RICARDO PALMA UNIVERSITY

ECONOMIC AND BUSINESS SCIENCES FACULTY

GLOBAL BUSINESS ADMINISTRATION SCHOOL

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 SURCO, NOVEMBER 23th 2017
Introduction

We, Aguamal S.A.C. will offer pallet based on aguaje, which is made up of
women from 18 to 55 years old, from socioeconomic levels A, B and C, which
live in Metropolitan Lima. Aguaje is a fruit known to be rich in antioxidants,
phytoestrogens, minerals and vitamins that help regulate the symptoms of
menopause, reduces cardiovascular diseases and helps strengthen hair and
skin.

The product is ideal to cover the market need that could be identified when
interviewing women within the aforementioned range, since the preference is
towards beverages that satisfy their basic need to hydrate, giving them a good
taste based on exotic fruit and supporting its quality to not have preservatives or
chemicals, thus achieving a 100% natural product that helps them take care of
their health.

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 I. Project Profile

Company name: Aguamal S.A.C.

AGUAMAL
We are a Peruvian company that was formed by a group of university
students who are dedicated to the elaboration of aguaje ice pacifiers. Our
company is having a team of quality where each of the members would be
responsible for implementing all their skills and knowledge to deliver quality
product to our customers.

The product we offer is aguaje ice pacifiers. We are focus in the market
of Lima-Peru, why we do not decide to export our product? Because we want to
all peruvians and residents of Peru taste an exotic fruit of Peru and also to
refresh their throats, after that we will see if we export or not.

The aguaje ice pacifiers are widely seen as a healthy and refreshing
snack. They are a better alternative to sugary sweets not like the artificial ice
pacifiers or ice creams, which is why we saw a business opportunity.

The aguaje ice pacifiers has become an interesting outlet for producers
that every year facing the hard problem of getting rid of surplus and even had to
bury overflowing with fruit production and falling prices. It gives added value to
well production and minimizing losses.

The presentation has the form of a tube.

I.1. Title

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 Project of making aguaje ice pacified

I.2. Start and end date

In agreement on the objectives to be discussed later, the project
duration time is based on three years (156 weeks), beginning on
March 01, 2017 and ending on February 28, 2020.
Table 1. Quantification of the actual market
MARKET MARKET SIZE COMMENTS
Total population 31,770,000 Total Peruvian population
Potential market 8,473,000 Population of Lima
Target market 4,506,249 Women of Lima Metropolitan between 18 - 55 years old
Actual market 67,594 We estimate a 1.5% of market share

Table 2. Quantification of the raw materials required

DESCRIPTION QUANTITY UNIT
Actual market 67,594 people
Frequency of purchase 270,375 units/month
Aguaje 40,556 kg/month
Plastic bag and label 270,375 units/month
Table 3. Raw material cost (per
year)

RAW MATERIAL (per year)

Cost per
Equivalen
Quantit Total unit
Raw material Unit Cost t in pulp
y (USD) produce
juice (lt)
d
Aguaje Kg 2,38 85.000 202.300 59.500 0,68
Total 202.300  

Total cost of raw material (per year)

(USD) 202.300

Table 4. Direct workforce cost (per

month)
DIRECT WORKFORCE (monthly)
Cost per
Salary Quantit Total unit
Workforce
(USD) y USD produce
d
Specialized
workers 850 5 4.250 0,016
Total 4.250 0,02

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 Total cost of direct workforce (per year)
(USD) 51.000

Indirect costs of manufacturing (per month)

INDIRECT COSTS OF MANUFACTURING (per month)

Cost per
Salary Total
Description Quantity unit
(USD) (USD)
produced
Services        
Electricity supply     1.600 0,006
Water supply     1.000 0,025
Phone and Internet supply     700 0,003
         
         
Depreciation     1.042 0,004
Labels and packaging     10.000 0,444
Confirmation of the Co and certifications     3.000 0,011
Factory certification     3.000 0,011
Indirect workforce        
General manager 4.500 1 4.500 0,017
Area manager 2.700 1 2.700 0,010
Supervisor 1.350 1 1.350 0,005
TOTAL 28.892 0,535

Total indirect costs of manufacturing (per year) (USD) 346.700

I.3. Type of funding

The funds of the project come from two sources:
 Capital: Composed by USD 600,000. To the purchase of
the construction, machinery and equipment needed, the
payment of the direct and indirect workforce and the
working capital.
 Bank loan: Composed by USD 240,000.

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 I.4. Objectives
The main objectives of the project are the following:
 Introduce, in a successful way, our aguaje ice pacified in
the Peruvian market within the first year of operation.
 Obtain a 1% of market share in the first year of operation in
the selected target market.
 Obtain a 71% of profit at the end of the project.

I.5. Core activities

 Development of a market study, focused on our target market
 Development of a feasibility study
 Implementation of practices according the international quality
certifications
 Hiring the staff required
 Product development and production
 Supervision of the production process
 Quality control
 Packaging and product labeling
 Post-sales service
II. Project processes
II.1. Project initiation
At this initial point, the first ideas will be established; all the ideas
are accepted to later decide what will help to the project and then
reinforce that idea, so that they are not just loose ideas and can be
ideas that help the success of our project.
II.1.1. Selection of the best project given resource limits
This was considered the best project, given the validity of
the technical fundamentals. Moreover, there is a big level of
innovation on the proposal; the economic and business feasibility
studies of the project are included, not leaving aside the economic
impact of the project.
Some technical fundaments are:
 Growth of the agroindustry sector of 24.5%.

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  The government promotes the cultivation of native fruits.
 Stable financial situation, so the access to credit is
feasible.
II.1.2. Recognizing the benefits of the project
There are many benefits that generate the implementation
of this project, including:
 New sources of revenue resulting from the sale of the
product in the Peruvian market.
 Expansion of the product line.
 Coverage and positioning of national market.
II.1.3. Preparation of the documents to sanction the project
In this chapter, it is going to be mentioned all the
authorization needed in order to run the project.
First, our company will use aguaje, given that our target
market demands that kind of product. The trend in the Peru, in the
consumption on this kind of products is increasing continually.
II.1.4. Assigning of the project manager
In this part, it is mandatory to select the right person as the
project manager.
For our company the project manager’s main responsibility
will be to promote communication, cross-functionally toward
common goals and objectives:
The main functions are:
 The project manager has the right to request specific
resources, but the final decision of what resources will
be committed rests with the line managers.
 Stakeholders are organizations that can be favorably or
unfavorably impacted by the project. As such, project
managers must interface with these stakeholders, and
many of the stakeholders can exert their influence or
pressure over the direction of the project.

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  The project manager must be willing to manage within
the guidelines, policies, procedures, rules, and directives
of the parent organization.
II.2. Project planning
II.2.1. Definition of the work requirements
The personnel required for the company, are the one that
will be responsible for processing the aguaje and take out the
pulp, to be presented to the market should be highly qualified and
able to perform the necessary operations. Qualified personnel who
will regularly work in our company will have a constant
compensation system.

II.2.2. Definition of the quality and quantity of work

 General Manager: She will be in charge of determining
what is related to the styles and new styles in the
process of taking out the pulp, to develop and implement
the best working method, to inform supervisors some
changes in methods, to direct the activities of
supervisors, to monitor the payment reports, to
represent the organization at all times.
 Area Manager: Responsible for overseeing sales, visits
potential customers, establish and maintain an optimal
level of communication between the company and
suppliers, oversee the planning, implementation and
control visits by its sales force, among others.
Its functions are also related to manage and
coordinate area sales, manage and control ongoing
projects, participate in developing growth strategies,
market research and implement promotional strategies
and sales techniques, direct and control the activities of
the commercial area to maximize profitability business,
defining the business strategies of the organization, they
also have authority in determining prices.

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  Specialized Operators: their functions are to supervise
the correct handling of the corresponding machines,
teaching procedures to be followed by the regular
operators.
 Regular Operators: To manage and properly handle the
machines correspondingly, effectively and efficiently, to
package the products according to the required
specifications, maintaining constant communication with
supervisors to give appropriate priority to repairs of
machinery, to monitor the scheduled preventive
maintenance.
II.2.3. Definition of the resources needed
Production Resources:
 Machinery and equipment: required for production of
the product.
o Refeer
o Pealing machine
o Press abd extractor machine
o Packaging machine
o Electronics devices

 Raw Material: for the production of the final product.

 Inputs: Accessories for the production of the product.
Among them, polypropylene bags bi-oriented, labels,
other materials such as cardboard boxes, tape, and
protective equipment to export.
 Direct and indirect workforce: Composed by the
general manager, the area managers, the
supervisors, the specialized and the regular
operators.
II.2.4. Evaluation of the various risks
Some of the main risks that our project faces to are the
following:

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  Wandering people that sell fruit`s iced pacifiers are
our main direct competitors, the ones that also
supply our target market
 Ice cream companies.
 Potential competitors can become big bidders.
 Ecological risks that may affect our suppliers of raw
materials.
 Entry of foreign processing companies.

II.3. Project execution

II.3.1. Negotiating for the project team members
As a company we consider that the project’s team
members are made up of those people dedicated to the
project or borrowed on a part-time basis.
The company is committed to provide leadership,
direction, and above all, the support to team members as
they go about accomplishing their tasks. Working closely
with the team to solve problems can help the company
learn from the team and build rapport. Showing the support
for the project team and for each member will help the
cooperation.
The future team members will be evaluated in a first
instance by evaluating their CVs and then psychological
and psychometrical evaluations will be applied in order to
identify the ones that fulfill the requirements of the profiles
needed.

II.3.2. Directing and managing the work

Managing the project with the team members
requires interpersonal skills. The activities are in charge of
one of the Area Managers, as to:
 Establish clear tasks and activities for each
member in order to increase the productivity.
 Evaluating and controlling the daily performance
of each team member.
 Checking that all the work is being developed
under the standards of the certifications.
 Checking that all the work is done within time and
fulfilling the minimum quality standards set.

II.3.3. Working with the team members to help them improve

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 At this point the first activity to consider is:
 Feedback communication
As a company, it is considered a process
that requires constant attention; feedback
communication will be done to promote efficient
performance. Operators have to know if what they
are doing is well. For them it is satisfactory to
hear thoughts from the company and suggestions
on ways to improve, though, that feedback has to
be delivered carefully and frequently.
Giving feedback will be done by the one of
the Area Managers, given that it is considered an
effectively skill. And like all skills, it takes practice
to build confidence and improve.

II.4. Project monitoring and control

II.4.1. Tracking progress
The tracking control will be focused on the set of activities
carried out by the team members in order to ensure that all the
activities are being carried out as close as possible to the initial
plan.

II.4.2. Analyzing variances and impacts

At this point the evaluation of potential variances will take

place; the comparison between the results sought to obtain and
those actually obtained will be performed. By the uncertainty
inherent in the planning itself, it is important to determine the
magnitude of the discrepancy and their impact on the process of
implementing the project.

The impacts will be reviewed in order to define which areas

of the project will be affected by any variance. On the other hand,
external factors will be analyzed to understand the impact of
variances that are not necessarily linked to the project, but that
may be affecting it.
II.4.3. Making adjustments
Two main activities will be performed at this point:
 Definition of corrections: Once verified an error and
assessing its severity, it is necessary to analyze the

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 possible existing solutions and select the one that
seems most appropriate.
 Implementation of corrections: It will take place
immediately after the most appropriate solution was
found.
II.5. Project closure
II.5.1. Verifying that all of the work has been accomplished
This will be done with the system implemented on the
project, where it will tell us if all tasks and activities were
accomplished; if not, immediate action will be taken in order to
achieve them.

II.5.2. Contractual closure of the contract

That involves accepting all the work of monitoring in order to
ensure if every step is completed, receiving pass through
guaranties, warranties and licenses, to resolve any dispute or
details in the contract inside. Unresolved claims have to be resolve
after the closure procurements are finished.
II.5.3. Financial closure of the charge numbers
Even though the previous step may have been completed,
there may still exist open charge numbers to complete the
paperwork that has not been done yet. This will include any
processes and documents related to the financial statements of
the project and some others related.
II.5.4. Administrative closure of the paperwork
The contracting parties – buyer and seller – both agree that
the seller (our company) that has provided the aguaje, has
completed the work stipulated in the contract; and the buyer
(Peruvian companies) have accepted it and paid for the price.

III. Project phases

III.1. Idea
To develop this project, we rely on the business opportunity that
was found in the lack of consumption of healthy snacks into the daily

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 nutrition of people of our target market. During the generation and
development of our business idea we found important data about the
actual malnutrition problems of the population,
III.2. Pre-investment
Into this stage we develop the feasibility study of the project before
making the investment; that is why it was necessary to analyze all the
costs that would be needed to execute the project, as well as the
expected return and income that this project will generate.
What is more, we analyze the environmental impacts that our
project could produce and if the political, legal and technical aspects
are favorable for the development of our project.
III.3. Investment
Once we prove the feasibility of our project, we concluded that the
project will give us the results and return expected, so we proceeded
to make the investment.
III.4. Operation
Once we have made the investment, all the purchase of raw
material, packaging and machinery was made in order to develop the
essential processes such as the taken of the pulp of our product as well
the packaging and distribution of it.
IV. Project strategy

To carry out our project, we decided to apply and highlight one

strategy in which we will make a difference as a company and as a
product; this is because of the type of product we offer and the
relationship with our suppliers.

V. Market study

In this chapter, we will present and analyze the models of the

quantity demanded and supplied and the calculation of the sample size. It
is important to mention that all the models presented are statistically
significant.

V.1. Location

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 Our product will be mostly offered in the most important
supermarkets of Peru.

VI. Feasibility study

It is important to highline that this project is a private one, and
because of that, we will only consider the legal, technical, economic-
financial and environmental aspects.

VI.1. Legal
 LAW Nº 29571, CODE OF CONSUMER
PROTECTION AND DEFENSE
It has a big impact on our project because our
project is a product for human consumption, so we
have to take care and ensure that what we offer our
audiences are quality products.
 MINISTERIAL RESOLUTION N° 449-2006/MINSA
This law approves the Sanitary Standard for
the implementation of HACCP in food and beverage
production, which is a very important system in the
food and beverage industry as it checks and verifies
the quality of the products. By following these
standards our company can improve the quality of
our products and increase its competitiveness as a
consequence.
VI.2. Technical
Through this study it was able to determine the product distribution
system, so as the sector in which the company, which is in going
through a very optimistic development and growth process; the
support and promotion of the government favors the production of our
product, generating a great expectation in local markets.
From the point of view of our direct competition, wandering people
and ice cream companies come to carve as the main suppliers of the
product to our target market. Considering that, our product must meet

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 the optimal technical requirements in order to provide a high level of
service and satisfaction to our customer to compare these first.

SAMPLE SIZE

We choose the district of Miraflores to make our Surveys, with the following
data:

DEPRECIATION

PRICE AND TOTAL INVESTMENT

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Table 6. Price definition
PRICE
Unit
Product Unit cost profit Unit price
(USD) (115%) IGV (18%) (USD)
Pallets of Aguaje 1.23 1.41 0.31 2.96

Table 7. Total investment projection

TOTAL INVESTMENT
Total cost of raw material (per year) (USD) 202,300
Total cost of direct workforce (per year) (USD) 51,000
Total indirect costs of manufacturing (per year) (USD) 346,700
TOTAL 600,000

Table 8. Return projection

RETURN
Total sales (USD) 799,951
Total investment (USD) 600,000
TOTAL (USD) 199,951
TOTAL (%) 33%

LOAN

LOAN
Investment 600,000
Loan 40% 240,000
i 35.0% per year
n 3 years

Payment 170526.32

DEBT PAYMEN AMORTIZATIO

YEAR BALANCE T INTEREST N
1 240000 170526.32 120000 -50526.32
2 189473.68 170526.32 94736.842 -75789.47
3 113684.21 170526.32 56842.105 -113684.21

COST ANALYSIS

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CASH FLOW

  0 1 2 3
Price   2.96 2.508 3.552
Q   270,375 280,000 310,000
         
Revenue   800,310 702,240 1,101,120
Expenditures        
Variable costs   -303,855 -314,672 -348,387
Fixed costs   -16,100 -16,100 -16,100
Interest   -120,000.0 -94,736.84 -56,842.11
Depreciation of
construction   -13,120 -13,120 -13,120
Depreciation
machinery and -2,591 -2,591 -2,591
equipment
Profit   344,644 261,020 664,080
Tax (20%)   -68,929 -52,204 -132,816
Net profit   275,715 208,816 531,264
Depreciation of
13,120 13,120 13,120
construction  
Depreciation
machinery and
equipment   2,591 2,591 2,591
Machinery -15,800      
Construction -80,000      
Working capital -159,977 -5,408 -16,857 182,243
Loan        
Debt amortization   -50,526.32 -75,789.47 -113,684.21
Residual value       31,422
Project cash flow -255,777 235,491 131,880 646,957

PV, NPV, IRR

Table 15. PV, NPV and

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IRR
  0 1 2 3

CASH FLOW -255,777 235,491 131,880 646,957

PV ( i = 35%) -255,777 174,438 72,362 262,950

NPV 253,973.37
IRR 89.6%

BREAK EVEN POINT

AGUAJE PALLET
PRICE 2,96
VARIABLE COSTS 1,12
FIXED COSTS 16100,00

Q = FC/ P-VC
  8768

Quantity of Pallets that we will have

to sell in order yo recuperate our
investment.

WACC

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 Market Share WEIGHT*B
Division Beta
Value (WEIGHT) ETA
2.603.67
Aguaje Pallets 1,2
0 1 1,2
2.603.67
Total 0 Unlevered beta 1,2

Levered Beta = 1,2 x (1 + (1 – 0.35)

Tax Rate 35% (240000/2603670))
Equity 2.603.670 Levered Beta = 1,271898517    
Debt 240.000

Cost of equity=(Risk Free Rate+Equity Risk

Risk Free Rate 5,90% Premium)
Expected Market Equity Risk 0,11580636 11,5806 %
Return 15% Premium= 4
Cost of equity= 17,48%

Required
Return 0,121173758  
  12,11737575 %

WACC=Wdebt ∗R.debt (1-t)+Wequity∗R.Equity

Cost of debt 9,50% 0,165264631

W Debt 0,08439798 Rounded=17%
R Debt 9,50%
W Equity 0,91560202
R Equity 17,48%

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SENSIBILITY ANALYSIS
PROJECTS NPV
Scenario Probability AGUAMAL ZACATECA PALACHI NORDWIK
Recessive 5% 139.685 -9.000 -120.000 -150.000
Pessimistic 15% 177.782 -5.000 210.000 130.000
Normal 25% 253.973 100.000 251.000 110.000
Optimistic 40% 279.370 120.000 200.000 200.000
Expansive 15% 304.768 156.000 290.000 245.000

PROJECTS NPV
Scenario Probability AGUAMAL ZACATECA PALACHI NORDWIK
Recessive 5% 139.685 -10.000 -4.000 -8.000
Pessimistic 15% 177.782 -5.000 210.000 100.000
Normal 25% 253.973 100.000 251.000 110.000
Optimistic 40% 279.370 120.000 200.000 200.000
Expansive 15% 304.768 156.000 290.000 245.000

Very conservative PROJECTS

Winning
Scenario Probability
AGUAMAL PALACHI NORDWIK project
Recessive 5% 139.685 -4.000 -8.000 AGUAMAL
Pessimistic 15% 177.782 210.000 100.000 PALACHI
Normal 25% 253.973 251.000 110.000 AGUAMAL

Project E(NPV)
AGUAMAL 6984,25 26.667 63.493 111.748 45.715 254.608
PALACHI -6.000 31.500 62.750 80.000 43.500 211.750
NORDWIK -400 19.500 27.500 80.000 36.750 163.350

Project E[ NPV x]
2.168.467.12
660.365.846 885.337.245 100.719 245.260.849 377.402.466
AGUAMAL 6
5.502.903.12 385.140.62 6.862.187.50
459.375 55.225.000 918.459.375
PALACHI 5 5 0
4.909.411.12 711.555.62 1.000.008.37 7.325.097.50
166.833.375 537.289.000
NORDWIK 5 5 5 0

Project Deviation project Variation Coefficient

AGUAMAL 46.566,80 0,182896005
PALACHI 82.838,32 0,39120813

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NORDWIK 85.586,78 0,523947251

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