A Project Business Plan Of H Company

After 30 years of rapid growth, China’s economy enters new normal situation like the speed shift, structural optimization, dynamic conversion. It has been declining year by year since 2007, although the government has taken loose monetary policy and many actions to stimulate it but see little success. The benefit on Chinese economy from globalization gets less and less. China’s export growth rate contributed to zero even negative in last three years. China’s economic growth in the past mainly relied on the government’s promotion on the demand side by increasing investment in infrastructure. It occurred serious problems like tremendous capability with the low even no returns and lots of damage on environment.The rapid rise in domestic labor cost make the advantage of China’s manufacturing sharply decline. In feasible future, China will have increasing elder population but not realizing industrialization. " Made in China" is no longer popular. Southeast Asia will overtake our position to be " Factory of World ". In long past term, we developed our economy just depending on simply copying products but in lack of owned innovation. It is difficult for us to do it anymore. A new round of technological revolution is featured with robot manufacturing, genetic Biological Sciences, new energy and mobile Internet. The road ahead may be more challenging and more difficult.Chemical industry is an important part of China’s economy. H company has similar problem as millions of Chinese manufacturers. The profit of H company gets worse as the result of the decline in both sales and price of products. H company’s business is closely related to real estate and export business. The real estate has come into sunset period, new residential construction decreases year by year. Although the government has paid a lot of effort to promote unsold houses and resulted in short-term price increases, but in the long term, the real estate industry can no longer contribute energy as before to China’s economy rebound. Consequently it is critical for H company to invest new profitable project.Entering 2015, like most products, Bulk chemical also suffered from serious over capacity. The collapse of crude oil price didn’t help downstream manufactures. on the contrary, Finished product have earlier, more substantial decline in price. The erosion of the most of the profits and vicious competition also led to the seriously low capacity utilization in chemical industry.How to survive under the background of the economic slowdown? How to cure the problem of the over capacity and achieve long-term sustainable economic development? The answers are on efforts in upgrading the product but have to avoid repeated construction of traditional products and competition among current products. Only vigorous improvement for the quality and efficiency of the supply of products could provide power to the sustained economic growth in future.The company strategic team focus mainly in bulk chemicals with high import dependency. Such kind of products is not easy to find as China has grown to be an Net export country of most chemical products. After sustained attention and investigation, H company’s strategic team focus on A products. That has high dependence on the imports about 80% and are well profitable. It could be a model product for industrial upgrading.The expectation of A product future growth is really attractive. It is mainly used in the fast growing applications like smart phone camera, security monitoring and water based paints. Its direct downstream product are Synthetic resin lenses and solvent free paints. Both of them are sunrise industry and blue ocean market. This project can also make use of the advantage which H company owns through long engagement in chemical industry like strong portfolio of customers and R&D force. Additionally, Company has spare land for new project to build in. The investment in fixed assets can be greatly saved by sharing public facilities which are available in the park. It is conducive to shorten the investment cycle and to reduce investment risks. When products is commercialized, Current sales channel can be supportive of its promotion to market. There is a complimentary relationship between them.It is believed that this project can bring expected profit to H company immediately after its operation. This project is very important for both the long term development of the company and the switch from Red ocean market to blue ocean market. This project is determined to be a good investment on the basis of thoughtful investigation and analysis including Finance, technology, market, raw material, production, Potential risks. It is highly suggested to raise money for instant commence.