarter
Cash Outflow will be 100% in the same Quarter
WAREHOUSING COST
CU 1 Per Unit
Warehousing cost on Raw Material & Finished Goods Inventory at the end of the Qtr.
Cash Outflow will be 100% in same Qtr.
MANPOWER COST (LABOUR COST)
CU 20 Per Unit
Cash Outflow will be 100% in same Qtr.
PRODCUTION OVERHEADS
CU 2,00,000 Per Qtr.
Cash Outflow will be 100% in same Qtr.
PLANT AND MACHINERY (CAPACITY COST)
Present Plant and Machinery capacity is 15000 unit each
Cost of New Plant (CU Per Unit)
Cost of New Machinery (CU Per Unit)
Life of Both Plant & Machinery
Lead Time for New Plant & Machinery
Cash Outflow will be 100% in the Ordering Qtr.
Cu 200
Cu 200
10 Qtrs
1 Qtr.
MARKETING DATA
Fixed Advertisement, Branding, Distribution & Marketing Cost Per Qtr.
Co-Branding, Incentives to Dealers Per Qtr. (on Sales Rev.) on each product
Cu 2,00,000
1%
Cash Outflow for Advertisement & Incentive will be 100% in same Qtr.
Cash Collection of Sales is 100% in same Qtr.
INFORMATION PACKAGE COST
Information No.
6
7
8
9
10
Description
Cost in CU
Key Performance Data
Efficiency and Activity Ratios
Market Share Data
Industry Wide Inventory Levels
Comparative Financial Statements
50000
40000
125000
25000
125000
Cash Outflow in respect of Information Packages will be 100% in the same Qtr.
FINANCIAL COSTS AND DATA
Maximum Permissible Debt to Equity Ratio
0.4
Maximum Overdraft Limit
Cu 486,000
Loan Processing Chagres in CU
Cu 25,000
Interest on Three Year Term Loan
3.25%-4.75% above PLR
Interest on Two Year Term Loan
2.25%-3.75% above PLR
Interest on Bank O.D.
3.25%-4.75% above PLR
Minimum Cash Balance to be Maintained at End of Quarter in CU
Shark Loan Interest (annual): Number of times PLR
Interest on Short Term Investment
Corporate Income Tax Rate
Face Value of Equity Share (in CU)
Page 12
Cu 500,000
4
2% above PLR
30%
Cu 1
CHANAKYA
Group
Date of Play
Business Decision Game
Team No.
Quarter No.
Submission @
MPX- MOBILE MUSIC INDUSTRY
Decisions
Names of Finished Products
Palm
Total Production (units)
Retail Selling Price (Cu.)
Total Purchase of Wafer (units)
Total Purchase of Wrap (units)
CEO's Signature____________________
Page 13
Milli
Stick
Trial Quarter