The Return on Investment (ROI) is 125.10%, which is higher than the required ROI of twenty-five per cent. Thus, the report concludes that this project will be beneficial Port Fairy Caravan and Camping Park Pty Ltd.
|
Year |
0 |
1 |
2 |
3 |
Total |
|
Inflows (Income) |
0 |
90000 |
130000 |
150000 |
370000 |
|
Outflows (Expenses) |
-90000 |
-20000 |
-20000 |
-15000 |
-145000 |
|
Total Cash Flow (Net) |
-90000 |
70000 |
110000 |
135000 |
225000 |
|
Discount Factor |
1 |
0.917431193 |
0.841679993 |
0.77218348 |
|
|
Discounted Inflows |
0 |
82568.80734 |
109418.3991 |
115827.522 |
307814.7285 |
|
Discounted Outflows |
-90000 |
-18348.62385 |
-16833.59987 |
-11582.7522 |
-136764.9759 |
|
Cumulative Cash Flow |
-90000 |
-25779.81651 |
66804.98275 |
171049.753 |
|
|
NPV |
$1,71,049.75 |
||||
|
ROI |
125.07% |
||||
|
Payback Period |
1.235607692 |
According to the computation performed in the table below, the report has established that the Present Net Value (NPV) of our project is 171,050 and the estimated payback period for Port Fairy Caravan and Camping Park Pty Ltd will be 1.24 years.
- Low risk -1
- Medium risk -2
- High risk – 3, 4
- Critical – 5
For low risks, Port Fairy Caravan and Camping Park Pty Ltd can live with them and perform no action, for medium and high risks, the company has to address them during the plan development stage. Any risk identified as critical has to be handled with immediate effect by Port Fairy Caravan and Camping Park Pty Ltd risk management team (Rabechini and Monteiro, 2013)
|
Risk |
Risk description |
Risk level |
Risk Rating |
Mitigation Plan |
|
Protection of data |
The company needs to protect its data from hackers and crackers. |
High |
4 |
The company should also have enough database to store the information of all the customers and to safeguard it. |
|
Decision-making and competition problem |
The company will face a lot of pressure and competition from competitors, which can force the company to adopt new methods and strategies which can be useful at times. Still, in most situations, the decision taken will not be up to the mark. This situation can lead to failure and can affect the goodwill of the company (Sols, 2018). |
Medium |
2 |
The company managers and stakeholders should maintain a sober mind and should be able to find a way out of this situation. |
|
Precaution and safety standards |
Customers will only come if they feel that proper safety measures are present in the company. If there is no safety, the customers will only approach the company for a single time and will go for a new company next time. |
Critical |
5 |
Proper safety and precautions methods should be adopted by the company. |
|
Proper management and allocation of resources |
If the customers are not attended, they might not recommend the same company again. Therefore, it is very important to expand the company’s network when they need it. |
Low |
1 |
In the peak seasons, the company have to make sure that there are adequate rooms and facilities available to all customers. |
References
Rabechini, R., & Monteiro, M. (2013). Understanding the Impact of Project Risk Management on Project Performance: An Empirical Study. Journal of Technology Management & Innovation, 8, 11–12. https://doi.org/10.4067/S0718-27242013000300006
Sols, A. (2018). A Comprehensive Approach to Dynamic Project Risk Management. Engineering Management Journal, 30(2), 128–140. https://doi.org/10.1080/10429247.2018.1450030
Case study. (n.d). Port Fairy Caravan and Camping Park Pty Ltd
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