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Viability Assessment of Railway Project COVER PAGE AND DECLARATION Master of Business Administration (M.B.A.) Specialisation: General Management Affiliated CEO Business School Center: Module Code & MGT580 – Project Managment Module Title: Student’s Hamza Ahmad Rasheed Hendi Full Name: Student ID: EIU146242 Word Count: 3689 words Date of 16/04/2021 Submission: I confirm that this assignment is my own work, is not copied from any other person’s work (published/unpublished), and has not been previously submitted for assessment elsewhere. E-SIGNATURE: DATE: 16/04/2021 ______________________ EIU Paris City Campus Address: 59 Rue Lamarck, 75018 Paris, France | Tel: +33 144 857 317 | Mobile/WhatsApp: +33607591197 | Email: [email protected] EIU Corporate Strategy & Operations Headquarter Address: 12th Fl. Amarin Tower, 496-502 Ploenchit Rd., Bangkok 10330, Thailand | Tel: +66(2)256923 & +66(2)2569908 | Mobile/WhatsApp: +33607591197 | Email: [email protected] 1 Contents EXECUTIVE SUMMARY .................................................................................. 3 PROJECT BUDGET ......................................................................................... 4 RISK ANALYSIS .............................................................................................. 5 PROJECTED COMPETITION ANALYSIS ............................................................ 5 QUALITY CONTROL MEASURES ..................................................................... 7 TEAM MEMBER BREAKDOWN ....................................................................... 8 ADDITIONAL FUNDS REQUEST ...................................................................... 8 VIABILITY ASSESSMENT OF RAILWAY PROJECT ............................................ 10 ADDITIONAL WAYS FOR THE PROPOSED RAILWAY TO EARN INCOME .......... 11 REFERENCES ............................................................................................... 13 2 Executive Summary Aspire International Corporation, a multinational based in Sweden, is planning to expand and diversify its portfolio. One of the viable and feasible projects that the company is planning is setting up a pharmacy and a convenience store named Aspire Pharmacy and Village Market in a nearby village. Aspire International’s project manager has decided to go with this project as it provides an opportunity to tap a new untapped village market. Still, it also facilitates the local village population by providing a pharmacy and a well-equipped convenience store. This project is bound to be a success as it is a win-win situation for all the stakeholders. As grocery shopping has become commonplace and this is an evergreen business with its demand going up with the growing population, this is the best business that a company can invest in and reap benefits in the long term by building valuable customer relationships. Similarly, these types of stores fulfill the needs that continue to exist as long as there is any life left on the planet. Moreover, this project also keeps the customers a center point as it tries to address the multiple yet everyday needs of the village population under one roof. The parent company that is Aspire international Corporation has decided on an initial budget of 2 million. The project manager has also devised a strategy to meet the competition, analyze other risks and take quality control measures. A team has been finalized, which will work on the principles of Labor division, as was Adam Smith’s idea. This measure will ensure operational excellence and efficiency of the market and help significantly cut the business’s operating costs. All in all, a well-researched and detailed business proposal has been formulated for the project, i.e., Aspire Pharmacy and Village Market. 3 Project budget Aspire Pharmacy and Village Market, a pharmacy, and a convenience store; the project will have a starting budget of 2 million euros as has been decided by the core committee of this business’s parent company. This budget will cover maintenance charges to give the place a facelift, initial rent for a couple of months, electricity and other bills, advertising cost of the project, initial supplies of pharmaceutical products and other household items, initial salaries of staff members working there and other miscellaneous expenses. After thorough research and study of the market, the Project manager has decided that the allocated budget for the project will be divided to try to minimize the risk. The allocation of the budget has been done after a thorough market study. It has been done to reduce the risk of default and maximize profit by helping the customers meet their basic needs under one roof at the same time. A detailed allocation of the budget is as follows: Sr. No. Items Budget ( € ) 1 Rent for 4 months (advance) 80,000 2 Initial maintenance expenses 75,000 3 Electricity and other bills of 4 months (expected) 125,000 4 Advertising Cost 200,000 5 Salaries for 4 months (budgeted) 120,000 6 Cost of supplies 1,200,000 7 Miscellaneous expenses 200,000 Total 2,000,000 4 Risk Analysis Pharmacies and convenience stores face significant disruptions in the business as customers’ buying behavior changes with the change in the business environment. One of the most common risks that such kinds of stores face is competition. Small shops in homes or small corners in a village pose a greater threat to these attractive convenience stores than anything else. This kind of risk can be minimized by choosing a suitable location for the supermarket. Similarly, the customers want their prescriptions at a discounted price. Keeping in view the village environment, this problem becomes even more relevant as mostly the poor and the impoverished segments of the community live in such localities. Thus, the management of Aspire International would have to look this up very carefully. This issue can be addressed by increasing the operational efficiency and cutting other costs incurred at stores, and providing prescriptions to customers at relatively lower rates than the competition. Likewise, the instore pharmacies with convenience stores where they make it easy for customers make it difficult for the business owners to manage them effectively. Studies suggest that the crime rate in such markets is usually higher. The regulatory authorities also keep a stringent check because customers take advantage of such places and buy unprescribed drugs for unfair uses. Such situations can put businesses in a difficult position as they might have to confront regulatory authorities, which does not leave a good impression on the business. Such risks can be minimized by keeping a solid background check for all personnel. Moreover, there should be a check-in check-out system for all pharmaceutical products, and the pharmacy should be closed during non-operational hours. This way, the risk can be minimized. Moreover, slip and fall lawsuits, along with any other operational mishaps, affect such retail businesses. Due to the nature of business, such incidents are bound to happen in which both employees and customers can suffer. Thus, to keep all the stakeholders safe, strong safety measures need to be in place. However, these incidents do happen no matter how reasonable the safety measures are. Thus, businesses need to have good risk management programs to minimize and handle incidents of such nature. Projected Competition Analysis Competition Analysis is a strategy where a company identifies its significant competitors, its products, and its sales and marketing strategy. The businesses try to formulate their own strategies that give them a competitive advantage 5 over their rival businesses. One of the most fundamental challenges that businesses face is the threat of competition from rivals. After a thorough internal and external analysis by using the Strengths, weakness, opportunity, threat (SWOT) model, Value, rarity, imitability, organization (VRIO) model and red and blue ocean strategy, the project manager has concluded that in joint businesses like these where a pharmacy and a convenience store are combined the risk of competition is usually more in urban settings because this type of business model has become more common in such type of surroundings. The business will also identify direct, indirect, and tertiary competitors. This division will help in formulating the competitive strategies accordingly. So, by developing a targeted competitive strategy, the business will gain a competitive advantage over its competitors no matter to what category they belong. The business would have created different strategies to compete with different types of competitors. However, in rural settings like the one where Aspire International Corporation’s Project Manager is planning to set up the new business, the threat of competition will be lower from similar businesses. However, the company might have a threat of competition from small businesses usually working in streets and running mini convenience stores. As it is a norm in rural settings that small businesses operate instead of profit-making huge businesses. The focus of such small businesses is usually to earn a living so that their families have sufficient food on their tables for all three meals of the day. Necessarily, their sole focus is not on profit-making only. Due to this reason, there are many small shop owners in almost every corner of the street. That is why they can give a tough time to any new business trying to compete them and snatch their livelihood in a way as those small shops are their sole means of earning. Therefore,
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