Cor Van Raay Agribusiness Case Competition workshop

Introductions Micheal Ostrom Graduated with a double major in Accounting and Finance from U of L in January 2 + 2 program Work at Haul-All Equipment as a Staff Accountant Have worked in public practice as well as corporate accounting in downtown Calgary Current CPA articling student Case Experience CPA Governance, KPMG case competition, etc. Coached 2nd place JDC West team Held several case workshops

Agenda Discussing a Case 8 Important Steps in Case Presentation PowerPoint Presentation Key Points Figuring Out the Numbers

What is a Case? A real world business issue Can be any major, strategy or general business Lots of information General, Accounting or major specific Critical thinking Apply textbook knowledge

Where to start Read case before making notes / calculations How do you know what's important yet Read the first and last page again Make some quick notes what the case is asking for (problem)? What is your role? Read again and highlight information that is relevant

Important Steps Introductions Criteria Matrix Problem Statement Decision Analysis Implementation Alternative Solutions Contingency Plan Conclusion

Problem Statement Primary Problem Secondary Problem May be more than, but choose the most important Secondary Problem Be clear by using only 1-2 sentences Symptom vs. Cause – what are the “real” issues Must flow through the rest of the presentation

Analysis Looking at the big picture 3 ways to Analyze Internal to company External to environment 3 ways to Analyze SWOT Porters 5 Forces PESTLE

SWOT

SWOT Internal to the Company Strengths Weaknesses Strengths and Weaknesses What is the company doing well Weaknesses What do we need to improve External to the Company Opportunities Opportunities and Threats What can we capitalize on Threats What could de-rail our business

Porter’s 5 Forces Analyzes Competitive Position within Industry Rivalry Threats of New Entrants Bargaining power of buyers Threat of substitutes Bargaining power of suppliers Analyzes Competitive Position within Industry When to use Market position in question Product launch Expansion

Alternative Solutions Qualitative Table works well Show all options Advantages and Disadvantages Pro / Cons Outcome Specific

Criteria Matrix Table format Quantitative Backs up decision Simple numbering scheme Backs up decision Use weighted criteria Be confident on numbers and explain how

Decision 1 choice, 1 slide Be confident and don’t rush this slide Everything before should lead to your decision (analysis) Everything after should tell how to achieve the decision (implementation)

Implementation Usually longest part of presentation Think SMART Worth most of mark on judges score card Think SMART Specific Measurable Achievable Relevant Timely

Implementation Create a timeline to guide judges through your plan SPECIFIC activates that help solve the problem identified earlier Timeframes must be realistic to business production cycles

Contingency Plan Plan B Do not change your decision If economy… If government… If family is concerned… Do not change your decision

Conclusion Summarize main points Highlight: Push Benefits Decision Implementation Push Benefits Need to sell the idea Strong final ending

PowerPoint Keep it simple Clean and Organized No grammatical errors

Titles: 38-48pt PowerPoint Subtitles: 28-36pt Body: 26-34 Large Font: Color Contrast Titles are important

Presentation Skills Remember to use terminology Smile and acknowledge Live the Case Show Passion High Energy Expand on Points Remember to use terminology You- referring to company Us- referring to team presenting Consulting Firm giving ideas Smile and acknowledge

Presentation Skill Talk to Audience Glance at slides do not read Try and not hide Clothing and Appearance matter Pay attention to person speaking Entrance and Exit etiquette

Marking Rubric Will be posted online before competition and emailed out Content and Implementation most important section Also marked on: Organization Presentation Skills Layout PowerPoint Originality Always looking for - Validity of an idea Doesn't have to be normal, just backed up

Team dynamics Who does what? When? Break apart presentation into individual areas based on major, presentation skills, and salesmanship When? At the beginning before reading Focus on notes that are important to your section while reading Presenting with 3 vs. 5 makes the presentation flow better Introductions, Problem Statement, Analysis Alternative Solutions, Criteria Matrix, Decision Implementation, Contingency Plan, Conclusion

Case Extras

Providing evidence with numbers Be confident Be able to defend your numbers Could be based on information provided by company and industry Double check the numbers Remember simple is better than not at all

Thinking about cases Considering growth: Sales growth potential – actual customers? Market potential – overall demand? Production ability Can we afford to grow financially Employee costs and availability of skilled people Do we have the infrastructure to grow (additions required) Distribution channels – getting product to customer Wholesale vs. retail Margins worth while?

COGS VS Expense COGS (cost of goods sold) The cost of producing an item for sale Farms - hard to track/determine exact amounts Farms often don’t use “COGS” and use and special form of accounting Examples of expenses on a farm Property tax Utilities Employees WHAT ELSE? Variable Cost vs. Fixed cost VC = feed expense (changes with # animals) FC = land rent

Revenue Projection Pessimistic Realistic Optimistic Sales in Units 50 $2 each Pessimistic Realistic Optimistic Sales in Units 50 100 150 Revenue 200 300 COGS 25 75 Gross Margin 225 -Fixed Costs 10 20 -Variable Costs 30 EBIT 45 110 155 Tax (40%) 18 44 62 Net Income 27 66 93

Revenue Projections Option 1 (10 Units) Option 2 (5 units) Revenue $20 each Option 1 (10 Units) Option 2 (5 units) Revenue 1000 500 Expenses: Piglets 200 100 Land rent 50 Feed Utilities 25 Employees 250 Net Income 125 Tax (40%) 10 Cash Available 75 15

Break-even point (BEP) The point of $0 profit All sales above BEP produce profit All sales below BEP produce loss Analyze by units or dollars The key here is to show how much production is required before profit can be made These allows judges to determine suitability and ability of your plan

BEP Example Fixed Costs = $10,000 Selling Price = $15 Variable Cost = $10 BEP$ = FC/CM X SP BEP$ = 10,000/(15-10) X 15 BEP$ = 10,000/(5) X 15 BEP$ = $30,000

Loan costs Money is not free or unlimited Backed by assets as collateral Examples – inventory, land, building, machinery If you are borrowing money you must include the loan payment in revenue projections as an expense

What important

What important

The END