Best Choice Company in Malaysia: Business Plan Report (Assessment)

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Executive Summary

The general business plan is prepared for Best Choice Company’s management, as it was requested by the owner, Mr. Mohammed AL Shaikh (Abu Omar). The purpose of preparing the plan is to assess the Manager’s abilities and strategies to handle the new and current investment of Best Choice in Malaysia. The Malaysian market is promising for the investment in the Middle East region because the country’s export and import relations develop, and GDP grows annually. In this context, much attention should be paid to investing into the country’s palm oil industry because it contributes to the Malaysian economic progress significantly.

The key approaches to handling the investment that can be discussed as advantageous for Best Choice Company include the development of promising relationships with suppliers, customers, and partners; the integration of diversification approaches to distributing investments; the implementation of the differentiation strategy for improving the potential of the industry; the expansion of operations; and the minimization of risks. The core financial elements, such as the potential financial profits and risks, are addressed. Funding requirements, such as banks, business owners, and other options, are also identified.

The management team includes me as a Manager and potential candidates who will be employed for the promotion and completion of sale strategies. The ability to track the business is also supported by references to my personal and professional skills and leadership. I have comprehensive knowledge regarding the development of small and medium enterprises and associated investment options. I am focused on promoting sustainable strategies in business. I have developed managerial skills, and I am also able to train the personnel.

Company Description

Promoters and Shareholders

At the current stage of the business development, the focus is on the managerial potential of the firm and activities of Area Manager (Abu Maha). The selection of the secretary candidate is possible. As a Manager, I am responsible for directing all business activities and dealing with experts in the areas of interest. My activities are associated with the financial and legal areas, as well as the sphere of engineering.

In the company, shareholders are Mr. Sami Alsubieh and Mr. Mohammed ALshaikh, whose number of shares is about 1,000,000. It is possible to speak about the 50% shareholding and associated cash investment.

Long-Term Aim of the Business

To contribute to the growth of Best Choice Company in East Asia, and particularly in Malaysia, with the focus on expanding operations in the region; increasing the number of customers; establishing high-profit margins related to investments; diversifying opportunities for investing in industries; as well as on minimizing risks.

Objectives

  1. To develop the working strategic plan on increasing profits or revenues within the next 3-5 years.
  2. To develop and integrate the plan on expanding operations in the region for the next 3-5 years.
  3. To develop and implement an effective investment plan.
  4. To minimize investment risks by 50%.
  5. By the end of the third year, to increase the profits by 65%.
  6. To develop and integrate the differentiation strategy.

SWOT Analysis

Strengths
  • Good relationships with key business players;
  • Entrepreneurial networking;
  • Immense experience and knowledge related to the region of investment;
  • Developed management skills.
Weaknesses
  • The necessity to expand current operations in the region and industry.
Opportunities
  • Flexibility of the international trade, especially for the Middle East Investors;
  • Governmental incentives;
  • The interest in expanded investments.
Threats
  • Currency and economic fluctuation;
  • Governmental policy and taxation;
  • High-level competition among investors in industries, including the palm oil industry.

Market Analysis

Target Market

The market of Malaysia develops actively. The GDP for 2016 is potentially composed of 1.2% for agriculture, 4% for industry, and 5% for services (“Malaysia Profile” par. 2). In this context, the palm oil industry is emphasized, having more than 40% share of the palm oil production worldwide (“Palm Oil Research” par. 3). In 2014, more than 19 billion tons of palm oil was produced in Malaysia (Figure 1; “Just How Big is Malaysia’s Palm Oil Industry?” par. 3).

Malaysia Palm Oil Production: Statistics.
Figure 1. Malaysia Palm Oil Production: Statistics (“Malaysia: 2014/15 Palm Oil Production Affected by Flooding” par. 3).

Total Market Valuation

The palm oil industry is divided into such segments as the seed nursery, planting, and collecting, followed by the production of oil. This industry accounts for more than 5% of the country’s GDP (“Just How Big is Malaysia’s Palm Oil Industry?” par. 3). More than 90% of the oil was exported in 2012 (Palm Oil Research” par. 3). More than 550,000 people are employed in this industry (Palm Oil Research” par. 4). The industry develops because the global consumer demand for palm oil products increases annually.

Market Trends

Currently, the sector accounts for more than RM50 billion. Although there were fluctuations in the volume of production and exports during 2014–the early part of 2015 caused by the flooding, the current growth of the industry is stable (“Malaysia: 2014/15 Palm Oil Production Affected by Flooding” par. 3). The Malaysian industry “is targeted to reach RM178 billion by 2020, and 98% of funding will be from the private sector, reinforcing their leading role in steering the palm oil industry” (“Malaysia’s Palm Oil Industry Needs to Enhance Upstream Productivity” par. 2). To address the future demands, it is necessary to increase the productivity of the industry with the focus on the expanded investment opportunities.

Profile of Competitors

The domestic competition in the Malaysian palm oil industry is represented by BLD Plantation Bhd, Genting Plantations, and Felda Global Ventures Holdings Bhd among other smaller companies. Still, the main global competitor in Indonesia that shares more than 46% of palm oil production worldwide (Figure 2; Rusmana and Listiyorini par. 4).

Comparison of the Monthly Production of Palm Oil by Malaysia and Indonesia.
Figure 2. Comparison of the Monthly Production of Palm Oil by Malaysia and Indonesia (Rusmana and Listiyorini par. 4).

Marketing/Sales Strategy

Marketing Strategy

The proposed marketing strategy is based on using the principles of social responsibility and implementing low-budget and high-impact marketing techniques.

The company should focus on promoting sustainability in operations to address the needs of stakeholders, the problem of environmental protection and the lack of lands for palm oil production in Malaysia.

The focus is on:

  1. Developing relationships with suppliers, customers, and partners.
  2. The integration of diversification approaches.
  3. The implementation of the differentiation strategy.
  4. The expansion of operations.
  5. Minimization of risks.
  6. Addressing the needs of the community and consumers.

The benefits of this approach are in attracting the interests of the community not only in Malaysia but also worldwide because of respecting the principles of social responsibility and applying low-cost techniques. The expected results are the expansion of the company’s operations and the increased impact on the industry.

Sales Strategy

In the context of the sales strategy, it is appropriate to use the services of domestic and international agents and sales representatives who spread the information regarding the products and services worldwide to increase the potential sales. Revenue sharing partners are also involved in enhancing the productivity of the supported facilities. The website should include information regarding changes in the company’s profitability to attract potential partners and consumers.

Pricing

The price should be set depending on the competitors’ prices, production costs, as well as on the assessment of the overall competition in the global market.

Marketing and Communications Strategy

The promotion is based on direct marketing, the reference to developed public relations, the usage of the website and social media to report on the sales and update the information important to stakeholders and shareholders. The company’s representatives should participate in conferences and exhibitions to inform the public about their achievements.

Research and Development

It is important to conduct more researches to investigate how consumer demands and the land abilities to produce the raw resources change over the determined period. To meet market demands in the future, it is necessary to invest more in increasing the land capacity and development of facilities to produce palm oil among other competitive products.

Staffing and Operations

Staffing

With the focus on more investment projects and diversification and differentiation strategies, it is important to increase the number of employees and pay more attention to facilitating their productivity. The staff having different managerial skills to support the operations related to the particular type of investments will be employed.

Training Plans

Focusing on worldwide sales and expanded operations, managers and employees need to participate in training sessions to improve their specific knowledge or skills.

Operations

More production facilities should be built to address changes in the increased production. The innovative equipment is expected to be used to protect the environment.

Financial Projections

Key Assumptions

The projected income sources include the promoters’ funds, the investments of business owners, and the lending from Malaysian banks. The current number of employees will be increased by 10%. The highest part of investments will be spent on improving the productivity and expanding operations. The small part will be spent on equipment, research, and development, as well as training.

Profit & Loss Accounts

Projected profit and loss accounts for the first three years of the company’s operations.

Balance Sheets

Projected balance sheets for the first three years of the company’s operations.

Cashflow

Monthly cash flow prediction for the first two years of the company’s operations.

Sales Pipeline

The sales pipeline will depend on the number of customers that we will be dealing with, the size of the deal (that can be small or big), the profits of getting the sales, and the expected PO. The focus on the sales pipeline will allow choosing partners and customers with whom it is possible to develop beneficial relationships.

Funding Requirements

The promoters’ funds, the investments of business owners, and the lending from Malaysian banks are identified sources that are important to support the implementation of the determined strategies to expand palm oil production in the Malaysian and global markets.

Works Cited

2015. Web.

. 2016. Web.

Malaysia: 2014/15 Palm Oil Production Affected by Flooding. 2015. Web.

Malaysia’s Palm Oil Industry Needs to Enhance Upstream Productivity. 2015. Web.

Palm Oil Research. 2016. Web.

Rusmana, Yoga, and Eko Listiyorini. Palm Oil Sales from Top Grower Dropping First Time Since ‘. 2015. Web.

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IvyPanda. (2020, July 19). Best Choice Company in Malaysia: Business Plan. https://ivypanda.com/essays/best-choice-company-in-malaysia-business-plan/

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IvyPanda. (2020) 'Best Choice Company in Malaysia: Business Plan'. 19 July.

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IvyPanda. 2020. "Best Choice Company in Malaysia: Business Plan." July 19, 2020. https://ivypanda.com/essays/best-choice-company-in-malaysia-business-plan/.

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