Project Report: Feasibility of Kopitiam in the Chinese Market

This project report evaluates the feasibility of Kopitiam Investment Pte Ltd, a Singaporean company, entering the Chinese market. The report comprehensively analyzes various factors, including legal, environmental, product, marketing, business strategies, and financial aspects, to determine the company's potential in China. It assesses the viability of establishing a business in China, providing detailed feasibility analyses and outlining the process for market entry. The report highlights the potential for strong performance in the Chinese market and suggests new strategies and plans for the company's preparation. Key areas covered include industry and company descriptions, product factors, legal considerations, business strategies, financial planning, and management considerations. The report also includes an executive summary, contents, references, and an appendix, offering a complete overview of the company's prospects and recommendations for successful market entry. The report emphasizes the importance of adapting to the local market, understanding consumer preferences, and developing effective strategies for product positioning, pricing, distribution, and promotion.

Running Head: International business
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Project Report: International Business

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Executive summary
This report has been prepared to evaluate the feasibility of Singapore Company,
Kopitiam Investment Pte Ltd into Chinese market. The report evaluates all the related factors
such as legal factor, environmental factor, product and service factor, marketing factor,
business strategies, finance factor etc of the company to identify the performance and the
position of the company in Chinese market. It evaluates that whether it is possible for the
company to set its business into china market or not.
The report includes all the feasibility analysis on the china market and the process of
the company to enter into china market. It explains that the performance of the company
would be quite better in the company. The reports also concentrate on some new strategies
and plans which should be prepared by the company before entering into the china market.
The report includes the industry description, company description, product factor, legal
factor, strategies, evaluation, feasibility etc.

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Contents
1. Industry business description...................................................................................5
1. Company description...............................................................................................6
1.1 Type of business...............................................................................................6
1.2 Legal structure..................................................................................................7
1.3 History, mission, goals and objectives.............................................................7
1.4 Company principals..........................................................................................8
2. Products and services factor....................................................................................8
2.1 Product and service analysis.............................................................................8
2.2 Customer profile and demand analysis...........................................................10
2.3 Competitive situation......................................................................................10
3. Environmental factors............................................................................................11
3.1 Host country business climate........................................................................11
3.2 SWOT analysis...............................................................................................12
3.3 Government constraints..................................................................................13
3.4 Laws regulations and administration practices...............................................14
4. Business strategies.................................................................................................14
4.1 Product positioning.........................................................................................14
4.2 Pricing strategies............................................................................................15
4.3 Distribution and logistic.................................................................................16
4.4 Promotion and advertising..............................................................................16
4.5 Estimated sales and sales mix.........................................................................18
4.6 Production strategies......................................................................................19
5. Financial planning..................................................................................................19

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5.1 cost analysis, funds and cash flow..................................................................20
5.2 Project profit and loss account.......................................................................21
5.3 Other financial statements..............................................................................22
6. Management consideration....................................................................................25
6.1 Personnel and sales force factor.....................................................................25
6.2 Business advisers............................................................................................26
6.3 Contingency plans..........................................................................................26
7. Conclusion and recommendations:........................................................................26
References:.....................................................................................................................28
Appendix.........................................................................................................................32

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1. Industry business description
Kopitiam group is running its business in hospitality industry in Singapore. Hospitality
business covers numerous businesses which focus on the money. Few of the categories of
hospitality industry of Singapore are as follows:
Travel – Trains, flights, rental cars and busses
Hotels- Beds, motels, rental condos and breakfasts
Food and beverages – Bars, restaurants and cafes
Entertainment – Movies, sports and theatres
Tourist attraction – Museum, historical sites and park
As immense businesses are involved in the industry so, the hospitality industry is a
large revenue market in Singapore. There is little unique business in Singapore hospitality
industry such as medical tourism where people visit to the country for medical purpose. The
medical tourism is one of the largest hospitality markets in Singapore. Though, Singapore is
not a big country and the population of Singapore is dense. But the Singapore has several
zoos, universal studios, museum, Buddhist temple and flower gardens and natural tree. The
food, hotels and cafes of Singapore are also luxurious (Jie et al, 2014).
The current report of Singapore explains that the Singapore has 400 hotels and still
they are building new. It is a small island in an ocean and enhance, the sightseeing of the
country is quite better. The culture of the country also attracts the tourism. Its central location
makes it a better destination for the tourist and visitors. The hospitality industry is also
performing well at international level. It has been evaluated that the current position of
hospitality industry is quite better and thus the firms are diversifying their market and new
investors and ventures and investing their amount in the industry. The given report explains
about the Kopitiam group and its diversification policy in China market (Jianrong et al,
2014). It briefs that how the company could diversify its market into china market and what
is the feasibility of entering into china market.
2. Company description
The Kopitam group is currently running its business in Singapore market and following
is the information about the company:

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2.1Type of business:
Kopitiam Investment pte limited is a private limited company. Private limited comapny
is a company that is privately owned and held by a small business. The member’s liability of
private limited company is only limited to the invested amount or the shares which are
respectively held by them. A private limited company could not trade its shares in public
market. Though, the Kopitiam shares are not traded in the market and only few relatives,
friends and family members are holding the shares of the company. Though, the company is
trying to diversify its market in china and company is planning to Joint venture with a local
company in china.
The study on Kopitiam Investment Pte limited and its joint venture with a local
company in china market explains that the company would enjoy various pros of joint
venture in china market (Our company, 2018). The main advantage of joint venture is that it
helps the company to grow faster, generate greater profit and increase productivity of the
company. It would offer various attractive options to the Kopitiam Investment pte limited in
china market. The company should invest 51% in the joint venture.
1.1 Legal structure:
The legal structure of the company has been evaluated and it has been found that a
joint venture is required to register itself in the comapny registrar office. Joint venture is a
form of FIE (foreign invested enterprises). A company is required to follow few steps to joint
venture with a local company in china. Basically, there are few stages to register a firm and
start a joint venture company. The steps are as follows:
A letter of intent which should be signed by the partners
Joint venture name
JV contract and AOA
Pre approval from NDRC
Approval from some other ministries
Obtain a certificate from MOC (Howell, 2017)
After licensing certain formalities such as tax authorities, technical supervision, bank
account, administration of foreign exchange, certificate form bureau of statistics etc.

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Through the above steps, the company could register itself in the china market as a
joint venture company.
1.2 History, mission, goals and objectives:
Kopitiam Investment Pte limited is a prime site food shop in Singapore. It is one of
the leading names in local food services in Singapore. Kotipiam is basically a traditional
coffee shop which has been founded in south Asia supported by meals and beverages as well.
The company has been founded in 1988 in Singapore. The company has enjoyed a lot growth
in last few decades. The market share of the company has also been enhanced. Currently, the
worth of the company is s$ 2.1 million and it is a prime site food shop (Scholes, 2015).
The main business key model of the company is to identify, select and bring into line
with the right mix for each eatery item and manage the daily operations on an effective basis
(Wang, 2015). Food stalls of the company are leased to identify and select the food vendors,
drink, fruit and dessert vendors. The company has established the dessert shop in 1992 and
The Pa set in 1977. The company has acquisition with 2 major competitors to manage the
market share and enhance the profitability level.
The main strength of the company is its strong business identity, proven track
record, and professional management team, expertise in crafting the thematic eatery,
competency in managing various portfolios, quality food vendors, services and revolutionary
cashless dining. The main mission and vision of the company is to enhance the market share
and offer the good quality food to the customers.
1.3 Company principals:
The main principles of the company are offer an emotional connection to the customers
so that they could feel connected with the stalls and the company, aim to surprise the
customers by anticipating their needs proactively, Nurture the authenticity of the services and
the products, be competent in comparison of the competitors, enable flexibility and be in
touch with the customers (Johnson, 2016).
2. Products and services factor
The company is offering various eatery products and beverages in Singapore market
and the company is now planning to diversify its market into China. The feasibility analysis
on product and service of the company is as follows:

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2.1 Product and service analysis:
The company should evaluate firstly that which product and services would be offered
in the china market. Chinese food products are quite famous in the world wide. Though, the
report of local Chinese people depicts that they are always ready to taste the new food
(Armstrong et al, 2015). The taste of Chinese food is quite different that Singaporean food. It
evaluates that if the company would offer the authentic and local Singapore food in Chinese
market than there are more chances for the company to grow faster and generate more profits.
The company should start a new restaurant in china market where all the authentic food and
the beverages would be served to the Chinese people (Luthans and Jonathan, 2018)
A current report has evaluated that the Singapore food is making huge impact on the
Chinese food. Both the food offers the authentic Asian taste and thus it would be easier for
the company to attract the Chinese people. Further, Chinese people mostly eat the frozen food
and fast food which affects their health badly. It says that if the fresh and authentic food
would be served to the Chinese people than they would definitely love it. Kopitiam
Investment pte limited should focus on the local Singapore food, fresh food and the authentic
taste of the food (Rosario, 2016). Further, the service of the company should also be better.
Company should learn the Chinese culture and must greet the people accordingly. The
Chinese market is one of the huge
Though, a report also explains that the Chinese food is fattier than the Singaporean food
and thus the dietary people would prefer to have Singaporean food rather than Chinese food.
People would also love to enjoy to different cuisine and it would make the restaurant more
popular. Company could also focus on the Chinese cooking. Further, if Singaporean food
would be cooked and served into Chinese style than it would also attract the Chinese people.
It explains that the product and service analysis of the Kopitiam Investment pte limited is
quite better. This diversification strategy would offer huge market to the company to grab and
generate more profit.
2.2 Customer profile and demand analysis
Further, the customer profile and demand of the customers have been evaluated to
identify that whether the Kopitiam Investment pte limited would be successful in china
market or not. The customer of the company has been evaluated and it has been found that
local Chinese people would be targeted by the company (Benz and Thomas, 2017). The

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company would focus on the Chinese people who are looking for some changes in their daily
food or looking for dietary food. It has been found that the Chinese people are looking for
some changes in their daily food. Chinese people mostly eat the frozen food and fast food
which affects their health badly. So the company should offer the fresh and authentic food.
Kopitiam Investment pte limited should focus on the local Singapore food, fresh food and the
authentic taste of the food. It would attract the Chinese people towards the restaurant of the
company.
A report explains that the Chinese food is fattier than the Singaporean food and thus
the dietary people could be focuses by the company as they would prefer to have Singaporean
food rather than Chinese food. Some people would also love to enjoy different cuisine and it
would make the restaurant more popular. Further, the demand s of the Chinese people has
been studied and it has been found that the people are looking for different cuisines but
however, they are still connected to the Chinese culture and the Chinese taste. So, if the
Singaporean food would be cooked and served into Chinese style than it would also attract
the Chinese people and their needs would be fulfilled.
The company should also serve Chinese food in its restaurant as it would attract those
people who always prefer Chinese food. The Joint Venture Company would make it easier
for the company to cook the Chinese food and serve it to the customers of the company.
2.3 Competitive situation:
Further, the competitive situation of the company has been evaluated and it has been
found that there are various restaurants which are offering the Singapore food to the Chinese
people at china market. The analysis on the china market explains that the china market is
one of the largest food markets for international food. The company’s are growing their
business rapidly in the china market (Nebojsa and Sharma, 2015). The international
department of chins explains that the international food joints are continuously opening their
stalls into the china market with the help of joint venture.
It explains that there is huge competition in the market of china for Kopitiam
Investment pte limited. It explains that the company is required to set up some competitive
advantages so that the threat from competition could be lower. It explains that the new
strategies of the company such as cooking the Singapore food in Chinese style etc would
assist the company to set competitive advantage.

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3. Environmental factors
Environmental factors of china have been evaluated further to identify the position of
the country and feasibility of Kopitiam Investment pte limited in the market. Following is the
feasibility analysis:
3.1 Host country business climate:
The business climate of china has been evaluated and it has been found that the food
industry of china is one of largest food industry. It has been found that the food industry of
china is open for all the international flavours. The straits time (2018) briefed about the
Singapore food firms in china market and explained that there is boom in Chinese food
industry. The Chinese people always have cravings for the new taste and international
flavours and thus the food industry climate is always in the favour off the companies. It also
explains that the Chinese people are always ready to pay for the quality food and new
concepts and thus the food players could generate good profit from the china market. It also
adds that Singapore is quite near to china and thus few cultural similarities are also there. It
makes it easier for the Singapore food players to set their business in china market.
The Shanghai market is the best option for the food players as there are huge
population as well as it is a tourist destination. On the other hand, the city is crowded with
middle class families who are always ready to expose and receptive of new taste and culinary
products. Various companies who have moved into Chinese market from Singapore market
are running their business effectively as well as they are also making huge profits. Though,
china market is always possessive about the quality of the food and thus the organizations
should offer good quality food to the customers (Tajudeen et al, 2017).
3.2 SWOT analysis:
SWOT analysis study has been done further on Kopitiam Investment pte limited joint
venture in china with a local firm in Shanghai. Following is the strength, weakness, threat and
opportunities of the joint venture company:
Strength:
Strong business identity
Proven track record
Weakness:
New country
New culture

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Professional management team
Expertise in crafting the thematic eatery,
Competency in managing various portfolios
Quality food vendors
Services
Revolutionary cashless dining (Kumar and
Ghodeswar, 2015)
Different taste and demands of the customers
Opportunity:
New market to capture
Customers are willing to taste the
international flavour
New technology and cooking style
New eateries
Organic dishes and healthy food
Offer delivery services
Threat:
Competition level
Potential rising price
Suppliers issues
It explains that the joint venture of the comapny is china market would have some
strength and opportunity as well as they will have to face few threats and weakness. The
company could grab the opportunities through entering into the market and makes few
changes into the operations as well as the strategies (Camilleri, 2018). Further, the weakness
could also be controlled and vanished by the company. It briefs that it would be easier for the
company to set the business into china market and generate profits.
3.3 Government constraints:
The government constraints have been discussed further and it has been evaluated that
the Chinese market is open for the international business. A company could enter into the
china market for the business. The company is just required to fulfil some legal forms and
regulations. Though, the Chinese government has set some limits for the foreign countries

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such as investment limitations etc. a foreign company could not invest more than 51% in the
venture in china (Zhang et al, 2014). Further, it also briefs that a foreign company is required
to follow the rules of Chinese government as long as they are running their business in
Chinese market. It also adds that a foreign company is required to contract with a local
company to enter into the market and thus the Kopitiam Investment pte limited would
contract of joint venture with a local firm in china with 51% share.
3.4 Laws regulations and administration practices:
Further, the legal and administrative obligation of china market has been studied to
identify the feasibility of the business. The law regulations brief that if a foreign company
wants to enter into the Chinese market then it has to accomplish some legal formalities as
well as some registrations are also required. Though, the process is not at all complicated.
The foreign company is required to submit the name of the joint venture to the registrar office
along with a letter of intent which should be signed by the partners, JV contract and AOA,
Pre approval from NDRC, Approval from some other ministries and Obtain a certificate from
MOC. It would offer a licence to the company to work into china market (Duan et al, 2015).
After licensing certain formalities such as tax authorities, technical supervision, bank
account, administration of foreign exchange, certificate form bureau of statistics etc. are also
required to be done by the company.
4. Business strategies
Further, few business strategies have been evaluated which must be followed by the
company to enter in the china market. The analysis on the business strategies are as follows:
4.1 Product positioning:
Product positioning is an important element for a business. It assists the business to
evaluate a way to communicate with the customers of the company. It evaluates the
customer’s needs, the pressure from competitors and the communication channel which are
available. Further, it ensures that a good positioning of the product could be set in the
customer’s mind. The product positioning of Kopitiam Investment pte limited has been
evaluated and it has been recognized that the company could set its position into the
customer’s mind through advertisement and the promotion in the market. It has been

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explained that the positioning is not related to a product, it relates to the entire company.
Positioning is the part when a single word or a line gets you remind about the company.
Kopitiam Investment pte limited should set its position into customer’s mind through using
some jingles such as “the best Singaporean food in Chinese style” (Trogisch et al, 2016).
It would always help the company to remind the customers about the best
characteristics of the company and at the same time, people would also like to try the
different cuisine with some similar taste. This positioning style would assist the company to
grab more market.
4.2 Pricing strategies:
Further, pricing strategies of the company has been evaluated. Pricing is the value of
the product which is willing to give by the customers to the company against a product or a
service. Kopitiam Investment pte limited’s pricing strategies in Chinese market has been
evaluated. As the company is trying to enter into the Shanghai market as there are huge
population as well as it is a tourist destination. On the other hand, the city is crowded with
middle class families who are always ready to expose and receptive of new taste and culinary
products. So, the pricing of the company should be medium or either comapny could use the
penetration pricing strategy (Sia, Christina and Peter, 2016).
This strategy briefs that initially company could offer the products into lower price
but with the time and with huge customer base, company could enhance the price of the
product. This strategy makes it easier for the company to grab the market and make the
customer satisfy. The strategy is one of the best strategies for the company to grab the market
of china.
4.3 Distribution and logistic:
Further, distribution and logistics of the company has been evaluated. Distribution and
logistics are the critical function of a company. Distribution and logistics are done by the
company according to the customer’s demand, warehouse, nature of goods, inbound and
outbound shipment etc. In case of Kopitiam Investment pte limited, it has been found that the
spices would be purchased by the company from Singapore and must be distributed through
the ship. On the other hand, the raw material would be of perishable nature and so company
should not order much quantity at a single time (Cascio, 2018).

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Further, the company should use a warehouse in china market to manage the raw
material of the company. Through the evaluation on the market, it has been identified that the
warehouse of the company should be chilled and refrigerators are also required for the
company to manage the performance. The evaluation on logistics and distribution explains
that the huge amount would be spent by the company in logistic as the suppliers are from
Singapore itself (Akter et al, 2016).
4.4 Promotion and advertising:
Promotion and advertising is the marketing tactics of a business which is used to
promote the product and brand of the company. Promotion could be done by an organization
through various ways such as sales promotion, media advertisement, and direct promotion,
door to door marketing etc. the promotion and advertising tactics of Kopitiam Investment pte
limited has been investigated and new strategies for the comapny has been evaluated to
manage the performance and the position of the comapny (Armstrong et al, 2015). Through
the evaluation, it has been found that the promotional and advertising strategy of the
company could be as follows:
Segmentation:
Dividing the potential customers of the company into discrete group is significant.
Kopitiam Investment pte limited is required to segment the potential customers first so that it
becomes easy for the company to manage the customers and target them t o promote the
product and the brand. Segmentation is a broad price which classifies the customers on the
basis of their demographics, age group, education, and behaviour, psychographic and
geographic area. In case of Kopitiam Investment pte limited, it has been evaluated that the
entire Chinese population has to be divided by the comapny into few segment so that it
becomes easy to identify the suitable customers for the comapny.
For the company, target people must be according to their age group and the good
lifestyle and the people who care for new cuisines and international taste. This segmentation
would provide huge revenue as well as profit to the company. Thus, it is recommended to the
company to follow the above recommended segmentation.
Targeting:

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Targeting is a next process of STP process. This process evaluates that the company
should target only on 1 or 2 segments to make it easier to grab the market and enhance the
profit of the company. In this process, the resources are directly allocated to the required
target and thus maximum utilization could be done by the company of minimum resources.
The target process of Kopitiam Investment pte limited explains that the target of the company
should be on the people according to their age group and the good lifestyle and the people
who care for new cuisines and international taste (Wilson et al, 2016).
This target would offer huge return to the company as well as it would also be easier
for the comapny to promote its product. The target focus would make it easier for the
company to manage the promotions quickly in china market.
Positioning:
Positioning is an important element for a business. It is the last stage of STP. It assists
the business to evaluate a way to communicate with the customers of the company. It
evaluates the target customer’s needs, the pressure from competitors and the communication
channel which are available. Further, it ensures that a good positioning of the product could
be set in the customer’s mind. The positioning of Kopitiam Investment pte limited has been
evaluated and it has been recognized that the company could set its position into the
customer’s mind through advertisement and the promotion in the market. It has been
explained that the positioning is not related to a product, it relates to the entire company.
Positioning is the part when a single word or a line gets you remind about the company.
Kopitiam Investment pte limited should set its position into customer’s mind through using
some jingles such as “the best Singaporean food in Chinese style” (Leonidou et al, 2017).
It would always help the company to remind the customers about the best
characteristics of the company and at the same time, people would also like to try the
different cuisine with some similar taste. This positioning style would assist the company to
grab more market.
4.5 Estimated sales and sales mix:
Sales mix is the variety of products which could be sold by an organization. A
company’s sales mix could also be recognized the sales ratio for each product in comparison
with the entire sales volume of the products of the company. The sales ix explains about the
total estimated sales of an organization. Through the evaluation on the sales mix and

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estimated sales analysis of Kopitiam Investment pte limited, it has been evaluated that the
company would offer different cuisine in the Chinese market and the USP of the company is
Singaporean cuisines in Chinese style which is quite unique in the market so it is expected
that the total revenue of the company would be SGD 10,000 per year which would enhance
with the time and would reach to SGD 15,000 by the end of the 3rd year (Chaffey and Fiona,
2016).
The sales evaluation of the comapny explains that the comapny would achieve the
high sales revenue from Chinese market due to its position in the customer’s mind and the
different cuisines in the market.
4.6 Production strategies:
Lastly, the production strategies of the company have been evaluated. Different
organizations plan and schedule different manufacturing and production plan along with the
help of different strategies. Some organization prepare the products only after receiving the
customer’s order while some other companies make goods and distribute the products and
goods to the distributors and retailers from where the customers could buy the product.
In case of Kopitiam Investment pte limited, it has been evaluated that the company
should follow the chase strategy for the production. Chase strategy depicts that an
organization should produce only enough products to exactly match the demand of the
customer (Yan, 2017). This strategy has many pros such as the company could maintain the
low inventory which frees the cash of the company and it also reduces the inventory cost of
the company. It also offers the fresh product and goods to the customers so that they could
feel satisfy.
5. Financial planning
Financial planning has been evaluated further to identify the position of Kopitiam
Investment pte limited in the china market. Financial planning has been evaluated to identify
the estimated expense, revenue, and financial strength cash position etc of the company after
diversification into Chinese market. The financial planning of Kopitiam Investment pte
limited is as follows:
5.1 cost analysis, funds and cash flow:

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Firstly, the cost of the company has been evaluated and it has been found that what
would be the cost of the company and how much would be the cash flow of the company
after the first year. Following is the Cash flow statement of the company:
Cash Sales $ 2,500.00
Cash collected from customers (debtors) $ 3,000.00
Stock purchased, not yet paid $ 2,000.00
$ 1,000.00
Total Expenses $ -
Inventory (stock)purchases $ -
Sales made not yet collected (Sheridan, Arthur
and Martin, 2017)
$ -
$ 8,500.00
Sale of property and equipment $ -
Matured Investments $ 1,000.00
Purchase of property and equipment $ 500.00
Purchase of investments $ 5,000.00
$ 6,500.00
Increase in short term debt $ 50.00
Increase in long term debt $ 100.00
Increase in equity (proceeds from owners) $ 500.00
Repayment of loans $ 1,000.00
Dividends $ 500.00
$ 2,150.00
$ 17,150.00
Cash at End of Year $ 17,150.00
The cash flow statement of the company explains that the company would be able to
manage the cash inflow and outflow in a better manner in Chinese market. The cash outflow
of the company is quite lesser than the cash inflow of the company. It explains about a better

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position of the company (Renz and Robert, 2016). The funds would be invested by the owner
of the company as well as Chinese local company which has made a contract of joint venture.
5.2 Project profit and loss account:
Profit and loss account explains about the financial position of the comapny in terms of
expenses and the revenue of the company, profit and loss account of Kopitiam Investment pte
limited is as follows:
Profit & Loss Statement
Month Apr 18 Apr 19 Apr 20
Income
Total Sales 10,500 13,000 15,700
Less Total Disc/Comm. 1,300 1,550 1,650
Total Net Income 9,200 11,450 14,050
Less Total Cost of Goods
Sold
2,550 3,638 4,547
Gross Profit 6,650 7,813 9,503
Expenses
General & Administrative 1,550 1,550 1,550
Marketing & Promotional 1,500 1,850 1,850
Operating Expenses 675 755 855
Motor Vehicle Expenses 370 370 370
Website Expenses 45 45 45
Total Employment Expenses 905 945 968
Occupancy Costs 585 648 726
Other Expenses 120 160 160
Total Expenses 5,215 5,748 5,948
Monthly Net Profit /
(Loss)
1,435 2,065 3,555
Total Year to Date Net Profit / (Loss) 1,435 3,500 7,055
(Bekaert and Robert, 2017)
Profit and loss account of the company explains about the revenues and the total
expenses of the company. It briefs that in initial year, the profitability level of the comapny
would be lesser but with the time, the position of the company would be better. The profit
and loss ratios of the company are as follows which explains about the future prediction of
the company and the performance of the company:

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Profit and Loss Ratios
2018 2019 2020
Gross Margin
(Gross Profit / Net Income)
0.72283 0.68231 0.67638
Net Margin
(Net Profit / Net Income)
0.15598 0.18035 0.25302
Mark Up
((Net Income Less Cost of
Goods Sold) / (Cost of
Goods Sold)) x 100
2.60784 2.14777 2.09003
Break Even
( Expenses/((1-(Cost of
Goods Sold/ Net Income))
7214.74 8423.54 8794.07
(Lau, 2016)
5.3 Other financial statements:
Other financial statement of the company includes balance sheet. Balance sheet
explains about the financial position of the company. It explains about the total assets and
total liabilities of the company. Following is the balance sheet of the company:
Balance Sheet
Month Apr 18 Apr 19 Apr 20
Assets
Current Assets
Cash on hand $5,000.00 $7,500.00 $6,000.00
Debtors $3,000.00 $4,000.00 $8,000.00
Prepaid Expenses
General $150.00 $150.00 $150.00
Rates $100.00 $100.00 $100.00
Work cover $50.00 $50.00 $50.00
Insurance $50.00 $50.00 $50.00
Etc.
Total
Prepaid
expenses
$
350.00
$
350.00
$
350.00
Inventory
Raw material $450.00 $562.50
Total
Inventory
$
-
$
450.00
$
562.50
Short term Investments
$
50.00
$
500.00
$
1,000.00

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Other current assets
$
-
$
1,500.00
$
2,500.00
Total Current Assets
$
8,400.00
$
14,300.00
$
18,412.50
Fixed Assets
Computer $1,000.00 $1,000.00 $1,000.00
Store Fit Out $500.00 $500.00 $500.00
Office Equipment $500.00 $750.00 $1,500.00
Leasehold $150.00 $200.00 $450.00
Buildings & improvements $300.00 $500.00 $800.00
Furniture & Fixtures $100.00 $300.00 $500.00
Etc.
Total Fixed Assets
$
550.00
$
1,000.00
$
1,750.00
Total Assets
$
8,950.00
$
15,300.00
$
20,162.50
Liabilities
Current Liabilities
Bank Overdraft
$
-
$
900.00
$
900.00
Credit Card Debt
$
1,000.00
$
800.00
$
1,200.00
Creditors
$
2,000.00
$
2,500.00
$
1,200.00
GST collected
$
50.00
$
500.00
Superannuation
$
-
$
15.00
$
80.00
PAYG Withholding Payable
$
-
$
20.00
$
60.00
Work cover Insurance
Payable
$
-
$
40.00
$
40.00
Current portion of long term
debt
$
1,500.00
$
1,500.00
$
2,000.00
Etc.
Total Current Liabilities
$
4,500.00
$
5,825.00
$
5,980.00
Long Term
Liabilities
Motor Vehicle
Loan
$
1,000.00
$
500.00
$
300.00
Equipment
Finance
$
640.00
Long term Loans
$
200.00
$
500.00
$
800.00
Total Long Term Liabilities
$
1,840.00
$
1,000.00
$
1,100.00

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21
Total
Liabilities
$
6,340.00
$
6,825.00
$
7,080.00
Net Assets
$
2,610.00
$
8,475.00
$
13,082.50
Shareholders’ Funds ( Equity)
Owners
Funds
$
1,000.00
$
4,475.00
$
4,027.50
Retained
Earnings
$
175.00
$
500.00
$
2,000.00
Current Year Profit
$
1,435.00
$
3,500.00
$
7,055.00
Total
Shareholders’
Funds
(Equity)
$
2,610.00
$
8,475.00
$
13,082.50
Balance sheet of the company explains about the total assets, owners stock and total
liabilities of the company. It briefs that in initial year, the financial position level of the
comapny would be not strong but with the time, the position of the company would be better
(Finkler et al, 2016). The balance sheet ratios of the company are as follows which explains
about the future prediction of the company and the performance of the company:
Balance Sheet Ratios
Current Ratio (Current Assets
/ Current Liabilities)
1.866666667 2.454935622 3.079013378
Quick Ratio ( Current Assets
less inventory) / (Current
Liabilities less bank overdraft)
2 3 4
Working Capital Funds
(Current Assets Less Current
Liabilities)
3,900 8,475 12,433
Leverage Ratio (Total
Liabilities / Total Assets)
0.708379888 0.446078431 0.351146931
Debt to Equity Ratio
(Total Liabilities / Total
Shareholder’s Funds)
2.429118774 0.805309735 0.541180967
(Brooks, 2015)
It explains that the financial position of the company would be better in Chinese
market.
6. Management consideration

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Management consideration evaluates all the data related to the management team of the
company to evaluate the performance and the position of the company (Gunn and Simon,
2017). It has been evaluated the management of the company should consider the following
factors to manage the performance and the position of the Kopitiam Investment pte limited:
6.1 Personnel and sales force factor:
Management of the company should consider the sales and human resource factor to
manage the performance of the company. It has been evaluated that the management of the
company is required to evaluate the sales factor to enhance the sales of the company as well
as the personnel factor of the company should also be evaluated with efficiency by the
company.
6.2 Business advisers:
Management of the company should consider the factors, decision and changes in the
organization after evaluating and considering the advices from the professionals. It has been
evaluated that the management of the company is required to evaluate all the related factors
to manage the performance of the company so that the business could be run with the
efficiency and effectively (Bar et al, 2018).
6.3 Contingency plans:
Lastly, the management of the company is required to check all the marketing
strategies, sales strategies, business strategies, financial strategies etc to manage the
performance and impalement the action plan in perfect way. Company is required to prepare
the contingency plan prior so that the business plan could be run by the company efficiently.
7. Conclusion and recommendations:
To conclude, Kopitiam Investment pte limited is a private limited company. The study
on Kopitiam Investment Pte limited and its joint venture with a local company in china
market explains that the company would enjoy various pros of joint venture in china market.
The main advantage of joint venture is that it helps the company to grow faster, generate
greater profit and increase productivity of the company. It would offer various attractive
options to the Kopitiam Investment pte limited in china market.

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The study on company explains that the legal position, financial position, marketing
position, product position, environmental position, business strategy position, marketing
position and financial position of the company explain that the performance of the company
would be quite better in the company. Though, it s recommended to the company to make
few changes in the business strategy, sales evaluation etc to manage the performance and the
position of the company.

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24
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