Articles

Feasibility Study for Tugboat Expansion Project Using Capital Budgeting And Sensitivity Analysis (Case Study: PT. ABC)

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The Covid-19 pandemic and the unstable geopolitical environment has highly disrupted the global economy. The turn of events affected businesses sectors differently, due the disruption of the supply chain many industries have to suffer. However, there are sectors that performed well in a very uncertain economic condition. One of the business sectors that flourish during this turbulent time is in the mining sector. The soar in demand for natural resources such as coal, nickel, and construction stones have increased the sector’s operational activity drastically. Being a part of the mining industry supply chain, PT. ABC is a marine transport company that provide delivery services for the minerals by utilizing tugboats and barges. The surge of activity in the mining sector has positively impacted the company. A mining companies has queued up to acquire marine transport services, however it is quite difficult to meet the rapidly demand due to the limited number of tugboats and barges available in the market. To keep up with the market demand, PT. ABC is planning to add and additional set of tugboat and barge to its fleet.

The management’s decision to acquire a new set of tugboat and barge is a sizeable investment for the company. Financial calculations such as the capital budgeting method is needed to support the management’s decision for to invest in the expansion project. Therefore, the objective of this research is to utilize the crucial financial calculations to analyze whether if the expansion plan is worth pursuing.

The research results shows that the expansion project is feasible, by examining the base assumptions by the company’s management. The assumptions consist of the initial investment of Rp 40.500.000.000, an annual growth rate of 8,18%, the assumption of 30 working days for the charter duration, and 10 years useful life of the asset. The project will begin in the year 2023. Furthermore, the sensitivity analysis suggests that the most influential factor for the project’s NPV is the charter rate. Based on the analysis, the minimum charter rate that should be charge to the customer is Rp 834.480.000 per month.

Effect of Covid-19 on Logistics of Thai Rice Export

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The purpose of this paper is to analyze the effects of Covid-19 on Rice Logistic to Thai rice export in terms of product and logistics. Starting from rice plantation, farmers, mills, labour, storage and transportation. In the later part, discusses the impacts of Covid-19 to Thai Rice Export Logistics with conclusion. The authors review Covid-19situation in Thailand and Thai Rice papers. Followed by in-depth interviews influencers and experts from major Rice exporters, Rice Traders and Shipping Lines. The disruption from COVID-19 to Thai rice export logistics was from global supply chain disruption. Imbalance in world containers caused lacking of containers to export and increased Sea Freight were the major effects. High Sea Freight let to higher imported fertilizer cost for plantation. Shipping lines delayed calling some ports in Thailand. Traders delayed the order and waited for lower freight reflecting excess stock in the warehouse. Not only increased cost for carrying stock but also no space for new crop that linked to supply chain disruption as a whole. This paper studied the impacts from 2nd wave of Covid-19 pandemic (2019 to May 2021) in Thailand to Thai Rice logistics where the output could definitely be adopted for further strategy and further study.