Shareholder’s Report ImPACKed ­ A Junior Achievement Company

2015­2016 IBM Markham Michael Xu

Toronto, Canada

TABLE OF CONTENTS Executive Summary 3 Production 4 Sales 4 Marketing 5 Information Technology 6 Human Resources 6 Environment and Corporate Social Responsibility 7 Finance 9

2

Executive Summary Dear Shareholder, On behalf of all the employees, thank you for your continued support in ImPACKed (a Junior Achievement Company) over the past several months. As a student­run company, we strive for community engagement and ignition of early development of cognitive abilities and hands­on problem solving skills in youth. As a socially responsible group of high school students, the management team at ImPACKed is committed towards promoting volunteerism, giving back to the community, and high quality customer service. We value excellence in every product; impact over profit. This year, ImPACKed launched two main products: ThinKits and Celebritea. ThinKits were our first product line, essentially puzzle kids marketed towards youth, aimed to revitalize a generation of hands­on puzzle solvers and Rubik’s cubers. Celebritea are custom designed tea bags featuring prominent pop culture figures on the tea tags, such as DJ Khaled, Taylor Swift, and Donald Trump. The final ROI for each shareholder is determined to be 168%. The final share price is $25.23, while the initial share price was $15. The company was able to bring in a total revenue of $1696.75, exceeding the financial revenue goal of $1000. ImPACKed was able to successfully break­even on the week of March 23. I will not deny that there have been many ups and downs. We have taken tentative steps into the marketplace and discovered that ideas we had been previously excited about simply don’t work. But throughout it all, ImPACKed persevered. We found new ideas, took new steps. We had an incredibly successful sales event at the Toronto Trade Show and at Norman Bethune. We established contact with SickKids, and donated 20 ThinKits to sick children, supported by our sponsor, IBM. We have grown, individually, collectively, emotionally. I daresay that we have made a difference in our community. Thank you, Shareholders, for your continuous support, for persevering right along with us. Our success is your success. Sincerely,

Cindy Zeng CEO of ImPACKed

3

Production Operations was in charge of the production and distribution of the two products we created. The Thinkit and Celebriteas proved to be a huge success in terms of sales and popularity, but that came at a cost. Part of our job as operations was to analyze the market to look for the best "bang for your buck" so that we could deliver a quality product and keep our operating prices low. We managed to do so by managing our inventory with many different methods and by being smart with the materials we had. Making the switch of products did not cost us as much as we thought it would due to the efficiency we had. We used as much of the Thinkit materials as possible in order to save money. As a team of three we were able to create a working production line which allowed us to create an astonishing 60 products per session (or more). This team of three were given equal tasks and the synergy is what kept operations working together and in good spirits. Aside from delivering a great product one of the first and foremost important duties we had was delivering a safe product, safety for our consumers and fellow company members was a top priority, we made sure to use gloves at all times when handling our tea product and as a result we delivered a clean and friendly product. The success that operations had was largely due to the three great technicians we had who showed great character in their work.

Sales At the beginning of the program, the Sales department aimed to achieve the goal of selling 500 ThinkKits. It was also written in the policy that each member has to sell a minimum number of 4 ThinKits. It was unexpected when the company decided to change the product entirely. This new adjustment in product also set a new expectation to sales. The Sales team allocated the new product, Celebritea, to every member of the company and aimed to sell 200 units of Celebritea. However, the company achieved beyond the expectation and sold in total of 224 Celebritea. There are a few things that contributed to the outstanding result of sales. Throughout the program, the company had the opportunity to attend two sales events. One is the Toronto Downtown trade show and the other one is the sales event at the high school Dr. Norman Bethune C.I. The Sales department organized two sales trainings to assist the company members on how to approach customers and conduct an elevator pitch. This well prepared the members to demonstrate professional selling skills at the sales event. In addition, the department introduced a reward system to promote personal sales. The top salesperson of the week received a $10 gift card (the top salesperson has to make more than five sales in order to receive the reward). This reward system motivates the individuals of company to achieve beyond the expectations. Lastly, the Sales department worked with the I.T department to create a social media campaign called

4

#MyCelebriTea. The purpose of the campaign was to raise brand awareness and attract media attention. Documentation and the tracking of sales were done by using Google Excel. It included the number of products each member signed out each week and number of products each member sold each week. The sales department made minor errors throughout the documentation process which resulted eight miss products at the end of the program. However this did not result in serious financial consequences because the Finance department considered lost/missing/damaged product expenses at the beginning of the program.

Marketing The creative department created Impacked’s logo and created the unique designs for the packaging of both the Thinkit and the Celebritea. In addition we put together an informative pamphlet for the Thinkit that communicated the company's goal and vision for the product, to the customers. The creative department fabricated crosswords and brain teasers that were also included in the Thinkit. Furthermore, in collaboration with the IT department, the creative department spearheaded the marketing plan for Impacked’s second product, the Celebritea. This led to the production of a commercial and posters for the trade show to promote the product.

5

Information Technology Creation of website Several different technologies were used in the deployment of our website, including the Django APIs which run on the Python programming language. Our website was a web app deployed on Heroku, a free website hosting platform. This platform also provided many forms of search engine optimization, which let us be ranked higher in a Google search. In the initial stages of our company, our Information Technology team worked to provide an administration page to easily edit the website. This would make changing the website extremely simple and no programming experience would be required. Next, we wanted to make our website aesthetically appealing as well as easy to use. On our website, we included the essential information about our company and our products as well as a small gallery of pictures related to our products. Third, we needed to find an appropriate URL for our website, and after much discussion, we ended up picking www.impackedja.com. One of the problems that surfaced was that the link without the “www” did not work. We could not resolve this issue as our GoDaddy account was locked. Use of Social Media Our company used many different forms of social media to get word of our product out. We used platforms such as Facebook, Twitter, and Instagram. The information Technology department had a team of 2 members managing all 3 of these social mediums, pushing out weekly content. The largest issue we had with our social medias was the highly unsuccessful social media campaign. The hashtag MyCelebriTEA received very little attention and eventually died out. Overall, however, we received a lot of support, raking in 200 likes on our Facebook page.

Human Resources Investment in our employees Improving our company member’s knowledge was what we targeted in. We brought in several guest speakers including Alumnis that are now successful in their business roles. We used positive reinforcement to encourage selling within our company. This included a friendly competition, and the most suitable winners went the Lacrosse game that was funded by IBM. We also included special days including Valentine’s day/Pink day to ensure that our company supported a safe­environment that included a positive community. HR often brought in snacks as a small reward for the hard work the employees put in including timbits and chocolate. Positive Attendance Rate HR ensured that the attendance rate would be at least an 80%, if not, we would find the root of the problem. We made sure that if the employees had a problem, this would be discussed

6

thoroughly so both parties would be satisfied with the compromise. When an employee could not make the meeting, this was communicated with a member of the HR department to ensure that they will not miss out on important information. Retention Rate There was a problem with the number of company members leaving. Since many of the students were in grade 12, many left as a result of night school. HR understood that school comes first, so we talked through this issue with all the members involved and made sure their departure was not for any other reason. HR compiled questions asking their opinions on the company and whether or not they enjoyed their experience. The outcome was positive as they did not want to leave the company, but they had no choice. Documentation A record of the attendance was kept on Community for the Human Resources department. Later on a google docs was made for all other departments to view. This helped the Finance Department tremendously as they needed the attendance to calculate the salaries. The final number of employees at the end of the program was 25.

Environment & Corporate Social Responsibility

Contacting external organizations An official cover letter for the company was created to contact external organizations, including businesses or nonprofit organizations, to present a professional front when requesting a sponsorship or proposing a partnership with the organization. SickKids Donation We reached out to community organizations such as the Sick Kids Hospital to offer our support. Thanks to a sponsorship secured with IBM Canada, we were able to provide a donation of 20 ThinKits ($300 retail) to the patients at the Sick Kids Hospital. A large obstacle we faced as a company was selling the ThinKit products on an individual level, and so this sponsored donation was vital to the company’s success both financially and publicly. It was an outlet of giving ack to the community which aligned very well with our mission of helping children’s cognitive abilities and creating a positive impact.

7

Recycling and Production Waste Management In order to produce as sustainably as possible, we kept a strict eye on the recycling and waste management of the process. For instance, ensuring all wastes were disposed of in the correct bin, through removing the staples from teabag tags and sorting the paper and metal staples correctly. In producing the cushioning for products in the ThinKit box, old newspapers were shredded. Monthly Newsletters In January and February, company newsletters were drafted detailing the progress and significant events of the company for the respective month. Meant to keep all employees in the loop and provide highlights of the month, the newsletter featured department updates, successes in sales, as well as employees of the month. In addition, both editions presented an environmental awareness and fun section, to keep company members informed about environmental issues as well as raise awareness for events such as the WWF National Sweater Day. ***We worked with Marketing to implement environmental facts into the brainteasers of the ThinKit product puzzles

8

Finance Financial policies Financial policies were implemented at the beginning of the company program to ensure all company members could contribute to the company’s overall success. All company participants were required to purchase a minimum of one share, and up to a maximum of two shares, valued at $15. If a shareholder were to leave the company, it was a company consensus that the $15 share would not be returned. A 1% commission is issued for every sale made. Salaries were $0.10/hour or $0.30/meeting. Financial outlook ImPACKed exceeded the financial revenue goal of $1,000, which contributed to the positive return in share value. Total revenue was $1,696.75 and total expenses were $1,420.04. The rate of return was 168%, where the final share value was $25.23 (calculations are shown below).

9

Financial Statements

The following are the Balance Sheet and Income Statement for ImPACKed.

10