MG305 MAJOR PROJECT_BUINESS PLAN

Group Name:
 Hamhrey Rima ID#:s11176496
 Grey Abana ID#: s11140857
 EXECUTIVE SUMMARY
Pacific Oil Limited is a small scale licensed crude oil refinery enterprise that will be based
totally in Honiara, Solomon Islands. Although we intend beginning out on a small scale, but
that will not in any way give up us from maximizing our potential in the international crude
oil industry. We hope to develop the commercial enterprise so as to start exporting
sophisticated crude oil products from the Solomon Island to other Pacific Island countries.
The company mission is to establish a successful crude oil refinery industry that will
maintain customers and employees satisfaction. And have the capacity to compete and
become one of the competing companies in the pacific region and its vision is to become a
highly profitable firm that will have a strong manifestation in it operation in the Solomon
Island and pacific region as a whole.

Our commercial enterprise aims to become a popular and licensed crude oil refinery business,
and will grow to be one of the leading oil and gas companies. Pacific Oil activities will
involve; kerosene production, distillate fuel oil (diesel fuel) production, residual fuel oil
production, lubricant production, diesel gas oil, jet fuel, liquefied petroleum gases, different
subtle petroleum products. We have been able to impenetrable approves from all relevant
departments in the Solomon Island to run the business.

Pacific Oil Limited is set to construct an exceptionally profitable crude oil refinery
commercial enterprise which is why we have put plans in place for non-stop coaching of all
our team of workers contributors at normal interval.

No doubt the demand for subtle crude oil merchandise is not going to plummet any time
soon, which is why we have put plans in vicinity to proceed to explore all available market
for our products. In the nearest future, we will ensure that we create a large range of
distribution channels throughout the Solomon Island and other pacific Island countries. With
that, we recognize we will be in a position to maximize earnings in our business.

Pacific Oil Limited will at all instances proves her dedication to sustainability, by means of
opinion as a firm, by actively collaborating in our communities and integrating sustainable
enterprise practices anywhere possible. We will make certain that we maintain ourselves to
blame to the best possible requirements by means of meeting our customers’ desires precisely
and completely. We will cultivate a working environment that provides a human, sustainable
approach to incomes a living, and dwelling in our world, for our partners, personnel and for
our customers.

Pacific Oil Limited is a domestic commercial enterprise that is owned by Gray Abana and his
instant household members Hamphrey Rima. Although the business is launching out as a
household owned enterprise however there is a plan to invite different buyers who has equal
investment ideology in other to grow the business.
 BUSINESS DESCRIPTION
The name of the business is Pacific Oil. It will be a small scale business but standard and
licensed crude oil refinery firm that will be located just within the capital city Honiara on
Guadalcanal province. Its establishment is based on the freehold of land and factors like
accessible location with good amenities and logistical facilities, and thus operational
activities can be progressing positively for the company. Pacific company will mainly focus
on accessing and providing effective and efficient petroleum products In the Solomon Island
and other countries.

Pacific Oil Company is a new setup company. It is an Oil refinery Industry that emphasis on
providing petroleum for all short of transportation through Land, Sea, Air and also for other
industries who uses petroleum products to produce their products, and likewise to individuals
and household who make use of the petroleum product. The company will involves in
producing more for its customer and uphold the cooperation between the company and
customers. Pacific Oil will maintain the provision of diesel, petrol, fuel oil, jet fuels and
kerosene and then provide it to customers both nationally and internally.

Pacific Oil will provide service such as;

 Providing fair pricing for all types of customers

 Provide service to the most remote areas
 Allowing different types of payment methods
 Timely deliverance of products to customers

Mission and vision statement

 Pacific Oil mission is to establish a successful crude oil refinery industry that will
maintain customers and employees satisfaction. And have the capacity to compete and
become one of the competing companies in the pacific region.
 The vision of Pacific Oil is to become a highly profitable firm that will have a strong
manifestation in it operation in the Solomon Island and pacific region as a whole

Here are some of the business goals of Pacific Oil

 Creating a more attractive and customer centred company

 Having a well improve and dynamic workforce with satisfying attribute.
 A gender equity in terms employment all across the firm
 To expand into large scale company
 To own oil well in the future operation

Pacific Oil Company is a small scale Oil refinery firm but aim to become one of the most
successful Oil Company in the pacific region. And to attain that, it will implement different
development plans and strategies. For instance;

 Provide daily training and development for employees

  Learn from other companies failure or mistakes ( be a second mover type of firm)
 Implement essential method to adjust to the changes likely to be faced in the future.

Pacific Oil will base its operation in a more effective form of operation. Its operation will
focus on avoiding the mistakes by its competitors. As a second mover firm, it has the
opportunity to imitate its already established competitor, and try avoiding mistakes and other
failure its competitor confronted.

Pacific Oil has forecast different methods of marketing advantage to use in its upcoming
operation. The likes of

 Extensive distribution
 Flexible price
 effective promotion are the competitive edge
 Involve more in technology for effective company operations.

Its focus on this marketing advantage is to enable the firm to be competitive and successful in
the operation it will carry on.

STATEMENT ON SUSTAINABILITY
By looking on the Pacific oil limited, it seems that there are some sustainable challenges that
need to be address in order to reduce environmental impact. Therefore, due to the climate
changes that experienced by most petroleum refinery companies, the Pacific Oil Limited was
planned to reduce the carbon emission. As a result, due to climate changes which encounter
by most industries, Pacific Oil is enhancing strategies to support energy efficiency, emission
reduction, DE carbonization; methane intensity targets and water conservation .This are the
sustainable strategies that the company planned to reduce the climate changes.
 MARKETING SEGMENT

The Targeting Market

Customers can be available everywhere. And when it comes to petroleum products, all
families are label as customers. Pacific Oil target market can’t be limited to certain group of
people only, but to all those who make use of the diesel, petrol, fuel oil, jet fuel and kerosene
petroleum products in one way or the other. Petroleum product has not restricted in terms of
demographic and psychographic composition of the targeted market. The petroleum products
have a wider range of attraction, reaching even the most remote location.

Pacific Oil will conduct a marketing research and have Ideas of what target market would be
anticipating. The Pacific Oil firm are in business to engage in retailing and wholesaler
circulation with distributing of petroleum product to different types of customers like,

 The shipping industries

 Business that make use of the petroleum product
 The aviation industry
 Schools with generators
 Household who make use of the product
 Industries that uses petroleum products to create their products

By Identifying target market, it really helps with providing and selling of the products to the
customers. Pacific Oil will now focus mainly and prioritize the above listed types of
customers. Through attracting customer with the service provided, it will result in quick
selling of the products that will attain an increase rate of market share for the company.

Competitive Advantage
In today’s business world, investors with good financial standing can engaged in mass crude
oil refinery business. Level of competition is very high and thus, enable firms to provide to
their very best in order to cope up with the competition.

For a small scale business like Pacific Oil, gaining competitive advantage can be challenging.
But the most essential aspect is to investigate better the demographics of the surrounding and
the nature of existence of the competitors. Pacific Oil will be the only small scale crude oil
refinery in the Solomon Island that will engage more on wholesale distribution of petroleum
product in the Solomon Island and also to other pacific Island countries.

Another competitive advantage will base on the second Mover firm factor. Since Pacific Oil
Company will established as a second mover firm, it will become an imitating type of
company, which it will focuses on the mistakes the first mover company (competitors) made,
and then try its very best to avoid those mistakes made by the First Mover. Through imitation
from first mover firm, it is an advantage for the second mover to learn from the first mover
and then creates competitive advantages and other relevant strategies to successfully operate.
Moreover, employing more experienced and skilled employees in the oil sector will be a
competitive advantage. Having a pool of skilful and experienced workers on the business will
positively impact the business. Since they have the mentality, idea, skills and knowledge on
how to work things out from the bottom and up to the top. The source of experience, skill and
knowledge will be strength for the operation.

Marketing Position And Pricing

The pacific Oil Company has established its marketing position as “The source of blood for
all types of engines”. The marketing positioned is based on fuel as the blood vessel for
engines. Without fuel engines can’t move or work. This marketing positioned will attract
customers in a more entice manner. Since customer will understand the company’s position
and it will enable them to make daily purchase.

In the Solomon Island there is only one company operating in Oil industry. As such, Pacific
Oil will be in a good position to operate, since there is only one competitor. Pacific Oil
Company will be better than its competitor because, first of all, Pacific Oil is a second mover
firm. And therefore, it will learn from the mistakes of its competitor and implement strategies
that will avoid mistakes done by its competitor. For example, Pacific Oil will involve in cost
leadership as their strategy to try and earn above –average returns. By practicing cost
leadership as the business –level strategy, Pacific Oil Company will attract more customers
and gain customers loyalty that will boast its operation.

In terms of pricing, as a new emerging company it is difficult to capture market share. As

such, Pacific Oil will engage in penetrating pricing strategy. This pricing strategy can lead the
company capture market share. The strategy consists of setting price at affordable/lower cost
than competitor to earn customers loyalty. This pricing strategy will run for 6 – 8 months.
After progressing in the business, the company can involve in other pricing strategies like
competing pricing, Cost –plus pricing and Dynamic pricing. The more Pacific Oil sold its
production, the more it will get hold of increasing market share.

Payment Method

Pacific Oil will outline different types of payment method like

 Payment with cash

 Payment via cheque
 Payment via online bank transfer
 Payment via bank transfer

The company will made possible these different types of payment method to allow customers
in different locations to purchase without facing any problem on their side.

Sales and marketing strategy

Source of income
The aim of establishing Pacific Oil is to capitalize on profit in the oil refining industry In the
Solomon Island and one day throughout the world. It focusses on providing the sale of
petroleum product to whatever customers in both the retailer and wholesaler, who can make
use of the provided petroleum products.

In term of generating monetary transaction, Pacific Oil has involve in selling petroleum
products like

 Diesel
 Petrol
 Kerosene
 Jet fuel
 Fuel Oil

For the business to grow and continue to excel in its operation, Pacific Oil will hire
employees with vast experience on crude oil industry. By hiring experience employees, they
will help in implementing effective marketing strategies to achieve the given goals of the
company.

Pacific Oil aim is to continue to grow and excel in business. And to do so, it will engage in
selling the petroleum products to every available market. As such, marketing teams will be on
the move to try and sell whatever products is available for the customers to purchase. Pacific
Oil will take on different types of marketing strategies to earn income;

 Engaged in mobile marketing to the most remote ares

 Involve in launching and awareness of the petroleum products to the community
 Introduce our business by sending introductory letters to residence, business houses
and other state holder in and outside of Solomon Island
 Engage in advertising the product through, local television, radio stations and news
paper

Advertising strategy
In terms of advertisement, Pacific Oil Company will engage in different types of advertising
programs. It will involve in, Newspaper and Magazines advertising, Social media advertising,
Outdoor advertising and video advertising. These methods of advertising can really help the
company by influencing and gaining customer. The cost of those advertising strategies can be
estimated to $100,000 Solomon dollars.

Promotion of the petroleum products will also be done to gain customers

Sales Forecasting
In crude oil business operation, the position of the market is one important factors, Having
accessibility can be an advantage for the company, since when the position is easily
accessible, it will attract more customers with purchase intention that will contributes to
increase revenue generating in the company.

Pacific Oil is located in one of the accessible location. As such, the location is highly credited
and is in a good position to operate in this competing era. The company will be in a position
where it will enable to take on market in the Solomon Island and Pacific Countries that it
aims to export petroleum products to. By doing so, the company is confident to achieve its
marketing profit for the first 6 – 8 months that it will operate.

The company will prioritize of having a full examine in the oil refinery industry. And from
that, it will have a chance in the industry and also to come up with an effective sales forecast.
The sale forecast will base on information that will be receive from the examination on Oil
refinery Industry.

As listed below will be the sales projection of Pacific Oil. The sales forecast will base on the
location of the business and also other factors that concerning customers and competitors.

 First fiscal year: $1,5 m

 Second Fiscal year: 2 m
 Third fiscal year:3.5 m

The sales forecast is base on what is get within the industry and the suspicion that there won’t
be any major emergency and there won’t be any major competitor offering the same
petroleum production and customer care services that we will do within the location. The
projection can and might be lower and simultaneously it might be higher.

Government policies and Natural disaster are the two factors that will likely to affect the
cooperation of Pacific Oil. Government can implement new policies or alter some existing
policies can affect the way the firm operate for instance, government can implement pricing
policies that will sometimes affects the income flow of the company. Likewise, natural
disaster is one factor that really affects organization operations. For example, In the Solomon
Island, weather pattern is unstable, therefore unpredictable cyclones can affects the operation
of Pacific Oil.
 OPERATION
The business was planned to located within town boundaries which it will accessible to road,
power, water and wharf. The company will recruit 6 – 8 hundred employees that consist of
top level managers down to low wages earners. Therefore, wages was paid according to the
type of job the employees performed, the qualification and experiences based on the
company’s hierarchical order.

PRODUCTs

The main intention of the company is to make more profits from the petroleum refinery
industry. The company will also do what is permitted under the Solomon Island business law
in order to achieve its aim. Below are some of the products which the company will offering;

 Gasoline products
 Kerosene products
 Diesel fuel oil
 Liquefied Petroleum Gases(LPG)
 Jet fuel
Organization Structure
Chief Executive Officer- CEO

 To promote effective in management by recruiting, selecting, orienting, counseling

and coaching.
 Communicating of values, planning, monitoring and appraising of job results
 Creates, communicates, and implementing organization vision, mission and overall
direction of business by leading the development and implementing of overall
organization strategies.
 Responsible for fixing price and signing of business deals.
 Responsible for signing of checks and other documents.
 Evaluate the success of the company.

Human Resources & Admin Manager

 Responsible for administrative tasks for business.

 Enhance department and organization reputation by accepting for accomplishing new
and different request; exploring opportunities to add value to job accomplishment.
 To define job positions for recruitment and managing interviewing process.
 Responsible for employees training, evaluation and assessment of employee’s.
 Oversees the smooth running of daily business activities.
Sales and Marketing Manager

 To develop, executes and evaluates new plans for increasing sales.

  Manages external research and to coordinate internal sources of information to retain
the organizations best customers and attract new ones.
 Implement plans to increase sales and growth for the company.
 Responsible for supervising implementation, advocate for the customer’s needs, and
effective communication with the customers.
 Models demographic information’s and analyses volumes of transactional data
generated by customer purchases.
 Their role is to represent the company in strategic meetings.

Accountant & Cashier

 Responsible for preparing financial reports, budgets, and financial statements for the
organization.
 Responsible for administering for payroll.
 Responsible for handling of financial transactions for the organization.
 Responsible for cash management, general ledger accounting, and financial reporting
 Responsible for developing and managing financial systems and policies
 Ensures that company comply with taxation legislation
 Responsible to handle all financial transactions for the organization
 Serves as internal auditor for business
Petroleum Refinery Machine Operators

 Responsible for petroleum for operating crude oil refinery machines

 They actively involve in gasoline production, liquefied petroleum gases, kerosene
production, jet fuel and other refined petroleum products for the company.
 They responsible to handle any other duty by the petroleum refinery process manager.
Tankers Drivers/ wholesale distributors

 Responsible for loading and unloading oil products

 Keep records of vehicle inspections and make sure the truck is equipped with safety
equipment
 Responsible for collecting and verifying of delivery instructions.
 Report faults, accidents or violation
 Delivery driver are required to sell products and businesses on their route, obtain
signatures receipts and collect cash.
 Compliance with traffic rules and regulations as well as with company policies and
procedures
 Responsible for inspecting of vehicles for mechanical items and safety measures and
perform preventative measures.
Client service executive

 Ensures that all contacts with customers

 Provides the clients with personalized service experience of the highest level
  Through effective interaction with customers on phone will build clients’ interests in
the company’s product and service.
 Manages administrative duties assigned by the store manager in an effective and
timely manner
 Responsible in provision of rightful information is supplied to customers when make
enquiries.
Suppliers
In term of supplier, Pacific oil will able to bring in suppliers of raw material and other
asset for the company, since its location was accessible due to road access and closeness
to the wharf. Supplier can be transport by ship and collection of suppliers to the
site/location will be transported by truck. The cost of transporting supply will be paid
monthly. It is estimated total of $500.000
The community are also in support of establishing an oil refinery industry in the
particular. By setting up the company, the community will have easy access of purchasing
petroleum product, which also reduce some expenditure to go far to purchase petroleum
product. Also it will bring employment opportunity for the community to engage in to
help support their individual families.
Facilities
Regarding the facilities for Pacific Oil operation, it will consist of;
 A big maximum size warehouse
 Office building
 Oil tanks
 Machines for the operation
 A small security building for check point at the entrance
 Stand pole lights (Security or street light)

For the operation of Pacific Island, Employees will work according to their Day and night
shift. Work will continue 24 hours and only on weekend will each employee have day off.
Saturday keeper will rest on Saturday and Sunday keeper will ret of Sunday. This routine will
continually effective during the operation of Pacific Oil. Worker must try and achieved per
day production target or per week target.
SUSTAINABILITY DEVELOPMENT MEASURES OF PERFOMANCE
The success of pacific oil limited depends on loyal customers, their capacity and competences
as employees, their investment strategy, and the structure of the company. Therefore, if any
of the above factors gone from the business (company), it won’t be long before it fails.

One of the main goals of Pacific oil limited is to build a company that can survive on its own
cash flow rather than depending on external financing once the company operates.

We recognize that one of the methods of gaining approval and triumphing customers over is
retail our petroleum a little bit more cost effective than what is obtainable in the market and
we are well prepared to continue to exist on decrease income margin for a while.

The pacific oil limited will make positive that the right foundation, buildings and procedures
are put in locating to make sure that our staff welfare is properly taken of. The company’s
subculture is designed to power our business to larger heights to become profitable. As be
counted of fact, profit sharing association will be made accessible to all our management
personnel and it will be primarily based on their performance for a period of three years or
more.

In term of carbon dioxide emission, the company will implement measures to reduce its
effect on the environment. For instance, monitor closely the emission of carbon dioxide
emission in a monthly basis and control it in the most possible way. Greenhouse can only be
reduced, once the company prioritize it control of carbon dioxide emission.
 MANAGEMENT
In every business operation, Management plays a very important role in leading, controlling
and allocating different types of framework and strategies that the organization try to follow
and achieve. Pacific Oil Company will base its employment strategies by employing
employees with qualify profession and vast working experience so that the level of
competency in the company is competitive.

In the Management of the Pacific Oil, like any other business Management, it will be a
bureaucratic type of operation and the management structure will be hierarchy. The company
will consist of the following positions;

 Chief Executive Officer

 Human Resources and Admin Manger
 Sales and marketing officer
 Accountant
 Customer Service Executives
 Crude Oil Refinery Manager/ Petroleum engineer
 Crude Oil Refinery Machine Operators
 Tankers Drivers / Crude Oil Wholesale distributors

The following positions will be the main actors in the company operation by controlling and
leading various working department in the company.

The Management structure

Chief Executive Officer

(CEO)

Finance Manager
Marketing Manager Production Manager

Foremen/Supervisor

Workers
Job Position and Responsibilities
Pacific Oil will have the above key position in the company. Its operation will be delegated
by these above key personnel. They will be part of the management team that will engage in
the operation of the firm. As such, each position will have its own responsibilities in place.

Top level Management

This level of management consists of Board of Directors and Chief Executive Officer. And
their roles involves

 Establishing controls of all organization department

 Laying down the objectives broad policies of the business enterprise
 Responsible for recruiting, selecting, training, counselling, managing strategies,
assigning accountabilities, developing incentives, planning, monitoring and appraising
job
 Responsible for fixing prices and signing business deals
 Appointing the executive for middle management, example, departmental managers
 Creates communication, and implements the organization vision, Mission and overall
direction

Middle Level of Management

This people Consist of department managers E.g. Financial Manager, production Manager
etc. Their roles can be summarise as

 Sending reports and data to the top management in a more timely and effective
manner
 Motivating lower level managers towards improving their performance
 Execute plan for the organization in understanding with the policies and directives
given by the top Management.
 Involve in the in the hiring and training process of lower –level management
 Assess the performance of junior managers
 The plan maker for the sub –unit they supervise

Lower Level of management

In this management level, it consists of, supervisor and other executives whose work must
engaged with the HR oversight. Their roles includes

 Assigning tasks to workers

 Administering the quality and quantity of products
 Analysing and arranging machines, materials and other resources necessary to bring
about organization tasks
 Create a fair and peaceful working environment
 Maintain discipline, decorum and harmony in the workplace
  Instruct and guide employees in day –day tasks
 Be the voice of workers to the higher management

Board of Directors and Management Team

In every organization, Board of Directors existence is very important, as it plays vital role
in steering the company to its destination. For Pacific Oil, The board of directors will
consist of the, Owner, CEO, and Managers from each departments within the company,
and another company’s director (Outsider). The role of the board of director for Pacific
Oil will be focussing on;

 Vision, Mission, and values establishment

 Establishing organization strategy and structure
 Delegating to management
 Instructing board and management responsibilities
 Exercising accountability to shareholder and also accountable to important
stakeholders

For the Pacific Oil, The Board of Director and the Management team will cooperate to ensure
positive operation of the company. The Board of director will essentially focus/responsible
for the company, and also delegates the day - to day activities and tasks to the management.
The management will focus more on supervising, assessing and manage the day to day
activities and task for accomplishment.

Personnel Selection

For Pacific Oil to grow into a successful organization it will need employees with
qualification, profession and experience to be part of the company’s operation Thus, Pacific
Oil will base its employment selection by qualification, field of profession and experience.

By qualification base selection, The Company will give its position to the employees
following whatever qualification the applying employees attain. For example, if the employee
possesses a diploma in Business Administration, he/she will involve in the middle
management operation, and if the employee possesses a degree, then he/she will be working
at the Top management level. The level of qualification attain by employees define their level
of work in the Company.

In regards to the field of profession, The Company will hire employees that have the required
profession that fits the given positions. For instance, if the employee profession is based on
HRM, then he/she will be given a place at the human resources management division. Or if
the employee profession is based on Accounting and financing then he/she will be given a
placed in the financial department. All applying employees will be hired in regards to
whatever profession they possess.

By experience, the company base it hiring of employees on the work experience possess by
the employees. Work experience is a key function of accessing quality of work performance
in the organization. Thus, Pacific Oil entertains highly skilled and experienced personnel to
be part of the firm. For instance, to become the Human Resources Manager (HRM) of the
Company, A personnel must attain a 3 years working experience in Human Resources
Management and possess a Degree in Public administration and Management. As such with
number of working experience employees possess, he/she will contribute positively to the
operation of the company.

The Pacific Oil company will be owned by us, Hamhrey Rima and Grey Abana. We are the
co –founder and owner of this Oil Refinery Company. Thus, we will be responsible for
necessary decision making and also be included in the board of directors.
 FINANCIAL
In setting up this new firm, the amount will be depending on the approaches and scale that
need to be undertaken. This mean that the start-up depending on company’s goals, vision and
its aspiration.

The start-up Expenditure

 The total Fee for Registration the Business in Solomon Island-$5,000

 Legal expenses for obtaining licenses and permits as well as the accounting service
( software, P.O.S machines and other software’s)-$ 50,000
 Marketing promotion expenses for the grand opening of Pacific Oil Limited$ 10,000
 Cost of hiring business consultant $ 5,000
 Insurance (general liability, workers compensation and property casualty) coverage at
the total premium-$100,000
 Cost for construction of a small scale but standard crude oil refinery-$2 million
 Other start-up expenses including stationery-($ 5,000) and phone and utility
deposits($2,500)
 Storage hard ware( rack, bins, shelves, food case)$4000
 Transportation cost - $500.000
 Operation cost for the first 6 to 8 months (salary of employees, payments of bills et
c)- $ 1.5 million
 Cost of start-up inventory-$ 350,000
 Cost for store equipment (cash register, security, ventilation, signage)-$14,000
 Cost of purchase of distribution of tankers $ 200,000
 Cost for furniture the purchase and gadgets $ 5,0000
 The cost of launching a Website $1,000
 The cost for our opening party-$100,000
 Advertisement-$ 100,000
 Miscellaneous-$ 30,000
Therefore, the Pacific Oil Limited needs an estimated cost of $5 million to successfully set up
small scale with a standard petroleum refinery in Solomon Islands. Note that this amount
includes the salaries of the staff for the first 6 to 8 months of operation.
 CRITICAL RISKS
From the beginning of any business setup to its progressing operation, risk is one thing for
certain that organizations likely to encounter during the course of operation. Risks
encountered by companies can be in different form and strengths.

Pacific Oil must be alert of risk that she will likely to face. The likes of Political risks, Price
risks and supply and Demand risks. These are the three Major Risks that Pacific Oil will
likely to encounter.

Political Risk

Politics can affect the operation of Oil refinery in several ways. The change of regulations
and law made by the government can affect the firm. Unstable of government and likewise
dictatorship will negatively impact the way oil refinery industry operates.

As such, Pacific Oil will implement back –up plans, like careful analysis and building
sustainable relationship with the government to mitigate such risk in its operation

Price Risk

The price of oil is another risk usually encountered by organization. The price of oil is the
essential factor of whether a reserve is financially attainable. Essentially, the more
geographical barriers to easy oil extraction, the more price risk are given faces. Since
eccentric extraction usually cost more than a vertical drills down to a deposit.

Therefore, Pacific Oil must make backup plan such as, forecasting the probable price over the
term of the venture in arrange to choose whether to begin, to incorporate the risk that will
likely to encounter

Supply and Demand Risk

Supply and demand risks are the most shocking and factual risk. The number of supply oil
and demand of Petroleum product will identify whether the organization is likely to earn
income or profitless. Thus, Pacific Oil will have backup plan as, carefully analysis the supply
of Oil and demand of petroleum product to mitigate such risk.

New competition can be a risk as well. Since competitors will to some degree try its very best
to operates using different strategies to bring about successful operation in their fir. As such,
it will cost Pacific Oil to try and also compete in one way or the other to gain competitive
advantage.

Weather pattern can also be a critical risk. Since in the Solomon Island, the weather pattern is
unstable. There are no season for rain and sun and cyclone can occurred in anytime of the
year. As such, Pacific Oil must consider well the weather pattern and have connection with
the meteorological weather forecast. By doing so, they will have advance knowledge about
bad weather seasons and take precautions before it strikes

HARVEST STRATEGY.
Pacific Oil Will setup as a small scale, its operation will only covers limited range of a small
business scale oil refinery industry will establish. Pacific oil will establish plans for the
growth of the business. Its plan will include;

 Moving from a small scale business to large scale business.

 To engage in partnership with other multinational cooperations
 To own a well oil
 To have operating branch in different countries
 To become one of the leading Oil refinery industry in the Pacific.

In term of Management succession, the company will provide stored data of the company
management systems, strategies and other important operating approaches that enable the
company to operate. Thus, if there is a change of Management for Pacific oil, succeeding
management will continue with the existing management system and will only focus on
adjustment of the management systems to the changing working environment it likely to
encounter.

Regarding the continuity of the business, Pacific Oil will engaged on insurance in the
properties it owns, its injured employees health, and finance. Therefore by engaging in
insurance, it safeguards the company from property and financial risks/losses.

MILESTONE
For Pacific Oil, regardless of it’s newly start-up plan, it will develop petroleum products for
national and international marketing. Its product will design mainly for target market and thus
try it very best to be recognizing in the marketing phase. Its operation will run for the first 6
to 8 month period and will see the earning it made and the loose it will encounter.

It service will be to provide, fair pricing, providing service to the most remote area, deliver
product on time and allowing different types of payment method. It sales and marketing will
happen when the petroleum products are ready. Pacific Oil will engage in different type of
sales and marketing method for the aim of earning income and making profit.

Pacific Oil will maintain decent relationship with its shareholder. The company operations
will focus on satisfying every shareholder in the company. Everybody involvement in the
company is worthy, from supplier, distributor, and employee management.
The company will try to maintain its reputation through providing quality service and
customer centred firm. The service it will provide will be of high quality. It will response
immediately to the feedback from customer in trying to satisfy its customer to gain loyal
customer and become a customer centred organization, and thus, excel in its operation.

BIBLIOGRAPHY

 Howard H. Frederick, Allan O’connor and Donald F. Kuurato

(2020),’Entrepreneurship, Theory, process, and practice, 5th Edition, cengage
Learning, Victoria, Australia.