TAVUSH MINERAL WATER FACTORY

Transcription

1 TAVUSH MINERAL WATER FACTORY "Slovakia" Ltd Registration number Date of foundation legal address Village Voskevan, Tavush Marz of the RA Tax code Director Tel. Trademark Seryozha Barsegyan , Tavush Yerevan 2017

2 BUSINESS PROJECT OF THE CONSTRUCTION AND EXPLOITATION OF TAVUSH MINERAL WATER FACTORY 1 business project is a commercial secret and belongs to "Slovakia" Ltd. 1. Conclusive Chapter goal of the given project is the evaluation of the efficiency of the construction a water bottling plant on the base of 5 mineral water and 2 spring water sources located on the territory of Tavush region villages Achajur and Vazashen. All the sources are managed by Slovakia LLC, 5 mineral water sources together have got bandwith of about 8,7 liters/second, and 2 sources of spring water together have got bandwith of about 2 liters/second. However at this stage we are planning to bottle 30% of water, with capacity of about 3,2 liters/second. In addition, Slovakia LLC owns a plot of m 2 - for building a factory, which is located in Vazashen village, and Vazashen is included in the list of villages exempt of taxes and in the future the plant will operate being free of all kinds of taxes. sources of Vazashen village are located 2km away from the factory and the water will be supplied to the factory through pipes. water of

3 Vazashen has got stomach healing characteristics, on the base of which a dissertation has been written, and this water is the duplication of famous mineral water Narzan. sources of Achajur village are 15 km away from the factory and the water will be transported to the factory by water trucks. Also the name TAVUSH (name of the region where the plant is built) belongs to Slovakia Ltd. with the right to use it as a trademark. Slovakia Ltd. has a license to provide construction works and a team of constructors, and all its construction projects it carries out substantively and on cost price. Slovakia Ltd. in Tavush region has a permission to install about 20 advertisement panels and 2 already placed advertisement shells on the interstate highways. As a great advantage it should be noted that the goods produced in Armenia, including bottled water are exported to the European Union and the Eurasian Union without customs clearance fee. In order the plant can start its operation it is necessary an investment of another 4 million dollars Outgoing indicators Start of the project realization planning horizon 1 years Currency unit USD Currency rate dollar/dram 486 total area of the plant (plot) 10000m 2 Industrial area (m 2 ) 4000m 2 plant's production capacity (liters/day) Production It is provided to produce sparkling mineral and spring water in glass bottles with capacity of 0.3 l, 0,5 l, 0.7 l and in plastic bottles - with capacity of 0.5 l, 1 l, 1.5 l, 5 l, about 35 million liters of production a year. Price Policy Takinng as a basis the competetive character of the market at working out its price policy the company is guided by the method «cost+», of course, also a study of the competitors was carried out and for each product present in the name list it was chosen a competetive price, which provides the maximum level of the price-quality correlation, hence of competitiveness too. Market Capacity company is going to export its production mainly to the following countries: Russian Federation, United Arab Emirates, Kuwait, Qatar, Iran and China.

4 Products Sale Sales of the production of the company in the domestic market will be carried out throuh its own sales team in Yerevan and adjacent regions, in far regions it is provided to cooperate with regional distributor organizations. distribution in foreign markets is planned to be realized in the frames of cooperation with specialized organizations, in accordance with principle: one country one distributor, with this aim works are carried out both with the support of Armenian-Russian Palace of Trade and Industry and of Armenian-Qatar Palace of Trade and Industry, preliminary agreements are reached with the potential partners. 2. Marketing Study of the Target Market Mineral water is the underground (rarely - surface) water, it is formed through mixing of underground water of various aquifers, through their interaction with mineral atmosphere and silicates blown of mineral openings. y contain large amount of biologically active inorganic (less organic) substances and are endowed with unique physical and chemical properties (composition, temperature, radioactivity), thanks to which have got healing effect on human organism. y are used as external and internal medication. components of mineral water depend on the geological development of the area, the nature of tectonic structure, geo-termal conditions, and the gas composition depends on the transformation and volcanic processes. above mentioned useful properties of mineral water served as a basis for the commercialization of the latter and for the dynamic growth of demand towards him, which is more expressed in developed countries, where there is a solvent demand, and, conditioned by higher level of living standards, great tendency of people towards «healthy lifestyle». Bottled mineral water consumption in the world per person is presented below: World dynamics of mineral water consumption per 1 person in (liters/person)

5 World dynamics of mineral water consumption per 1 person in (liters/person) It is evident from the graphics the stabile, multiple long term growth of the world consumption, positive deviation from the world average index. Based on the foregoing, as well as on the company s business relationships, the company considers it appropriate in the planned horizon to enter with its products first the Russian Federation, the United Arab Emirates, Kuwait, Qatar, Iran and China, furtheron on to expand the geography of the export. essential features of the Russian market are. fact of membership to EEU, which allows to gain a competetive advantage in the Russian market towards the mineral water inported from other countries re is a widespread view, that actually (unofficially) in RF live more Armenians, than on the territory of RA, however this may be exaggerated, nevertheless the vast majority of Armenian diaspora lives in Russia. For decades in the Russian market Armenian brand «Jermuk» was presented as Armenian mineral water. During these years Jermuk managed to gain its own place in the Russian market of mineral waters, especially in Moscow, where the biggest share of the company s export is consumed (around 80%). reasons for entry to Arab world are also the follows: problem of drinking water caused by climatic conditions presence of solvent demand. China has currently large amounts of water demand and applied to us looking forward to cooperation.

6 Iran has removed the water import customs clearance fee. Price Price Policy Price policy is the component of marketing mix (4P), and as on the chosen price policy depends both the profitability of the project, as well as the competitiveness of the product in the market, therefore it is necessary to develop the most responsible approach while working-out the price policy. price policy of the company sould consist of the following basic factors: full cost of the product (direct and indirect costs), price of similar and substitute products in the market, goals of the company, Strategic approach, Ensuring competitiveness in foreign markets, Target Group solvency level. Company has chosen its price policy in accordance with the principle of best optimal combination of the above mentioned factors. prices of the products presented by the Company are competitive in the market taking into account the offers presented by the concurrents. USD Type Mineral water in Spring water in Mineral water Spring water in Bottle glass bottle glass bottle in plastic bottle plastic bottle capacity 0.3 լ լ լ լ լ լ Actuation re are definitely approved stimulation means for actuation any production in the market. se are the advertisement, PR, sales promotion, individual sale, targeted marketing, internetmarketing. A certain orientation must be in the issue of the actuation object choice. In this case it is possible to observe 3 variants of the actuation of the object:

7 1. To promote the consumption of mineral water - at the same time we actuate the production of the concurrent. On the other hand taking nto account the specific taste characteristics of the Armenian mineral water and the mass consumption of mineral water (especially in Arab market) may be rational, but it supposes significant marketing costs. 2. To actuate the Armenian mineral water it may be realised through propaganda. aim is the enhancement of the Armenian mineral water authority, which will directly contribute to the sales increase. However, in the Armenian mineral water market there is a leader of the market - «Jermuk Group», and this variant of the actuation must be excluded for the planned period. 3. To actuate the trademaark the mineral water is presented under the brand «TAVUSH» which belongs to the Company. trademark nowdays represents a non-material «valuable» active, through the increase of the cost of which the businessmen have the possibility to buy back the expenses and investments spent on advertisement, marketing before, moreover, these expensesonce again have been included in the prime cost. 4. Human Resources People are the core of any business and only through reasonable human resources policy clear definition of vacancies, correct choice of personnel, effective motivation and control provision, it is possible to secure the desired results planned by the project. Staff Number of employees Salary (US $) Monthly Total Annual Director Deputy Finance Director Deputy Director of Production (technologist) Responsible person for marketing and sales team Chief accountant Accountant Engineer Driver Operator Worker Security worker Cleaner Total

8 5. Financial plan capital investments of the Factory ( technique, equipments and construction) Investment direction Measurement Number Unit price Price unit Complete production line liters / piece day production capacity Complex equipment of water metal part piece filtration and neutralization Water container 40 thousand liter, nerzh piece Water pump piece Plastic bottle production line piece Plastic bottle form piece Glass bottle form piece Power /energy/ transformer piece Heating boiler and equipment piece Construction of the factory building and m communication Վերամբարձ մեքենա Crab piece Truck IVECO (24 tons) piece Truck Citroen Jumper (2 tons) piece Water transporting Truck Kamaz (20 tons) piece Vehicle NIVA piece Acquisition of warehouse in Yerevan m Own billboards construction piece Office furniture and equipment Other capital investments Total

9 Production and profit calculation on a daily basis Bottle capacity Product Mineral water in glass bottle 0.3 լ Spring water in glass bottle 0.3 լ Mineral water in glass bottle 0.5 լ Spring water in glass bottle 0.5 լ Mineral water in plastic bottle 0.5 լ Spring water in plastic bottle 0.5 լ Mineral water in glass bottle 0.7 լ Spring water in glass bottle 0.7 լ Mineral water in plastic bottle 1 լ Spring water in plastic bottle 1 լ Mineral water in plastic bottle 1.5 լ Spring water in plastic bottle 1.5 լ Mineral water in plastic bottle 5 լ Spring water in plastic bottle 5 լ Number of bottles / day Price Profit Total Working 21 days a you wiil have dollars revenue a.

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11 Cash forecast ARTICLE preliminary investment first second Cash flow forecast third fourth fifth INITIAL BALANCE 0 ². INPUTS 1 Input from realization Total access Outputs 0 1 Salary Cost of realization Wells exploitation right fee Environmental fee stuff and materials Amortization Communication and communal 7 fee Business trip fee Advertisement Design Bottle Label Bottle cap Office expenses Main resources Working capital Transportation tax Maintenance and restoration of the main resources TOTAL EXIT final result sixth USD seventh eighth ninth tenth eleventh twelfth Total 24