Hutchison Whampoa and Mobile Telecoms

The assignment examines Hutchison Whampoa's involvement in the mobile telecommunications industry. It delves into their strategies, challenges faced, and overall impact on the sector. The analysis draws upon academic research and data sources to provide a comprehensive understanding of the company's journey within this dynamic field.

Freshtel expansion into India
International Business Challenge (IBC-2)
Assessment 2: Business Case
Student Name: Student ID:
Subject Name: Subject Code: BPD2100
Date Due: Professor Name:
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Executive Summary
Corporations are expanding at a rapid rate post ease of norms in globalisation. Technological
advent have created immense opportunities for several corporations to expand and set up
their own businesses. Australian telecommunication sector in recent times have been facing
significant stagnation in growth and is unable to expand. Demographic factors are leading
these companies to look for profitable ventures offshore. Freshtel Holdings limited is an
Australian corporation that is considering expanding to offshore countries for exploring greater
opportunities. Senior stakeholders including shareholders of the organisation have provided
$5million seed funding for investment into various projects. A team of project managers post
careful evaluation of various processes have found that expanding company operations into
India will yield significant benefits for the Company. The scope of this study evaluates scope
of the Company while expanding offshore and taking into consideration budgetary allocation
and time related factors along with its human resources with other allocation. Considering
such factors for allocating the Company resources into offshore countries will yield various
benefits for the same and will allow development of a profit center. Along with careful
allocation of resources there are recommendations developed for the Company which
suggests a suitable model that will allow it to expand in a more profitable manner.
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Table of Contents
Executive Summary.................................................................................................................. 2
Table of Figures........................................................................................................................ 3
1. Introduction......................................................................................................................... 4
1.1 Background of the Study..................................................................................................4
2. Review of Freshtel Holding Website...................................................................................4
3. Researching India...............................................................................................................6
4. Literature on Corporate Social Responsibility.....................................................................8
5. Research Entrepreneurship, Business Development or Corporate Social Responsibility. .9
6. Business Case Definition..................................................................................................10
7. Business Case stakeholders and Stakeholder Analysis...................................................11
8. Program Logic Model........................................................................................................12
9. Feasibility Analysis........................................................................................................... 13
10. Gantt Chart....................................................................................................................15
11. Resources..................................................................................................................... 17
12. Budget........................................................................................................................... 18
13. Conclusion and Recommendations...............................................................................22
13. Reference Lists................................................................................................................. 23
14. Appendices........................................................................................................................26
 Appendix 1: The Project Team......................................................................................26
 Appendix 2: Business Case Methodology.....................................................................26
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Table of Figures
Figure 1: Plans of Freshtel.................................................................................................................................5
Figure 2: FDI in Indian Telecom Sector............................................................................................................6
Figure 3: Revenues from Indian Telecom Sector............................................................................................7
Figure 4: Growth in India Telecom Sector Subscribers..................................................................................8
Figure 5: Stakeholder Analysis........................................................................................................................12
Figure 6: SWOT Analysis.................................................................................................................................15
Figure 7: Resources..........................................................................................................................................17
Figure 8: Human Resources............................................................................................................................18
Figure 9: Physical Resources..........................................................................................................................19
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1. Introduction
Corporations around the world are expanding at a rapid rate to take benefits of globalisation
(Knight, 2009). Globalisation along with rapid technological advent are providing companies
capabilities to build profit centers abroad for creation of a greater brand name.
Telecommunication sector within Australia are expanding at a rapid rate in the recent years.
Coupled with their capacities to grow and expand they are faced with significant competition
in Australia. Various companies are offshoring multiple non-core activities such that they are
able to gain significantly from returns of larger scale (Beamish, 2013). Australian economy
has been experiencing a stagnant growth over the past few years due to lower rates of growth
and rising unemployment in certain sectors. On the contrary some other companies are
planning to expand to emerging economies in order to generate more profitability for their
businesses. Freshtel is an established telecommunication business in Australia which has
tremendous potential to expand overseas (Killing, 2012). The scope of this project defines
and discusses several opportunities that Freshtel can benefit from in case it expands with its
operations in overseas emerging countries as India.
1.1 Background of the Study
Telecommunication sector has undergone significant changes and transformations in the
recent past. There are multiple types of associated businesses that have emerged along with
telephony services as data services that telecommunication companies are providing (Ball,
2012). Currently, Companies in Australia are providing 4G as well as some companies are
providing 5G connections at increasing cheap rates. Along with data connections there are a
large number of associated businesses as fixed telephone lines, mobile services, broadband
services and so on. Though there are immense business scopes yet presence of a large
number of telecommunication giants have made the industry scenario more competitive
(Harzing, 2013). Freshtel a growing company in Australia market post receiving seed
financing can make use of the same to divert its resources to developing countries around the
world to gain substantial advantages. The scope of this study examines the relevant issues
and opportunities that the Company can gain in case it expands its business to India. A brief
review of feasibility analysis is conducted along with necessary time frame and budgetary
analysis (Cheng, 2009).
2. Review of Freshtel Holding Website
Freshtel Holding Limited is an Australian based telephony company which is recently
developing Voice over IR services along with products. It was established in 2004 and has its
headquarters based in Melbourne in Australia (freshtelholdings, Retrieved on 4th October
2017). The Company offers VoIP solutions for its wholesale customers and other retail
products for direct sale to customers. It has two subsidiaries as Voicedot and Virbiage. Its
retail producst are marketed through Freshtel Pty Ltd. It has a global base for its wholesale
products. Its current CEO is Rhonda O’Donnell and Chairman is Kenneth V Loughnan. It has
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several agreements and arrangements with various companies worldwide as it recently
signed a deal with Tesco for catering to UK markets (Campbell, 2016). Primary product
offerings of the Company comprises of Voice over Internet Protocol service, software and
hardware. The below mentioned pictorial representation depicts the various charges for the
Company’s products for retail customers.
Figure 1: Plans of Freshtel
Source: (infozed.blogspot.in, Retrieved on 4th October 2017)
There are three distinct structures in the business of Freshtel Holdings along with its research
and development wing. Virbiage which is into manufacturing of hardware, Voicedot Networks
which runs Internet telephony network. Both these companies make available products for
Freshtel Pty Ltd. Recently the organisation’s senior authorities have allocated $5million seed
funding for undertaking various projects. According to the project management team some
allocation should be made to extend current services of Freshtel Pty Ltd into emerging
markets of India.This investment can yield tremendous benefits and returns on investments.
For expanding operations into Indian subcontinent only $750,000 will be required. This study
will discuss the relevancy of making such investments. the website of the Company contains
limited information regarding the business and stated investment proposal however it contains
a detailed proposition for corporate social responsibility that the company adheres to. Freshtel
holding is a publicly listed Company in ASX and has a stable market share.
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3. Researching India
Amongst the various BRICS countries of Brazil, Russia, India, China and South Africa,
Freshtel Pty Ltd has selected India for expanding its operations into. India is a rapidly growing
emerging nation in Asia, that offers perfect destination for FDI endeavors (Birkinshaw, 2011).
Demographic trends within the country is promising, socio-cultural trends are rapidly
transforming especially in major cities in the country. However, the country remains affected
form political interferences especially in businesses, but the present government is providing
several endeavors such that FDIs are made in the country. Economic situation are also stable
in the country within the Asian region compared to its past offering a stable rate of GDP. The
telecommunication sector within the country is highly regulated by TRAI. TRAI is an
association of various telephony companies along with participation of government (Doz,
2011). The body allows significant investment of foreign authorities into the country, which is
why there is a plentiful amounts of foreign funds flowing into the same. The figure below
depicts increase in FDI inflows posts governmental regulations and incorporation of TRAI into
the country.
Figure 2: FDI in Indian Telecom Sector
Source: (slideshare.net, Retrieved on 4th October 2017)
With steady increasing trends in the telecommunication sector coupled with a robust
population and rise in middle class white collar employees, there remains scope for foreign
companies. Though the markets in India in the telecommunication industry remains highly
competitive in nature yet rising population depicts high trends in consumptions (Hill, 2008).
Telecommunication subscribers have risen sharply in the recent past with the country
becoming on the best countries for IT offshoring opportunities. Triggered by several sectoral
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growth the country is experiencing there remains need for more and more telecommunication
companies. The market remains unsaturated as telecommunication companies are facing
increasing levels of hurdles to provide customer services to the population. The below
mentioned figure depicts the rise in telecommunication sector revenue in India since the
recent past (Welch, 2011).
Figure 3: Revenues from Indian Telecom Sector
Source: (trak.in, Retrieved on 4th October 2017)
As number of subscribers to telecommunication services continue to quadruple, there is huge
opportunity prevailing for adding more and more company’s services for generating greater
profitability. The below depicted figure represents the amount of growth of telecommunication
subscribers in India in the recent year’s trends (Rugman, 2009).
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Figure 4: Growth in India Telecom Sector Subscribers
Source: (business-standard, Retrieved on 4th October 2017)
4. Literature on Corporate Social Responsibility
The website of Freshtel holding incorporates several corporate governance principles which
includes creation of long-term shareholder value. The Company undertakes significant
investment into research and development procedures as its board members are concerned
on creating sustainable opportunities with investment into generating long term benefits
(Morley, 2010). The Company enjoys a positive relation between long-term shareholder value
with high quality in corporate governance. The Company along with its board members
operates as a singular economic entity with focus on ethical norms. Along with the several
principles identified by the company for its corporate governance procedures are conforming
to ethical standards and catering to due diligence in every possible manner. With continuous
focus of research and developmental procedures, the company is well focused on creating
am impact on the society as well as within the community in which it operates (Verbeke,
2013). It considers CSR as one of its duties to act in favor of the society and community to be
able to contribute in a positive manner. The scopes of the below mentioned literatures
identifies the multiple CSR responsibilities that businesses while internationalizing needs to
adapt to.
J. D. Cantwell (2010) in his article, An evolutionary approach to understanding international
business activity: The co-evolution of MNEs and the institutional environment. Published in
the Journal of International Business Studies, pages 567 to 586 (Cantwell, An evolutionary
approach to understanding international business activity: The co-evolution of MNEs and the
institutional environment, 2010). Businesses while expanding in an international environment
has several significant imapcts on the community as well as on the society. Earlier
international business activities were looked down upon by host countries as they were meant
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to reap benefits only rather than creation of opportunities. In this endevour several
corporations are well known to have impacted negatively on host countries by exploiting
workers, lowering wage rates and so on. There is a limited amounts of benefits attached to
internationalisation of companies, hence traditional businesses did not lay much focus on
CSR activities. Y. S. Chandra (2009) article, The recognition of first time international
entrepreneurial opportunities: Evidence from firms in knowledge-based industries. In the
International Marketing Review, pages 30 to 61 (Chandra, 2009). Entrepreneurial endevours
in recent times recognises that in case of internationalisation of businesses it needs to create
benefits for host country as well. Entrepreneurs in recent times are diagnosing ways and
means they could create positive impacts on host countries thus, extending their CSR norms.
F. J. Contractor (2007) article, Is international business good for companies? The
evolutionary or multistage theory of internationalization vs. the transaction cost perspective.
Published in MIR: Management International Review, pages 453 to 475 (Contractor F. J.,
2007). The scope of this article recognises the ways in which internationalisation could yield
benefits for their own companies. In this article CSR norms with respect to companies are
analysed according to impacts they generate on their employees. Internationalising
companies often accommodate several employee engagement strategies for expatriates such
that they continue to retain their interests. F. J. Contractor (2007) article, Nature of the
relationship between international expansion and performance: The case of emerging market
firms. In the Journal of World Business, pages 401 to 417 (Contractor F. J., 2007). This article
recognise realtionship of international business with that of performanes of businesss which
reflects that greater that greater employee satisfaction more the performance of the company.
5. Research Entrepreneurship, Business Development or Corporate Social
Responsibility
Business developments are often coupled by means of exapnsion into larger areas or
forums. Entrepreneurship skills are applied onto business development or corporate
social responsibility such that the business can grow in a sustainble manner in the
future (Barton, 2011). Evaluation of several literatures and texts on corporate social
responsibility reflects that entrepreneurs take on priority CSR for betterment of the
organisation. Below are some more texts and articles that are taken into account for
the purpose of evaluation.
M. J. Dollinger (2008) in his book Entrepreneurship: Strategies and resources.
Published by Marsh Publications (Dollinger, 2008). This identifies scope of resources
and strategies in entrepreunial internationalisation. It evaluates resources and
strategies that are extended by entrepreneurs while expanding their businesses. They
consider impacts on the business that are internal as well as external impacts such
that they can easily divert their resources. It identifies the importance of feasibility
analysis for the corporation while internationalising. A. Kolk (2010) article, International
business, corporate social responsibility and sustainable development. In the
International business review, page number 119 to 125 (Kolk, 2010). The scope of this
analysis identifies the CSR challenges faced while incorporating sustainable features
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in businesses. CSR can provide significant benefits for the corporation towards
building a positive brand name and brand recognition in the market.
Y. Luo (2007) article, International expansion of emerging market enterprises: A
springboard perspective. In the Journal of international business studies, page number
481 to 498 (Luo, 2007). The scope of this article recognises article recognises benefits
that corporations can have in emerging markets and CSR norms that they apply. Often
corporations aim to only reap benefits from emerging markets due to cheap and readily
available resources. Thus, it becomes more difficult for them to apply CSR norms.
T. E. Nulty (2016) article, Some thoughts about Australian telecoms. In the Australian
Journal of Telecommunications and the Digital Economy, page number 11 (Nulty,
2016). Australian telecommunication companies are developing and expanding at a
rapid rate. M. W. Peng, 2008. An institution-based view of international business
strategy: A focus on emerging economies. Journal of international business studies,
920-936 (Peng, 2008). This journal reviews various business strategies that are
applied by international corporations while expanding in emerging markets. S. E.
Sakarya, 2007. Market selection for international expansion: Assessing opportunities in
emerging markets. International Marketing Review, 208-238 (Sakarya, 2007). This
article reviews ways and means which are applied for selecting a market for the
purpose of expansion. This article views the several benefits according to CSR which
might emerge from such expansions. D. W. Yiu, 2007. International venturing by
emerging economy firms: the effects of firm capabilities, home country networks, and
corporate entrepreneurship. Journal of International Business Studies, 519-540 (Yiu,
2007). Firms expands in international markets once they have access to wide
capabilities which they apply in emerging markets. This article views the several
capabilties that firm’s expand while internationalising to create a positive impact.
6. Business Case Definition
Nature of the business undertaken in this case is telecommunication sector in Australia, which
is planning to expand its operations into India. The business of Freshtel revolves around
wholesale of hardware and connectivity related products whereas Freshtel Pty Ltd has only
retail products for internet as well as telephony connections. The business is a highly
profitable venture in the Australian market and occupies a significant market share. The
business that is into retail production will divert its operations into India for catering to a large
number and segment of customers for broadening its business base.
The business case aim is to expand business operations also its CSR initiative. The
organisations mission statement is to provide a reliable uninterrupted service to Australian
customers. The business had been constantly bent on several research and developmental
related endeavors such that the society at large can be benefitted (Meredith Belbin, 2011).
While expanding its businesses into India, it will still continue to include R & D endeavors
such that it can benefit the Indian society and bring about new products as well as
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Stakeholder Analysis Matrix
Shareholders
Keep Investors Senior Management
Satisfied Manage Closely
High
Customers
Influence Employees
Staffs Governmental Authorities
Low Monitor Keep Informed Agencies
Low High
Interest
developments. Further CSR elements that will be incorporated into the business will be to
create employment in India rather than appointing expatriates in the country. The company
will aim at benefiting the Indian society while expanding by providing local employment,
training and development. It will aim at engaging employees such that there is higher
amounts of retention and lower levels of turnover in the company.
The expansion of the business into India will take an year to two years. While expanding it will
start up as a smaller enterprise and gradually with growing profits it will aim at expanding its
operations further. It can expand using joint venture model where size of the business will be
restricted to a smaller frame and then later grow to be a self-regulated enterprise (Johnson,
2009).
7. Business Case stakeholders and Stakeholder Analysis
Every businesses has a group of stakeholders who take active interests in functioning of the
business. For Freshtel Pty Ltd to expand into India there are several stakeholder, which
needs to be analysed such that the business can function in an effective manner.
Figure 5: Stakeholder Analysis
Source: Author
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The above stakeholder analysis has been undertaken using particular template available such
as to understand their influence and impact on the business. Like every business this
business also has internal as well as external stakeholders. Analysis of internal stakeholders
includes shareholders, employees, staffs, investors, managers and so on. External
stakeholders includes government, credit rating agencies and other regulatory authorities who
takes active participation in the conduct of the business.
8. Program Logic Model
A program logic model will be implemented for proper and effective attainment of the goals of
the project. The Company is operating in a profitable manner in Australia but for expansion
into India it will need to adopt program logic model suing SMART techniques such that they
are able to expand easily. SMART technique is an abbreviated form for Specific, Measurable,
Attainable, Relevant and Time Based measure for an objective. The primary objective for
applying this model is to effectively attain expansion into offshore country using current
available resources.
Specific: The specific attainable aims of the Company is to set up operations within India.
The Company aims to divert its current available resources along with a funding of $750,000
to establish operations in India.
Measurable: The outcome for the business post setting up operations in India will be to
generate profits in the country. The Company will set a break even period of 3 years to attain
the entire payback on its initial investments.
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Table 1: SMART Objectives
Attainable: The goals of the Company is highly attainable as it will easily be able to set up
operations in India with $750,000. It will also be able to reach its payback period within 3
years’ time.
Relevant: The objective set up is highly relevant in nature and attainable. With current
scopes prevailing within India, the Company can easily reap benefits from its investments.
Time Based: The time that will be set to expand operations will be 1 year and post which 3
years will be deployed for getting payback.
9. Feasibility Analysis
Prior to expanding operations it becomes crucial to evaluate market prevailing situations and
conduct an internal analysis for the Company. A feasibility analysis a market level analysis is
conducted using Porter’s five forces of competition whereas internal analysis is done using
SWOT analysis.
Porter’s five forces of competition: It is conducted using five relevant types of competitive
forces prevailing within the industry as;
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Bargaining power of suppliers: It is relatively low in India due to prevalence of a large number
of suppliers. Further with current branding of Freshtel, suppliers will not be making much of
bargaining endeavor and will aim at establishing a relationship.
Bargaining power of buyers: Buyers have high bargaining power due to presence of a large
number of telephony as well as internet providers.
Table 2: Industry Analysis
Threat from substitute products: Threat from substitute products is medium as there is
constant innovation that is taking place in technology related to data and calling.
Rivalry amongst existing competitors: There is high prevailing rivalry amongst competitors.
Giant players as Vodafone, Bharti Airtel, Jio occupies relatively a higher levels of market
share, which makes it difficult for new players to establish their businesses.
Threat from new entrants: Markets in India are open to FDI hence there is immense chances
for entry of new entrants into the business. There is high levels of threats existing from new
entrants however with substantially higher investments.
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SWOT Analysis:
SWOT is an abbreviated form for strength, weakness, opportunity and threat. A
comprehensive SWOT analysis for Freshtel will allow understanding of its key strengths and
weaknesses and plan for expansion or further growth.
Strength
 Existing resources and competence
 Availability of funds
 Immense experience
 High quality R & D facility
Weakness
 Lack of understanding of Indian
markets
 No hands-on experience of Indian
markets
Opportunity
 Immense possibilities to expand in
BRICS economies
 Capabilities to emerge as a leading
company in telecommunication
sector
Threat
Figure 6: SWOT Analysis
Source: Author
10. Gantt Chart
In order to apply the project initiative there will be a time frame that will be required to be
integrated. The below depicted time line chart of Gantt chart depicts the time frame that will
be required to conduct feasibility for the project of Freshtel Pty Ltd expanding and its
implementation. The time line is only an estimate and there might be overrun in timing or the
project might be concluded prior to its designated time frame.
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GANTT
CHART
Research for analysing Freshtel Business Expansion in India
Topic
Months
1 2 3 4 5 6 7 8 9 10 11 12
Country Evaluation
Entry Mode Analysis
Evaluation of
Stakeholders
Business Model
Feasibility Analysis
Resources Evaluation
Budget
Implementation
Control and Monitoring
Table 3: Time Line & Gantt Chart
Source: Author
The below mentioned graph is a pictorial demonstration of the time line that will be required to
conduct the study and application of the internationalization project.
1
0 2 4 6 8 10 12 14
Control and Monitoring Implementation
Budget Resources Evaluation
Feasibility Analysis Business Model
Evaluation of
Stakeholders
Entry Mode Analysis
Country Evaluation Series2
Topic
Table 4: Graphical Time Line Representation
Source: Author
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11. Resources
In case of any Company trying to internationalize of expand its businesses overseas there is
a need for various resources for the same. In order to prepare Gantt chart and Program Logic
Model, the following in-house resources has been consumed for the purpose. A total
estimated expenditure of AUD 19500 has been estimated for the preparing the charts.
Resources Amount (AUD)
Computer 5000
Internet Connection 2500
Budget Estimation
Software
4500
Professional 4500
Miscellaneous 3000
Total 19500
Figure 7: Resources
Source: Author
Human Resources:
Human resources is the most important of all resources and there are a number of people
who will be required for the purpose of establishing operations and evaluating for the same.
The below mentioned chart depicts a detailed resources of human capital that will be needed
by the organisation. Administrative, technical, marketing, compliance employees will be hired
for a full time basis. Staffs will be hired on a contract of 2 years which can be renewable or
taken into probation later on. Additional staffs required by the organisation will be taken on
part-time basis as and when required.
Personnel No. of Personnel Qualification Salary Each (AUD)
Administrative 5 BTech 2500
Technical 6 BTech + 5 years
experience
3000
Marketing 5 BTech+2 years
experience
3000
Compliance 2 BTech 3500
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Staff 10 BTech 1500
Additional Staffs (if
any)
8 N/A 1500
Figure 8: Human Resources
Source: Author
Physical Resources:
In order to expand into a new domain of business there will be large amounts of physical
resources needed for the same. The following are some of the lists of resources that will be
needed for setting up of office in the new domain.
Physical Resources Amount (AUD)
Furniture 100,000
Equipment 150,000
Computer 75,000
Internet Router 50,000
Vehicles 250,000
Materials 120,000
Premises 400,000
Miscellaneous 220,000
Figure 9: Physical Resources
Source: Author
12. Budget
An estimated budget has been included for understanding diverting of resources into new
country. A rough estimate of human resource costs and those related to physical resources
has already been detailed out. Below depicted is a detailed expenditure lists along with
budgetary outlook for a 3 year period. A detailed lists of profit and loss statement, cash flow
statement and balance sheet has been prepared for the business.
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The cost benefits arising from the project is immense that can be understood from the cash
flows that will occur from inflow of funds through sales.
Month wise
Expenditure
Turnover
Mo
nth
1
Mo
nth
2
Mo
nth
3
Mo
nth
4
Mo
nth
5
Mo
nth
6
Mo
nth
7
Mo
nth
8
Mo
nth
9
Mon
th
10
Mon
th
11
Mon
th
12
Income from
Telecom
Products
5,00
0
10,0
00
15,0
00
5,00
0
5,00
0
10,0
00
5,00
0
10,0
00
5,00
0
10,0
00
5,00
0
5,00
0
Total Income
5,00
0
10,0
00
15,0
00
5,00
0
5,00
0
10,0
00
5,00
0
10,0
00
5,00
0
10,0
00
5,00
0
5,00
0
Cost of Sales:
2,24
4
319
9
432
1
579
4
227
5
353
6
464
6
687
8
323
2 4517 4624 4734
Materials
Total Cost of
Sales
2,24
4
319
9
432
1
579
4
227
5
353
6
464
6
687
8
323
2 4517 4624 4734
Gross Profit
2,75
6
6,80
1
10,6
79
(79
4)
2,72
5
6,46
4 354
3,12
2
1,76
8
5,48
3 376 266
Overheads:
Wages &
Salaries 898
128
0
172
8
231
8 910
141
4
185
8
275
1
129
3 1807 1850 1894
Rent & Rates 45 64 86 116 46 71 93 138 65 90 92 95
Insurance 135 192 259 348 137 212 279 413 194 271 277 284
Bank Charges 22 32 43 58 23 35 46 69 32 45 46 47
Light, Heat &
Power v 67 96 130 174 68 106 139 206 97 136 139 142
Telephone v 4 6 9 12 5 7 9 14 6 9 9 9
Advertising v 224 320 432 579 228 354 465 688 323 452 462 473
Print, Post,
Stationery v 4 6 9 12 5 7 9 14 6 9 9 9
Motor &
Travel v 22 32 43 58 23 35 46 69 32 45 46 47
Professional v 9 13 17 23 9 14 19 28 13 18 18 19
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Fees
Miscellaneous v 90 128 173 232 91 141 186 275 129 181 185 189
Loan interest 90 128 173 232 91 141 186 275 129 181 185 189
Depreciation 187 267 360 483 190 295 387 573 269 376 385 395
Total
Overheads
1,79
8
2,56
3
3,46
3
4,64
3
1,82
3
2,83
4
3,72
3
5,51
2
2,59
0
3,62
0
3,70
5
3,79
4
Net Profit 958
4,23
8
7,21
6
(5,4
37) 902
3,63
0
(3,3
69)
(2,3
90)
(82
2)
1,86
3
(3,3
29)
(3,5
28)
Table 5: Month wise Expenditure
Profit & Loss Year 1
Year 1 Year 2 Year 3 Total
Turnover
Income from Telecom Products 90,000 110,000 130,000 330,000
Total Income 90,000 110,000 130,000 330,000
Cost of Sales:
Materials 50,000 56,000 59,000 165,000
Total Cost of Sales 50,000 56,000 59,000 165,000
Gross Profit 40,000 54,000 71,000 165,000
Overheads:
Wages & Salaries 20,000 26,000 28,000 74,000
Rent & Rates 1,000 1,200 1,000 3,200
Insurance 3,000 4,400 6,400 13,800
Bank Charges 500 600 600 1,700
Light, Heat & Power 1,500 2,500 2,800 6,800
Telephone [phone]
Advertising 5,000 4,000 4,000 13,000
Print, Post, Stationery 100 100 100 300
Motor & Travel 500 800 1,000 2,300
Professional Fees 200 200 250 650
Miscellaneous 2,000 2,000 2,200 6,200
0
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Loan interest 2,000 1,900 1,750 5,650
Depreciation 4,167 4,167 4,167 12,501
0
0
Total Overheads 40,067 47,967 52,467 140,501
Net Profit (67) 6,033 18,533 24,499
Table 6: Profit and Loss Statements
Cash Flow Projection Year 1
Year 1 Year 2 Year 3 Total
Sales 90,000 110,000 130,000 330,000
Other Income
Bank Loan 200,000 0 0 200,000
Share Capital 0
Total Cash Inflow 290,000 110,000 130,000 530,000
Capital Expenditure 300,000 0 0 300,000
Opening & Closing Stock 90,000 120,000 150,000 360,000
Direct costs - materials 68,000 74,350 77,000 219,350
Wages & Salaries 21,000 26,000 28,500 75,500
Rent & Rates 1,000 1,200 1,000 3,200
Insurance 3,000 4,400 6,400 13,800
Bank Charges 500 600 600 1,700
Light, Heat & Power 2,800 2,800 2,800 8,400
Telephone [phone]
Advertising 5,000 4,000 4,000 13,000
Print, Post, Stationery 100 100 100 300
Motor & Travel 500 800 1,000 2,300
Professional Fees 200 200 250 650
Miscellaneous 2,000 2,000 2,200 6,200
0 0 0 0 0
loan repayment 0 0 0 0
Loan interest 0 0 0 0
VAT (43,880) 8,860 12,090 (22,930)
Page | 22

Total Cash Outflow 450,320 245,410 286,140 981,870
Net Cash Flow
(160,320
)
(135,410
)
(156,140
)
(451,870
)
Opening Bank Balance 0
(160,320
)
(295,730
) 0
Closing Balance
(160,320
)
(295,730
)
(451,870
)
(451,870
)
Table 7: Cash Flow Projections
Balance Sheet at End of Year
Non-Current Assets
Histori
c
Cost
AUD
Plant and Equipment 250,000
Land 150,000
400,000
Current Assets
Stock 90,000 120,000 150,000
Debtors 120,000 136,000 145,000
Cash on hand and at bank 50,000 50,000 50,000
Total Current Assets 260,000 306,000 345,000
Total Asset 660,000 706,000 745,000
Current Liabilities
Creditors 140,367 170,617 206,967
Corporation Tax Payable 10,000 22,000 23,000
Long Term Liability
Bank Loan 200,000 200,000 200,000
Page | 23

Representing:
Shareholders' funds 300,000 300,000 300,000
Share Capital 0 0 0
Retained Profit for Year 9,633 13,383 15,033
Total Liabilities 660,000 706,000 745,000
Table 8: Balance Sheet
Cost benefit analysis from the project depicts that the project will initially spend AUD250,000
and will easily reap benefits multiple times to that within first three years of its investments.
the investment for the Company will be made in parts and all of the outflow obtained from
seed financing will not be allocated all at once. This will result in obtaining greater confidence
and benefits form the project. The shareholders and investors will be able to gain substantially
from such inflows that will generate great amounts of benefits for the project.
13. Conclusion and Recommendations
Analysis of various trends existing in India market scenario, it can be understood that in case
the Company expands then it will be able to generate tremendous profits from it. The
Company however, needs to decide on the appropriate business model through which it will
be starting its operations in India. The scope of various products and CSR endeavors will also
need to be decided for the purpose of such conduct for business. The Company will be able
to expand successfully in case it has adopted the following recommendations:
 Freshtel need to expand first in a form of either alliance or joint venture. Such
endeavors will allow the Company to have first-hand experience of the Indian
markets. This will further allow the Company to expand with greater prospects in the
future.
 Freshtel needs to adopt serious CSR norms for Indian markets such that it can build a
sustainable brand name for the future. The Company is always focused on its long-
term sustenance which can further be appreciated in case it adopts CSR norms for
Indian markets as well.
 The Company can make of employee engagement endeavors in the host country by
providing them opportunities rather than appointing Australian counterparts. This will
also allow the Company to have a better socio-cultural understanding of the Indian
markets.
 Lastly, the Company needs to keep up with its innovative trends such that it can
design cost affordable products and services for the Indian markets. Being a
developing nation, affordable products of the Company will be able to create a greater
share compared to expensive once.
Page | 24

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Page | 28

14. Appendices
 Appendix 1: The Project Team
Members Qualification Commentary
1. Business Strategists BTech (with experience) The capabilities of this person
needs to be extended across
various business functionalities.
This person needs to possess
visions and can work solely. He
needs to possess relevant
experience in the domain of 10
years along with a qualification
degree and professional degree
if possible.
2. Business Analysts BTech (with experience) A business analysts with
qualification and experience
needs to be appointed for
analysing business prospects
related to offshoring.
3. Lawyer LLB (with experience) An international lawyer who has
experience related to forming of
international agreements and
contracts needs to be appointed.
He needs to have relevant
exposure in the field.
Page | 29

3. Accountant BTech (with experience) An accountant for understanding
and handling divergent issues in
the domain needs to be
appointed. He needs to have
thorough understanding related
accounts related understanding
in Indian context.
4. Marketing Personnel BTech (with experience) A marketing professional who
will be handling marketing
endeavors in the new business
domain will have to be
appointed such that he can take
care of several business
expansion issues.
 Appendix 2: Business Case Methodology
The business project management literature has made use of several literatures and
theories related to project management. Defining of key terms as SMART objectives,
Gantt Chart and other procedures have been used for undertaking analysis pertaining
to the business case (Griffin, 2012). Further, the business case methodology have
made use of extensive data analysis from secondary sources that are available in
internet sources, journals and so on. The project management team has made several
endeavors for analysing trends and perspectives related to the project for international
expansion.
Several corporate social responsibility literatures are also evaluated for the purpose of
this business methodology (Whalley, 2012). Project management theories have been
undertaken for analysis in this international expansion for the telecommunication
companies. Methodology in this case has adopt a relevant paradigm and inductive
techniques such as to arrive at the goals for the study. CSR journals used in this
Page | 30