LAHORE SCHOOL OF ECONOMICS

Kinetic Advertisements
Small Medium Enterprise Location
Ali Ijlal Kiran Maheen Luqman Arshad Muhammah Usamah Bakhshi Waleed Baig

Section C

Presented to: Sir Haroon Ahmad

Contents
Executive Summary.......................................................................................... 3 Objectives: ................................................................................................... 3 Mission......................................................................................................... 3 Keys to Success ............................................................................................ 4 Company Summary .......................................................................................... 5 Start-up Costs .............................................................................................. 5 Company Ownership ...................................................................................... 6 Company Locations........................................................................................ 6 Services .......................................................................................................... 7 Product Description........................................................................................ 7 Future Products ............................................................................................. 7 Market Analysis Summary ................................................................................. 8 Product ........................................................................................................ 8 Customers .................................................................................................... 8 Competition .................................................................................................. 8 Pricing ....................................................................................................... 10 Proposed Location ....................................................................................... 11 Strategy and Implementation Summary ............................................................ 12 Strategic Influences ..................................................................................... 12 Consumers .............................................................................................. 12 Competition ................................................................................................ 13 Environment ............................................................................................... 13 Competitive strategy.................................................................................... 15 Competitive Edge ..................................................................................... 15 Marketing Strategy ...................................................................................... 15 Marketing objectives ................................................................................. 15 Marketing methods ................................................................................... 16 Time line: ................................................................................................... 17 Sales Strategy ............................................................................................ 18 Management Summary ................................................................................... 19 Job analysis: ............................................................................................... 19 Job description: ........................................................................................ 19 Training ..................................................................................................... 22 Financial Plan ................................................................................................ 23 Start-up Funding ......................................................................................... 23 Projected Balance Sheet )1st year) ................................................................. 23

Projected Balance Sheet (2nd year) ............................................................... 24 Projected Balance Sheet (3nd year) ............................................................... 25 Projected Profit and Loss (first 3 years) ......................................................... 27 Projected Cash flows (first 3 year) ................................................................. 28 RATIOS ...................................................................................................... 30 APPENDIX .................................................................................................. 31 Appendix A: Questionnaire: .......................................................................... 31 Appendix B: Ratios working ......................................................................... 34 Appendix C: ................................................................................................ 36

Executive Summary
Kinetic Advertisement, Inc. (KA) is a Pakistani company that rents holographic equipment. We rent out holographic equipment in different sizes. We have obtained the authorizations to be a distributor for Holocube, also we will be the only authorized distributor. KA is a small enterprise fueled by a dynamic management team with unique administrative skills, who are focused on creating, building and maintaining long term relationships with its clients. Its team includes, Mr. M. Usamah Bakhshi, Miss. Kiran Maheen, Mr. M. Luqman Arshad, Mr. Waleed Baig and, Mr. Ali Ijlal. Having lived in Lahore, Pakistan throughout their lives, the management team has compiled an extensive list of customers/ potential customers.

Objectives:
To create a service-based company whose primary goal is provides unique and innovative advertising technology. To increase our number of clients served by 20% per year through superior performance and services To develop start-up advertising firm that can survive off its own cash flow. To increase sales to more than 13 million by the third year.

Mission
KAs mission is to become the exclusive hologram equipment rental, and software service company in Lahore with the ability to service the surrounding areas of Lahore as well. Therefore the company's strategy is to create a limited geographical niche for itself where there are no potential competitors. We will constantly strive to supply what the consumer is asking for, continually review what is available in the marketplace, and what isn't. Improving on what is available and providing new products and services to the areas of need will help ensure our success in the market. Success will ultimately be measured by our customers choosing us because of their belief in our ability to meet or exceed their expectations of price, service, and selection. KAs vision is to continue to expand its service to other areas. The company's coverage area is constantly increasing, as the areas are becoming aware of the company's presence.

Keys to Success
Kinetic Advertisement has identified three key factors that will be instrumental to its sustainability: 1. Ensure 100% customer satisfaction: Repeat customers and customer recommendations are valuable. 2. Design and rent out meaningful and valuable hologram products. 3. Design and implement strict financial controls. This is very important because KA is a small business thus a stand-alone entity financially. The company is seeking a loan/credit line in the amount of $300,000 for the purpose of starting the business.Projected revenues for Year 1 to Year 3 are $210,000, $420,000, and $840,000, respectively

Company Summary
Kinetic Advertising provides unique and patented technology. It is a fully integrated 3D projection platform that provides you with the most advanced modern projection technologies. We distinguish ourselves though the unique specs of our products. Our products will offer our consumers the extra attention that will make them stand out from the rest. We plan to commence our business by 1st August2014 The name of our business will be Kinetic Advertising Inc. the company is owned by a partnership of 5 people. Its team includes, Mr. M. Usamah Bakhshi (Director Sales), Miss. Kiran Maheen and Mr. M. Luqman Arshad( Director Marketing and Sales), Mr. Waleed Baig (Director Operations) and Mr. Ali Ijlal (Director Logistics and operations)

Start-up Costs
Kinetic Advertising will incur the following start-up expenses: 1. Separators for the different departments, 2. 6 tables and 12chairs, with 1 couch 3. 1 lockable cabinet. 4. DSL router and DSL connections 5. 5 laptops, including 1 printer 6. Two telephones

START UP EXPENSE Start-up Requirements Start-up Expenses Equipment: HC 15 HC 40 HC 70 System Equipment Laptops Router Communication Telephone Internet Number of items 3 2 1 5 1 2 1 Price (Rs) Total Price (Rs)

236,250 607,500 2,362,500 40,000 1500 1000 2000 2000

708,750 1,215,000 2,362,500 200,000 1500 2000 2000 2000

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connection Internet fee per month Office Chairs Tables Sofa Separators

12 6-1 1 2

1500 2000 (8000* long table) 9000 3000

18,000 20,000 9000 6000 4,546,750

Premises: Rent Advance Utilities

Total Start-up Expenses

76000 2 month rent as advance

76,000 152,000

50,000

50,000 4,824750

Company Ownership
Kinetic Adverting is a privately held partnership of 5 people. The capital structure is such that the profits/losses will be shared equally by all the partners.

Company Locations
We have one location--a 1010 square feet office on the third floor in a suburban center located in Dha phase 6. It provides us with easy access to cantt, Gulbreg and surrounding areas of DHA, where there are offices of companies like Nestle, Coca-cola and etc.

Services
At kinetic advertisement we work on innovative and attractive way of advertising a product. We are introducing the holographic image projection technology for the first time in Pakistan. We are using HOLOCUBE holograph equipment. This includes the modern holograph technology in a cube shaped display box.

Product Description
The Hologram box ranges in sizes from 15 inch to a life size display of 72 inch. The modern 3D holograph technology is used in the production of holocube. It is manufactured in Belgium, Europe. All three of the holocube have a high resolution of 1024x768 ensuring the life like picture quality along with a contrast ratio of 700:1 to make sure the sharpness of the image is not deteriorated. The equipment can be used independently placed on floor, a stand or table as well as can be fit into a two sided wall and can be viewed perfectly from either side. All three holocube products come with an auto 3D digital convertor that can convert simple 2D videos and pictures into digital 3D. internal storage of 4gb and externally extendable storage options gives a great room of using it for longer video advertisements. Holocube is very energy efficient and works on conventional voltage using only 60 Hz current. Holocube is being produced in Belgium and is directly imported to Pakistan with all the reselling rights reserved with us. We will not only be providing the equipment but also we will be providing our services of making 3D ads for the holocube. However this service will be outsourced to Red Tape Media .

Future Products
For the first year of operations kinetic advertisements will only be using holocube whereas later we plan to import the next generation holographic display known as telepresence. Telepresence is next generation holographic image projecti on technique in which it is not enclosed in a box but actually present just like a human being. We also plan to start out own software development center to make the advertisements for our customers.

Market Analysis Summary

Product
Most of our responders, 71%, said that they will be more interested in renting the holocube, thus for the first year we plan to only import holocube and rent that. The pricing for the technology is given ahead.

Customers
Kinetic advertisements will be targeting the corporate sector in particular. Since it will be a new introduction to the Pakistani market; Lahore initially, we will be charging a premium on the services that we will be providing. This is the reason our customer base will include companies who have major interest in marketing; which can be seen by their marketing budget. Our customers will include beverage companies, automobile companies, telecommunication, banking etc We have a diverse range of customers that we are focusing. Our customers can be anybody from fmcgs to retail and garment companies. Following is the graph of the industries that were used for the survey

Industry type
14% 29% 14% FMCG Telecommunication food and bevrages Retail 14% 29% Construction

Almost all of the responders took part in heavy advertising with 86% saying that they rely heavily on advertising. 57% of the companies had a marketing budget bigger than 15crore. Coke said that they do not have any specific marketing budget; they will use whatever is required for marketing. 100% that is all of our responders said that they will use hologram for advertising and 71% said that they are even ready to extend their marketing budget for this technology.

Competition
The advertising industry has grown at a very high pace in past few years. The companies now focus quite a lot on their advertising which is why the advertising budget is one of the highest allotted budgets by all major companies nowadays. As the demand has
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increased, it has created many opportunities which is why there are many advertising companies working and entering the market. There is a large indirect as well as direct competition that we will be facing. It includes the top advertising companies of Pakistan which have major customers which are large companies operating in Pakistan. From our survey we found out that TVCs is the highest used medium followed by billboards.

Medium used

30% 40%

billboards Radio print media

10% 20%

TVC's

Our competitors were also found from the survey. Our major competitor is symmetry digital, red tape media and pakmedia advertisement, which both hold 25% of the market each, followed by mindshare, synergy advertisement at 13 and 12%

Competitors
Symmetry Digital 25% 25% Pak Media advertisement Mindshare 13% 25% 12% Synergy Advertisements Red Tape

Pricing
Since 71% of our responders said that they will be more interested in renting the technology thus we plan to rent our technology. 63% of the responders wanted to rent this technology (HC40) from 13000-15000, thus we used that figure to develop our pricing models.

prices
0% 13% 12% 7 to 10 12% 10 to 13 13 to 15 15 to 18 18 above 63%

Also since we will have a sole dealership with our respective companies who we get the technology, we plan to make use of that factor and charge a premium price on our products for the first few months. 86% of the responders said that they will rent the technology on need basis, thus our prices are priced on per day estimates. For those that want to rent it for 15 days or above, we will give them a 10% discount. HTC-15 Rent Charge= Rs.11000/day Estimated No. of days rented/month= 15 days

HTC-40 Rent Charge =Rs.15000/day

Estimated No. of days rented/month=10 days

HTC-70 Rent Charge=Rs.40000/day

Estimated No. of days rented/month=10 days

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Proposed Location
We will need an office in DHA phase 6 area in Lahore because of the easy access to cantt, Gulbreg and surrounding areas of DHA, where there are offices of companies like Nestle, Coca-cola and etc. In this phase the commercial area consist of 4 marlas plazas mostly and the rental cost of each floor are as below: 1st floor 2.15 lakhs/month 2nd floor 1 lakh/month 3rd floor 76 thousand/month 4th floor 60 thousand/month Different sections could be made in it and can be used for storage and cubicle offices. This facility has a good parking area and this phase has an easy access to new airport Lahore. In addition to that the locality has a good infrastructure with all facilities being provided such as: Electricity, Sui gas and water. We plan to rent the 3rd floor costing us 76thousand per month (the office layout is given in appendix B)

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Strategy and Implementation Summary

Strategic Influences
Consumers Kinetic advertisements will be targeting the corporate sector in particular. Since it will be a new introduction to the Pakistani market; Lahore initially, we will be charging a premium on the services that we will be providing. This is the reason our customer base will include companies who have major interest in marketing; which can be seen by their marketing budget. Our customers will include beverage companies, automobile companies, telecommunication, banking etc . Mobile companies in Pakistan have gained tremendous importance as far as marketing is concerned; therefore this industry will be another prominent focus of ours. Another product which is continuously and intensely advertised is the textile industry; Lawns in particular for the ongoing season. We will be dealing with different and diverse customer segments, where we will sell or rent out product. As before our focus is on companies with huge marketing budgets that advertise their product regularly, according to the events, seasons etc. These companies mostly have focused adverts that are according to the events in the country, example Eid, Ramzan. Thus their marketing is mostly focused on specific times and rarely done randomly The biggest amount of advertisement is done by Q-mobile, Ufone, Coco cola, and Pepsi. To find out the percentages we will have to do a primary research since a lot of data is not available in Pakistan. Individual customers will include the following who will also be our biggest clients: Beverage Companies Coke Pepsi Automobile Companies Mercedes Porsche BMW Mobile Companies Q Mobile Samsung Voice Nokia

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Competition The advertising industry has grown at a very high pace in past few years. The companies now focus quite a lot on their advertising which is why the advertising budget is one of the highest allotted budgets by all major companies nowadays. As the demand has increased, it has created many opportunities which is why there are many advertising companies working and entering the market. There is a large indirect as well as direct competition that we will be facing. It includes the top advertising companies of Pakistan which have major customers which are large companies operating in Pakistan. Some of these top advertising companies and their respective major customers are: Pak media company- Ufone Maxim advertisements- Unilever Red Tube Media- Sooper Midas- Samsung JWT artistics- LG Pakistan Mindshare- Nokia Synergy advertisement- Mobilink All these advertising companies are quite big and have been working for long time now. The advertising market is very volatile currently because it has just been a few years since the companies have started highly focusing on advertisement. Also every company from every industry is trying to come up with some new and innovative ways to market their products. This actually has created an opportunity for new ideas and innovative ways of marketing a product and that is why many new competitors are entering the market. To further find out the sales turnover and the percentage of the market our indirect customers hold we will have to do secondary and primary research. Environment One of the major limitations that our target customers can face is related to the technology itself. The setting up process can take up to 3months, with high cost. If we take the example of Musion, an industry leader in Hologram technology, they charge up to $65000 rent, which is around 65lakh Pakistani rupee. If the company wants to buy the product, then yet again taking the example of Musion, they sell the technology for $220,000 which 2.5crore. Thus the whole system becomes very costly; however we can make use of the Holo Cube here, which is cheaper than the eyeliner technology. A believe a major limitation would be the internet connection problem. Live telepresence needs a fast, direct connection of 10-20 megabytes per second (Mbps), as the recordings are of higher quality. In todays challenging environment, companies are finding new ways to advertise. The legacy of communication has unfolded over the past few decades leaving unconventional prints in the history of advertising. With the high involvement of technology and advanced media, several new communication channels have exploded over time.
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Innovation is at its peak in even Pakistan, where recently we saw the arrival of 3d advertisements in billboards, example the Cadbury, dairy milk advert and sting advert. Marketing has become one of the core competencies for a lot of companies residing in Pakistan, example the current biggest selling mobile brand in Pakistan: Q-mobile which has made marketing their unique selling point. Another good example could be safe guard and how it marketed itself successfully through its advertisement which makes use of animated character called commando safeguard. Thus we can see that companies tend to spend increasing amounts of marketing and advertising strategies, led by multinationals, the advertisement industry has become enormously complex but successful. Trying to market a new product is difficult in hard economic times. Pakistan has overall been through an economic turmoil. However looking how the Pak rupee appreciated against the dollar last week, it shows that Pakistan is moving towards positive economic growth. Another important factor is the power crises; it has hit every industry very hard and made it difficult for them to flourish given the increase in the oil prices as well (costly to operate generators). There are low foreign reserves and less investments coming into the country, which makes it more difficult to establish new business. Since we are starting off from Lahore, which is one of the most flourishing provinces of Pakistan. A lot of multinations are based here, and loads of money goes into marketing products, an example Coca Cola beverage has a marketing budget of 22 corers. Pakistan has a very unstable political system; however, in the current period the situation has improved. The current government is more supportive of new businesses and more open to giving loans. Recent government policy of reducing import tariffs and duties would also work in our favor when we import our equipment. There has been a shift in marketing from tradition to technology, in terms of approach and tools, this is actively underway in Pakistani media thanks to emerging digital means of communication. Today the advertisement industry is equipped with all those technologies that one would find globally, our production houses and agencies make use of latest techniques and modern technologies for the creation of any advertising product, This has really raised the standard of advertising products in Pakistan. A good example would be of the projector screen located Ghora chowk round about, which shows that the trend towards video ad broadcasting is also being introduced into Pakistan. Thus we can make use of these trends to launch our product. The companies that we are targeting need to be well established, with high marketing budgets. Another factor would be to target companies that advertise regularly. Initially we are focusing on companies in Lahore, one reason being that the companies here dont hesitate in introducing new innovation advertisements. We will be focusing on all the three industry sectors; primary, secondary, tertiary.

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There are a several external influences on our target market. For example consumers perception, maco-economic changes, technological changes, political environment and legal regulations. For the given factors we will have to make use of both secondary and primary research methods

Competitive strategy
Kinetic Advertisement has a strategy that allows them to leverage their competitive edge and quickly gain market penetration. KAs competitive edge is its state of the art technology, that is being imported from one of the top distributors from Belgium Competitive Edge Holographic image projection is a completely new concept for Pakistani market and this technology has not been used by anyone in Pakistan yet. This introduction of a very innovative and unique medium of advertisement is what sets kinetic advertisements apart from all other firms in the industry. The introduction of holographic image projection equipment to Pakistani market is our competitive edge. But this competitive edge might get compromised after few months so we plan to keep on extending our line of innovative marketing techniques to keep kinetic advertisements unique and different from all other competitors in the market. However one advantage that we have is that we are the authorized sole distributor of Holocube in Pakistan, thus our competitive edge might not get compromised for a long while.

Marketing Strategy
The marketing strategy will concentrate on the ability to offer supreme, state of the art hologram technology equipment that is not available in the Pakistani market elsewhere. This campaign The marketing strategy will concentrate on the ability to offer supreme, inexpensive protection for an entire family's stable of electric and electronic appliances. This campaign will be communicated through various methods and will focus on the product offerings coming from the safe, established TCIC, an icon of Cleveland for over 50 years. Please review the following sections for a more detailed analysis. Marketing objectives For our business plan we conducted a research in which we held interviews with different firms, mainly large MNCs and other business firms. Kinetic advertisement is a B2B business and being a B2B business the marketing techniques to be used are different from a normal B2C business. The marketing method to be used by us would be different from other marketing or advertising firms. Since our
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USP is our equipment and the holographic image projection technology hence the marketing mediums to be used would be slightly different. The equipment needs to be displayed and the specifications or capabilities of that equipment need to be explained to the potential customers. We aim to provide a better and a whole new way to market a product using latest technology that has not been used in Pakistan yet. Marketing methods Innovation: Our services are completely new and different from all other marketing and advertising firm present in the market. The holographic image projection is completely a new medium for advertisement in Pakistan. Incentives: We will be giving free demos of their own products to the companies so that they could actually see and evaluate the equipment as how could it benefit them. Furthermore we will be giving big discounts in the beginning just to give our target customers an idea and taste of what we have to offer them. Promotion For promotion we wont be allocating a high budget to our promotional activities as we are being cost effective. So we will be focusing more on low cost mediums for our marketing. Our first step would be to inform the target market as to create awareness and for this we will start by: Visiting different companies and giving presentations and free demos of our equipment and services. In the initial months we will offer high discounts upto 100% for a very short period of time so that the potential customer would actually use it to see how it could work for them in future. To create awareness about the product we will also set up stalls on all business related exhibitions and expos. We will also advertise through social media, i.e Facebook, Twitter, where a complete detail of our services along with pictures, videos etc will be provided. We will also have a complete website with online ordering facility. We will be giving brief presentations to the managers of the targeted firms and in those presentations the hologram equipment will be shown in working condition with sample of their respective products.
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Furthermore, we will setup small seminars and exhibitions of our own where our holographic image projection equipment will be displayed in fully working condition. Building and using contacts or PR is the key in the advertising industry so we will be highly focusing on reaching out to our potential customers personally. We also plan to launch our own website, which would be built interactively to offer customers the distinct experience that they are looking for. To target and reach out to our potential customers (Large business firms) we will also be advertising our company in various leading magazines of Pakistan including Pakistan Business Jounal, Media blinks, Herald, Economic Affair, Vmag etc. we will also advertise of the websites of these magazines We will be focusing the most on creating product awareness among our potential customers and on creating brand awareness, we will be designing various giveaways like paper weights, calendars, ball points, desk clocks, wall clocks, stationary holder and other such items with our brand name on it that will be gifted to the top level management of our potential customers so that our brand is recognized by them. We will also use email marketing where a brief email including pictures and video links of our product will be sent out to managers from various firms. We would not be using high cost mediums such as billboards and tvcs since our target market is not individual consumers but large businesses. We also plan to partially or completely sponsor any event where multiple businesses are involved like marketing expos.

Time line:

Dec-March 3 Months

MarchJune 3 Month

July- Aug Promotion

September

Research

Import and setup

Promotion

Launch

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Sales Strategy
KAs sales campaign will emphasize the fact that KA is using state of the art products, imported straight from Holocube. This will be effective because Holocube is a wellknown established company known for its latest, innovative hologram equipments.

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Management Summary
Kinetic advertisements is a small company with a small workforce. The 5 business partners will make up the majority of the workforce. Furthermore we will be hiring a few more personnel. We be needing a helper/assistant, a technician and two sales assistants.

Job analysis:
The hiring preferably will be done from within Lahore since, the personnel need not be highly specialized and the job requirement is fairly basic. Ads will be given in jung newspaper due to its large reader base and rozee.pk. Job description: Director finance: He/she will be in charge of: Monitoring business performance Managing and monitoring cash flow Preparing and overseeing budgets Managing and preparing accounts Competitor analysis Skills and qualification: Must be a university graduate with a degree in finance and a passion for accounting and numbers. Good oral and written communication skills, self-motivation, excellent analytical and numeric abilities Director Marketing: He/ She will be in charge of: Analyzing and evaluating marketing environment Monitoring opportunities and threats and performing actions to ensure sales and brand development Analyzing all marketing activities of the business (sales-product mix, customer profile, demographics etc) Developing, managing and implementing marketing plans and advertising campaigns. Public relations and ensuring that the companys image is maintained at high standards. Skills and qualifications: Must be a university graduate with a degree in the field of marketing. Exceptional public dealing skills. Must have a creative approach. Must have the confidence to sell ideas.

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Director Operations: He/ She will be in charge of: Day to day operations of the business Ensuring that the operational targets are met Controlling costs and debt management Maintaining customer satisfaction Skills and Qualifications: Must have a university degree, excellent leadership skills, effective communication skills, high ability to synthesize. Very high problem solving abilities. Director Logistics and distributions: He/ She will be responsible Looking over the import and purchases of equipment Organizing the storage and distribution of equipment Ensuring the delivery of right products to the right location in right time Coordinating effectively with the suppliers and the consumers Skills and Qualifications: Must have a university degree, good understanding of supply chain management, good collaboration skills, innovative ideas to optimize logistics. Installation and service technician: He will be responsible for: Setting up the hologram equipment in working condition Repairing any damages caused to the equipment Ensuring the safe and continuous electric supply to the equipment Keeping the equipment working by following the operating instructions and trouble shooting. Skills and qualification: Electronics troubleshooting, equipment maintenance experience of at least 5 years. Office assistant: He will be responsible for: Maintaining office supplies, receiving and forwarding information, making office schedules, holding reception desk. Skills and Qualification: Must be a college graduate with fairly good communication and typing, printing and photocopying.

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Personnel Plan Year 1 Activity Staff Finance Manager Delivery (driver) person 2-IT Designer Graphics Year2 Year 3

Operations Manager

Assistant Accounts and Imports

Logistics Distribution Manager

and Operations Supervisor

Marketing and sales Assistants for every Managers department Office Assistant Insurance Agent Installation and service technician Table: Personnel Plan The above table gives a summary of the personnels that we will require for the first 3 years. Below we show the payroll plan for these personnels Payroll Plan No. Staff Finance Manager Operations Manager Logistics and Distribution Manager Marketing and sales Managers Office Assistant Technician 1 1 1 Equal share in profit 2 1 1
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Pay (years) 1 2 3

Outsource Graphic Designing Table: Personnel Payroll Plan 25,000/hologram Increase with change 10,000/image in market rates

Training
strategy is important for every business small or large. The basic human resource requirement of kinetic advertisement is quite basic and conventional in nature. Most of the human capital will consist of the partners themselves. The basic recruitment and hiring would work in following manner:
New Employees TRAINING AND DEVELOPMENT Business Partners Managers Trained employees

The training programs will be different for both the kind of employees. The business partners will be given management training from a professional training institute Decisions pvt. Ltd. And the courses that will be attended by the managers will be: Cohesiveness through motivation (3 sessions) Managing leadership (3 sessions) The other employees will be trained from different training programs from another professional training institute (cyber design pvt. Ltd.) : Basic employee training program (2 sessions) Graphic designing and IT training and forward thinking development (1 month)

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Financial Plan
Start-up Funding
Project Financing Structure Inputs Equity Debt Basis of Assumption 60% 40% 100% PKR 3000000 2000000 5000000

Projected Balance Sheet )1st year)

B/S for the first year Assets Equipment HC-15 HC-40 HC-70 System Equipment Laptops Projector Office Equipment Chairs Tables Sofa Separator Total Fixed Assets Current Assets Bank Balance Debtors HC 15 HC 40 HC 70 Total CA Total Assets CL Rent Utilities

708750 1215000 2362500

200000 85000

18000 20000 9000 6000 4624250

5384400 330000 210000 200000 6124400 10748650 760000 50000 23

Telephone Transport Internet Total CL Long Term Liability Bank Loan (12.18%) Total Liability Assets-Liabilities Owner's Equity M. Usamah Bakhshi M. Luqman Arshad Waleed Baig Ali Ijlal Kiran Maheen Total Capital Net Profit Total Capital Transfer to Contingency Reserve New Capital

1000 15000 2000 828000

2000000 2828000 7920650

600000 600000 600000 600000 600000 3000000 5388650 8388650 468000 7920650

Projected Balance Sheet (2nd year)

Assets Equipment HC-15 HC-40 HC-70 System Equipment Laptops Projector Office Equipment Chairs Tables Sofa Separator

945000 1822500 4725000

200000 85000

18000 20000 9000 6000 24

Total Fixed Assets Current Assets Bank Balance Debtors HC 15 HC 40 HC 70 Total CA Total Assets CL Creditors Rent Utilities Telephone Transport Internet Total CL Long Term Liability Bank Loan (12.18%) Total Liability Assets-Liabilities Owners Equity Capital Net Profit New Capital 10736650 7080000 17816650

7830500

11659150 440000 315000 400000 12814150 20644650

760000 50000 1000 15000 2000 828000

2000000 2828000 17816650

Projected Balance Sheet (3nd year)

Assets Equipment HC-15 HC-40 HC-70 Telepresence System Equipment Laptops Projector

945000 1822500 4725000 10000000 200000 85000 25

Office Equipment Chairs Tables Sofa Separator Shehzore Total Fixed Assets Current Assets Bank Balance Total Assets Owner's Equity Capital Net Profit New Capital

18000 20000 9000 6000 3000000 20830500

9765150 30595650

23751650 6844000 30595650

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Projected Profit and Loss (first 3 years)

Year 1 Year 2 Rs. Rs. 3960000 5280000 2520000 378000 HC 15 (4*10*12)*15000 2400000 4800000 HC 40 (3*7*12)*20000 HC 70 (2*5*12)*50000 8880000 10458000 Total Revenue 114750 900000 10000 912000 600000 240000 12000 26000 100000 180000 11000 35000 10000 45000 10000 6000 36000 243600 100000 600000 13400 912000 600000 288000 12000 26000 130000 300000 11000 35000 10000 45000 10000 6000 36000 243600 Less Expenses Insurance Rent (76000*12) Utilities (50000*12) Salary- Office Assistant (2*12000*12) Telephone (1000*12) Internet (2000*12+2000) Miscellaneous IT Specialist Salary Company Website (1000+10000) Promotions Flex (7000*5) Keychains (20*500) Paperweight (150*300) Printed Ballpoints (10*1000) Website Ad. Online Magazine (3000*12) Training Interest Expense ( 2000000 * 12.18%) 13400 912000 600000 288000 12000 26000 130000 1200000 11000 35000 10000 45000 10000 6000 36000 36000 243600 Year 3 Rs. 5280000 378000 4800000 10458000

HC 15 (3*10*12)*11000 HC 40 (2*7*12)*15000 HC 70 (1*5*12)*40000 Total Revenue Less Expenses Freight Cost (280 kilos) Customs (21%) Insurance (0.25%) Rent (76000*12) Utilities (50000*12) Salary- Office Assistant (2*10000*12) Telephone (1000*12) Internet (2000*12+2000) Miscellaneous Transport (15000*12) Company Website (1000+10000) Promotions Flex (7000*5) Keychains (20*500) Paperweight (150*300) Printed Ballpoints (10*1000) Website Ad. Online Magazine (3000*12) Interest Expense ( 2000000 * 12.18%) Total Expenses Net Profit

3491350 5388650

3378000 Total Expenses 7080000 Net Profit 6844000 3614000

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Projected Cash flows (first 3 year)

Operating Cashflow Cash Receipts: HC 15 (3*10*11)*11000 HC 40 (2*7*11)*15000 HC 70 (1*5*11)*40000 Operating Cash Inflow Cash outflow Expenses Freight Cost (280 kilos) Customs (21%) Insurance(0.25%) Rent (76000*11) Utilities (50000*11) Salary- Office Asisstant (2*10000*12) Telephone (1000*11) Internet (2000*11+2000) Miscellaneous Transport (15000*11) Company Website (1000+10000) Promotions Flex (7000*5) Keychains (20*500) Paperweight (150*300) Printed Ballpoints (10*1000) Website Ad. Online Magazine (3000*12) Interest Expense ( 2000000 * 12.18%) Operating Cash outflow Year 1 3630000 2310000 2200000 8140000 Year 2 Operating Cashflow Cash Receipts: 4840000 HC 15 (4*10*11)*15000 3465000 HC 40 (3*7*11)*20000 4400000 HC 70 (2*5*11)*50000 12705000 Operating Cash Inflow Cash outflow Expenses 100000 Insurance 600000 Rent (76000*12) 13400 Utilities (50000*12) 836000 Salary- Office Asisstant (2*12000*12) 550000 Telephone (1000*12) 288000 Internet (2000*12+2000) 11000 Miscellaneous 24000 IT Specialist Salary 130000 275000 11000 Company Website (1000+10000) Promotions year 3 6600000 4620000 5500000 16720000

114750 900000 10000 836000 550000 24000 11000 24000 100000 165000 11000

13400 912000 600000 288000 12000 26000 130000 1200000 11000

35000 10000 45000 10000 6000 36000

35000 10000 45000 10000 6000 36000

Flex (7000*5) Keychains (20*500) Paperweight (150*300) Printed Ballpoints (10*1000) Website Ad. Online Magazine (3000*12) Interest Expense ( 2000000 * 12.18%) Operating Cash outflow

35000 10000 45000 10000 6000 36000

243600

243600

243600

3131350

3224000

3614000

28

Operating Cashflow

5008650

9481000

Operating Cashflow

13106000

Cash from Investing Activities Equipment HC-15 HC-40 HC-70 System Equipment Laptops Projector Office Equipment Chairs Tables Sofa Seperator Cash outflow Owner's Capital M. Usamah Bakhshi M. Luqman Arshad Waleed Baig Ali Ijlal Kiran Maheen Cash inflow

Cash from Investing Activities

708750 1215000 2362500 200000 85000

236250 607500 2362500

Shehzore 1 Pickup Telepresence

3000000 10000000

18000 20000 9000 6000 4624250 600000 600000 600000 600000 600000 3000000

Cashflow from Investing -1624250 Activities

Cashflow from Fianncing Activites Bank Loan (12.18%) 2000000

Cash from Financing Activities Repay Loan

2000000

Change in Cashflow

5384400

6274750 5384400

Change in Cashflow Beginning Bank Balance

-1894000 11659150

Total Bank Balance

5384400

11659150 New Balance

9765150

29

RATIOS
1 PERFORMANCE Liquidity Ratios Current Ratio Net working capital Ratio PROFITABILITY RATIOS ROA Profit Margin ACTIVITY RATIOS Asset turn over CAPITAL STRUCTURE RATIOS Debt to equity ratio ROE % 7.39 0.49 15.2 0.58 Ratios Years 2 % 3 %

0.3

0.5 0.6 0.82 0.94 0.26 0.68

0.34 0.67 0.5

0.22 0.65 0.34

0.94 0.39

0.22

30

APPENDIX Appendix A: Questionnaire:

Kinetics Advertising

What is your company name? Which sector does your company belong to Does your company rely heavily on marketing and advertising? a. yes b. no What is your companys approximate marketing budget for a year less than 1 crore 1-5 crore 5-10crore 10-15crore 15 crore above What medium do you use for advertising at the moment? a. Billboards b. TVCs c. Print Media i.e newspaper b. Radio other: _____________ Which company do you use to advertise?

Would you be interested in using Hologram technology for marketing? a. yes b. no What sort of technology would you be more interested in?

31

See the links to choose option: http://www.holocube.eu/files/hc32_01.jpg OR b.http://animationews.com/wp-content/uploads/2013/01/musion-toyota-launch.jpg a. Holocube (hologram inside a cube) b.Telepresence (device that can project holograms) Would you be willing to extend your marketing budget to use this new technology a. yes b. no Would you be interested in renting this technology? Yes No How often would you need to use this technology? Monthly Quarterly Every six months Yearly On need basis (randomly) On a scale of 1-5, how important is it for the content to be created for you? 1 being very important and 5 being not important 1 2 3 4 5 Select a value from a range of 1 to 5. How much would you be willing to pay for such a technology for a day? (given the size is 40inches or 3.25 feet) 7000-10000 10000-13000 13000-15000 15000-18000 above 18000

What size of the hologram would you prefer in the holocube Size in inches 14 15 17
32

17 above Would you be interested in receiving more information on these products as they evolve? If so please provide your email address.

33

Appendix B: Ratios working

Year 1 Liquidity ratios: Current ratio: current asset/ current liab 6124400/828000 =7.39 Net working capital ratio: (current assets-current liab)/ total asset (6124400-828000)/10748650 =0.49 Profitability ratios: ROA: Net income/ total assets 53886540/10748650 =0.5 Profit margin: Net income/ sales(revenue) 5388650/8880000 =0.6 Activity ratios: Asset turnover ratio: sales/total assets 8880000/10748650 =0.82 Capital Structure ratios: Debt to equity ratio: total liab/ total eq 2828000/3,000,000 =0.94 Year 2 Liquidity ratios: Current ratio: current asset/ current liab 12814150/828000 =15.2 Net working capital ratio: (current assets-current liab)/ total asset (12814150-828000)/20644650 =0.58 Profitability ratios: ROA: Net income/ total assets 7080000/20644650 =0.34 Profit margin: Net income/ sales(revenue) 7080000/10458000 =0.67

34

Activity ratios: Asset turnover ratio: sales/total assets 10458000/20644650 =0.5 Capital Structure ratios: Debt to equity ratio: total liab/ total eq 2828000/10736650 =0.26 Year 3 Liquidity ratios: Net working capital ratio: (current assets-current liab)/ total asset 9765150/30595650 =0.3 Profitability ratios: ROA: Net income/ total assets 6844000/30595650 =0.22 Profit margin: Net income/ sales(revenue) 6844000/10458000 =0.65 Activity ratios: Asset turnover ratio: sales/total assets 10458000/30595650 =0.34

35

Appendix C:

Office 1

Office 2

Storage Room

Office 3

Washroom

Elev ator

Conference Room Kitchene tte

36

Appendix C: Job descriptions

37