Entrepreneurial project Individual Project
Дипломная работа - Маркетинг
Другие дипломы по предмету Маркетинг
e it may be equally e.g. an advertisement in a last years special industrial magazine, a name card of the company representative with a note тАЬimportantтАЭ or тАЬinterestingтАЭ found somewhere, a web-site, an article in a local newspaper, a meeting at a specialized conference, etc.
Thus, the provided in table measurement media have a relative character. Nevertheless, they may serve as indirect promotional strategy assessment ratios.
Generally speaking, the main thing about the market under analysis is a very high price for any mistakes in the project promotion. So, every step taken should be thoughtfully considered and assessed.
Furthermore, since the customer tends to search for information everywhere, the promotional strategy should be carried out by means of different media channels, including even such as rumours sometimes.
Considering the promotional strategy budget, the important point here is that due to the peculiar feature of the industrial property lease process, the general concept lies in attracting the customers, not in their further retaining.
So, the sums of money spent on promotion at the initial stages of the project development (2008-2009 financial years) are considerably larger than the following periods budgets.
Thus, we expect that on the first stages of the project development the promotional budget will amount up to $350-450 thousand per year. The supporting marketing strategy will cost $100-150 thousand per year.
- Sales Strategy
With the forecasted market growth (see Graph 4, paragraph 3.4 of the current document) we plan to occupy the fourth part of Kazan industrial real estate market by the 4th year of project realization (600 thousand square meters of the forecasted 2500 thousand sq.m total market capacity).
The real estate operations concept of the тАЬHimgradтАЭ Industrial Park comprises the three main steps:
- new construction of industrial premises;
- long-term lease agreements signing with site residents, and
- optional buying the leased premises out, after expiration of the lease agreement at will of the residents.
The dynamics of these three types of real estate activity is presented at Graph 6. The positions of total square under operation and total square sold are cumulative.Graph 6
The rent rates policy of the тАЬHimgradтАЭ Industrial Park is based on our attempt to create favourable conditions for site residents. Thus, we have analyzed the Kazan real estate market rents (see Graph 7) and set the site rents at a level lower than the city average market rents.
Graph 7
In addition to premises lease and buy out, the тАЬHimgradтАЭ Industrial Park provides utilities (gas, electricity, water supply, heat supply etc.) and additional services (such as marketing services, consulting, law support etc.). The dynamics of providing both types of services directly depends on the amount of premises lease and buy out and will be examined in paragraph 7.2 of the current document.
- Financial Forecasts
- Important Assumptions
While assessing the project financial data, some underlying assumptions were made:
- inflation rate is taken 11%;
- rent rates, utilities prices and additional services prices growth estimation is based on the specified inflation rate;
- discount rate is taken 14%;
- a growth trend in the Kazan real estate market is expected.
- Project Earnings Structure
At Graph 8 the financial result of the main activity of the тАЬHimgradтАЭ Industrial Park is presented that is real estate operations, including lease and real estate units buy out.
Graph 8
As we see from the graph, the positive financial result in this type of activity appears in the 5th year of project realization, after all the real estate units are put into operation.
Graph 9 represents the financial result of the utilities providing activity. The financial result here is the minimal positive. This is conditioned by the preferential utilities prices on the industrial park territory. One more circumstance restricting the utilities pricing policy is that this economy sector is controlled by the government and antimonopoly institutions. This type of activity is necessary for the residents, but non-profitable for the company. Nevertheless, low utility prices will provide the site with a greater customers inflow. Graph 9
Another profitable type of activity, except the real estate operations, is providing additional services (consulting, law support, marketing, technical permissions etc.). The financial result of this type of activity is presented at Graph 10.
Graph 10
If we consider the total project earnings structure, it will look as follows (see Graph 11).
Graph 11
The real estate operations form the bulk of the project earnings, comprising up to 80% of all earnings structure.
- Net Present Value Analysis
The Project Net Present Value is presented at Graph 12. According to the Graph, the accumulated project NPV is $167 mln. by the 10th year of project realization. Net profit/sales are expected to be positive by the 7th year of project realization.
Graph 12
- Projected Cash Flow
The Project Cash Flow Dynamics is presented at Graph 13. The positive discounted cash flow in the 5th year of the project realization is conditioned by the total amount of real estate object putting into operation and being leased from that point of time.
Graph 13
- Key Financial Indicators
- Redevelopment site size 131 hectares
- New construction 750 thousand sq.m
- industrial premises600 thousand sq.m
- office premises150 thousand sq.m
- Total investment amount$390 mln.
- Front-end investments$15 mln.
- Investment in utilities reconstruction $30 mln.
- Investment in new construction $345 mln.
- Planning horizon10 years
- NPV$167 mln.
- IRR 21%
- Payback period7 years
- Number of resident companies250
- Number of workers (residents included)10 thousand
- Residents expected annual production volume $ 100 mln. (when at full capacity)
- Company Profile
Name of the company: Joint-Stock Company тАЬIdea CapitalтАЭ Asset ManagementтАЭ
Establishment date: July 2004
Core competence: asset management, property management in particular
Objects under operation:
- тАЬIdeaтАЭ Technopark, Kazan city
- main areas: innovative production
20000 sq.m (approx. 8% of Kazan office market)
- 88 companies
- over 700 workers
- 2006 annual production volume is approx. $15 mln.
- anchor tenants: DHL Express, McDonalds, Siemens, Citybank etc.
тАЬIdea-South-EastтАЭ Technopark, Leninogorsk city
- main areas: agriculture, petrochemistry
- 40 150 sq.m
- 100 projects under realization
- Kama Industrial Park тАЬMasterтАЭ, Naberezhnye Chelny city
- main areas: automotive components
- 138 000 sq.m
- nearly 100 companies
- approx. 1 500 workers
- 2006 annual production volume is approx. $30 mln.
- Management Team
The company top-manager are general manager 54301 and chief operating officer Airat Gizzatullin. After graduating from Kazan Institute of Economics and Finance in 1997 and completing the Certificate in Presidential Management Training Initiative Program with practical work at California State University Hayward in 1999, 54301 got the degree of Ph.D. in Economics in 2001. 54301 has a wide experience of working successfully in both commercial enterprises and in governmental authorities (TDT-Invest Company general manager, Deputy General Manager of the Agency for Enterprise Development of the Republic of Tatarstan, First Deputy Prime-Minister of the Republic of Tatarstan Counsellor in economics, Innovative Technopark тАЬIdeaтАЭ chief financial executive etc.). Airat Gizzatullin has also graduated from Kazan Institute of Economics and Finance, a year later than 54301. For a ten years period Airat has proved to be a born leader, possessing a broad outlook, equipped with a practical experience in business-centers operating, real estate and antirecessionary management.
The team of experts working on the project development consists of highly professional people. The main advantage of the team formed is that most team members have successfully worked together on other projects, e.g. Innovative Tecnhopark IDEA creation, development and promotion.
They work together for two years approximately and have proved to be a real team, creative and efficient. So, the team is capable of solving difficult tasks and working under pressure. The team members are presented at Fig 6.
Fig 6
- Management Team Gaps and Personnel Plan