entrepreneur analysis - complied v1

Running head: JAWAD INTERNATIONAL (PVT) LTD

ENTREPRENEURIAL ANALYSIS

OF

JAWAD INTERNATIONAL (PVT) LTD

By

W.D.L.S Weerasekera (2009/MBA/WE/53)

S.P.T. Thejani (2009/MBA/WE/54)

J.B.A.R. Niroshana (2009/MBA/WE/71)

Lucksiri Perera (2009/MBA/WE/FIN/21)

Varuna Dharmarathna (2009/MBA/WE/FIN/30)

A.C. Wickramasinghe (2009/MBA/WE/FIN/37)

Semester III – Second half

May 2011

Course: MBAGM 614 – Entrepreneurship and Small Business Management

Lecturer(s): Prof. Gamini De Alwis

Dr. Sarath Buddhadasa

Postgraduate and Mid-Carrier Development Unit

Faculty of Management and Finance

University of Colombo


Contents

1 Research Objective.............................................................................................................1

2 Introduction.........................................................................................................................2

2.1 Personal History of the Owner....................................................................................2

2.2 Company......................................................................................................................2

2.3 Products and Export market........................................................................................3

2.4 The Facility..................................................................................................................3

2.5 Financing.....................................................................................................................3

3 Business Analysis...............................................................................................................4

3.1 How the business grows..............................................................................................4

3.2 Profitability and stability of the business....................................................................4

3.3 Ratio analysis...............................................................................................................5

3.4 Industry analysis..........................................................................................................6

3.5 SWOT Analysis...........................................................................................................7

4 Entrepreneurial Analysis.....................................................................................................9

4.1 Need for achievement (N-Ach)...................................................................................9

4.2 Risk Taker...................................................................................................................9

4.3 Opportunity Seeking Behavior..................................................................................10

4.4 Innovator....................................................................................................................10

4.5 High Locus of Control...............................................................................................11

4.6 Visionary Person.......................................................................................................11

4.7 Entrepreneurial questionnaire....................................................................................11

5 Recommendation..............................................................................................................13

5.1 Age of the organization.............................................................................................14

5.2 Size of the organization.............................................................................................15

5.3 The speed of growth..................................................................................................15

6 Reference..........................................................................................................................17

Annex 1 - Assumptions made in preparing the Balance sheet and Income Statement............18

Annex 2 - Income Statement for 2008, 2009, 2010, 2011 (forecast) and 2012(forecast)........19

Annex 3 – Balance sheet of Jawad International (pvt) Ltd (Comparative)..............................20

Annex 4 - Key financial ratios.................................................................................................21

Annex 5 – Self rating questionnaire.........................................................................................22


List of Figures

Figure 3-1 : Business forecast....................................................................................................4

Figure 3-2 : Value chain and Supply chain management...........................................................6

Figure 5-1 : Age of the Organization.......................................................................................15

Figure 5-2 : Growth speed of the Organization........................................................................16

Figure 5-3 : five phases of growth...........................................................................................16

List of Tables

Table 4-1 : Entrepreneurial Analysis.......................................................................................12

ENTREPRENEURIAL ANALYSIS 1

1 Research Objective

Main objective of this research is to analyze the success and the sustainability of the

entrepreneurship, Jawad International (pvt) Ltd and relate the entrepreneur’s qualities

towards the business using relevant theories. In this context we have adopted the

methodology which is inclusive of accepted questionnaire for capturing entrepreneur’s

qualities. Financial statements constructed based on the information provided by the

entrepreneur were used for measuring the success of the business.


2 Introduction

2.1 Personal History of the Owner

Mr.Mohomed Jawad is the founder of this company. He got education up to Ordinary

Levels (O/Ls) at Viruthodi Muslim Vidyalaya. After doing O/Ls, he has migrated to Saudi

Arabia and he worked there for almost ten years. His occupation at Saudi Arabia was not

mentioned during the interview. After returning to the country, he has worked as an

intermediary for a short period. As a broker, he purchased coir from local suppliers and sold

them to some other manufactures. However, his inner intention was to start a business owned

by him in the future and ultimately he became the owner of the Jawad International (Pvt.)

Ltd.

He is from a Muslim family

and his father is a community

leader and his grandfather has done

Copra business. (Coconut related

business). Therefore, from his

childhood he has been grown in a

business environment. So that from

the childhood, he was dreaming to

start his own business and that

imagination and hard working

nature caused him to start his own business.

2.2 Company

Jawad International (Pvt.) Ltd. is one of the organizations engaged in exporting of

coir products from Sri Lanka. It falls under the small enterprise category and the main

product area of the company is baled coconut fiber. The company has been in the coir

industry since 2008 and is striving its way towards a better hold of the company’s growth.

Coming from the coconut triangle of Sri Lanka, the company has always been a part of eco-

friendly product manufacturing in the country. China is the main target market at present and

the organization is also geared to develop products to individual customer specifications.


2.3 Products and Export market

The main product area that the company is

engaged in is the baled coconut fiber category.

Fiber is compressed into bales and this baled

fiber is used in agriculture industry as hydro

seeding mixture provides better medium for

seed germination. This fiber is also used in

nursery pots and flower pots and also it helps

the environment by acting as an erosion

control product. He exports his products to

twenty one companies in Fujian, China. On

average, three number of 40 feet containers

are being exported per week. This is roughly (17.5 X3) Tons and as per him the monthly cash

inflow is US$ 200,000.00.

2.4 The Facility

He has an in-house production facility and he collected some assets to his business

gradually including two Chinese made bail machines, three vehicles, a forklift, a large factory

building with loading bay, an office and other auxiliary buildings. Since his factory is located

very close to the suppliers, it is a definite advantage for him to collect row materials easily at

lower cost. On the other hand he has built a good rapport with suppliers in order to build a

strong supply chain. Although he has done this business more than two years, no any

advertising has been done so far.

As instructed by Export Development Board he has recently built a boundary wall

around the factory and finished his building as per EDB stipulated standards. Since his low

education level he has not applied any SME awards and therefore he has not achieved such

awards so far although he is success in his venture.

2.5 Financing

Financing for the business has been basically done as equity finance. He saved the

earned money during his transition period and invested them to start his own business.


3 Business Analysis

3.1 How the business grows

Based on the information gathered from Jawad, we have constructed the Income

Statement of the business for 5 years commencing from 2008 (Y0) where the figures for

2011(Y3) and 2012(Y4) were estimated subject to certain assumptions (Annex 1). As agreed

with Jawad, we also built up 3 scenarios under the probabilities assigned, with annual

performance increment of 25%, 10% and a reduction of 10% for the Cases, “Best”, “Normal”

and “Worst”, respectively (Annex 2). Graphical representation of the scenarios is as follows.

Best Case Normal Case Worst Case

Figure 3-1 : Business forecast

Results indicate that Jawad should make efforts to keep his business around or above

the normal case, to ensure future business growth. Requisite suggestions in this context are

further discussed under recommendations.

3.2 Profitability and stability of the business

The aforesaid Income Statement also follows a Balance Sheet as at 31st December,

2010 (Annex 3) and Cash Flow Statement for 2010 (Annex 4). For analytical purposes we

will consider the income statement under the normal case.

Gross and net profits figures are positive, indicating that the entrepreneur is in a

profitable business.


Balance sheet shows that the receivable and the cash amounts are much higher than the

rest of the assets suggesting the entrepreneur to search for optional mechanisms to them

within the company’s working capital life cycle and to consider the excess cash to be

invested in other positive NPV projects, capital market (by constructing a portfolio) or money

market etc. Higher amounts under the capital and tax payable also support the above

argument.

Screening through the Cash Flow Statement is evidenced that the magnitude of the

amounts received from the customers and the amounts paid to suppliers are almost similar.

This suggests the need of searching for some credit mechanisms such as negotiating credit

terms with the suppliers, exporting on DA terms etc.

3.3 Ratio analysis

Based on the key financial ratios of the business (Annex 4), our comments are given

below.GP Margin indicates that the entrepreneurship is in a profitable business. However

26% may not be a very healthy indicator as the GP Margin.

NP Margin has increased by 2% during 2010 and the present rate of 11% which is

slightly above the prevailing interest rates within the economy.

Return on capital employed (ROCE) is 44% in 2010 and an increase of 100% as against

the previous year. The returns of the business are at a very high position in relation to the

capital employed.

Gearing of the company is zero as the entrepreneur is running the business almost on

his own capital. Although the machines are obtained on loan, this has been fully settled

during 2010. Also the current interest coverage is 55 times. The position indicates that he can

look for further business expansions by raising some debt capital.

Current asset and quick asset ratio of the business are 6: 1 and 23: 1 respectively.

Although the ideal position of these rates are depending on the industry, as we see they are

very high suggesting the entrepreneur to look for his supply chain management process as

against the value chain of the organization. A supply chain is the stream of processes of

moving goods from the customer order through the supply, raw materials stage, production,

and distribution of products to the customer inclusive of the customer services. Managing the

chain of events in this process is known as supply chain management. Effective management

ensures coordinating all these different pieces quickly and efficiently, without losing the


customer satisfaction (RGG University, Supply Chain Management). We need value chain to

understand the activities through which a firm develops a competitive advantage in creating

the organizational value. It separates the business system into a series of value-generating

activities. M. E. Porter identified primary and support activities that comprise a sequence of

activities found to be common to a wide range of firms (Jonson G., Scholes K, Whittington

R). Based on the above theories, the relationship of supply chain and value chain of our

entrepreneur can be shown through the following diagram.

Figure 3-2 : Value chain and Supply chain management

3.4 Industry analysis

Assessing the existing competition is another vital area when performing a business

analysis for a business organization. This will assure long term survival and growth of the

entity. If it is a small scale business the owner/entrepreneur should have an idea of the

magnitude of the competition so that he/she could take necessary steps to withstand

successfully in the competition or avoid any adverse effects of competition.

In this context, we intend to assess the magnitude of the competition that Mr. Jawad

(“Jawad International”) is currently experiencing as an entrepreneur. This assessment will

focus mainly five key areas based on Michael Porter’s five forces model. They are namely,

suppliers, customers, new entrants, substitute products and no of existing competitors.

As far as this coir related business is concerned, the suppliers are individuals who

supply raw coir materials. The quantity of each supplied is not large with compared to the


total volume purchased by Jawad. Other coir raw material collectors in the area also offer

similar prices to that of Jawad. Further, these suppliers are vested with no other option if they

do not supply these materials one of collectors/coir product manufacturers like Jawad.

Therefore, it is clear that suppliers do not have a bargaining power if his/her quantity supplied

is significant.

Jawad focuses only on foreign customers; Chinese buyers who initially helped him

start the business. He heavily depends on this single buyer and he does not have any control

over the buyer. This seems to be very risky area of this business unless Jawad finds new

buyers locally or internationally by using his existing network.

Coir business does not require specific technical know-how. Therefore, anyone who is

interested in coir related business could enter the business as long as s/he has easy access to

raw materials required. Further, even at present there are few coir collectors available in the

area. However, in the case of Jawad he is operating at quite large scale not being merely a

coir collector but adding value to it through further processing. On the other hand he is more

comfortable with high demand from his sole buyer. As a result, he is ahead in the competition

and though new competitors get into the same business Jawad would not be much affected.

It is very difficult to find substitutes for coir products in the sense that it is fully

dependent on natural materials (wastes of coconut tree). However, there is a risk of being

introduced low cost artificial material which is substitutable by Chinese inventors. Therefore,

if that happen this entrepreneur has to find other buyers locally or internationally.

It can be concluded, in summary, all other factors considered in competitor analysis are

favorable to Jawad’s coir product business except bargaining power vested with buyer.

However, the impact of only unfavorable factor could be critical in the sense that he has only

one buyer.

3.5 SWOT Analysis

Another very important area of business analysis is assessing internal and external

environment of the organization. Strengths and weaknesses are internal factors to be

concerned whereas opportunities and threats are external to the organization. Accordingly,

this section consists of brief SWOT analysis with respect to Jawad’s business.

The key strength of this business is assistance from Chinese partner. Because of

Chinese assistance Jawad has been able to own two “Bail Machines” and assurance about his

sales, which are competitive advantages for him. Also, since Jawad is operating large scale

with compared to others suppliers have more confidence on him. This enables him buy more


materials on 7 day credit basis. Further, experience gained and network built among

suppliers, buyers and labors can also be considered as internal strengths.

On the other hand, Jawad heavily depends on Chinese assistance and he has only one

buyer. He does not think of other options available to him either. As a result, any unfavorable

decision from Chinese buyer would totally change his journey.

There are opportunities available to this business. Jawad could think of producing the

end product what Chinese partner produce with his materials or some coir related new

products for local market.

However, there might be potentially threats from availability of materials due to some

diseases caught by coconut trees like we currently experiencing in Galle, Matara, Weligama

areas. Further, there is always risk of emerging new entrepreneurs in this sector with more

innovative products where s/he could offer higher prices to suppliers than that of Jawad.


4 Entrepreneurial Analysis

When analyzing the background information of Jawad, we could observe that several

entrepreneurial characteristics have been inherited by himself from his small stage.

Need for achievement

Risk taker

Opportunity seeking behavior

Innovator

High locus of control

Visionary person

4.1 Need for achievement (N-Ach)

Need for Achievement (N-Ach) refers to an individual's desire for significant

accomplishment, mastering of skills, control, or high standards. Jawad has a burning driven

to be an achiever. He seems to be more concerned with personal achievement than with the

rewards of success. As his background information depicts, after a short time period once

returning from overseas he has initiated his business as a broker in coir business while the

intention of starting his own business was struggling in his mind. During this period, he

might have definitely gathered the information related to the coir business and made good

social network which might help him in the future. Once he has started the business he had to

undergo several obscurities, but he never thought of giving up the business. He has a strong

determination of making his dream a true. He is a "can do" person who demonstrates

common sense in his decision and actions and is able to cut through and resolve problems

effectively. Before commencing the new business he saved every cent for his future business.

He pursued issues until results are achieved and paid the high degree of energy till his

business grew up to his satisfaction level. All these traits show that how achievement oriented

he is.

4.2 Risk Taker

Jawad can be considered as a risk taker since he had to operate the business

effectively in an environment filled with risk and uncertainty from the very beginning of his

new business. He has invested all his saved money in his business knowing that if something

bad has happened he will lose everything he had. For example, if the exported products are


not in good condition, buyers might reject the goods creating losses for the business and it

was one of the biggest challenges in front of him. But his commitment and strength of mind

helped him to withstand as a calculated risk taker. He was able to make progress towards

goals and was able to make decisions when lacking one or several critical resources or data.

Knowing his own strengths and shortcomings, he has established and managed his business

in a manner which helped to mitigate huge risks.

4.3 Opportunity Seeking Behavior

Jawad can also be considered as an opportunity seeker. As mentioned in his

background data, he has identified the advantage of the location he was living. His home

town is located within the coconut triangle in the country and the nearest port is Colombo,

which is 65km away and the Katunayake International Airport is just 40km away. He has an

in-born advantage of producing high quality products since his home area has the ideal

climate for coconut cultivation. Therefore, he was able to collect the necessary row materials

from the surrounding area and he knew that quality is one of the prime factors that he should

take into the consideration when outperforming competitors. Therefore, Jawad maintained a

better relationship with suppliers to buy quality materials since the whole business operation

is depending on the row materials provided by the suppliers and it is a major factor for

business sustainability. He could reduce the transportation costs since the row materials

sources were located in the close by areas. Likewise, he was intelligent enough to grasp the

opportunities existed around his environment in order to attain his ideation on coir business.

4.4 Innovator

The major step of Jawad’s successful venture is developing a creative idea by looking

at opportunities of his environment as above discussed and proper understanding of his

strengths and core capabilities. Since he has been grown in a business environment during his

childhood, the idea of generating a business might have flashed in his mind from those days.

The innovative ideas of Jawad helped to shape up his business in order to achieve his ultimate

goals. Coming up with innovative ideas has become a continuous activity in his business and

he always sees new ways of doing things with little concern for how difficult they might be.

He never satisfied by merely achieving what he really expected and he made into practice

what he really dreamt. He knew exactly where he was, what he wanted, or what he didn’t

want, and based on that he stepped into the next step of the creation of ideas or innovate

something. He was encouraged by this splendid thinking combined with the willpower to


start the business of exporting of coir products by using the existing resources in his

surroundings.

4.5 High Locus of Control

As an entrepreneur in coir business, Jawad was able to control the circumstances that

affected his business in numerous ways in both internally and externally. He takes the full

responsibility for all the things happen in his business and his behavior is also figuring out it

clearly. He makes sure to maintain extensive and noteworthy relationships with both

suppliers and buyers since the whole business is controlled by those parties. Further, he was

able to properly maintain the financial aspects of the business although he has never used

advanced financial techniques like balance confirmations, income statements, profit and loss

accounts and etc. By doing so, he was able to invest what he earned prior to business and

during the business for expansion of the business and assets. He had only few permanent

workers, but he is clever enough to retain them with himself due to his respectful and

empowering relationship with them. He knew that they are the key assets for his business.

Likewise, his internal locus of control with related to the factors of production helped him to

achieve his determination.

4.6 Visionary Person

Jawad can be considered as a visionary leader who dreams wonderful visions of the

future and articulate them with great inspiration. Higher commitment to the values is an

outstanding characteristic of him and he is elevated by power and exercised moral leadership.

From his childhood, he had a positive picture of the future, as well as a clear sense of

direction as to how to get there. That’s why he dedicated his whole life and sacrificed many

things to reach his ultimate target. Once he visualizes something, he sees exactly how to

make it happen.

4.7 Entrepreneurial questionnaire

To identifying the entrepreneur characteristics in quantitative manner it should assess

through a comprehensive questionnaire. Therefore comprehensive questionnaire should

address the each entrepreneurial characteristic and also need to capture the accuracy of the

data gathered.

A questionnaire (Annex 6) which is capturing 13 entrepreneurial characteristics of Initiative, Sees and Acts on Opportunities, Persistence, Information Seeking, Concern for High Quality of Work, Commitment to Work Contract, Efficiency


Orientation, Systematic Planning, Problem Solving, Self-confidence, Assertiveness, Persuasion and Use of Influence Strategies. Mr. Jawad’s skills and characteristics were analyzed using this questionnaire.

Characteristic ScoreInitiative 22

Sees and Acts on Opportunities 18Persistence 21

Information Seeking 23Concern for High Quality of Work 19

Commitment to Work Contract 21Efficiency Orientation 23Systematic Planning 22

Problem Solving 20Self-confidence 24Assertiveness 22

Persuasion 22Use of Influence Strategies 20

Correction factor 16Corrected Total Score 277

Table 4-1 : Entrepreneurial Analysis

With this analysis it can be clearly seen that Mr. Jawad is a genuine person because

that corrective point 16 are below 19. And his characteristics are majority scoring more than

20 points by summing up to 277. But in few occasions like Sees and Acts on Opportunities

and Concern for High Quality of Work are lagging behind which indicates by getting value of

18. As an example adoption to new technology or applying for the SME category award and

recognition programs were not seen from Mr. Jawad. Also he is not much concern on to

adoption to latest quality checking process which is symptoms of lagged characteristics.

But at the field it can be seen that he is very powerful in persuading others to achieve

his objectives. Mr. Jawad is only player in coir export in this region which illustrates his

initiative characteristics. Also he is very confident in business because he is ensuring his

factory maintain the required standard as well as he insured his property with government

insurance company. It also gave himself confident on his business.


5 Recommendation

From our study we conclude that Jawad is an entrepreneur with N-arch traits. From

his humble beginnings coupled with laborious work at the incipient stages, he has achieved

greater strides in his business domain and today is an established businessman in the area

with a monthly turnover around USD 200,000.00 (approximately LKR 22.20 million). Apart

from his personal success, Jawad portraits himself as a foreign exchange earner to the nation,

to which he places more value than his personal achievements. In essence, Jawad also

demonstrates the traits of need for common affiliation that transcends personal goals.

The core competence of his business is the business link that he has established with

China via his Chinese partner. This is a highly vulnerable core competence. The entire

success of Jawad’s business depends on this particular individual. Further, owing to the

proliferation of Information Technology (IT) the entire world has become one village.

Establishing business relationships has become a common aspect via IT with very lower

transaction costs. Hence, for how long Jawad could exploit the core competence for his

competitive advantage is a matter that need scrupulous thought.

Therefore, to surmount the challenges, Jawad must understand the changes in the near

(micro) and the far (macro) environment and respond accordingly.

The main ingredient of the product he exports is “coir”. Therefore, there is a high

degree of bargaining power of the suppliers. Though at present he maintains a very

harmonious rapport with them, it may be possible that such relationships may strain as time

progresses and the suppliers may switch allegiances. Therefore, in order to defuse a potential

threat, Jawad may consider backward integration by acquiring the business of some of the

main suppliers and / or acquiring coconut lands so that he could directly source the raw

material. This could also herald the end for other players of the industry in the area in which

Jawad operates thereby negating the inter-firm rivalry.

The above measure could deter the any new entrants to the industry in that area. This

is because the main raw material sources are under the realm of Jawad and hence the

remaining suppliers would be compelled to continue supply to his business instead to some

other business.


As mentioned, the success of the business is dependent on one single customer.

Hence, we may conclude that there is a very high degree of bargaining power of that

customer. In the event that the solo customer decides to sever the business relationship with

Jawad then the entire business would be in a quandary. To overcome such a possible scenario

following measures are recommended:

The value addition for the raw material is at a very rudimentary level. Jawad must

ascertain the purpose of his product being used in China and explore the possibility of

manufacturing the end product.

Another option would be to tap other international markets to supply the basic product

and / or a value added product.

For above purposes, assistance from the Export Development Board (EDB) may be

solicited.

If the users of Jawad’s product in China find an alternative that is superior in cost,

quality, ease of handling, etc, the sustenance of the business is at stake. Hence, avenues to

continuously improve the quality of the product and extensive liaison with the customer to

fulfill the changing aspirations are necessary.

Jawad’s business is also exposed to the vicissitudes of the macro environment such as

political, economic, social, technological and legal aspects.

In order to effectively deal with challenges discussed above (micro and macro), Jawad

needs to fathom the stages of his business and respond accordingly. An appropriate

framework would be Greiner’s Evolution and revolution as organizations grow.

The two most important dimensions are the “age of the organization” and the “size of

the organization”:

5.1 Age of the organization

Same organization practices are not maintained throughout a long life span. Jawad’s

business commenced in 2008 and it is still a young business. However, as the business grows

more employees will be recruited, equipment employed, perhaps the business itself moving

into a new premises, the present direct controls can’t be sustained.


Figure 5-3 : Age of the Organization

5.2 Size of the organization

A company's problems and solutions tend to change markedly as the number of

employees and sales volume increase. Thus time is not the only determinant of structure; in

fact, organizations that do not grow in size can retain many of the same management issues

and practices over lengthy periods. In addition to increased size, however, problems of

coordination and communication magnify, new functions emerge, levels in the management

hierarchy multiply, and jobs become more interrelated. Jawad can’t escape this veracity.

5.3 The speed of growth

The speed at which an organization experiences phases of evolution and revolution is

closely related to the market environment of its industry. For example, a company in a

rapidly expanding market will have to add employees rapidly; hence, the need for new

organization structures to accommodate large staff increases is accelerated. While

evolutionary periods tend to be relatively short in fast-growing industries, much longer

evolutionary periods occur in mature or slowly growing industries. Evolution can also be

prolonged, and revolutions delayed when profits come easily. For instance, companies that

make grievous errors in a rewarding industry can still look good on their profit and loss

statements; thus they can avoid a change in management practices for a longer period.


Based on the best available information we may conclude that the company is in a

low growth industry. Hence, the evolutionary periods can be longer for Jawad but still it

should happen.

Now let us analyze what obstacles (revolutions) that Jawad would have to face

(including the influences of the macro environment as described above), how to address them

and how evolution can take place.

Figure 5-4 : Growth speed of the Organization

The following table provides a summary of the organization practices that Jawad’s

business could adopt during the evolution in the five phases of growth:

Figure 5-5

:

five phases of growth


6 Reference

ANSHU GUPTA. (n.d.). ENTREPRENEUR AND ENTREPRENEURSHIP. Retrieved 2011,

from www.egyankosh.ac.in:

http://www.egyankosh.ac.in/bitstream/123456789/36012/1/MTM8-02.pdf

Greiner, L. E. (n.d.). Evolution and Revolution as Organizations Grow. Harward Review , p.

Vol. 50(4).

Jonson G., Scholes K, Whittington R. In Exploring Corporate Strategy (7th Ed.) (p. 137).

RGG University, Supply Chain Management. (n.d.). Supply Chain Management. Retrieved

May 2011, from rockford consulting.com: http://rockford consulting.com/supply-chain-

management.htm.


Annex 1 - Assumptions made in preparing the Balance sheet and Income Statement

1. Transactions were taken place towards the beginning of the year

2. Transactions were taken place towards the beginning of the year.

3. Transactions were taken place towards the beginning of the year

4. Taxes were computed based on the country's tax law, as tax information of was not

available.

5. No additions of property plant and equipment were made after the year 2010.

6. No volatility of exchange rates. US$= 110 LKR

7. So far no payments made to Jawad for his services rendered to the business.

8. Loan on machines supplied by Fujian was fully settled in 2010.

9. Purchases are made on cash basis, while the sales proceeds are expected to settle in one

month (No receivables towards the end of 2009).


Annex 2 - Income Statement for 2008, 2009, 2010, 2011 (forecast) and 2012(forecast)


Annex 3 – Balance sheet of Jawad International (pvt) Ltd (Comparative)


Annex 4 - Key financial ratios

2010 2009

Profitability and Efficiency

Ratios

GP Margin 26% 26%

NP Margin 11% 9%

Return on capital employed 44% 20%

Solvency Ratio

Gearing Ratio (Debt Equity

Ratio) 0% 0%

Interest Coverage (No of

times) 55

18

Liquidity Ratios

Current Ratio 6 8

Quick Asset Ratio 23 1


Annex 5 – Self rating questionnaire

Name Mr. Mohomed Jawad

Company Jawad International (pvt) LTD..

Address Madurankuliya, Puttlam

Date 23rd of April 2011

Instructions

1) This questionnaire consists of 70 brief statements. Read each statement and decide how well it describes you. Be honest about yourself.

2) Select one of the numbers below to indicate how well the statement describes you:

5 = Very well 4 = Well

3 = Somewhat 2 = Very little

1 = Not at all

3) Write the number you select on the line to the right of each statement. Here is an example:

1. remain calm in stressful situations. - 2

The person who responded to the item above wrote a “2” indicating that the statement described him or her very little.

4) Some statement may be similar, but no two are exactly alike.

5) Please answer all the questions.


Write the number on the line to the right of each statement.

1) I look for things that need to be done. : 5

2) I like challenges and new opportunities. : 4

3) When faced with a difficult problem, I spend a lot of time trying to find a solution. : 4

4) When starting a new task or project, I gather a great deal of information. : 5

5) It bothers me when things are not done very well. : 5

6) I give much effort to my work. : 5

7) I find ways to do things faster. : 5

8) I plan a large project by breaking it down into smaller tasks. : 5

9) I think of unusual solutions to problems. : 4

10) I feel confident that I will succeed at whatever I try to do. : 5

11) I tell others when they have not performed as expected. : 3

12) I get others to support my recommendations. : 5

13) I develop strategies to influence others. : 4

14) No matter who I’m talking to, I’m good listener. : 5

15) I do things that need to be done before being asked to by others. : 4

16) I prefer activities that I know well and with which I am comfortable. : 5

17) I try several times to get people to do what I would like them to do. : 5

18) I seek the advice of people who know a lot about the problems or tasks I am working on. : 5

19) It is important to me to do a high quality job. : 4

20) I work long hours and make personal sacrifices to complete jobs on time. : 5

21) I am not good at using my time well. : 3

22) I think about the advantages and disadvantages of different ways of accomplishing things. : 5

23) I think of many new ideas. : 5

24) I change my mind if others disagree strongly with me. : 2


25) If I am angry or upset with someone, I tell that person. : 5

26) I convince others of my ideas. : 5

27) I do not spend much time thinking about how to influence others. : 5

28) I feel resentful when I don’t get my way. : 3

29) I do things before it is clear that they must be done. : 4

30) I notice opportunities to do new things. : 5

31) When something gets in the way of what I am trying to do, I keep on trying to accomplish what I want. : 5

32) I take action without seeking information. : 1

33) My own work is better than that of other people I work with. : 5

34) I do whatever it takes to complete a job. : 5

35) It bothers me when my time is wasted. : 5

36) I try to think of above problems I may encounter and plan what to do if each problem occurs. : 5

37) Once I have selected an approach to solving a problem, I do not change that approach. : 5

38) When trying something difficult or challenging, I feel confident that I will succeed. : 5

39) It is difficult for me to order people to do things. : 2

40) I get others to see how I will be able to accomplish what I set out to do. : 4

41) I get important people to help me accomplish my goals. : 5

42) In the past, I have had failures. : 5

43) I take action before it is clear that I must. : 4

44) I try things that are very new and different from what I have done before. : 3

45) When faced with a major difficulty, I quickly go on to other things. : 4

46) When working on a project for someone, I ask many questions to be sure I understand what that person wants. : 5

47) When something I have been working on is satisfactory I do not spend extra time trying to make it better. : 5


48) When I am doing a job for someone, I make a special effort to make sure that person is satisfied with my work. : 4

49) I find ways to do things for less cost. : 5

50) I deal with problems as they arise, rather than spend time trying to anticipate them. : 3

51) I think of many ways to solve problems. : 5

52) I do things that are risky. : 5

53) When I disagree with others, I let them know. : 5

54) I am very persuasive with others. : 5

55) In order to reach my goals, I think of solutions that benefit everyone involved in a problem. : 5

56) There have been occasions when I took advantage of someone. : 4

57) I wait for directions from others before taking action. : 1

58) I take advantage of opportunities that arise. : 5

59) I try several ways to overcome things that get in the ways of reaching my goals. : 5

60) I go to several different sources to get information to help with tasks or projects. : 3

61) I want the company I own to be the best of its type. : 4

62) I do not let my work interfere with my family or personal life. : 4

63) I get the most I can out of the money I have to accomplish a project or task. : 5

64) I take a logical and systematic approach to activities. : 4

65) If one approach to a problem does not work, I think of another approach. : 5

66) I stick with my decisions even if other disagree strongly with me. : 5

67) I tell people what they have to do, even if they do not want to do it. : 5

68) I cannot get people who have strong opinions or ideas to change their minds. : 3

69) I get to know people who may be able to help me reach my goals. : 5

70) When I don’t know something, I don’t mind admitting it. : 5


1) Enter the ratings from the completed questionnaire on the lines above the item numbers in parentheses. Notice that the item numbers in each column are consecutive: item number 2 is below item number 1, and so forth.

2) Do the addition and subtraction indicated in each row to compute each competency score.

3) Add all competency scores to compute the total score. Rating of Statements Score Competency

5 + 4 + 4 + 4 – 1 + 6 = 22 Initiative (1) (15) (29) (43) (57) 4 – 5 + 5 + 3 + 5 + 6 = 18 Sees and Acts on Opportunities (2) (16) (30) (44) (58) 4 + 5 + 5 – 4 + 5 + 6 = 21 Persistence (3) (17) (31) (45) (59) 5 + 5 – 1 + 5 + 3 + 6 = 23 Information Seeking (4) (18) (32) (46) (60) 5 + 4 + 5– 5 + 4 + 6 = 19 Concern for High Quality of Work (5) (19) (33) (47) (61) 5 + 5 + 5+4 – 4 + 6 = 21 Commitment to Work Contract (6) (20) (34) (48) (62) 5 – 3 + 5 + 5 + 5 + 6 = 23 Efficiency Orientation (7) (21) (35) (49) (63) 5 + 5 + 5 – 3 + 4 + 6 = 22 Systematic Planning (8) (22) (36) (50) (64) 4 + 5 – 5 + 5 + 5 + 6 = 20 Problem Solving (9) (23) (37) (51) (65) 5 – 2 + 5 + 5 + 5 + 6 = 24 Self-confidence (10) (24) (38) (52) (66) 3 + 5 – 2 + 5 + 5 + 6 = 22 Assertiveness (11) (25) (39) (53) (67) 5 + 5 + 4+ 5 – 3 + 6 = 22 Persuasion (12) (26) (40) (54) (68) 4 – 5 + 5 +5 + 5 + 6 = 20 Use of Influence Strategies (13) (27) (41) (55) (69)

TOTAL SCORE = 277


5 – 3 – 5 – 4 + 5 + 18 = 16 Correction Factor (14) (28) (42) (56) (70)

CORRECTED SCORING SHEET Instructions 1) The Correction Factor (the total of items 14, 28, 42, 56, and 70) is used to

determine whether or not a person tries to present a very favorable image of him or herself. If the total score on this factor is 20 or greater, then the total scores on the 13 competencies must be corrected to provide a more accurate assessment of the strength of the competencies for that individual.

2) Use the following numbers when figuring the corrected score:

If the Correction subtract the following Factor score is: correction number from the Total score for each competency:

24 or 25 7

22 or 23 5

20 or 21 3

19 or less 0 3) Use the page below to correct each competency before using the Profile Sheet.

COMPETENCY PROFILE SHEET FOR SELF-RATING QUESTIONNAIRE

Instructions

1) Transfer the corrected competency score to the profile sheet by marking an “x” at the appropriate point on the dotted horizontal line for each competency.

2) Draw a heavy line over the dotted horizontal line for each competency, from the left vertical line to the point you have marked with an “x”. The heavy line you have drawn graphically represent the strength of each competency.

3) The following is an example of how to create the profile sheet. If the score for Initiative is 19, it will appear as follows: Initiative —————————————————– 0 5 10 15 20 25


CORRECTED SCORE SHEET Competency Original Correction Corrected

Score – Number* =Total

Initiative 22 – 0 = 22 Sees and Acts on Opportunities 18 – 0 = 18

Persistence 21 – 0 = 21

Information Seeking 23 – 0 = 23 Concern for High Quality of Work 19 – 0 = 19

Commitment to Work Contract 21 – 0 = 21

Efficiency Orientation 23 – 0 = 23 Systematic Planning 22 – 0 = 22 Problem Solving 20 – 0 = 20

Self-confidence 24 – 0 = 24

Assertiveness 22 – 0 = 22

Persuasion 22 – 0 = 22 Use of Influence Strategies 20 – 0 = 20

Corrected Total Score = 277

(ANSHU GUPTA)

entrepreneur analysis - complied v1

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