Key Objectives of Business:

1. Getting and Staying Profitable

2. Reaching the Right Customers (Elite Class)
3. Producing Quality that loved by people
4. Sustainable Growth
5. Staying Ahead of Competition

Sensitivity Analysis

The Basic purpose of the sensitivity analysis is to determine the impact of the independent variable on
dependent variable. In the scenario analysis, we have tried to analyze the impact of price on the sale of
the oranges. We have taken the assumption, according to which relation of price and sales unit is
inversely proportional. This kind of trend has been seen in the fruit market. When the prices have been
increased its demand decreased and when price decreased the demand for the product shoot up. Our
production capacity is of 4000 Units. If our company decided to increase the prices, then by increasing
every 200 per box, profit will increase by 800,000. And we can easily see from data, this market is too
much price sensitive as other tech markets. By changing every 200 in price will impact the profit by
800,000 either negatively or positively.

Scenario Analysis:

In this analysis, company has two possible cases to go with. In First scenario which is worst case in which
if Fertilizer prices increase by 20% due to taxation and due to increasing demand of fertilizers or due to
import of fertilizers. In this case our losses almost got doubled in first 3 year. And our operating profit
became half. It’s a very worst case in which operating expenses increased too much and company profit
become half.

In second scenario (which is good case scenario) Delivery cost decrease by 25%, which is very possible
case because of competition in Courier service market and due to increasing E- Commerce in Pakistan. In
this scenario, our profit becomes more than doubled. Even company will be able to enjoy profit after 2
years. But in life case, company will came in earning after 3 year. And Losses in first 2 years become half.
That’s best case scenario, it could be possible due to increasing E-Commerce Market in Pakistan.
NPV and IRR

NPV and IRR show that the project is very profitable. NPV value of the project is 7,654,800 which show
that the project is very profitable. IRR of the cash flows is 60% which is very huge return. NPV and IRR
have shown that the project is very feasible and very profitable.

Breakeven Analysis:

Breakeven Analysis of the investment is 750 Units of sale. This is 18.75% of the total sale. Breakeven is
easily achievable. Total cost on the project is 1345829 which will be covered with the sale of 750 Units.
As shown is graph

3500000

3000000

2500000

2000000 Units
RS ( Rupees)

1500000 Fixed cost

1000000 Variable Cost
500000 Total Cost
0 Revenue
0 0 0 0 0 0 0 0
30 55 75 1 0 0 1 5 0 1 7 0 1 8 0 20 0

Number of Units