Business Plan Of K Company

Looking to the further increasing of the offshore oil industy, K hope to enter this marketby providing the logistics service. As the first step, K will invest on a Platform Supply VesselProjet (“The Project”). The business plan is to provide all fully informations to the investmentpartners invided by K for the Project.The vessel of the Project is a medium size PSV. It would be operated in the market bychartering. The plan made a detailed analysis on the general environment, competitiveenvironment, PSV shipping market, the PSV vessel, return on investment and risk of theproject. Methods of analysis include Michael Porter’s Five Forces model of competitionanalysis, SWOT analysis and NPV, IRR of financial analysis.Through the analysis, it shows that deep sea oil will be the important source in nextfurther and will have over10%increasing per annual in the coming year. It shows that themedium size PSV for the deep sea oil industy would be the good chance now as its increasingwas slow in the past time. Through the contrast, vessel of the Project have the goodperformance and is a cost effective solution for the market. Through the competition analysisand SWOT analysis, the potential entrants and long project schedule will be the issues.However, the competitive environment is not too warm. The Project could be successful dueto the good market chance, good relationship and experience of K and the cost efftive vesselfor the market. Through the studies on the financial and the risk, it show that the return of theinvestment is good and risk could be avoided or controlled.The Project would be carried by the SPV invested by K and the investment partners andoperated by K. Whole project will need USD13M, of which30%of the Project cost will besettled by SPV’s owned capital injected by K and the other shareholders. DiscountedCumulative Payback Period of the Project is4.27years. For five year’s operation period,NPV>0and IRR is27%wich is much more better than the WACC (9.5%).It can be concluded that the Project is workable and would give all investors good profit.