Ressett CIMA MCS Preseen – November 2025 – February 2026

The pre-seen sets out Ressett, a Lamland-based reseller of PCs, peripherals and consumables, in a mature market served by manufacturers, retailers, online marketplaces and specialist resellers. Only two major resellers operate in Lamland (Ressett and Fixxupp), so access to bulk, good-quality lots and credible grading is decisive.

Understanding the Entity and the Industry

The entity: Ressett’s operating reality

• What Ressett actually does. Buys new, ‘as new’, and refurbished PCs plus peripherals/consumables in bulk, then resells through a website + call-centre model. Credible grading underpins willingness-to-pay and trust: New (unopened surplus), As new (ex-demo/returns), Grade A (minor wear), Grade B (moderate wear).
• Why bulk matters. Economics favour homogeneous lots and scale (photography, copywriting, listing, after-sales support). Ressett targets batches of c. 50+ units to make listing and corporate fulfilment worthwhile.
• How the operation flows.
  • Buying: sources surplus/new/used stock from manufacturers, retailers and institutional refreshes, ensuring models remain current enough to meet customer needs.
  • Inventory: receipts, inspection/power-on checks, secure wipe, cosmetic clean, grade assignment, problems feedback to Buying, warehouse control linked to the web catalogue.
  • Sales: sets prices, photographs, product copy, listings, call-centre guidance for retail and corporate orders.
• Service signals customers notice. Human advisers available 08:00–20:00, 7 days/week; OS is retained but all other previous-owner software is deleted for licence compliance; 3-month technical support after purchase. These policies are frequent touchpoints in exam unseen scenarios (complaints, comms, policy clarifications).
• Where Ressett sits in the market. Lamland sustains only two major resellers—Ressett and Fixxupp—so rivalry is focused, and access to good-quality bulk is a strategic constraint/advantage.
• How we got here. Founded 1986 (consumer electronics), added PCs 1990, specialised since 1995, and by 2010 had closed all shops to operate from a purpose-built sales & fulfilment centre—a cost-lean, volume-friendly footprint.

The industry: what drives value

• Channel architecture. Four routes dominate: manufacturers (direct, limited discounting to avoid undercutting retailers), retailers (range and in-person advice), online marketplaces (fixed-price/auction with fulfilment risk), and specialist resellers (professional refurb, consistent grading, after-sales). Expect unseen tasks that contrast trust, fulfilment and pricing power across these.
• Supply engine that feeds resellers.
  1. Institutional refresh cycles (banks, government) release large single-model waves;
  2. Retailers/manufacturers offload surplus and superseded lines;
  3. Condition standards ensure “current enough” hardware (able to run supported OS/software). These sources create the batch homogeneity resellers need.
• Trust mechanics & grading economics. Grading is more than a label—it’s the price fence that monetises different customer tolerances for cosmetic wear and residual life, with New/As new/A/B mapping to distinct price points and return risks.
• The risk-and-ESG backdrop you can quote.

• E-waste is a global hazard (scale measured in tens of millions of tonnes annually). Extending device life is a core sustainability lever that supports the reseller narrative.
• Data security on used devices is non-negotiable—poor wiping can lead to identity theft—hence the emphasis on secure erasure in Inventory and careful customer communications.
• Why this matters for the exam. Many unseen tasks will hinge on: (i) availability of quality batches at the right price, (ii) the credibility of grading and wipe processes, (iii) service promises (support windows, call-centre coverage), and (iv) channel trade-offs (marketplace “cheap” vs reseller “assured”). Each flows directly from the industry mechanics above and Ressett’s operating design.

Company’s Business Model and Financial Performance

How value is created & delivered. Four integrated departments: Buying (sources surplus/new/used in bulk; ensures desirability), Sales (sets prices; runs site & call-centre), Inventory (inspects, refurbishes, grades; links stock to website; prepares despatch), and Administration (trade credit, accounting, HR, marketing). Website ordering and a technically literate call-centre support both retail and corporate buyers.

Sustainability & licence to operate. Board-level oversight (≥2 meetings/year) with a Sustainability Champion; model framed as inherently sustainable (life extension reduces new manufacture). Net-zero 2030 ambition. Recent metrics: 5% CO₂e reduction at the distribution centre; 80% of deliveries involve EVs for at least part of the journey.

1) Profitability & operating leverage

• Top line & mix. Revenue rose 3.1% (L$203.3m → L$197.2m), while gross profit grew 7.0% and gross margin expanded from 27.0% → 28.0%. That points to a slightly richer grade/price mix and/or better buying.
• Cost discipline. Administrative expenses fell L$1.1m despite higher revenue, shrinking from 15.0% of sales → 14.0%. Operating profit rose 20.3%, lifting operating margin from 12.0% → 14.0%, evidence of operating leverage.
• Bottom line. PBT increased 21.0% to L$27.7m; profit for the year climbed 19.6% to L$23.8m, pushing net margin to 11.7% (from ~10.1%).

Snapshot (FY25): GP 28.0%, OP 14.0%, PBT 13.6%, PAT 11.7%—solid margins for a reseller with a lean cost base.

2) Efficiency & returns

• Asset productivity. With total assets L$51.0m, revenue implies asset turnover ≈ 4.0×—very high for retail/wholesale and consistent with a light asset footprint. ROA ≈ 46.7%, boosted by strong margins on a lean base.
• Return on equity (ROE). Equity of L$27.1m against L$23.8m profit yields ROE ≈ 87.8%. Note this is amplified by high dividends (see payout, below), which keep equity low—great for ROE optics, but it limits internally funded growth.

3) Liquidity & working capital

• Liquidity headroom. Current ratio ≈ 2.46×, quick ratio ≈ 1.50×—comfortable buffers for a bulk-buy business. Current assets L$39.1m vs current liabilities L$15.9m → working capital ≈ L$23.2m.
• Cash conversion cycle (CCC). Approximate FY25 days:
  • Inventory ~38 days (Inv L$15.2m; COGS L$146.4m),
  • Receivables ~29 days (AR L$16.1m; Rev L$203.3m),
  • Payables ~30 days (AP L$12.2m; COGS L$146.4m),
    → CCC ≈ 36 days. This is tight for a refurb reseller and supports healthy cash generation from trading.

4) Capital structure & payout

• Leverage. Loans L$8.0m vs equity L$27.1m → Debt/Equity ≈ 0.30×. With cash L$7.8m, net debt ≈ L$0.2m (near-neutral). Financial risk is modest.
• Payout policy. Dividends L$22.9m vs profit L$23.8m → payout ≈ 96%. This keeps equity low (boosting ROE) but constrains reinvestment capacity unless leverage rises or margins expand further.

5) Peer benchmark (Fixxupp FY25)

• Scale & margin profile. Revenue L$187.0m; GP 26.0%, OP 11.0%, PBT 10.5%, PAT 9.0%—all lower than Ressett, indicating weaker mix/price realisation and/or higher opex intensity.
• Efficiency & returns. Asset turnover ≈3.82×, ROA ≈34.5%, ROE ≈67.1%—healthy, but below Ressett, consistent with slightly less efficient operations and higher leverage.
• Liquidity & CCC. Current ratio ≈2.69×, quick ratio ≈1.59×—liquidity is strong. Approximate CCC ≈ 41 days (Inv ~40; DSO ~30; DPO ~30), slightly slower than Ressett.
• Leverage & payout. Debt/Equity ≈0.40×; net-debt-to-equity ≈15%. Payout ≈91% (L$15.4m dividends on L$16.9m profit). A more levered stance than Ressett.

Head-to-head takeaways (FY25):

• Margins: Ressett outperforms at every level (GP/OP/PBT/PAT).
• Working capital: Ressett cycles cash ~4 days faster (CCC ~36 vs ~41).
• Risk posture: Ressett carries lower leverage and near-neutral net debt.

6) Trend signals you can quote (Ressett)

• Margin expansion: GP% 27.0% → 28.0%; OP% 12.0% → 14.0%; PAT% 10.1% → 11.7% (FY24→FY25).
• Balance-sheet lightness maintained: Total assets L$51.0m (up ~2.8%); cash up to L$7.8m; payables slightly lower—signals stronger trading cash and timely supplier settlement.

7) What these numbers mean in decisions (exam-friendly angles)

• Pricing & mix: Higher GP% than Fixxupp suggests better price fences across New/As New/Grade A/Grade B. Any unseen proposing a margin trade-off (e.g., discounting Grade B) should be stress-tested against the 28% GP baseline.
• Budgeting & capacity: The ~36-day CCC supports growth without heavy external funding—but watch inventory days if intake quality slips (grade downgrades inflate rework and holding).
• Funding & payout: With payout ≈96%, big projects (e.g., certified data-wipe at scale, warehouse automation) will crowd cash, nudging choices toward selective leverage or phased implementation. Quote the near-neutral net-debt fact to justify a modest loan if NPV is strong.
• Operational KPIs: To sustain OP% at 14%, keep an eye on first-time refurb pass, listing accuracy/returns, and call-centre resolution—each links straight back to cost-to-serve and repeat sales.

How the Exam Tests You Through the ‘I Can’ Statements

The ‘I Can’ statements serve as a roadmap for the skills and competencies you need to master. This blog will provide a section for each ‘I Can’ statement, breaking it down into three key areas:

1. Understanding the Statement – A summary of what you need to know.
2. Applying It to the Company – A detailed application of the statement within entity’s business context.
3. Possible Exam Scenarios – Examples of how the exam might test this area.

1. Evaluating Opportunities to Add Value

Understanding the Statement

This capability is about sizing up proposals that could increase value—small capex (systems, racking), service design changes (e.g., support duration), pricing/mix moves across New / As New / Grade A / Grade B, and process upgrades (e.g., certified data-wipe)—by combining financial appraisal with operational and strategic fit. It fits Ressett because:

• Value capture rests on credible grading that creates price fences and trust.
• Supply is lumpy and batch-driven; resellers work best with homogeneous lots (≈50+ units), so “buy or pass” decisions are frequent and material.
• The market is a two-player reseller duopoly (Ressett vs Fixxupp), sharpening the pay-off from differentiation (service, quality assurance, ESG claims).
• Service promises (human advisers 08:00–20:00, 3-month tech support) and OS-only on refurbs (licence compliance) are live levers that proposals may extend or monetise.
• ESG context is salient: e-waste risk, identity-theft from poor data wiping, and a stated net-zero 2030 pathway (incl. 80% EV-involved deliveries) shape reputation and cost-to-serve.

Financial headroom frames feasibility: cash L$7.8m, loans L$8.0m, equity L$27.1m, with a high payout (L$22.9m) in FY25—strong trading, low net leverage, but limited self-funded room for large projects.

Application

When an opportunity appears (a bulk lot, a support extension, a process/tooling upgrade), an evaluation typically combines:

A. Commercial logic (how value is created)

• Price fences by grade: willingness-to-pay varies across New / As New / A / B; margin and return risk differ by grade.
• Mix & attach: peripherals/consumables and impulse add-ons (e.g., USB sticks, tablets) influence basket size.
• Channel trust: website + knowledgeable call-centre offsets marketplace fulfilment risk—core to monetising refurbs.

B. Operational feasibility (can we deliver it?)

• Inventory/Refurb: intake checks, secure wipe, cosmetic clean, grade assignment, warehouse capacity, and feedback to Buying if condition slips.
• Sales ops: photography, copy accuracy, listing speed, and call-centre throughput.

C. Financial appraisal (is it worth it?)

• Baseline: revenue L$203.3m, GP L$56.9m, OP L$28.4m (FY25) set the context for target uplift and tolerance for cost additions.
• Methods: NPV/IRR/payback on incremental cash flows (price × volume × mix − refurb/returns/courier/support costs − capex − working-capital effects).
• Sensitivities: ± unit margin, ± volume, grade-mix drift (e.g., A→B), rework/returns rates, courier surcharges, call-time per ticket.
• Funding lens: nearly net-debt-neutral; high dividends suggest either selective leverage or phased roll-out for bigger bets.

D. Strategic & risk fit (should we do it?)

• Licence compliance: OS retained; other software must be removed—avoid proposals that introduce licensing breaches.
• ESG & reputation: life-extension supports the sustainability narrative; poor wipe harms it—certified processes add risk control and marketing truth.
• Competitive position: two-player market magnifies the impact of small service/quality moves.

Possible Exam Scenarios

• Extend technical support from 3 to 6 months for refurbs
  Facts to anchor: current 3-month support and 08:00–20:00 human advisers. Evaluate incremental call volume, ticket time, parts/returns, impact on conversion/price realisation, and goodwill; run NPV with churn/attach-rate upside cases.
• Adopt a certified data-wipe solution & audit trail
  Facts to anchor: identity-theft risk in the press; Inventory already wipes and prepares devices. Evaluate capex (tools/certs), cycle-time impact, warranty/claims avoided, brand lift, and ESG reporting benefits; include downside of status-quo risk.
• Bulk purchase of 1,000 Grade A laptops from a bank refresh
  Facts to anchor: resellers seek homogeneous lots (≈50+), grade definitions and desirability thresholds (able to run current OS). Evaluate buy price, refurb touch cost, expected grade yield, price fence, and working-capital lock-up (inventory days vs CCC).
• Partnership to increase EV-leg deliveries and badge ‘green fulfilment’
  Facts to anchor: 80% of deliveries already involve EV legs; net-zero 2030 aim. Evaluate courier rates, SLA reliability, marketing benefit, and scope for a green price premium or institutional tender win-rate uplift.
• Website ticketing & knowledge-base for faster resolution
  Facts to anchor: Sales runs the website and call-centre; complaints/queries flow there. Evaluate licence/subscription, training, impact on FCR (first-contact resolution), AHT (average handle time), listings accuracy (fewer returns), and sales conversion.

2. Preparing Budget Information and Assessing its Use

Understanding the Statement

This outcome is about turning operational reality into a decision-ready budget that managers can use for planning and control. You’re expected to:

• Source and prepare data using appropriate tech (operational feeds from inventory, sales, service, logistics, and finance), ensuring what’s budgeted reflects what can actually be delivered (e.g., inventory availability driving sales acceptance).
• Choose sensible forecasting methods for each driver (pipeline/judgement for known bulk intakes; simple time-series for steady lines like consumables; driver-based models for grade yields, attach-rates, and service load).
• Produce manager-friendly outputs (category/grade views, contribution by driver, and a clear price–volume–mix/refurb/logistics variance bridge) with plain-English commentary.
• Stress-test key variables (± volume, price, grade-mix drift, refurb/returns rates, courier cost, call-time per ticket) and explain which move the budget most and who owns each lever.
• Connect to planning & control by linking budgets to KPIs and responsibilities across Buying, Inventory, Sales, and Administration, and explaining how variances trigger action.
• Select an approach that fits context (e.g., driver-based budgeting for controllable levers, rolling forecasts to dampen end-period gaming, or ZBB for targeted resets) and note behavioural implications (accuracy vs speed, sandbagging, service quality trade-offs).

In short: build from the right data, forecast with methods that match the drivers, present for decisions, flex intelligently, and show how the budget guides behaviour and controls performance.

Application

A. Where the data comes from (in this case)

• Operational systems: Inventory is tied to the sales website so only available items can be sold—this “availability-to-promise” link is a key planning constraint for sales and intake forecasts.
• Department feeds:
  • Buying → expected lot arrivals, negotiated prices, mix by model/condition.
  • Inventory → refurb throughput, grade yields (A/B), rework/returns expectations, warehouse capacity.
  • Sales/Call-centre → price ladders by grade, listing cadence, service load (queries, complaints, technical help).
  • Administration → trade-credit terms for corporates (affects cash-flow phasing), accounting calendars, marketing plans.
• Logistics & sustainability: courier performance and EV share (already high) affect distribution cost run-rates and ESG reporting lines used by management.

B. Typical budget structure & drivers (Ressett context)

• Sales budget by category (PCs, peripherals, consumables) and grade (New / As New / A / B): volume × ASP, influenced by batch homogeneity and desirability.
• COGS budget from Buying’s pipeline (purchase prices, expected discounts, intake quality).
• Refurb/returns cost from Inventory’s cycle times, first-time-pass and grade shifts (e.g., “as new” downgrading to B).
• Distribution & fulfilment from despatch volumes and courier arrangements (including EV legs).
• Service tail (post-sale support) informed by call-centre load and the 3-month technical support window.
• Working-capital budgets (inventory, receivables/payables) aligned to trade-credit for corporates and warehouse turns.

C. Forecasting & modelling choices you’ll see referenced

• Judgement + pipeline (bulk lots known to Buying) for short-term product availability.
• Driver-based projections (grade yield, attach-rates for consumables/tablets) to explain basket size and mix.

D. Planning, control & behaviour (what management looks at)

• Formats for managers: category/grade dashboards, variance bridges (price, volume, mix, refurb, logistics), and simple sensitivity views (±5–10% volume/price/grade shift). (Aligned with the ‘I can’ focus on formats, variables and behavioural insight).
• Behavioural levers: sales listing speed vs accuracy (returns risk), intake quality targets for Buying, first-time-pass for Inventory, and call-centre KPIs that balance handle time with resolution quality.

E. Financial context for capacity & headroom

• Liquidity and structure frame how “stretchy” budgets can be: bank L$7.8m, loans L$8.0m, current assets L$39.1m vs current liabilities L$15.9m. High dividend payout in FY25 signals a lean equity base, so big step-ups in spend are usually phased or offset elsewhere.

Possible Exam Scenarios

·        Quarterly sales & COGS budget with flex
A pack shows expected lots arriving, grade yields and planned price ladders; logistics costs rise slightly as EV delivery share grows. Expect to see a driver table, a flexed outcome (± price/volume/mix) and a short note on planning/control implications.

·        Service budget after a support-policy tweak
The unseen extends support activities (still anchored on the 3-month promise) or adds a knowledge-base tool for the call-centre. Expect modelling of ticket volumes, average handle time, training cost and expected reduction in returns/complaints.

·        Working-capital plan for a corporate tender
Administration approves trade credit for a bulk corporate order; Buying commits to a large homogeneous lot. Expect a receivables profile, inventory turn impact and a payables negotiation view to keep the cash gap tight.

·        Explaining a forecast change to managers
A short narrative that links a downgrade in grade yields (A→B) and courier surcharges to a reduction in gross margin and a timing shift in deliveries—using a variance bridge to communicate clearly.

3. Implementing Senior Management Decisions

Understanding the Statement

This outcome checks whether you can turn a board decision into a deliverable project: choose tools for the right life-cycle stage, define people/roles & KPIs, manage risk/uncertainty quantitatively, pick suitable funding, and shape a high-performing team. That’s exactly what the ‘I can’ set specifies: project tools by stage, key personnel & performance measures, risk tools for capex, financing source characteristics, and team effectiveness.

Application

• Project types you’ll see:
  Inventory & data hygiene (certified wipe/audit trail), website & call-centre tools (ticketing/knowledge base), warehouse & fulfilment layout/capacity, and green logistics partnerships. These sit naturally in Ressett’s flow: Sales runs the website/call-centre, Inventory handles wipe, grading, warehouse & despatch, and the inventory system links to the website so only available items are sold.
• Governance & ESG fit: Board attention to sustainability (agenda at least twice yearly) and a named Sustainability Champion shape project rationale; strategy is net zero by 2030, with 80% of deliveries involving EV legs—useful benefits/constraints for logistics projects.
• Risk backdrop: E-waste reputation and identity-theft from poorly wiped devices justify stronger wipe processes and comms. Treat these as risk register items with mitigations/owners.
• People/roles & KPIs:
  Buying (intake quality, discounts), Inventory (first-time pass, grade accuracy, warehouse throughput), Sales/Call-centre (listing accuracy, conversion, first-contact resolution), Admin (credit approvals, DSO). Note the call-centre’s technical knowledge and hours (08:00–20:00, 7 days) when planning resourcing.
• Funding lens: Cash L$7.8m, loans L$8.0m, equity L$27.1m, with a large dividend in FY25—projects of modest size can be cash-funded; larger ones may need phased rollout or small additional debt.

Toolkit to show in answers: stage-gated plan (scope, milestones), RACI, KPI pack, risk register with likelihood×impact, sensitivity on benefits/costs, funding option (cash vs loan) with pros/cons, and a paragraph on team routines (stand-ups, hand-offs, QA).

Possible Exam Scenarios

• Roll out certified data-wiping with audit trails
  Scope wipe tools/training, QA checks, and customer-facing proof; RACI led by Inventory, with Sales/Comms for messaging. KPIs: % devices certified, cycle time, wipe failures, complaint rate. Risks: privacy breach, throughput dip; mitigations: pilot, SOPs. Fund from cash; phase if capacity tight. (Inventory already deletes data; identity-theft story provides the risk case.)
• Implement website ticketing & knowledge base for the call-centre
  Owner: Sales (website/call-centre). KPIs: first-contact resolution, average handle time, returns related to misinformation. Risks: adoption, training; mitigate with super-users and staged go-live. Link staffing to 08:00–20:00 coverage. Funding: SaaS licence—cash-fund.
• Reconfigure warehouse & availability-to-promise
  Owner: Inventory. Aim: faster intake→listing, fewer stockouts. KPIs: dock-to-list time, first-time pass, pick/pack lead time. Guard the website-inventory link (sell only what’s available). Funding: small capex; test via one aisle pilot.
• Deepen ‘green fulfilment’ with EV-heavy couriers
  Owner: Admin/Logistics with Board ESG oversight. KPIs: on-time delivery, cost/order, % EV legs, CO₂e/parcel. Risks: courier capacity, surcharge volatility; mitigations: dual-supplier contracts. Align with net-zero 2030 narrative; small opex uplift vs marketing/ tender win-rate benefits.

·        Deliverable style to emulate: one-page plan → RACI → KPIs → risk & sensitivity → funding choice → next steps. Tie each decision to who owns the lever and which process metric proves success.

4. Managing Performance and Costs to Aid Value Creation

Understanding the Statement

This outcome is about designing and using performance and cost systems that actually move results: responsibility-centre reporting, employee engagement/alignment, leadership fit, cost management / cost transformation, quality & value management, and quantifying risk for stakeholders. In exam terms, you’ll be expected to propose measures, show how they drive behaviour, and cost the impact of improvements.

Application

Responsibility centres & core KPIs

• Buying – purchase discounts; intake quality; % lots returned/discounted after inspection. (Buyers ensure stock desirability, negotiate discounts, and maintain supply.)
• Inventory – first-time refurb pass rate; grade accuracy (A vs B); dock-to-list lead time; stock turns; wipe/QA failures. (Inventory inspects, wipes, refurbishes, grades A/B, runs the warehouse, and links inventory to the website so only available items are sold.)
• Sales/Call-centre – price realisation vs ladder (New/As New/A/B), listing accuracy, conversion, returns/complaints, first-contact resolution. (Sales sets prices, photographs and describes items; call-centre advises, handles queries/complaints.)
• Administration – DSO/trade credit outcomes for corporates; billing accuracy; marketing effectiveness. (Approves trade credit; bookkeeping; HR; marketing.)

Cost management & transformation levers

• Cut rework & downgrades by tightening intake specs and feedback loops (e.g., “as new” arriving with wear → seek discount/return to supplier).
• Reduce returns via better listing accuracy and call-centre knowledge transfer (technical detail matters for expectations).
• Grow basket size with peripherals/consumables (attach rates).

Quality & value management

• Operable checks + secure wipe + cosmetic prep → consistent grade A/B outcomes; tie quality metrics to margin by grade.
• Service promises that protect value: 08:00–20:00, 7-day advice; 3-month technical support (budget the service tail; manage SLA and knowledge base).

Risk quantification for stakeholders

• Track operational and ESG risks together: complaint/return rates, wipe-failure incidents, and CO₂e metrics (5% DC reduction; 80% deliveries with EV legs) in a single dashboard; present trends and $$ impacts.

Possible Exam Scenarios

• Grade-B margin is slipping
  Design a responsibility-centre pack: (i) grade yield vs target (Inventory), (ii) buy-price variance & intake quality (Buying), (iii) price realisation vs ladder (Sales), (iv) service tail cost (Call-centre). Recommend intake spec tightening and supplier discounts/returns for out-of-spec lots.
• Returns and complaints spike after a laptop promotion
  Trace to listing accuracy and expectation-setting at the call-centre; propose copy standards, adviser scripts, and KPI targets for first-contact resolution and return rate.
• Throughput bottleneck in refurb
  Map the intake→wipe→grade→list flow; set first-time pass and dock-to-list targets; pilot SOP changes; quantify savings from fewer downgrades and faster listing (stock turns ↑).
• Board asks for a combined performance & ESG view
  Build a dashboard with order SLA, return/complaint rates, wipe audit outcomes, and CO₂e/EV-leg metrics; include a short narrative translating metrics into cost, risk and reputation effects.

5. Measuring Performance

Understanding the Statement

This outcome expects you to:

• use risk tools for performance and business-model uncertainty,
• assess performance and position from the financial statements with a wide range of ratios,
• recommend actions to improve results and explain impacts on the wider ecosystem, and
• choose appropriate accounting treatments and explain their implications.

Application

A) Ratio set & baselines (what to calculate and why)

• Profitability: GP%, OP%, PBT%, PAT% using Ressett’s FY25 figures (rev L$203.3m, GP L$56.9m, OP L$28.4m, PBT L$27.7m, PAT L$23.8m) to spot margin shifts and operating leverage.
• Liquidity & structure: current assets (L$39.1m) vs current liabilities (L$15.9m), cash (L$7.8m), loans (L$8.0m) for headroom/solvency signals.
• Efficiency: asset turnover from total assets (L$51.0m), plus working-capital lenses (inventory, receivables, payables) to explain cash conversion.
• Benchmarking: compare with Fixxupp (rev L$187.0m, GP L$48.6m, OP L$20.5m, PAT L$16.9m) to frame competitive position.

B) Diagnose drivers (link numbers to operations)

• Grade mix & pricing fences (New / As New / Grade A / B) drive GP%; watch downgrades from “as new” to Grade B and rework/returns through Inventory.
• Sales execution (listing accuracy, call-centre advice) affects conversion and returns; Sales owns pricing and content.
• Availability-to-promise: inventory control links to the website—only available goods can be sold—so intake/throughput constraints explain volume variances.

C) Risk & uncertainty tools you can show

• Sensitivity of GP% to grade yield shifts (A→B), refurb cost per unit, courier surcharges, and return rates;
• Scenario sets (e.g., strong vs weak corporate refresh pipeline), tied to Buying/Inventory/Sales responsibilities (who can move which lever).

D) Accounting treatments that matter here

• Inventory at NRV when condition drops (downgrades, damage).
• Warranty/service provision for the 3-month post-sale support obligation.
• Presentation/classification: intangible assets exist (L$2.2m), loans are non-current (L$8.0m); users need clarity on impacts for ratios.

Possible Exam Scenarios

• Gross-margin dip this quarter
  Analyze price–volume–mix and grade yield movements; link downgrades and rework to Inventory KPIs; propose supplier discounts/returns for out-of-spec lots and tighter intake specs.
• Working-capital squeeze on a corporate tender
  Model inventory held, receivable terms (Admin-approved trade credit) and payable timings; recommend term tweaks or staged deliveries to protect liquidity ratios.
• Peer comparison shows Ressett’s OP% ahead of Fixxupp
  Quantify the margin gap using the two P&Ls; recommend actions to defend it (maintain price fences, listing accuracy, call-centre knowledge) and flag risks if grade mix worsens.
• Accounting note query: should we book a provision?
  Explain provisioning for the 3-month support window and inventory NRV adjustments when condition downgrades occur; show ratio impact (GP%, current ratio) before/after.
• One-page approach to emulate in answers: ratios table → 3-bullet diagnosis tying numbers to processes → 3 targeted actions (owner, lever, expected effect) → note any accounting adjustments that change the optics for users of the statements.

6. Managing Internal and External Stakeholders

Understanding the Statement

This outcome covers your ability to:

• explain financial reporting implications of additions to the group,
• explain behavioural and transfer-pricing issues in internal trading,
• articulate the implications of Integrated Reporting (IR) for the entity and stakeholders, and
• advise on the processes of communication, negotiation, and conflict management.

Application

Who the stakeholders are (and what they care about)

• Customers: legality (OS-only on refurbs), reliable advice (08:00–20:00, 7 days), and the 3-month support promise.
• Suppliers (manufacturers/retailers/corporates): fair grading feedback, claims/returns for out-of-spec lots, predictable payment terms (Admin).
• Couriers: service-level expectations and green-fulfilment metrics (EV legs).
• Board/Regulators/Community: sustainability governance (Board agenda, Sustainability Champion), net-zero 2030, CO₂e tracking. These form your IR storyline (governance→strategy→risk→metrics).

Where stakeholder issues show up in work you’ll do

• Communication: translate the OS-only policy and data-wipe checks into clear customer language (license compliance + privacy).
• Negotiation: secure supplier discounts/returns when intake quality misses spec; balance courier EV targets with on-time SLAs.
• Conflict management: Sales’ push for quick listings vs Inventory’s QA/grade accuracy; align via shared KPIs and hand-off SLAs.
• Integrated Reporting: evidence chain: Board oversight → Sustainability Champion → strategy (life-extension) → risks (e-waste) → metrics (5% CO₂e cut, 80% EV-leg deliveries).

If the group grows (acquisition/merger)

• Be ready to brief on group reporting implications (what consolidates, goodwill, alignment of policies) and highlight behavioural/transfer-pricing issues if intra-group trading begins.

Possible Exam Scenarios

• Customer email: “Why did you delete the office software?”
  Response outline: acknowledge need → explain licence compliance and OS-only rule → offer options (bundled open-source/discounted licences) → restate 3-month support and helpline hours.
• Supplier negotiation: intake below promised grade
  Plan: cite inspection findings, seek discount/return, agree future spec & photo evidence; tie to Inventory KPIs (first-time pass/grade accuracy) and Buying quality targets.
• Board asks for a 1-page IR update
  Structure: Governance (Board + Champion) → Strategy (life-extension model) → Risks (e-waste/data privacy) → Metrics (5% CO₂e cut, 80% EV-leg deliveries) → Next steps (supplier audits; courier SLAs).
• Internal conflict: Sales vs Inventory over listing speed
  Facilitate: agree handoff SLA, define shared success metrics (returns rate, listing accuracy, dock-to-list time), and set a weekly review—classic conflict-to-collaboration move tied to responsibility-centre reporting.
• Mini-acquisition on the table
  Brief: reporting implications (consolidation; policy alignment), behavioural/transfer-pricing for any internal component sales, and a comms plan for staff/suppliers/customers.

Deliverable style to emulate: short audience-aware note (purpose → key facts → implications → recommended action), with IR elements mapped to concrete Ressett evidence (Board/Champion, net-zero, CO₂e/EV metrics) and customer-facing policies (OS-only, support window, helpline hours).

Real-life Applications

1. Evaluating Opportunities to Add Value

• Enterprise refresh waves (2024–2026) = big, homogeneous lots. With Windows 10 support ending on 14 October 2025, enterprises are refreshing fleets—creating bulk disposals that refurbishers can source at scale. IDC also expects the PC market to grow into 2025 as the refresh cycle plays through. Use this to target single-model batches with repeatable refurb/copy workflows.
• Trust signals that command price: “certified refurb” + warranty. Apple’s Certified Refurbished devices come with full functional testing and a one-year warranty—that combination lets Apple price close to new, and it’s a playbook others mimic. Back Market standardizes condition grades and provides a 12-month warranty, which reduces buyer risk and helps sellers hold margin.
• Macro tailwind: the e-waste problem. The Global E-waste Monitor 2024 reports 62 Mt of e-waste in 2022 and a trajectory to 82 Mt by 2030, with just 22.3% formally collected/recycled—evidence you can use to position life-extension/refurb as value-adding and sustainable.

2. Preparing Budget Information and Assessing its Use

• Last-mile electrification changes delivery cost curves. Couriers are electrifying quickly (e.g., DPD ~⅓ of last-mile vans electric by 2024; DHL targeting >66% last-mile EVs by 2030). For planning, that means new unit-cost assumptions (energy vs diesel, HVO usage), charging/route constraints, and ESG KPIs that managers will expect to see alongside cost lines.
• Warranty & returns provisions are a real operating tail. Programs like Amazon Renewed (minimum 90-day guarantee, 1-year on Renewed Premium) and Back Market (standard 12-month warranty) illustrate why your service budgets must cover repairs/replacements, help-desk load and reverse logistics—budget these explicitly by product/grade.
• Volume forecasting has external triggers. Windows 10 EOL and IDC’s shipment outlook are defensible external drivers you can cite when flexing top-line scenarios (base/refresh-wave/slowdown).

3. Implementing Senior Management Decisions

• Data wipe projects aren’t optional—regulators care. The SEC fined Morgan Stanley $35m for failing to properly dispose of devices with customer PII—classic evidence for a certified-wipe + audit-trail rollout under NIST SP 800-88 (policy, tooling, QA, training, proof).
• Licensing compliance on refurbs is standardized. Microsoft’s Authorized Refurbisher (MAR) program provides access to genuine Windows 10/11 licenses for refurbished PCs, with branding benefits and sub-distribution to third-party refurbishers. Implementing MAR-compliant imaging is a straightforward governance decision that de-risks listings.
• Green delivery pilots are mainstream. Amazon’s roll-out of electric delivery vans (Rivian, now also testing GM BrightDrop) shows how to stand up EV routes incrementally with clear KPIs (on-time, cost/order, CO₂e per parcel). Use a stage-gate plan and dual-supplier mitigations when supply is tight.

4. Managing Performance and Costs to Aid Value Creation

• Grading frameworks drive margin discipline. Marketplaces publish transparent condition tiers (e.g., Back Market’s Fair/Good/Excellent/Premium), aligning price fences to cosmetic/functional standards. Mirror this internally so KPIs (grade yield, downgrade rates) tie directly to GP%.
• Warranty as a differentiator (and a cost center). UK retailer CeX advertises multi-year warranties (now 5-year standard) to boost conversion—great for loyalty, but it requires tight failure-rate tracking and provisioning in your cost-to-serve model.
• Logistics KPIs are moving with EV adoption. DPD’s public dashboards and updates show firms tracking %EV legs, CO₂ saved, and electric deliveries YTD—use the same style of operational + ESG metrics in manager packs.

5. Measuring Performance

• Use market baselines to frame targets. IDC raises its 2025 PC outlook (≈274M units), suggesting a healthier demand backdrop; pair that with your own conversion/ASP targets and track mix-driven margin.
• Secondary-market health checks (cross-category). The refurbished smartphone market grew ~5% in 2024, with strong ASPs at the high end (Counterpoint)—evidence that quality-led refurb can defend price even in used tech.
• Benchmark the “trust premium.” Apple’s refurb store demonstrates how testing + one-year warranty supports pricing power; Amazon Renewed’s guarantees set consumer expectations your ratios must live up to (returns, rework, NPS).

6. Managing Internal and External Stakeholders

• Policy tailwinds: the EU “Right to Repair”. The EU’s 2024 Right-to-Repair Directive entered into force 30 July 2024, extending guarantees by 12 months when consumers choose repair and obliging manufacturers to enable repairs—great external context when pitching life-extension strategies to boards and customers.
• Design-for-circularity rules are arriving. The Ecodesign for Sustainable Products Regulation (ESPR) (in force since July 2024) sets a framework for durability, repairability and the Digital Product Passport—expect B2B clients (especially in the EU) to ask suppliers about compliance and data.
• Public ESG reporting by logistics partners. DHL and DPD publish explicit last-mile electrification goals and progress; folding these into your own stakeholder comms (IR-style) makes your delivery claims auditable and credible.

Conclusion: Mastering the Pre-Seen for Exam Success

Ressett’s story is consistent: buy well, refurb right, grade credibly, list clearly, fulfil reliably, support sensibly—and do it with a light balance sheet and visible sustainability. On exam day, the unseen will nudge one or more of those levers (price, mix, intake quality, logistics, service scope, funding). Your job is to read the nudge through the six ‘I can’ lenses and respond with numbers, process implications, risk controls, and stakeholder communication that fit Ressett’s reality.

Think like a manager who owns outcomes: quantify, name the lever owner (Buying/Inventory/Sales/Admin), show the trade-offs, and close with a recommendation you could implement tomorrow.

Key Takeaways for Exam Preparation

• Anchor every answer in the pre-seen. Quote the operating model (grading, website–inventory link, call-centre hours/support window), the two-player market, and the sustainability stance to make responses specific—not generic.
• Carry one ratio pack in your head. GP%, OP%, PBT%, PAT%, current ratio, quick ratio, asset turns, CCC (inventory/receivables/payables days). Use these to diagnose issues fast and benchmark against Fixxupp.
• Use the right appraisal/budget tool for the job.
  • Investment cases: incremental cash flows → NPV/IRR/payback + sensitivities (margin, volume, grade mix, returns, courier costs).
  • Budgets: driver-based builds (grade yields, attach rates, service load) with a clear price–volume–mix/refurb/logistics variance bridge.
• Design deliverables that managers can use. One-page plan or dashboard → KPIs → risk register (likelihood × impact) → actions/owners → timeline. Keep commentary in plain English.
• Name and manage the behaviours. Listing speed vs accuracy, sandbagging, handle-time vs resolution quality—call them out and design KPIs/SLAs that balance them.
• Link operations to ESG and compliance. Data-wipe assurance, licence-compliant OS policy, EV-supported deliveries, board oversight/Champion—these strengthen brand and reduce risk; they’re not “extras.”
• Have stock responses for common scenarios.
  • Grade slips/returns spike → tighten intake specs, supplier claims/discounts, listing QA, call-centre scripts.
  • Cash squeeze on a big tender → WC phasing, staged deliveries, term negotiation.
  • New tool/process rollout → scope, RACI, KPIs, pilot, funding choice (cash vs small loan), comms.

Final Words

Treat the unseen as an update memo to a business you already know. Start from Ressett’s facts, bring in the relevant real-world context where it strengthens your case, run the numbers that matter, and recommend actions with clear owners and timelines. If you stay disciplined to the six ‘I can’ lenses, your script will read like management advice—not a textbook recital. Go in with your frameworks ready, your baselines memorised, and your answers written for decision-makers.

Best of luck with your preparation!