Sei sulla pagina 1di 10

I

On the eve of Christmas in 2006, Anil N{oolchandani, ChairmS o.f ryoh:tt Greetings and Gifts, in his office at Nerv Delhi was wondering what the festive profitlbiliV season iould bring this time. For the past 6 years. he had seen the of his companytecline from 187o in-2000 t: ".b".tt.]:87o in'-OO!at Raiesh Vaishnav, one of the promoters of Vintage Ca1ds,,l '400 kms' alvay' a had company His worried' more rvas even Pune his headquarters at sMS of e-greeting, the trend If crore. Rs. 9.5 consolidated loss of more than
edging and MMS greetings continued, the greeting card business was perhaps

towards doom.

ARCHIES GT{EETINGS & GIFTS


Archies Greetings and Gifts Ltd (AGGL), set up as a parlnership firm in 1979 by Anil and Jagdish Moolchandani, was India's largest manufacturer and and distributor of greeting cards, posters, soft toys. gift ltems, cassettes/ CDs managed have could University' Delhi from graduate a stationery items. Ani1, wiih the family business of sctris but his heafi was not in it. He was obsessed

Archies vs. Vintage-Are We in

the. Business

of Greetings? 13

he realised that they were mainraining high standards and while helping out in the fanrily business of saris, unable to match the standards, hence opted out of it (Business India, 1996)' to emotions' As a teenager, His heart, instead, was in the business of hearts-greeting cards that appealed trendV posters .\nil was interested in pop music and collecting posters. In early 1970s, there were hardly any that carried posters of pop to decorate rooms, the oniy source of posters being a magazine, Junior Statesman Chellsons in Sivakasi' stars and celebrities. ln 1971 there was only one company making posters in India' for selling the posters' shops other no were there Tamil Nadu. They had only one distributor in Mumbai and cards and posters greeting of selling That,s what goaded Anil to translate his hobby into his own business the lyrics of writing with starting rhrough mail order in 1979.In the same year', he starled selling songbooks, increasing With range. the irit songs by ABBA. This was followed by lyrics of other classics to complete an annual year with each .onsumer awareness and taste, they started with the yearbook containing the hits of
a\-erage sale

of 10,000 copies. (Business India, 1996). of their size rather The cards business started in 1980. At that time cards were priced on the basis of display soon :han design. In 1gg4, Anil decided to understand the Asian markets and the impofiance into being' Archies :ook ground. Thus the concept of Archies Galleries and Archies Card Shops came up in 1987 in a 1,000 sq' Gallery started with the objective of brand building. The first Archies Gallery came contained cards, gifts shop The campus. University Delhi of ;i. renied shop at Kamla Nagar, in the heart and youngsters' The rnd posters. Card buying bJcame an enjoyable experience for university students touching Rs 22 lac' sales with itself, year first the .on."pt clicked well and the firm could break even in to go into this inclination the had who others The same year they started franchising their name to and sustained commitment their ensured :usiness (Business India, 1996). Incentives to franchisee stores

nrerest (http://www.myiris.com/shares/company/ snapShotShow.php? icode=ARCGREGI&select=1 u 05.04.06) schemes were launched Innovative products were constantly introduced and special offers and promotional capital of just Rs 1,000 to :o drive volumes. Archies expanded from the first greeting card shop with an initial Archies Galleries, Card Shops, and .e1l song books and posters, io a network of 450 plus outlets comprising company paper being retailers who were converted to being exclusive Archies outlets' The
Rose shops - the last

accessed

in New Delhi' :ad a turnover of Rs J3 crore in 2005 (Business Line; 2005-a). Production was centralised sector organised the in 507c of share a market had ;roducing 2.5 lac greeting cards per day. Archies
The Hindu. Jul4,2OO4; PC 13). The remained the undisputed leader in the cards and gifts business in India' For 26 years the entered "o*pury Hallmark when L996, 'Archies'. h ',ery mention of greeting cards brought to mind the name .j]e Indian market, Anil was far from perturbed. He is noted to have said, "It does not pose a threat to usl with new launches (Business in fact, we need more companies to strengthen the market" and went ahead

India, 1996). perceived as By 2005, Archies had far outgrown the identity of a cards and gifts retailer to be gifts business, including rompany offering complete gifting solutions. Archies got into merchandise of the turnover' while posters, stationery items, cassettes and CDs in 1995, which contribtted 307o -rifts, te remaining TOVo was from cards (Business Linel 1998). Archies focused on this business with the aim gifts were outsourced' :o earn 507o revenues from this business. Though the margins were lower, because Besides, gifts L5-207o' growing at was which of cards, :he business was growing at 507o against that potential more had business this value, of terms In rrovided support to franchisee stores to run the show.
ihan cards.

associates' franchisees Archies was considered by all stakeholders, employees, suppliers, business a global network of :nd customers, as a people's company. In 1989, Archies tied-up with HelpAge,

Ire,

14

Cases in Slryrcgic N!0.n!331rcfi

and care of the disadvantaged non-profit organisations, founded in April 1978' and working for the cause of greeting cards in association older persons in India. HelpAge India launched its 2002-2003 collection Zohra Sehgal and with Archie-s Greetings and Gifts Ltd. in August 2002' Film and theatre actress, celebrated as Grandparents Day shooter Jaspal Rana unveiled the collection. September 9 started being l{elpAge India, synergised with along as a tribute to senior citizens (Business Line; z}az-a). Archies, of corporates such number growing the manufacturing and marketing of greeting cards. Every yeat, a were resorting to HelpAge as Sony Corp, Shell Gas, ICICI, Honda Motors and Reliance Industries also their clients (Business India products to wish not only their own employees and associates, but million destitute senior citizens Line. Jul 3, 2OO4). Being able to improve the quality of lives of over 8

-:

-i--' - -

_:
:lf

:*---:

__ _.-

a:i l: r.i-:

of the country, spread more smiles per card. (rvw'w.myiris.com/shares/company/writeDet'php


0s.04.06).

accessed on

:[i:]:a
-

was erstwhile not so To promote sales, the company started the concept of occasion cards" which and accounted for 77o of popular in India. valentine's Day cards were introduced cluring early 1990s peopie found a reason to greet each the total revenue of Archies. They started creating occasions, so that Day (Business Indial 1999)' other and keep in touch. Cards for Rakshabanilhan, Holi, Eid, Mother's India, 2001)' valentine's (Business Father,s Day (Financial Express;1999-b), Husband' Day, Kanachauth accounted for 25Vo gradually and Day, Forgiveness Day (Business India, 1995) etc., gained momentum occasion to be ceiebrated' of total sales. Friendship day cards were launched in 200i and became a big
cards. Cards in regional languages were 307o revenues came from season's greetings and 45o/o from everyday

: - -., -,u.:r
!.I-.|. i-

Standard; 2005)' also launched for certain occasions (Business Line; 1999 and Business Licencing Agreement' to source simple a as 1993 in The relationship with American Greetings, inc. started evolved to one where Archies This in India. American Greeting designs and sell them as Paper Rose cards Gibscn, Flanson graphics, including umbrella, had access to all the various brands under the American Greetings all the product categories to meant access Expressions gifts and Carlton cards. Access to all these brands also lines' under them including plush toys, giftware and stationery product eminent Indian child rights organisation an You), ',,itf, and (Child Relief Cny In 2001 Archies tied up protection, development and participation, which believed that every cifld was entitled to basic rights of survival, AGGL also entered into alliances for printing and distributing CRY greeting cards an-d stationery products. to retail the chocoiates and other with cadbury India and Taneja Mines. The company used its network Mines. products of cadbury India and the Divinity range of products of Taneja to include perfumes and a range portfolio product In financial yex 2002, the company "^pund"d its sales volumes for the company the up Archies identified its perfume business to drive

of gift articles.

by 2008 (http://www'myiris'com/shares/ and targeted the perfume business to contribute 5O7o ofits turnover accessed on 05'04'06)' It launched an

company/snapShotShow.php?icode=ARCGREGI&select=1 of stationery products like crayons entirely new division catled t<ids Stationery for marketing a new range (Business Line; 2002-b)' In April 2002' AGGL packaged in attractive boxes, pencils, erasers and rulers manufacturers of women's fashion entered into a marketing and branding tie-up with Normak Fashions, outlets across the jewellery to push Nomak's 'Estelle' line of jewellery through Archies' 150 exclusive to include 400 expanded be would network country under the 'Archies' brand name. At a later date, the from Normak jewellery classy and Archies franchisee outlets to retail the Splendour range of affordable
(Business Standard; 2002).

"l-llI:

l,r;d

Rose and Paper Magic labels With these alliances in place, Archies sold cards with Gibsons, Paper (USA), American Greetings Corp' (USA) owing to its licencing partnerships rvith Gibson Greetings World; 2005)' It had an agreement with and Portal Publications (USA) respectively (The Franchising

r.tm.,:

It;ti

t" :

Ar!!!!9!

!!. lirllggp-Are We in the Bttsiness of Greetings?

15

rntaged

)ciation

Ial and
rt-s

Day

ergised :s such

'Feelings' (retail chaiu of cards and gifts), under which the latter sold only Archies range of products calied Archies Feelings. h ZA04, the company tied up exclusively with worid's premiere stuffed toys & gift company 'Russ' of England and also with 'Florence' of Italy for limited edition of their porcelain figurines (http:/lwww.domain-b.com/companieslcompanies _alarchiesl2}15l22A_retail.html accessed on 18.12.06). Rrrss products were a little beyond the Indian market, which was extremely price sensitive and not that discerning about quality. Further, the company also planned to look beyond plush toys to the
\.ast range of porcelain gifts, ceramic mugs and exquisite designer range of coordinated gifts. They also tied up with Kathreen Francour (an intemational photographer) to introduce a new range of innovative designer
.-ards.

elpAge
usiness

citizens ssed on

Archies also tied-up with Walt Disney in the merchandise and gifts space. The paper products and gifts tere sourced through vendors for sale under the Disney label at exclusive corners within Archies stores in
Bangalore and the four meffos. Archies collaborated with Simon Elvin, greeting cards player from the UK, to :dd to its portfolio (Retail Biz 20A41. The idea behind forging such alliances was to have more designs and *ive variety, which was very important in the market. In most cases a royalty of 57c was paid. To further promote sales, Archies used props and promotional items in feature films, starting with Maine Ptar Kiya. The success of the endeavour led to Archies props in other films including Hum Aapke Hain Kaun. Tera Jadoo Chal Galta and Yeh Hai Prem. As a first mover in the 300 crore industry (organised sector), Archies had the advantage of a vast network comprising 450 pius franchisee stores a1l over the country. Archies had multi-brand stores, :rclusive stores and company-owned stores. It had a network of Archies galleries. Card Shops and paper

trot so 7% of

fi
sr
RS

each

1999),

lntile's
257o Were

:brated.

source

fuchies
raphics,

rose shops with 55 company owned stores, and 425 franchise stores in 180 cities across 6 countries :ncluding Sri Lanka, Bangladesh, Nepal, Muscat. United Arab Emirates and Bahrain (USP Age; 2004; Economic Times; 1999). Another 133 stores were in the pipeline, to be opened over a period of two

egories
nisation

rears. AGGL opened 11 Vision 2000 stores that offered the entire range of products (Financial Express; 1999-a). Archies planned to set up a chain of 100 company-owned stores called Vision 2000 b1, 2007 (Business Line; 2004). These stores would display the entire range of products unlike franchisee
stores, which had limitation of size. Wtrile an average franchisee store was spread over 500 sq. ft, company orvned stores had 1,000 sq. ft. and above.307o ofthe sales came from franchisees and another 230Vo from

ipation,
lliances d other a range )mpany
ishares/

C&F agents.
Some of the distributors were converted into C&F (Cost & Freight) agents to exhibit the range of products ro consumers. Usually distributors, facing problems of space and finance, adopted to pick and choose the products because they had to pay for it. In such situations, it was difficult to sustain in terms of creativity. Therefore, it was decided to go in for agents who wouid house all the products of all ranges at Archies' cost and let consumers and retailers choose what they wanted" Besides, margins were higher in the case of C&F

hed

an

clayons

all the investments on inventory. Archies was focused on setting up more Vision 2000 stores (http://www.myiris.com/shares/company/writeDet.php?icode=arcgregi#fut
agents because Archies made
accessed on 05.04.06).

AGGL
fashion oss the
rde 400

Archies also formed a LAOVo subsidiary Archiesonline.com at a cost of Rs 2 crore, for e-cards and e-commerce and tied up with Yahoo to "e-tail" its cards and gift items. This virtual store was a rotal replica of an Archies gallery on the net with the USP on third party gifting (Business India; 2001).
The aim was to reach ttre enci customer directly rather than through a distributor. Soon when they realised rhat though a large number of cards were sent on the net, they were not getting any returns, hence the site was converted into a paid site. It was India's first site and the world's first e-greetings site to go paid. A membership package was introduced at Rs 400 having a perceived value ofRs 700. Under the package the user could send 100 e-cards in a year free of charge and get a discount card that allowed discount shopping at Archies and

{ormak

labels

rusA) nt rvith

16

Cases in Strategic Management

Planet M (Business India, 2001). It focused on single-point sourcing and fulfilmenr in the first phase from Delhi, and multi-point sourcing and fulfilment in the second phase, covering C&F (Cost & Freight) agents. If the response was favourable, the system would be extended to franchisees. Under this business the card,/gift could be ordered either on the Internet or through kiosks. Indian customers were feel-conscious hence they had the option of ordering from a kiosk. Payments could be made either at the counter or through credit cards on the Net.

Archies was planning to launch a new chain of retail stores named as 'stupid Cupid' dealing in fashion accessories and prernium gifts to provide more choice to the company's prospective customers (Business Line; 2005-b). The company would be opening five stores by the end of2006 and another 10 stores by 2A07. Initially, the stores would be opened in Delhi and NCR and thereafter spread to Mumbai, Kolkata, Bangalore and other metros. The new stores would te opened in a phased manner over the two-year period extending till end oi 2A07 and Archies booked retail space for 133 stores in upcoming shopping malls across the country (http://www.domain-b.com/companies/companies_a/archies/
20051220 retail.html accessed on i 8.12.06). The company was looking for new growth horizons by adopting a multi-brand strategy targeted at various price points. With brand launches and new products, the thrust

was on reaching every individual, satisfying various emotions and being within varying budgets to ensure an Archies card in every hand. By 2005, 407o of the turnover of Archies came from the gifts division (http://www.domain-b.com/companies/companies 1220_retail.html accessed -a/archiesl2005 on 18.i2.06).
With several growth opportunities on the cards, the board members wondered whether Archies had strayed

from its mission of being in the business of emotiom. But Anil saw Archies moving from a single product focus company to a serious player in many other related categories encompassing human expressions:
We are in the Business of emotions" and Emotions never die. We have been chuming out a thousand Reasons to smile.

And to Celebrate. Not just moments, but life as a whole. Throughout this urhiie, we have Innovated better ways of Expressing ons's efilotions. Rendered voice, to many a feeling. Crafted words, for maay an Emotion. Words that have built many a new relationship. Yoices that have Strengthened many a

bonding.

Vintage Cards & Creations in 1983 by Anil Kapur and Rajesh Vaishnav for manufacturing and marketing greeting cards. Initially it was a part-time business, but within a year it became a fuli time occupation. The idea of setting up the business came when a few cards macle by the partners were appreciated by the customers for quality and design. Over the next 10 years, they concentrated on
developing local afiists to create new designs and also on appointing distributors and setting up retail outlets Vintage was founded as a partnership firm

for future growth. By 1992, Vintage had a collection of 3,000 designs, 26 distributors and 3,000 independent retail outlets.
To meet future growth requirements, the company entered into an agreement with Hallmark cards, one of the world's largest greeting cards company based in the United States in 1992 to use its brands, trademarks and intellectual properly. Thus, Vintage got exclusive right to use copyrights in the manufacture, distribution and sale ofproducts in India and non-exclusive rights in Sri I-anka, Bangladesh and Nepal. Vintage also had access to Hallmark's design studio and library. Hallmark executives visited India regularly to monitor quality

Archies vs. Vintage-Are IUe in the Business of Greetings? 17


rs from Eenrs.

If

::ntroi. to train product and sales staffand advice on marketing strategies leading to increasing ntarket

share

card/gift
oce they

.J :helf space.

: : tianchise outlets.

dit cards

ln consultation with Hallmark, Vintage laid down stringent control standards and consistency parameters A11 franchise outlets were 600-700 sq. ft. stocking a wide range of Hallmark products :-::rsside other non-competing products. All stores had a giow-sign with "Hallmark Cards & Gifts" and , -,::ially designed interiors, which were air-conditioned, well-lit and had soft music to provide zr soothing

aling in
Litomers

I0 stores
rlumbai,
or-er the pcoming

archies/
adopting
he thrust

dgets to the gifts


rccessed
d :

strayed

product

ns:

.-:-rience. Vintage entered into an agreement with Walt Disney Consumer Products to use materials like Mickey, ',':-'rie. Donald Dr.rck, Jungle Book, Aladdin and Alice in Wonderland for use in greeting cards, posters, -- reraph books, address books, telephone books and gift wraps. The company also entered into a licensing :.r3ifireflt with Verkerke to use Verkerke designs and "Brownsword", "Gordon Fraser Gallery" and "Forever - ,r:ds'' irademarks. Cards were personalised in association with American Marketing Group machine with ,.: hines tbr personalising positioned in high traffic areas of the country. Another brand licensing agreement " .:: -\lattel Inc. U.S.A. gave them rights for the "Barbie" brand. ir 1996 the franchise stores were increased to 67. In 1997-98, the company expanded it production -.:.rilities and commissioned a plant at Goa. The plant had facilities for precise cutting, folding, and '-.ii'acture of cards, PVC bags and packing. The franchise stores were increased to 135, an increase of - r :terfes within the span of a year. By the end of 1999, the company had a franchise network of 221 outlets .::."d over 94 cities. Apart from these. the company had 47 wholesale distributors and 8,000 retailers. Vintage '. :red up with Cancer Patients Aid Association to establish its presence in the corporate segment. By 2001, --,: i.rmpany had introduced cards in Hindi and Marathi and expanded the franchise network to 343 stores :u:r'!S 115 cities. -: the year ending March 200l,the company had accumulated inventory of cards equal to 1ll, years of sale i-: irventory of posters, exceeding four years (Exhibit 4). Anil Kapur resigned from the directorship of the - .r:iny in October 2001. The company decided to close the Pune plant and the entire production was shifted :: Goa piant. For the first time, the company suffered an operating loss of Rs 5.53 crore in 2003. By 2005, --": .urlrlpafiy had reached a situation where it was unable to pay statutory dues such as Tax Deducted at i. -:;e- Provident Fund Contritrution and Contribution to Employees State Insurance Scheme. It sold its :'r::: inventory to its distributor, NVs Sahil Distributors at 12.57c of the M.R.P. The survival of the company --r'-: r,, aS at Stake.
was confident that Santa would bring cheer with the stupid cupid -:ri-ls off well and tr.rrnover improving, Rajesh was not even sure whether he would be able to take care of the

Eg.

*hile Anil Moolchandani of Archies

.:::::on'dues.
facturing ecame a
partners

Exhibit l-Archies-Segment wise break-up of Sale


Greetings

Gifts
t0.23
10.01 10.92

Stationery

trated on

il

\fer-00
\
Iar-O
1

49.33 44"23

outlets

ependent ls. one of rdemarks

\1ar-02

37.91 36.16 34.39 32.8

\iar-03
\1ar-0:1

t7.t
2t.48
28.57 38.04

10.67

9.14
10.1

rribution
:

\{ar-05 \{ar-06

also had

quality

i3.93

t0.66

T-

l8

Cases in Strategic Management

Exhibit 2-Income Statement of Archies Greetings & Gifts


2006 2005
74.3

2W4
61.22 0.26
2.51

2003
76.5

2W?
80.6
0.41 9.15 8.83

2m1
68.43

2{m
"tr.52
0.62
6.1

LW'
60.28

19,98

tw
34.09

1996,

lncome
Sales 85.36 0.23 6.99 6.73 46.05 28.03 0.11

r-::--ltrl-

Other Income Chanee in stocks


Finished eoods Semi-finished eoods Non-recurring
Gain on sale of assets Gain on sales of investment Tax refunds/ adjustments Other non recurring

0.12 0.86 0.83 0.03 0.02

0.44

0.33 r0.93 r0.69 0.24 0.03


0.03

0.54

0.29

0.22

-o.06

2.54

4.17
0.1r
0.13 0.1

6.14

0.26

-o.03
0.25 0.11 0.01

0.32

-{.04
0.01

0.0r
0.01

0.04
trm -nT

0.01

0.02 0.02
37.94 29.86
13.1
1

0.03

lPrTr|a

0.11

0.04

!ry* Iul:rr
21.5 21.2

Expenditure Raw materials, stores, etc.


Raw materials
Stores

27.9
14.25

34.t2
r6.28 0.18 t7.66
6.8
1_24

10.48 18.4

36.67 23.01 0.23

36.41

JJ.JJ
27.8

29.45 29.35
0.1

24.65
24.5'7

t4.4
0.33

24.04
0.15

&

spares

0.29
16.46 6.65
1.68

0.3

0.17
21.91 6.01 1.28 3.28

0.09

0.08

0.03
0.27

Packaeine exoenses Purchase of finished goods 23.21 8.63 2.33


'\. t
1

I r-

r3.35 6.36
1.26 4.3 0.65

t3.43 5.02
o.'77

12.22 3.68 0.61

5.M
r.36 0.37 4.82 0.87 0.08
1

& salaries Energv (power & fuel)


Wages

1.41

r.25
0.11

0.29
1.4

0.26
0.33

Other operating expenses


Royalty/ knowhow
Insurance premium

4;72 0.67

3.14
0.5'7

5.05

4.84 r.05
0.1

0.25 0.22 0.02 ;ui

0.86 0.32 0.02 0.02


4.81

0.46 0.23
0.01

r.05
0.21

0.55 0.06

0.19 0.03

0.27

0.24 0.04 0.04

0.25

Indirect taxes
Excise duties Other indirect taxes

0.06 0.04 0.02 2.22


0.21 2.01 13.94

-:{

0.01

Repairs & maintenance


Plant

3.51 0.5 3.01


10

2.01

2.28

2.08

r.03
1.03

0.44 0.44 4.07 4.03 0.04 0.17

0.4 0.4
2.61

0.38 0.38
1.51

0.11

-.."---." ,1': ,, r .*i{


,nr[flH::tildl

4,

-'-r

& machinery

0.66
4.15
11.9'7

0.32

0.22 2.06
14.55 2.08

0.07 0.04 9.64


3.35

'-:UniDt|t[!f!.
-T-r

Other repairs

t.69
11

Advertising & marketing


expenses

.59

6.32

i.03
0.91

Advertisine Marketins

2 9.97
1.06

2.29
'7.71

2.64

4.89
9.05 2.55

4.39
10.16
1.8

4.t3
2.19

-,""*xrr...:*,.
ii4lrNmuii,&dl

ia

2.52 0.09
0.17

1.42

8.9s 0.89
0.05

6.29 0.63

0.09
0.18

0.12 0.02 "-l ,rt ,- ]l _

Distribution Provision for doubtfuV


bad debts

1.11

o.M

0.59
0.03 8.26

0.11

0.46 0.04 4.93 0.08 0.08

0.15 0.04 5.99


0.01

Amortisation
Miscellaneous expnses Less: Expenses capitalised

0.04
5.81

0.04 4.83 0;75 0.23


0.25

0.04
3.58

0.04
2.71

0.13

0.13
1.53

0.13
1.21

2.M
0.06 0.06

0.93

lrr *rmme fu"--r l-l ,r'-

Non-recurring expenses
Loss on sale of assets
Loss on sale of investment

0.04 0.04

0.21

0.04 0.04

0.12
0.01

0.03
0.03

0.19 o.o2

0.ll
0.01 (Conr[1

Prinr nerinrl far

Archies vs. Vintage-Are We in the Business of Greetings? 19

t996
38.03
0.11

2006

2{n5

2604
4.27

2003

2002

2tI01

2000

ld:irs
PBDTT

tg99

1998

1997

1996..

non-recurring

3\finSeS

13.t7
0.75 0.47 0.52
ioans

11.9

10.22 0.6 0.43 0.43

7.43

t4.22
0.96 0.79 0.79
0.17

t6.2
t).97

22.05 0.23

13.64 0.12

7.36 0.18 0.09 0.09

4.26 0.36 0.25 0.25


0.11

Financial Interest
On short term loans

2,94
0.31

0.63 0.43 0.43

0.86 0.66 0.66 0.2


6.57
1.51

0.82 0.82

0.04 0.04 0.19


21.82 0.98 20.84

0.25
0.25

Jri iong term


Iterest

-0.05
0.28 0.05 12.42
11.2'.7

Other financial ch
caDrtahsed

4,2

0.t7
9.62

0.1-5

A,D
13.52

0.09

0.06
2.63 0.23 2.4

13.26

15.23

7.1 8

rxprreclafion FBT

3.9 0.43
3.4'7

1.62

r.56
8.06 2.98 2.98

r.37
11.89

r.18
14.05

0.77 t2.75
3.93 3.93

0.58
6.6 1.85
1.85

t0.42

9.65 3.62 3.2

5.06
1.95

fat
21.5

provision

3.7 3.21

4.37
3.8 r

4.9 4.9

t.+i
7.43

0.99 4.99

0.72 0.72

L Lrmorate tax

2t.2
0.03 4.27

1.65 0.3

)ettrred taxes

0.24
0.25 6.72

0.42
6.03 5.08

0.56
'1.52

lher

direct taxes

3.1

9.15

13.41

8.82

4.'75

2.48

1.68

1.25

Exhibit 3-Income Statement of Vintage Cards & Creations

0.11 0.25 0.22 0.02

M*r
,06

Mar
'05
4.01 4.01

Mar

,M

Mar
'03
6.47 6.38

Mar
,u2

Mar
'll1
t4.79
14.4'7

Mar
'00
24.69 22.40

Mar
,99

'

Mat
'99

Mm

tn.

iltt]{ne:
I,perating Income
3.26 3.26 3.47 3.46

12.1A 11.93

i., :. \lanutacture

19.94 19.30

16.75
16.7 5

4.51 4.51

:.--0.11

Trading

0.00 0.00 0.00

0.00 0.00 0.00

0.00 0.00
0.01

0.00 0.00 0.10

0.00 0.00 0.16

0.00
0.01

r.43
0.01

0.00
0.01 0.63

0.00 0.00 0.00

0.00 0.00 0.00

0.07

0.32

0.86

t-Penses

0.04
1.03

Uaterial Consumed

0.48 4.29 0.00 -3.81 r.00 0.02


0.98

5.04

t.'18
1.00

5.00 0.82 0.00 4.18 0.89 0.06 0.84

4.03 2.18

4.13

7.68 5.98
1.30

6.4s

';

5.15

0.35 0.48

\laterials Consumed
sase

0.80 0.00 4.24 0.67 0.02 0.65


0.63 0.63

4.68 0.00

5.2s 0.00
1.20 2.66

6.09 0.00

0.91

oI tradmg goods

0.00
0.78

0.00
1.85 1.82

0.00

012 oo2

l,*-;:ease/(Increase) in inventory

-{.55
1.86

0.40
3.8s

l2nuitacturlng uxpenses I ;.er & Fuel expenses


!..mlg.expense Fersonnel Expenses

4,94
0.00 0.00 0.00 t.39
1.39

-o.13
0.00 0.00 0.00 0.55 0.55 0.00 0.00 0.00 0.00 0.00
(Contcl)

t.02
0.05

0.07
r.7 5

0.07
1.79 2.62

0.00
3.85 2.17
1.88

0.00 2.66

0.97 0.83 0.74


0.07 0.03
0.21

0.66 0.66 0.00 0.00

t.7'l
1.56

2.27 1.99

,i-.:es & Salaries paid


ldent tsund/Gratultv

t.87
1.64 0.13

2.30 0.20 0.12 0.99 0.77 0.22

0.00 0.00 0.00 0.00 0.00

0.15

0.19 0.09
0.41 0.08

0.17 0.13 2.42 2.22

0.00 0.00 0.00 0.00 0.00

0.06 0.12
0.03

0.09

).:-"-ilng b,xpenses

0.00 0.00 0.00

r.;r ertising Expenses


(Contd)

2.t2
1.67

4.02 0.20

-,rrer Seliing Expenses

0.08

0.29

0.20

0.46

20

Cases in Strategic Management

(ContA

Mar
'06
Other Indirect Taxes 0.00
11.09

Mar
,05 0.00
3.02

Mar
,04 0.00
0.-58

Mar
,03
0.01

l\Iar
,{r1 0.03 2.66

Mar
'01 0.00
3.0'7

Mar
'00
0.00 6.20 0.09
0.1 0

lVIar ,99 0.00


2.3'7

Mar
'98
0.00
6.52

Mar
,97 0.00 2.84 0.00 0.00 0.00 0.00 0.00
2,.84 l,---:"

Adminstrative Expenses
Rates

4.22 0.00 0.10


0.04

&

Taxes

0.00 0.00
0.0t)

0.00 0.00 0.00 0.00 0.00


3.02 9.36

0.00 0.09 0.02


0.03

0.04
0. i1

0.07
0.1.5

0.03

0.00 0.00 0.00 0.00 0.00 6.52


13.06 3.69

Rent paid

0.10
0.03

Auditors Remunerartion
Insurancc premium paid

0.03 0.13 0.25

0.03 0.13

0.04 0.23 0.83


4.91

0.00 0.00
11.09

0.06
0.1 6

0.20
0.67
1.35

Travelling expenses
Other Administration expenses Cost of Sales

0.07 0.38 4.42

0.76
1.94

3.85
12.01

2.09
11.20

t3.23

12.68 2.11

22.32
/.) I

15.18

3.'74

,,

:-

Opelating Profit

-9.97
3.52

-5.35
+,JJ 0.00 4.33

-0.95
0.44 0.00 0.44 -o.51
0.91

-5.53
0.07

0.90 0,06 0.06 0.00 0.96


1.34

4.46
0.07 0.07

Other Recurring Income


Interest Income Miscellaneous Income Adjusted PBDIT

0.29 0.03 0.27 2,40


1.15
1.11

0.06 0.06 0.00


2.43 0.25

r.35 0.00
1.35

0.04 0.00 0.04


0.81
', r,.1"--'!:

0.00
3.52

0.06 0.0r -5.47


1.31

0.00
4.53

-6.45
0.02 0.02
charges

-1.02
0.01 0.01

5.04

Financial Expenses
Interest chargcs Bank

0.04 0.00 0.04


0.49 3.99

0.02 0.02 0.00


0.61

0.44 0.44 0.00


0.23
0. *l I

0.90 0.0r 0.34

129
0.01

l.29
0.05 0.34

0.24 0.02
0.57

& financial

0.00 0.26

0.00
0.25

0.04 0.76 0.50 0.00 0.50

Depreciation Adjusted PBT

0.34

*6.13
0.02

-1.28
0.00

-t.7 6
0.00

-7.t2
0.00

4.7t
0.00
-0;7

r.60
0.00
1.60 0.03

4.4t
0.22

l3
h,J

Tax Charges
Adjusted PAT

0.00
3.99

0.08

"-.r

-6.i5
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

*r.28
-0.12

-t.i6
0.01
0.01

-1.12
0.10

4.19 0.00 0.00 0.00 0.00 0.00 0.04 0.00 0.00 0.04 4.19 4.23 0.09
0.01 4.13

0.06 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.06 0.06
0.02
lt,

Non Recurring Items Profit on sale/discard nf assets


Profit on sale/reval. of Investment Gains/loss on exchanse rate Extra ordinary income

0.04 0.00 0.00 0.04 0.00


0.85
0.21

-8.92 -0.03
0.00 0.02

-0.03 -0.03
0.00 *o.01 0.00 -0.01 0.00 0.00 -0.01
3.95 8.05
0.51

0.00 0.00 0.00


-0.1 2

-0.01
0.11

0.00 0.00
0.03

0.00 0.00 0.00


0.:18

0.00 0.00 0.09


0.03

-8.91 -2.'78
0.00

0.00

Other Non Cash adjustments


Credit balances written back

0.00 0.00 0.00 0.00

-0

56

0.46 0.00
0.02
I lf

0.00 0.00

laxes previous year Other prior pcriod adj


R.eported Net Profit

0.00 0.06

0"00 0.63

-2.28 -o.50
0.66

-o.56 t.o7
'7.94

4.i5
4.75
0.00 0.00

-1.28 -1.40
0.00 0.00

-6.93

0.30

Earnings Before Appropriatron

-12.33

- 11.06
0.00 0.00 -1 1.06 0.00

4.13
0.00 0.00

4.31
0.00 0.00

Equity Dividend Dividend Tax Retained Earnings


Trans. to Generai reserve

0.00 0.00
12.33

0.76
0.08

Lir*lrl

0.06

0.00
0.04

-6.75
0.00

-1.40
0.00

-4.13
0.00

+.31
0.00

7.10 0.20 6.90 0.50


6.87

0.00

0.00

0.00
0.04

Net transfer to P

& L Account

-6.75

-1.40

-t2.33 -11.06

4.13

4.31

4.t3

Exhibit 4-Inventory position of Vintage Cards & Creations


Opening Stock Closing

Staa[Value (Rs Lakhs)

March 2000
0.00
2.84 0.00 Posters

Sale

Quantity
('000s) 928
330

Value (Rs Lakhs)


1tra
1

Quantity
('000s)

Quantity
('000s)
318

Yalue (Rs Lakhs) t926.6


84.6 228.3 2239.5 Sale

7t2
314

t75.9
40.4

JJ /.'

37.5 28.5 308.7

0.00
0.00

39

Total

25s.3

0.00 0.00
2.84
3.

Opening Stock

Closing Stock

\Iarch

2001

Quantity
('000s) 712 314

Value (Rs Lakhs)


175.9

Quantity
('000s)
519

Value (Rs Lakhs)


716.23 54.54

Quantity
('000s)
1976
121
1

Value (Rs Lakhs)


068.16 27.99
349.51

t+

3220

Posters

40.4 39 255.1

0.77 0.04

2t0.19
980.96

0.00 0.04
0.81

1445.66 Sale

Opening Stock

Closing Stock

\tarch

2002

Quantity
('000s) 3220
519

Yalue (Rs Lakhs)


716.23
54.51

Quantity
('000s) t7696 546

Yalue (Rs Lakhs) 702.46


84.31

Quantity
('000s) r87
13239

Yalue (Rs Lakhs)


950.69 37.13 205.04

0.44 0.44 0.00 0.23 0.13 0.08 Posters

2t0.t9
fotal
980.96

r56.26
943.03

t192.86
Sale

Opening Stock

Closing Stock

\Iarch
C"rds
P,:sters

2003

Quantity
('000s)
17696

0.06
0.00 0.00

Value (Rs Lakhs)


702.46
84.31

Quantity
('000s) 400
r

Value (Rs Lakhs)


389.8 48.29

Quantity
('000s)
61

Yalue (Rs Lakhs)


489.29 20.89
127.4'.7

1396

5485

546

156.26 Total 943.03

0.00 0.00 0.00 0.00


0.00

r19.42
557.51

637.65 Sale

Opening Stock

Closing Stock

\Iarch Irrds
Ptr
s

2004

Quantity
('000s)
11396

Value (Rs Lakhs)


389.8 48.29

Quantity
('000s) ro602

Value (Rs Lakhs)


3'71.66

Quantity
('000s)
29

Yalue (Rs Lakhs)

7098

297.7t
4.34
43.95 346 Sale

0.00 0.00
0.06 0.06 0.02 0.00

ters

400

37t

42.27
84.71

t19.42
s57.51

498.64

Opening Stock

Closing Stock

\Iarch
ards

2005

Quantity
('000s)
10602

Value (Rs Lakhs)

Quantity
('000s) 2829 230

Value (Rs Lakhs)


59.26
16.66

Quantity
('000s)
11640

Yalue (Rs Lakhs)


327.15 8.11 65.58 401.17

0.04 0.00

3t 1.66
84.11

Pisters

37t
498.64

7t

004

10.64 86.56

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