An India Entry Strategy plan for an international print on demand software making company. (May 2008)

1. Business plan, goals, focus & action
items for the India set up of an
international POD* software
company.
By:
Soumya P. Dhar
India 15th
May 2008
*Print on Demand

2. Agenda
Market Situation Analysis
Product
VDP
Market
Target Customer Segments
Strategy, plan and action points
Process flow
Goals
Business strategy
Distribution & Prospects
Sales & Action Plans
Projections

3. The product
variable data publishing (VDP)
Johannes Gensfleisch Gutenberg
Personalised marketing communication.

4. VDP
Variable-data printing (VDP)
a form of on-demand printing
text, graphics, images are manipulated from one printed piece to another
without stopping or slowing down the printing process.
using information from a database or external file.
A set of personalized letters, each with the same basic layout,
can be printed with a different name and address on each
letter.

5. The Need
On Demand Publishing
Direct Marketing & Fulfilment
Transactional Communication

6. The market
Indian printing market to grow to €11 billion by 2010
from € 8 billion in 2005 - Pira International, UK
estimates.
HP projects print market in India at € 12.81 billion (Rs
69,315 crore) by 2008, a growth of 47.5 % from 2003.
INDIA fastest growing print industry after China for HP’s
Imaging & Printing Group.
Digital printing is growing faster.
Xerox estimates Indian digital market will grow from €300
million in 2007 to €1 billon by 2012”.
VDP is around 3% of the total market.
Three “mega trends” in the industry Personalization,
Collaboration and Digitisation” - Ursula Burns, President,
Xerox in a recent visit to India.

7. Target Customer Segments
Print Service Providers
Direct Marketing Companies
Financial Services
Insurance
Utilities & Telecom
Government
Postal
Media

8. Agenda
Strategy, plan and action points
Process flow
Goals
Business strategy
Distribution & Prospects
Sales & Action Plans
Projections
Vision

9. Business process flow
Capability
Assessment
Status-
Review
Industry
Trends
Competitive
Analysis Financial
Analysis
Growth
Opportunity
Prioritization
Phase I
Phase II
Phase
III
Validated by
primary
market
research
Financial
Implications
• Market Potential
• Pro forma financials
• Profitability
Existing products,
distribution and pricing
Market
overview
Competitive landscape
Hypo-
thesis
Business options
& partnership
strategy
Partner
screening &
selection
Partnership
Strategy &
Partner
Selection
MARKETMARKET
ENTRY &ENTRY &
GROWTHGROWTH
MARKETMARKET
ENTRY &ENTRY &
GROWTHGROWTH

10. Goals
Double current sales. (€120,000 in ’07)
Increase & strengthen distribution.
Create ‘financial’ wins (have at least 5
prospects by the end of the year.)
Office and demo set up.
Build successful industry partnerships.
(HW vendors, industry associations.)

11. Distribution Focus
Value Added Resellers (VARs)
ISV (Independent Software Vendors)
Systems Integrators for the printing/publishing
industry.
Printing & publishing firms.
Target segment specific partnerships.

12. Prospect Focus
Hardware manufacturer relationships – HP, Xerox.
POD service providers like Printo at Bangalore.
Marketing and mail order fulfilment service providers.
All GSM and CDMA service providers.
Private utility service providers.
Key global customers in Insurance & Financial
services.

13. Business Strategy
• Grow distribution – target partners of ‘mail stream’
co.s like Pitney Bowes etc. strengthen and assist
current partner
• Marketing
– build case studies like Mega Calibre; create reference points
– participate in trade fairs
– PR; media coverage
• Industry & Trade association and member ships:
NPES - The Association for Suppliers of Printing,
Publishing and Converting Technologies.
• Drive the concept of the ‘Transactional Promotion’
Transpromo into new segments like finance.

14. Sales plans
• High touch sales model,
work closely with partner
with a regular business
plan and follow up.
• Develop new partners to
widen access to target
customer base.
• Competition accounts of
HP Exstream, PrintSoft,
EMC Document Sciences,
EFI.

15. Action Items
• Send information pack with a request
to meet to all 96 members of Indian
Printers association.
• Follow up with direct in person contact
& presentation with at least the top 20.
• Similar approach for distributors list.
• Sales & tech support team to be set up
for effective pre & post sale
coordination and service delivery.

16. P&L Budget € India - HY 2008
2008 Q1 Q2 Q3 Q4
Revenues
RS. 24 26 22 28
Total Revenues 240,000 15,573,600 57,600 62,400 52,800 67,200
Gross Profit
Gross Profit 96,000 6,229,440 23,040 24,960 21,120 26,880
Gross Margin 40.0 % 40 40.0 % 40.0 % 40.0 %
Salary Costs
Salaries, social sec, pensions 80,000 5,191,200 20,000 20,000 20,000 20,000
Operating Expenses
Marketing 10,000 648,900 2,400 2,600 2,200 2,800
Travel and Entertainment 10,000 648,900 2,400 2,600 2,200 2,800
Rental costs 30,000 1,946,700 7,200 7,800 6,600 8,400
Communication costs 10,000 648,900 2,400 2,600 2,200 2,800
Consulting, auditing, lawyers 15,000 973,350 3,600 3,900 3,300 4,200
Other Operating Expenses 20,000 1,297,800 4,800 5,200 4,400 5,600
Total Operating Expenses 175,000 11,355,750 42,800 44,700 40,900 46,600
Operating Profit
Operating Profit (79,000) (19,760) (19,740) (19,780) (19,720)
Operating Margin -32.9 % -34.3 % -31.6 % -37.5 % -29.3 %
Expense Ratios
SG&A in % of Revenues 106 109.0 % 103.7 % 115.3 % 99.1 %
G&A in % of Revenues 72.9 % 74.3 % 71.6 % 77.5 % 69.3 %
Salaries in % of Revenues 33.3 % 34.7 % 32.1 % 37.9 % 29.8 %

17. P&L Budget € India - FY 2009
2009 Q1 Q2 Q3 Q4
Revenues
RS. 24 26 22 28
Total Revenues 369,000 23,944,410 88,560 95,940 81,180 103,320
Gross Profit
Gross Profit 147,600 9,577,764 35,424 38,376 32,472 41,328
Gross Margin 40.0 % 40 40.0 % 40.0 % 40.0 %
Salary Costs
Salaries, social sec, pensions 100,000 6,489,000 25,000 25,000 25,000 25,000
Operating Expenses
Marketing 20,000 1,297,800 4,800 5,200 4,400 5,600
Travel and Entertainment 15,000 973,350 3,600 3,900 3,300 4,200
Rental costs 20,000 1,297,800 4,800 5,200 4,400 5,600
Communication costs 15,000 973,350 3,600 3,900 3,300 4,200
Consulting, auditing, lawyers 5,000 324,450 1,200 1,300 1,100 1,400
Other Operating Expenses 25,000 1,622,250 6,000 6,500 5,500 7,000
Total Operating Expenses 200,000 12,978,000 49,000 51,000 47,000 53,000
Operating Profit
Operating Profit (52,400) (13,576) (12,624) (14,528) (11,672)
Operating Margin -14.2 % -15.3 % -13.2 % -17.9 % -11.3 %
Expense Ratios
SG&A in % of Revenues 81 83.6 % 79.2 % 88.7 % 75.5 %
G&A in % of Revenues 54.2 % 55.3 % 53.2 % 57.9 % 51.3 %
Salaries in % of Revenues 27.1 % 28.2 % 26.1 % 30.8 % 24.2 %

18. Manpower:
Headcount 2009 Q1 Q2 Q3 Q4
Country manager - - - -
Sales 2 - - 1
Support 1
Channels
Marketing 1
Other - - - -
Total 3 1 - 1
Headcount 2008 Q1 Q2 Q3 Q4
Country manager - 1 -
Sales - - 1
Support 1
Channels
Marketing
Other - - - -
Total - - 1 2

19. Vision INDIA
• Sales and marketing office
• Off shore SW Development; R&D
Centre
• Support & Maintenance contact
centres.
• 5year horizon entry strategy.