CANDIDATE NAME: PRA-TEEK MINCOHA

CANIIIDATE NUMBER: 001226-045 SESSION: MAY 2010

BUSINESS AND MANAGEMENT - IA

SHOULD EVERSHINE TRADERS EXPAND ITS BUSINESS TO THE UNITED STATES IN ORDER TO INCREASE THE PROFIT?

Candidate Name: Prateek Minocha Candidate Number: 001226-045 Session: May 2010 Word Count: Research Proposal: 499 Executive Summary: 200
1 Report: 1998
I

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

ACKNOWLEDGEMENTS
Mr. Rajan Minocha: I would sincerely like to thank him for his guidance throughout the research. He has helped me in every possible way to know about the company. He provided me with the Profit and Loss Account statement of the company. M r . Rajiv Minocha: i would like to thank him also for his contribution towards my research. He gave me valid information about the company present situation which helped do my SWOT and Ansoff Matrix.
!
1

I?

Mrs. Tiffany D'Cunha: She was very kind to provide me important data about the paper market in the United States. the data she provided me with helped me t o perform the PEST analysis of the company.

;1

.. cpI; ; 1~ i

i;

;1
fi

F I'-

I d

iI

.-

!-r; I
I<
!:r

1.2

Ii
13

:1

ij

n
!'
,5

1:
: .1

: :1

r.

k
I'

I;

I I

I!

;1

!!
Q
I

I-

1;

ij

1
F

/i 2

I?

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

EVERSHINE TRADERS LTD

To whom so it may Concern

I Mr. Rajan Minocha hereby acknowledge Mr. Prateek Minocha's efforts. He has been in contact with

m e and has been discussing the various business aspects regarding the paper industry in India and the world. He has carried out intensive research about the company's future venture of expanding to the United States. I was happy to provide assistance and support to him for this research project. Regards

Rajan Minocha, Partner, Evershine Traders.

Evershine Traders Ltd. Nagpur-440 001 India. Contact Number: +91712 6625224

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

EVERSHINE TRADERS LTD

To whom so it mav Concern

This is t o certify that Mr. Prateek Minocha has sought constant guidance and assistance from me, for his research project regarding our company's expansion in the United States. He has shown great enthusiasm in the business activities of the company. With his diligent approach he had done an indepth analysis of the company's expansion investment project.

Regards,

Rajiv Minocha, Partner, Evershine Traders.

Evershine Traders Ltd. Nagpur-440 001 India. Contact Number: +91712 6625224

CANDIDATE NAME: PRATEEK M I N C O H A

CANDIDATE NUMBER: 0 0 1 2 2 6 - 0 4 5 SESSION: M A Y 2 0 1 0

RESEARCH PROPOSAL
RESEARCH QUESTION RATIONALE THEORETICAL FRAMEWORK ACTION PLAN LIMITATIONS

MAIN RESULTS AND FINDINGS INTRODUCTION REPORT

ANALYZING THE PEST ANALYSIS ANALYZING THE SWOT ANALYSIS ANALYZING THE ANSOFF MATRIX PROFIT AND LOSS ACCOUNT

CONCLUSION APPENDIX
PEST POLITICAL ECONOMIC SOCIAL TECHNOLOGICAL SWOT ANSOFF MATRIX PROFIT AND LOSS ACCOUNT: An interview with Mr. Rajan Minocha, Partner, Evershine Traders: An interview with Mr. Rajiv Minocha, Partner, Evershine Traders Interview with Mrs. Tiffany D'Cunha, Head, D'cunhaTraders, Pvt.Ltd.

CANDIDATE NAME: PRATEEK WllWCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

EXECUTIVE SUMMARY:
The company has embarked on an aggressive growth strategy of expanding the business to a completely new level. The company has thought of opening one of its branches in the US. This venture will help the company to increase their profit and also make the trading of waste paper with the European and African countries easier. This research of mine investigates whether 'Evershine Traders should expand

its business activities to the US'.

Through the primary data that I have collected through an interview with Mr. Rajan Minocha, along with the secondary data that I have collected from the internet and also the company has been very kind to provide me with the Profit and Loss Account of the previous year, a thorough analysis was done. Data was analyzed using financial techniques (Profit and Loss Account) and non financial technique (SWOT, PESTand Ansoff matrix) to arrive t o a definite conclusion for the company. Political, Social and Economic strengths are enough t o substantiate that the growth strategy that the company has sought is an excellent option for the company. The profit and loss account also shows that the company will be able to earn more profit after the expansion is complete. After this analysis of mine

I have concluded that the company should expand to the US.

61 Page

I*
I.

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

RESEARCH PROPOSAL
.,-

RESEARCH Q UESTZON:
, -7
: :

, ~. -. --

Should Evershine Traders expand its business to the United States to increase its profit?

. . !: .

--~

RATIONALE:
Evershine Traders is currently focusing all i t s business activities in increasing the flow of waste paper from the U to the paper mills in India and Europe. Recently after successfully expanding their business S in the United Arab Emirates (UAE), Dubai, the company now is working towards their goal of establishing a business in the United States, mainly Pennsylvania.

,~.
tI ."
L

L.

II ,.
L ,Li
5 .

1'L

THEORETICAL FRAMEWORK:
Financial and Non-Financial factors will be taken into consideration. Analysis of the profit and loss account statement will help analyze the financial aspects. SWOT and PEST analysis will be done t o find o u t the current position of the company in the market Ansoff Matrix will be used to analyze the company's framework and future opportunities and challenges that the company is most likely t o face with the expansion to a completely diverse market.

B
kj
g
P
k ; 1.;

KEY AREAS OF SYLLABUS

1 The external environment that affect the business (Location). .
C

2.

Accounting and Finance.

'p
:.r
I
I S

METHODOLGY
Primary Research: Primary research was conducted by interviews of the two main heads of the company Mr. Rajan Minocha and Mr. Rajiv Minocha. I obtained substantial data with the help of these interviews. I conducted these interviews t o get an idea of the current position of the company in i t s market. 1 also conducted a very brief interview with the head of a similar company already operating in the US, this interview helped me obtain the position of a similar business in the US taking non financial aspects into mind. Secondary Research:
I have studied the profit and loss account of the company which has helped me obtain enough financial

1 ;

E
7

ti

L?
1.:

!:

1.; 1

1
il:

;1

g
1:

data about the company and I now know where the company stands in the market. I have reviewed the internet about the laws and regulations of trading in the US.

:I

I!

1
71 P a g e

CAlVDlDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

ACTION PLAN

p t e 5-12 January 2010

Task Topic selection

Modification Changed from benefits of expansion to benefits only in terms of profit to increase focus

1 19 January 2010

1 Research Proposal Submitted

Feedback received
I

1
Methodology modified, Objectives elaborated upon
I

1 23 January 2010
1February 2010
L

3 main interviews conducted

1
Decision tree omitted due t o the lack of data

7 February 2010

Profit

and

loss

account

statement studied

10 February 2010

Completed

financial

data

analysis, profit and loss account and decision tree

1 5 - 21 February 2010
3 March 2010

I I

PEST/ SWOT / Ansoff matrix First full draft Feedback recieved Final submission

I
( Minor changes made

I I

March 2010 15 March 2010

LIMlTA TIONS
Throughout my business project I have faced many difficulties such as obtaining primary and secondary data from within the school, as all the financial websites are blocked due t o the school IT policy. I have not been able to take a long comfortable interview of the two associates of the business Mr. Rajan Minocha and Mr. Rajiv Minocha however I have mentioned the small interview I have had with Mr. Rajan Minocha, Mr. Rajiv Minocha and Mrs. Tiffany D'Cunha in the appendices.

CANDIDATE NAME: PRATEEK NllNCOHA

CANDIDATE IVUMBER: 001226-045 SESSION: MAY 2010

MAIN RESULTS AND FINDINGS:

Throughout the research that I have conducted, some facts about the company have come up t o me.
r r

The company Evershine Traders is one of the best traders of waste paper in the region The company i s known for it's quality and style of doing business is known to be a bit relaxed and comfortable Its main suppliers are spread across the world and the main market being lndia and Sri Lanka the company has been making substantial amount of profit over the past few years. The current situation in the US market helps traders t o flourish because of the reduced tax provided to the traders Trading right now from the US to lndia proves to very expensive because the market that accepts goods from the US is in Europe, thus this method of first importing in india then exporting again to the US is not worth it The recent hit from the recession has forced most of the Indian market to move out In Sri Lanka the recent conflict and tension has caused trading to slow down in the region by a big number

r r r

CANDIDATE NAME: PRA-FEEKMINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

INTRODUCTION:
Company Profile: Set up as a trading company in 1985, Evershine Traders diversified into international trading in 1998 to seize the opportunities being thrown up because of the opening up of the lndian economy. Today, Evershine Traders has acquired an extremely strong reputation in the international markets for its superior quality of service, a completely customer-focused approach t o business and i t s high ethical standards in business. The main activities of the company are:
1. Sourcing & Importing of Waste Paper & Pulp from across the globe into India. 2. Supply of Waste Paper to lndian Paper Mills.

3. Export of various grades of Paper t o International Markets. Since the time the company was set-up our focus has been on Medium to Higher Grades of Waste Paper, Paper in Roll Form, Special Cellulose items as well as all types of Special Waste Paper. With the biggest names from US, UK, Belgium, Germany, spain etc as our longstanding sources and some of the biggest lndian paper manufacturers as our customers we have created a very strong reputation of complete trust and complete satisfaction. Evershine prides itself on being able t o offer complete solutions for all kinds of waste paper including the difficult-to-sell grades.

OPERATIONS AND STAFF STRENGTH: The company has a total of two offices, Evershine Traders, Nagpur and United Fibers, Dubai. The employed strength in both the branches does not exceed more than 15 employees, as most of the work Is handled by the owners themselves.
PRODUCTS:

PAPER GRADES:
1. Standard News Prints

2.

Writing and Printing Paper

3. Uncoated Wood Free offset paper colored printing paper.

4. Duplex Board

5. M.G. Poster 18
6. Color M.G. Poster

7 Dip Dyeing Poster .

8. File Board 9. White and colored tissue paper napkin grade 10. White and colored tissue paper toilet grade

CANDIDATE NAME: PRATEEK MINCOHA

CAIUDIDATE NLIMBER: 001226-045 SESSION: MAY 2010

The vision and mission statement of this company is to be the leading and most trusted company in i t s field. Some of the main markets that are involved in trading with this company:
1. North America

2. South America

3. 4. 5. 6. 7.

Eastern Europe Southeast Asia Africa Oceania Mid East

8. Eastern Asia

9. Western Europe

Total Annual Sales Volume Export Percentage

US $2.5 Million 11% 20%

- US $5 Million

Total Annual Purchase Volume :

US $1 Million - US $2.5 Million

In the current year of 2009, Evershine traders is trying t o expand its business t o different countries of the world so that it helps them to gain more profit and also enhance the quality of trading. Earlier last year, Evershine traders has successfully established a branch in Dubai, UAE. This branch has helped a lot to generate more income and introduced many more suppliers and customers. Now, the company has planned t o establish another branch in the United States. This branch would help them to gain easy access to suppliers and customers living in the western part of the world and also help the company t o generate more income and obtain more profit.

I have used analysis tools t o analyze the opportunities, threats, profits and losses that the business i s
likely to face due to its expansion into the market of United States.

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

In this analysis of mine, 1 am going to use three analysis tools, Ansoff IVlatrix, SWOT analysis and PEST analysis. Along with this I am also going to analyze the profit and loss account statement that the company has provided me with. Using the PEST analysis to analyze the potential benefits and the loss' that the company shall face after expanding it's business to the US.

REPORT
ANAL YZZNG T H E PEST ANALYSIS
In the PEST analysis that I have done above, you may have noticed that there are many factors relating t o the Political opportunities and threats rather than the social opportunities and threats, this difference occurs because the company does not sell an particular product, it imports waste paper materials from main supplier and then supplies it to the other company's that manufacture that paper into toilet rolls o r paper napkins or books.

The lndian government has made many strict rules against the import of waste paper as it says that it does not have the proper technology t o keep the paper in the hubs for a very long time. And when kept for very long times it causes the paper to decay which causes harm to the environment. Because of this particular reason the company cannot keep extra stock in the hubs and thus uses the Just-in-Time method of trading, thus causing a decline in the profit and also unhappy customers. The US government on the other hand has the technology to store paper for longer times, so the company can have extra stock of the most popular paper grade. If it expands to the US, the company plans to make most of its imports to the US hub only. This way it Is able to use the Just-in-Case method of production. Also trading laws of the US with Germany and UK are easier than those of the countries with India. ,Import duty on waste paper is also less in the US. In India, after the formation of the Paper Traders Association, the company is having problems i n importing goods from Germany and then sending them back to Africa. The association does not allow lndian Traders to do that. The association also adds up a lot of tax and holds the import for a longer time, thus dissatisfying the customer base. Economic: Due to the recently hit recession, most of the paper manufacturing companies have shut down which has made the lndian market a little slow and dull, but the market in Europe and Africa is still very active and as I have mentioned earlier it is easier to trade from the US to these regions.

CANDIDATE NAME: PRATEEK NIIIVCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

As I have mentioned earlier tax and import duty that have been declared on the lndian companies by the lndian government is much more than the tax and import duty that are declared by the US government on their companies. As I mentioned, transport is easier and cheaper from the U to all the customers in Europe and S Africa. This will help the company to generate more profit from its trading..Supplying to the lndian companies is very difficult as the transportation has to be by road. This increases the cost and also the time of delivery of the material. Trading and making profit in Dollars ($) also helps the lndian branch of the company, because of the exchange rate that currently shows 47.23 Rs for 1$. Social: Consumers in lndia do not order in bulk which makes the cost of trading very high, as each company orders small thus increasing the number of orders. Customers that are based in Europe and Africa order in bulk thus decreasing the cost of trading and increasing the profit on each order.
It i s easier t o negotiate with Europe and Africa being a US company than being a lndian

company thus helping to sell at higher prices that offered by the lndian division of the company. As I mentioned in my very first point the US have the technology t o stock the waste paper at the hubs for a longer time than that on the lndian hubs. Thus reducing the toxic gases released by the paper, making the company work towards the ethical issues. Technological: The lndian manufacturing companies do not have advanced technology to manufacture it in bulk, thus reducing the order. The companies near the US are very technologically advanced thus the company will receive more profit from that side.
r

Communication is also easier and more advanced in the US when you compare it t o that of Indian.

Thus after analyzing the expansion through PEST I'feel that the company should expand its business activities t o the US, as it will make more profit there. To further solidify my belief I will use the other two analysis tools, SWOT analysis and Ansoff Matrix.

ANALYZING THE SWOT ANALYSIS

After thoroughly going through the SWOT analysis that I have performed I feel that the company has more Strengths and Opportunities than weakness' and threats. I feel that expanding its activities t o the US will benefit the company in more than one ways. After looking at strengths and the opportunities that the company will have by expanding to:the US is much more than what the company is currently exercising in lndia with its current market. Further after analyzing the weaknesses and the threats that the business will have, I have come t o a conclusion that the company will be able to cover up their losses

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

by using their strengths and taking advantage of their opportunities to cover up any risk of potential threats of losses that the new company in U may have. S

ANALYZING THE ANSOFF MA TKIX:

The company is introducing the same product that it is known for in a entirely new market place. The company is introducing the same quality of waste paper that it is known for selling for a very long period o f time in the US. This comes under the Market Development aspect of the Ansoff matrix. As I have mentioned in the Ansoff matrix (in the appendix) this aspect is a medium risk aspect in which the same product of a particular company is being launched in a new market.

PROFIT AND LOSS ACCOUNT:

As you can notice from the profit and loss account it is very clear that the company has made noticeable increase in the profit that it has obtained in the year 2008 t o the profit it has made in the year 2009. That increase in the profit of the company is mainly due t o the increase in the consumers of waste paper. This is also because the company has been able to expand i t s customer base to the Europe and Africa. This expansion has helped the company to increase its profit. The expansion that the company is looking t o make in the US will help the company to obtain more profit as the tax is reduced. As I have mentioned earlier, the cost of transportation for the supplier t o lndia and then from lndia t o the Europe is very expensive and the trade laws and taxes make it even more difficult to increase the profit. By shifting i t s business activities t o the US the business is set t o reduce the expenditure and increase the profit.

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

CONCLUSION
Throughout my internal I have thoroughly analyzed each and every financial or non-financial aspect that the company could encounter with its expansion to the US. I have analyzed the political, social, economical and technological advantages and disadvantages of the company's venture to the US using t h e PEST analysis. The SWOT analysis has clearly helped me to assess the strengths, weaknesses, opportunities and threats of the company's venture to the US.
I have also in very detail analyzed the Profit and Loss account statement of the company of the year

2009. By the account statement, the company can be predicted to obtain more profit with the future plan of expanding to the US. Some o f the points that I feel were very valid in my argument are:

1 It is set to have a larger consumer base. . 2. It is set t o reduce i t s expenditure

3. It is set to improve it quality 4. It will have extra stock of the waste paper.
5. And most importantly it will make lot more profit that it will do so in India
These points that have mentioned above are a brief summary of the advantages of the that the company will have from the expansion. Though there are some disadvantages of the expansion like:
1 High initial investment cost .

2. Success not guaranteed 3. High chance o f ignoring the South-Asian market Though these disadvantages are substantial, I feel that the advantages are far more concrete than the disadvantages. Thus my recommendation for the company is that it should expand t o the US, keeping in mind the high profit that they have a high chance of earning and also the fact that trading with European countries would be cheap and easier.

CANDIDATE NAME: PRATEEK MINCOHA

CAiVDiDATE NUMBER: 001226-045 SESSION: MAY 2010

APPENDIX
PEST

ECONOMlC
home economy situation home economy trends overseas economies and trends general taxation issues taxation specific t o productlservices market and trade cycles specific industry factors market routes and distribution trends customerlend-user drivers interest and exchange rates

current legislation home market future legislation Europeanlinternational legislation government policies government term and change trading policies funding, grants and initiatives home market lobbying/pressure groups wars and conflict

TECHNOLOGICAL

SOCIAL
1. demographics consumer attitudes and opinions buying access and trends ethical issues

!i

2. 3. 4.

competing technology development associated/dependent technologies manufacturing maturity and capacity information and communications technology legislation intellectual property issues global communications

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

SWOT
Strengths: The company right now has a large customer base and is a very well known company throughout the world. The company has a wide customer base that spreads across the world and has an excellent product range. The company is entering the US market relatively late compared to the other companies which gives it time t o differentiate their product and analyze their risks and opportunities according to the other companies. The company I think has a very good knowledge about its product range and I feel that they can increase their customer base and build up more opportunities by expanding into the US. Weakness': One of the main problems that the company may face after expanding its business to the US is that the company is not a very large company; it is a medium sized company and may be over powered by the other large companies that are in the business. Compared to other companies that are in the business that have thousands of branches all over the world this company has only three branches, India, UAE and now in the US. Furthermore this company does not interact much with small manufacturing companies thus restricting its customer base. Opportunities: The US laws will help the company more than the lndian laws, thus there is an opportunity or the company to increase its trade activities. From the US side there is an good opportunity to increase the customer base as it opens doors t o many more places that cannot easily be accessed from the lndian Subcontinent. Threats: The company after shifting its business the US may lose one of its very well known customer based in Iraq and Israel because of the current tension going on between the US the two countries. It also has a threat of losing its lndian and Sri Lankan market because of concentrating more on the European and African market.

CANDIDATE NANIE: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

A NSOFF MATRIX:

1
EXISTING

PRODUCT
NEW

EXISTING

MARKET PENETRATION

PRODUCT DEVELOPMENT

MARKETS

NEW

MARKET DEVELOPMENT

As you know in the Ansoff Matrix, the main analysis is all if the product or the market of a particular company is changing. We generally use the Ansoff matrix analysis tool when a particular company is planning t o introduce a new product or introduce itself to a new market or sometimes doing even both. There is also another case in which the product or market is only being improved.
1 Market Penetration: This usually happens when the company tries and improves its market or .

its product by introducing new minor changes to it and not by completely introducing a new product or a new market. It is a low risk feature as the company and i t s product is known in the market from before, thus bringing in minor changes would not be much of a risk. 2. Product Development: This usually occurs when a particular company introduces a completely new product in the same market that it has been supplying to from a very long time. This a medium risk feature because the company may be known for i t s quality and services in the

CANDIDATE NAME: PRATEEK MlNCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

market but the consumers are not very sure about the new product that the company has just launched.
3. Market Development: This condition usually arrives when the company expands its business to

a new market. The product that the company is the same but the market that they are supplying
it t o is new. This is a medium risk feature as the product of the company maybe well known but

the company itself may not be very well known by the consumers in that particular region.
4.

Diversification: This condition is a very high risks feature in the Ansoff matrix as in this

conditions both the market as well as the product is completely new. A company introduces a new product in a new market that is not familiar with it. It but obvious that the consumers will find it hard to use the product.

,-

li

e
L1 I

1
lj
I.?

!<

1:

Ij

iJ

1'

i :1
/:I

j'
I:
1.

I1

Ij
1:

I%

!i

li

;1 I :
, I

!i
;1
1: I ;

1:
li

!i

!1

tI!
;/

Ij
fi
!l 1:

CANDIDATE NAME: PRATEEK MINCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

PROFIT AND LOSS ACCOUNT:

201 P a g e

CANDIDATE NAME: PRATEEK MlNCOHA

CANDIDATE NUMBER: 001226-045 SESSION: MAY 2010

An interview with Mr. Rajan Minocha, Partner, Evershine Traders:

1. Could you please give me a background of your company?

Ans: The company Evershine traders is a trading company that imports waste paper from countries such as the US and provides it to the companies that actually manufacture those waste products to finished paper goods. . The main activities of the company are sourcing and importing Waste Paper & Pulp from across the globe into India. Supplying that Waste Paper to Indian Paper Mills. Export of various grades of Paper t o International Markets. 2. Could you please talk about the current paper market in India? Ans: currently the lndian market in the field of paper is very weak. This is one of the main reasons why
'

w e are planning to open a branch of the company in the US. The country was recently hit by recession which forced most of the company's buyers to close down. The paper industry of the country is slowly declining thus the company is looking for options abroad.

3 What comes toyout- mind when you look a%the cornpany'sfuture? .

Ans: the company Evershine traders has been long looking for an option for expanding overseas. When I think about the company's expansion, I think of easier and more comfortable trading with my clients and an obvious reason would be an increase in profit. We have recently expanded to Dubai, UAE. The new branch of the company is running very successfully and it has been helpful in financial terms. Now we are thinking to the US. This expansion will help us in many ways. It will increase the revenue of the company and also it will make trading with the European countries easier.
4.

Why have you chosen the US as an expansion option? Have you considered expanding to other companies?

Ans: me and partner Mr. Rajiv Minocha, have considered many options before finalizing the, U as our S ultimate option. After analyzing almost every place in the world for our expansion we shortlisted two main options. US or UK. The problem with UK was that trade was easy but only within the EU (European Union), apart from the EU trading from the UK would have proven to be very difficult. The UK government was known for not favoring external traders, thus US seemed to be a better option. With trading much easier and feasible and help from the US government. Thus expansion t o the US would have meant reduced tax and import duty, easier storage of product arrived in the bulk and also exporting the product would be very easy.

CANDIDATE NAME: PRATEEK MINCOHA

CAlUDlDATE NUMBER: 001226-045 SESSION: MAY 2010

An interview with Mr. Rajiv Minocha, Partner, Evershine Traders

2. Could you please tell me the advantages that you have would after expansion t o the US?
Ans: the main purpose of the expansion is so that the company earns more profit through i t s new venture. The company I feel will have a greater market when it expands to the US. Along with this I feel that trading has a high chance of becoming cheaper as the US government does not assert a high tax on the traders in the region. Though the initial investment will be very high the company can recover the investment faster than the Dubai branch of the company. The company can also export goods to Europe and Africa easier. The product that arrives in bulk can also be stored using the facilities present at the US ports.
2.

What do you think could be a major drawback of the company's expansion?

Ans: I feel that the company can face a major problem regarding the initial investment of the project. as you have seen in the profit and loss account that I have provided you with, it is quite evident that the company will have a difficulty in arranging the huge initial investment required. Also success is not guaranteed, though there are many advantages of the venture but there is a little uncertainty in the project. Also I fear that after expanding to the US, we may not loose contact with our Asian clients. We as a company would not like to loose a major part of the market by shifting most of trading activities to the US.

3. Could you please give me some information about the advantages that the US
governments providing you with? Ans: the US government is of great advantage t o the company. The company has great relationship with the German and European government which supports the company's trade. Also the government can provide fewer prices in terms of tax. All these benefits will help the company t o earn more profit.