ANALYZINGTHEFINANCIALFEASIBILITYOFPT.CROWN TEKNOLOGIINDONESIA'SMEDICALGLOVEPRODUCTION EXPANSION FINALPROJECT By: RahmaIlahiSariDewi 19021233 UndergraduateProgram SchoolofBusinessandManagement InstitutTeknologiBandung 2024 Thispageisintentionallyleftblank ANALYZINGTHEFINANCIALFEASIBILITYOFPT.CROWNTEKNOLOGI INDONESIA'SMEDICALGLOVEPRODUCTION EXPANSION RahmaIlahiSariDewi 19021233 UndergraduateProgramSchoolofBusinessandManagement InstitutTeknologiBandung,2024 Supervisor:KurniaFajarAfgani,MBA ABSTRACT ThisfeasibilitystudyexaminestheexpansionofPT.CrownTeknologiIndonesia(CTI)intothe productionofmedicalgloves,amarketsegmentshowingsignificantgrowthduetoincreasedglobal awarenessofinfectioncontrolandtherisingdemandforhealthcareproducts.Thestudyevaluatesthe financialviability,marketpotential,andassociatedrisksofestablishinganewproductionfacilityin Padang,Indonesia,scheduledtobeginoperationsin2028.Themarketanalysisrevealsstrongdemand formedicalglovesintheAsia-Pacificregion,projectedtogrowatacompoundannualgrowthrate (CAGR)of11.1%from2022to2029,withIndonesia'smarketexpectedtoexpandfromUSD40.951 millionin2022toUSD70.100millionby2029.CTI’snewfacilitywillproducehigh-qualitynitrile gloves,crucialformaintaininghygienestandardsinhealthcaresettings.Financialprojectionsindicate theproject'sattractiveness,withanetpresentvalue(NPV)ofIDR461.56billion,aninternalrateof return(IRR)of25.30%,profitabilityindexof25.30%,apaybackperiodof7.15years,anddiscounted paybackperiodof8.83years,allofwhichaffirmtheproject’sprofitabilityandalignmentwithCTI's strategicgoals.Thestudyconcludesthatthisexpansionisnotonlyfinanciallyfeasiblebutalso strategicallybeneficial,positioningCTItocapitalizeongrowingmarketopportunitieswhile contributingtotheenhancementofIndonesia'shealthcareinfrastructure. Keyword:Feasibility,expansion,gloves,analysis,medicalmarket,risk. i ANALISISKELAYAKANFINANCIALEKSPANSIPRODUKSISARUNGTANGAN MEDISPT.CROWNTEKNOLOGIINDONESIA RahmaIlahiSariDewi 19021233 ProgramSarjanaSekolahBisnisdanManajemen InstitutTeknologiBandung,2024 Pembimbing:KurniaFajarAfgani,MBA ABSTRAK StudikelayakaninimenganalisisrencanaekspansiPT.CrownTeknologiIndonesia(CTI)kedalam produksisarungtanganmedis,segmenpasaryangmenunjukkanpertumbuhansignifikanakibat meningkatnyakesadaranglobalakanpengendalianinfeksidantingginyapermintaanproduk kesehatan.Penelitianinimengevaluasikelayakanfinansial,potensipasar,danrisikoterkaitdalam pendirianfasilitasproduksibarudiPadang,Indonesia,yangdijadwalkanmulaiberoperasipadatahun 2028.Analisispasarmengungkapkanpermintaanyangkuatuntuksarungtanganmedisdiwilayah Asia-Pasifik,yangdiproyeksikantumbuhdengantingkatpertumbuhantahunangabungan(CAGR) sebesar11,1%daritahun2022hingga2029,denganpasarIndonesiadiperkirakanakanberkembang dariUSD40,951jutapadatahun2022menjadiUSD70,100jutapadatahun2029.FasilitasbaruCTI akanmemproduksisarungtangannitrilberkualitastinggi,yangpentinguntukmenjagastandar kebersihandilingkungankesehatan.Proyeksifinansialmenunjukkandayatarikproyekini,dengan nilaisekarangbersih(NPV)sebesarIDR461,56miliar,tingkatpengembalianinternal(IRR)sebesar 25,30%,indeksprofitabilitassebesar25,30%,periodepengembalianinvestasiselama7,15tahun,dan periodepengembaliandiskontoselama8,83tahun,yangsemuanyamenegaskanprofitabilitasproyek dankesesuaiannyadengantujuanstrategisCTI.Penelitianinimenyimpulkanbahwaekspansiinitidak hanyalayaksecarafinansialtetapijugabermanfaatsecarastrategis,menempatkanCTIuntuk memanfaatkanpeluangpasaryangberkembangsambilberkontribusipadapeningkataninfrastruktur kesehatandiIndonesia. KataKunci:Kelayakan,ekspansi,sarungtangan,analisis,pasarmedis,risiko ii APPROVALPAGE ANALYZINGTHEFINANCIALFEASIBILITYOFPT.CROWNTEKNOLOGI INDONESIA'SMEDICALGLOVEPRODUCTION EXPANSION By RahmaIlahiSariDewi IDNo:19021233 AFinalProjectinPartialFulfillment oftheRequirementfortheDegreeofBachelorofManagement UndergraduateProgramofManagementStudySchoolofBusinessandManagement InstitutTeknologiBandungMonthDate,Year ApprovedBy __________________________ KurniaFajarAfgani,MBA iii Thispageisintentionallyleftblank TABLEOFCONTENT ABSTRACT...............................................................................................................................i ABSTRAK.................................................................................................................................ii APPROVALPAGE.................................................................................................................iii FOREWORD ............................................................................................................................v TABLEOFCONTENT.........................................................................................................vii LISTOFFIGURES.................................................................................................................4 LISTOFTABLES....................................................................................................................5 CHAPTERIINTRODUCTION .............................................................................................1 1.1BackgroundResearch.....................................................................................................1 1.2ProblemIdentification....................................................................................................4 1.3ResearchQuestion..........................................................................................................4 1.4ResearchObjectives.......................................................................................................4 1.5ScopeandLimitations....................................................................................................5 1.6WritingStructure............................................................................................................5 CHAPTERIILITERATUREREVIEW...............................................................................7 2.1FeasibilityStudy.............................................................................................................7 2.2MarketAnalysis.............................................................................................................7 2.2.1MarketingMixAnalysis........................................................................................7 2.2.2TAMSAMSOMAnalysis....................................................................................7 2.3BusinessModelCanvas.................................................................................................8 2.4ExternalAnalysis...........................................................................................................8 2.4.1Theporter’sFiveForcesAnalysis.........................................................................8 2.4.2PESTELAnalysis..................................................................................................8 2.5InternalAnalysis............................................................................................................9 2.5.1SWOTAnalysis.....................................................................................................9 2.5.2TOWSAnalysis.....................................................................................................9 2.6FinancialStatement........................................................................................................9 2.6.1BalanceSheet........................................................................................................9 2.6.2IncomeStatement..................................................................................................9 2.6.3StatementofCashFlow........................................................................................9 2.7CapitalBudgeting.........................................................................................................10 2.7.1PaybackPeriod(PP)............................................................................................10 2.7.2DiscountedPaybackPeriod.................................................................................11 2.7.3NetPresentValue(NPV).....................................................................................11 2.7.4ProfitabilityIndex(PI)........................................................................................11 2.7.5InternalRateofReturn(IRR)..............................................................................12 2.7.6ModifiedInternalRateofReturn(MIRR)..........................................................12 2.8FinancialRiskAnalysis................................................................................................13 2.8.1SensitivityAnalysis.............................................................................................13 CHAPTERIIIMETHODOLOGY .......................................................................................14 vii 3.1ResearchDesign...........................................................................................................14 3.2DataCollection.............................................................................................................15 3.3DataAnalysis...............................................................................................................16 CHAPTERIVDATAANALYSIS.......................................................................................19 4.1CurrentBusinessStage.................................................................................................19 4.2ProjectOverview..........................................................................................................19 4.3MarketAnalysis...........................................................................................................21 4.3.1MarketingMixAnalysis......................................................................................21 4.3.2TAMSAMSOMAnalysis..................................................................................22 4.4BusinessModelCanvas...............................................................................................23 4.5ExternalAnalysis.........................................................................................................24 4.5.1Theporter’sFiveForcesAnalysis.......................................................................24 4.5.2PESTELAnalysis................................................................................................27 4.6InternalAnalysis..........................................................................................................30 4.6.1SWOTAnalysis...................................................................................................30 4.6.2TOWSAnalysis...................................................................................................31 4.7FinancialFeasibilityAnalysis......................................................................................32 4.7.1InitialInvestment.................................................................................................32 4.7.1.1CapitalExpenditure....................................................................................33 4.7.1.2OperatingExpenditure...............................................................................34 4.7.2FinancingPlan.....................................................................................................36 4.7.3SalesProjection...................................................................................................37 4.7.4FinancialStatementProjection............................................................................38 4.7.4.1AssumptionfortheFinancialStatementProjection...................................38 4.7.4.2IncomeStatementProjection.....................................................................38 4.7.4.3BalanceSheetProjection............................................................................39 4.7.4.4NetCashFlowProjection..........................................................................39 4.7.4.5FreeCashflowtotheFirmProjection........................................................39 4.7.4.6AccumulatedCashflowandPresentValueCashflowProjection...............40 4.8CapitalBudgetingAnalysis..........................................................................................40 4.9FinancialRiskAnalysis................................................................................................43 4.9.1SensitivityAnalysis.............................................................................................43 CHAPTERVCONCLUSION ANDRECOMMENDA TION...........................................47 5.1Conclusion....................................................................................................................47 5.2Recommendation..........................................................................................................48 REFERENCES.......................................................................................................................49 APPENDIX.............................................................................................................................51 viii LISTOFFIGURES Figure3.1ResearchDesign(Source:author)..........................................................................27 Figure4.1ProductionProcess..................................................................................................33 Figure4.2BusinessModelCanvasAnalysis...........................................................................36 Figure4.3RadarChartPorter5Forces....................................................................................39 Figure4.4ExchangeRateUSDtoIDR...................................................................................40 Figure4.5AnnualInflationRate(Source:Statista).................................................................41 Figure4.6Sensitivity10%SwingBarChart...........................................................................55 Figure4.7Sensitivity5%SwingBarChart.............................................................................56 ix LISTOFTABLES Table4.14P’sMarketingMixAnalysis...................................................................................35 Table4.2TAMSAMSOMAnalysis.......................................................................................36 Table4.3SOMCalculation......................................................................................................37 Table4.4Porter’sFiveForcesAnalysis...................................................................................38 Table4.5PESTLEAnalysis.....................................................................................................41 Table4.6SWOTAnalysis........................................................................................................44 Table4.7TOWSAnalysis........................................................................................................45 Table4.8InitialInvestment......................................................................................................47 Table4.9CapitalExpenditure..................................................................................................47 Table4.10CostofGoodSold(COGS)....................................................................................48 Table4.11Depreciation............................................................................................................49 Table4.12OperatingExpense..................................................................................................49 Table4.13WeightedAverageCostofCapital.........................................................................50 Table4.14SalesProjection......................................................................................................50 Table4.15Assumption.............................................................................................................51 Table4.16IncomeStatementProjection..................................................................................51 Table4.17BalanceSheetProjection........................................................................................52 Table4.18NetCashFlowProjection.......................................................................................52 Table4.19FreeCashFlowtotheFirm....................................................................................52 Table4.20FreeCashFlowtotheEquity.................................................................................53 Table4.21AccumulatedFreeCashFlowtotheFirmandPresentValueofCashProjection.53 Table4.22AccumulatedFreeCashFlowtotheEquityandPresentValueofCashFlow Projection.................................................................................................................................53 Table4.23CapitalBudgetingAnalysisforFreeCashFlowtotheFirm.................................53 Table4.24CapitalBudgetingAnalysisforFreeCashFlowtotheEquity..............................54 Table4.25SensitivityAnalysiswith10%Swing....................................................................56 Table4.26SensitivityAnalysiswith5%Swing......................................................................57 x CHAPTERI INTRODUCTION 1.1BackgroundResearch Theworld'spopulationismorethanthreetimeslargerthanitwasinthemid-twentieth century.AccordingtotheUnitedNations,thispopulationisexpectedtoincreasebynearly2 billionpersonsinthenext30years,fromthecurrent8billionto9.7billionin2050andcould peakatnearly10.4billioninthemid-2080s.It'salsoimpactedonthemedicaldevicesmarket thatshowssignificantgrowth.In2022,MedicalDevicesMarketsizewasvaluedatUSD 455.50BillionandispoisedtogrowfromUSD481.92Billionin2023toUSD756.59 Billionby2031,growingataCAGRof5.8%intheforecastperiod(2024-2031).This significantgrowthisdrivenbyseveralfactors,includingchronicdiseasescausedbychanging lifestyles,apreferencetowardshomehealthcare,andariseinthegeriatricpopulation.The datashowsfromtheUnitedNations,thenumberofagingpopulationisprojectedrisingfrom 761millionsin2021to1.6billionin2050.Thisnumbergrewevenfasterandbecamea globaltrend. It’sbeen5yearssincetheCOVID-19pandemichappened,thispandemichasdramatically increasedglobalawarenessaboutinfectionprevention,notjustforCOVID-19butforall communicablediseases.Healthcareprofessionalsandthegeneralpublicalikehavebecome moreconsciousoftheimportanceofproperhygienepractices.Thisincreasedawarenesshas ledtomorerigorousimplementationofexistinginfectioncontrolmeasuresandthe developmentofnewstrategiestopreventdiseasetransmissioninhealthcaresettings. Healthcarefacilitiesworldwidealsohaveimplementedstricterhygieneprotocolsinresponse tothepandemic.Theseprotocolsaredesignedtopreventthespreadofinfections,protect healthcareworkersandpatients,andimproveoverallsafetystandards. AccordingtotheDataBridgeMarketResearchanalyses,theAsia-Pacificmedicalclothing marketwhichwasUSD2694.58millionin2021,wouldrocketuptoUSD4584.98million by2029,andisexpectedtoundergoaCAGRof6.87%duringtheforecastperiod2022to 2029.Thesemedicalclothingherereferstotheclothingthatiswornbyhealthcare professionalsduringsurgerytoprotectboththepatientandthehealthcareworkersfromthe spreadofinfection.Surgicalwearcanincludegowns,masks,caps,andgloves.Themarketis mainlydrivenbythegrowingdemandforprotectionagainsthazards.Also,thetechnological 1 advancementinthemedicalfieldisconsiderablefortherisingnumberofsurgerieswhich alsoincreasetheuseofsurgicalwear. Oneoftheproductthatbecameapartofsurgicalwearisagloves.Glovesareacrucial componentofpersonalprotectiveequipment(PPE)usedinmedicalsettings,especially duringsurgicalprocedures.Thepurposeofthisequipmentaretoreducetheriskof contaminationandinfection,helpingtomaintainacleansurgicalfieldandprotectthe healthcareprovider.Surgicalglovesaretypicallymadeofmaterialslikelatex,nitrile,or neoprene,andaredesignedtobehighlydurableandprovideexcellenttactilesensitivity. AccordingtoDataBridgeMarketResearch,Asia-Pacificglovesmarketisexpectedtogain marketgrowthintheforecastperiodof2022to2029.DataBridgeMarketResearchanalyzes thatthemarketisgrowingwithaCAGRof11.1%intheforecastperiodof2022to2029and isexpectedtoreachUSD9,817.60millionby2029fromUSD4,207.42millionin2021. InIndonesia,themedicalglovemarketpresentsaparticularlycompellingopportunityfor investmentandexpansion.Themarket,valuedatUSD40.951millionin2022,isexpectedto growtoUSD70.100millionby2029,ataCAGRof7.98%.IfwelookattheIndonesia’s overallmedicaldevicesmarket,itvaluedapproximately$3.6billionin2021,reliesheavily onimports,witharound70%ofmedicalproducts,especiallyhigh-techequipmentlike diagnostictools,beingsourcedfromabroad.Thisreliancepresentsasubstantialopportunity forforeignanddomesticinvestorstofillthegap,particularlyastheIndonesiangovernment seekstoexpandandupgradethecountry'shealthcareinfrastructure. AcriticalaspectofIndonesia'shealthcarestrategyisthegovernment'sTKDN(Tingkat KomponenDalamNegeri)policy,whichmandatesaminimumpercentageoflocalcontentin medicaldevices.Thispolicy,enforcedbytheMinistryofIndustry(Kementerian Perindustrian),identifies79prioritymedicalproductsthathaveachievedaTKDNvalueof morethan40%.Amongthesepriorityproductsaresurgicalwearandapparel,including surgicalgloves,whicharenowmandatedtobesourcedlocallyandareprohibitedfrombeing imported.Thisregulationnotonlypromoteslocalmanufacturingbutalsoaimstoenhance self-sufficiencyandreducedependencyonforeignproducts.Businessesthatcomplywiththe TKDNpolicybenefitfromgovernmentincentivesandacompetitiveadvantageinsecuring governmentcontracts,crucialforaccessingthepublichealthcaremarket. viii Despitechallengessuchasregulatorycompliance,infrastructurelimitations,andtheneedfor high-qualityrawmaterials,theIndonesianmedicaldevicemarketispoisedforrobustgrowth. ProjectionsfromBMICountryRisk&IndustryResearchsuggestthatthemarketwillgrowat aCAGRof10.8%from2021to2026,potentiallyreachingamarketvalueofUSD1.9 billion.Themedicalglovessector,inparticular,offerssignificantgrowthpotentialduetothe increasingdemanddrivenbyheightenedhygienestandardsandthegrowingnumberof surgicalprocedures. Amidstthesepromisingtrends,PT.CrownTeknologiIndonesia(CTI),establishedin2022in Padang,WestSumatra,hasemergedasakeyplayerintheIndonesianmedicaldevice industry.Specializinginthemanufactureofmedicaldevicesandinvitrodiagnostictools, CTIbeganproductionin2023,focusingondevelopinginvitrodiagnostickits.Theseinclude NucleicAcidAmplificationTests(NAAT)andRapidDiagnosticTests(RDT),marketed underthebrandname"CRown_Lab."Bycollaboratingwithrenownedresearchersand prestigiousuniversities,CTIensureshighstandardsandinnovativesolutions,solidifyingits positioninthemarket. Recognizingthevastpotentialinthemedicaldevicesector,CTIplanstoexpandbyopeninga newbranchinPadangalongByPassStreet,strategicallylocatedforlogisticaladvantages. Thenewbranchisscheduledtocommenceoperationsinearly2028,reflectingCTI'sgrowth trajectoryandmarketconfidence.CTIhasearmarkedaninitialinvestmentofIDR40billion forthisexpansion.Thisinvestmentwillcoverrentingthenewfacility,purchasing state-of-the-artequipment,andotheressentialbusinessactivities.Fundingforthisproject willcomefromvariousinvestors,underscoringtheconfidenceandinterestCTIhasgarnered. Byincreasingtheirfootprint,CTIaimstosignificantlycontributetoadvancingmedical diagnosticsandhealthcaresolutionsinIndonesiaandbeyond,positioningthecompanyatthe forefrontofmedicaltechnologyinnovation. Inconclusion,theglobaltrendsinpopulationgrowthandincreasedhealthcareneeds, combinedwithspecificmarketdynamicsinIndonesia,presentacompellingcasefor investinginthemedicalglovessector.TheIndonesiangovernment'ssupportivepoliciesand thegrowingdemandforhigh-qualitymedicaldevices,includinggloves,createafertile groundfornewbusinessventuresandexpansionsinthisfield.Asthecountrycontinuesto developitshealthcareinfrastructureandreduceitsrelianceonimports,businessesfocusing onlocalproductionandcompliancewithTKDNpoliciesarewell-positionedtocapitalizeon 3 thegrowingmarketopportunities.CTI'sstrategicexpansionandcommitmenttoinnovation exemplifytheopportunitiesandgrowthpotentialwithinIndonesia'shealthcaresector, particularlyinthemedicalglovesanddiagnostictoolsmarkets. 1.2ProblemIdentification PT.CrownTeknologiIndonesia(CTI)isembarkingonamarketexpansionstrategy, leveragingitsestablishedcollaborationswithvariousinstitutionstoopennewopportunities andexpandintobroadermarkets.Thecompanyhasdecidedtoestablishanewbranchin Padang,whereitisalreadylocated,todeepenitspenetrationintotheIndonesianmarket.This strategicmoveaimstocapitalizeonCTI'sexistinginfrastructureandmarketpresencewhile enhancingitscapacitytomeetthegrowingdemandformedicaldevicesinIndonesia. However,thisexpansionplaninvolvessubstantialcapitalinvestment.Toachieveitsgoals, CTIneedstoinvestinadvancedproductionmachinery,high-qualityrawmaterials,andother criticalresources.Theseinvestmentsarenecessarytomaintainthecompany'scommitmentto producingtop-tiermedicaldevicesandadheringtostringenthygieneandqualitystandards, whicharevitalinthehealthcareindustry.Thesignificantfinancialoutlayrequiredforthese initiativesnecessitatesacomprehensivefeasibilityanalysis. So,byconductingafinancialfeasibilitystudyincludingmarketanalysisandfinancialrisk analysisisessentialforCTI.Thiscompanycanensurethatitsexpansionstrategyisgrounded insoliddataandwell-informedprojections.Thisapproachwillhelpminimizerisksand maximizethepotentialforsuccess,positioningCTItothriveinthecompetitiveIndonesian medicaldevicemarket. 1.3ResearchQuestion Basedonthebackgroundandproblemstatement,thisresearchseekstoanswerthefollowing questions: 1.Istheexpansionplanfeasibletobeimplemented. 2.Whatkindoffinancialrisksshouldbeconsiderbythecompanyiftheproject implemented. 1.4ResearchObjectives Fromtheresearchquestions,theobjectivesofthisresearchare: viii 1.ToevaluatethefinancialfeasibilitystudyofthePT.CrownTeknologiIndonesia expansionplanandtodeterminewhetherPT.CrownTeknologiIndonesiawilltake theprojectornot. 2.Todeterminethefinancialriskfortheprojectiftheprojectimplemented. 1.5ScopeandLimitations Thescopeofthisresearchencompassesseveralkeyareascriticaltothesuccessfulexpansion ofPT.CrownTeknologiIndonesia(CTI)intotheIndonesianmedicaldevicemarket.The researchwillfocusonthefollowingaspects: 1.MarketAnalysis:AnalysisofthecompetitiveenvironmentintheIndonesianmedical devicemarket,includingkeyplayers,andmarketshare. 2.FinancialFeasibilityStudy:Analysisofthenecessarycapitalinvestment,including costsforadvancedproductionmachinery,high-qualityrawmaterials,andfacility upgrades.Alsoestimationofpotentialrevenue,operatingcosts,andprofitability. 3.FinancialRiskAnalysis:Thisassessmentaimstoidentify,quantify,andpropose mitigationstrategiesforrisksthatcouldimpacttheproject'sfinancialviabilityandthe company'soverallfinancialhealth. Limitation: 1.DataAvailability:Thestudyreliesontheavailabilityandaccuracyofmarketand financialdata,whichmaybesubjecttolimitationsincompletenessandtimeliness. 2.MarketDynamics:Changesinthemarketenvironment,suchaseconomic fluctuations,regulatorychanges,orshiftsincustomerpreferences,mayimpactthe study'sconclusionsandprojections. 3.AssumptionsandEstimates:Thefeasibilitystudyincludesvariousassumptionsand estimates,whichcarryinherentuncertaintiesandmayaffecttheaccuracyofthe projectionsandriskassessments. 1.6WritingStructure Thisresearchfollowsastructuredwritingformatbasedontheoutlinedchaptersbelow: ChapterI:Introduction Thischapterprovidesanintroductiontotheresearch,includingthebackgroundofthe project.ItdiscussescurrentmarketconditionsandoffersabriefoverviewofPT.Crown TeknologiIndonesia'splantoestablishanewbranch.Additionally,itpresentstheproblem 5 statement,whichincludestwokeyresearchquestions,aswellastheresearchobjectives, scope,andlimitationsoftheproject. ChapterII:TheoreticalFoundation Thetheoreticalfoundationchaptercoversthetheoriesrelevanttosupportingthisresearchin conductingafinancialfeasibilitystudy.Itbeginswithadefinitionofafeasibilitystudy, followedbyananalysisofbothexternalandinternalfactors.Thisincludesmarketanalysis, financialstatementreview,capitalbudgetingtechniques,andfinancialriskanalysis. ChapterIII:Methodology Thissectionwillclarifytheproceduresinvolvedincreatingthefeasibilitystudyandfinancial riskanalysis,aswellasthedatacollectionprocess. ChapterIV:DataAnalysis Thedataanalysischapterfocusesonanalyzingtheproject,makingassumptions,utilizing financialparametersandtools,andconductingafinancialriskanalysis.Thissectionprovides acomprehensiveexaminationofthedatatoevaluatethefinancialfeasibilityofthenew branch. ChapterV:ConclusionandRecommendations Thischapterpresentstheconclusionsderivedfromthedataanalysis.Italsoincludes recommendationsforPT.CrownTeknologiIndonesiabasedonthecalculatedresults, suggestingthebestcourseofactionfortheproposednewbranch. viii CHAPTERII LITERATUREREVIEW 2.1FeasibilityStudy Feasibilitystudywasdefinedinchapter1ofBusinessFeasibilityStudyasfollows:“The definitionofabusinessfeasibilitystudyisresearchandassessmentofwhetherornota projectcanbecarriedoutsuccessfully(profitably).”(Ichsan,NasutionandSinaga,2019:3) 2.2MarketAnalysis 2.2.1MarketingMixAnalysis Marketingmixanalysisisacomprehensiveapproachtoevaluatingthefundamental componentsofacompany'smarketingstrategy(Investopedia,2024).Thisanalytical framework,traditionallyknownasthe"4Ps,"providesastructuredmethodforassessingand optimizingkeymarketingelements.Thisframeworkconsistof: 1.Product,thisreferstothegoodsorservicesofferedbytheproducertothecustomers. Theproductshouldaimtosatisfycustomerneedsorsolvetheirproblems. 2.Price,thisrelatestothepricingstrategythatusedbytheproducer. 3.Place,it'sabouthowandwherecustomerscanaccessorpurchasetheproductor service.Thiscouldinvolvephysicalretaillocations,onlineplatforms,wholesalers,or directsales,dependingonthenatureofthebusinessanditstargetmarket. 4.Promotion,thiscoversthecommunicationstrategiesusedtopromotetheproductor service. 2.2.2TAMSAMSOMAnalysis Accordingtoseerinteractive.com(John,2024),TAM,SAM,andSOMarekeymetricsfor estimatingmarketpotential.TAM(TotalAvailableMarket)representstheentiremarket demandforaproductorservice,assumingnolimitations.SAM(ServiceableAddressable Market)istheportionofTAMabusinesscanrealisticallytarget,consideringconstraintslike geographyandpricing.SOM(ServiceableObtainableMarket)isthespecificpartofSAMa businesscanrealisticallycapture,basedonfactorssuchascompetitionandmarketing capabilities.Thesemetricshelpbusinessesassessmarketsize,identifytargetsegments,and setgrowthtargets. 7 2.3BusinessModelCanvas AccordingtotheInteractionDesignFoundation,abusinessmodelcanvasisatoolusedby designerstooutlineabusinessorproduct'skeycomponents,includingactors,activities, resources,valuepropositionsfortargetcustomers,customerrelationships,channels,and financialaspects.Abusinessmodelexplainsthereasoningbehindhowanorganization generates,delivers,andsecuresvalue(Osterwalder,2024). 2.4ExternalAnalysis 2.4.1Theporter’sFiveForcesAnalysis Porter'sFiveForcesmodel,acornerstoneofstrategicanalysis,providesaframeworkfor understandingthecompetitivelandscapeofanindustryanditspotentialforprofitability.The modelexaminesfivekeyforces:competitionamongexistingfirms,thethreatofnew entrants,thebargainingpowerofsuppliers,thebargainingpowerofbuyers,andthethreatof substituteproducts(Investopedia,2023).Thisframeworkmovesbeyondtraditionalviewsof competition,recognizingthatrelationshipswithsuppliersandbuyerssignificantlyimpact industrydynamics.Byanalyzingtheseforces,businessescangaininsightsintotheintensity ofcompetition,thepotentialforprofitability,andthestrategiesneededtonavigatetheunique challengesoftheirindustry.Whilethemodelhasbeencritiquedforitsstaticnatureand limitationsinaddressingrapidtechnologicalchange,itscoreprinciplesremainrelevantin today'sdynamicbusinessenvironment(Investopedia,2023). 2.4.2PESTELAnalysis AccordingtotheCorporateFinanceInstitut,PESTELanalysisisavaluabletoolfor businessestounderstandtheexternalenvironmentinwhichtheyoperate.Itconsiderssixkey factors:political,economic,social,technological,environmental,andlegal.Byanalyzing thesefactors,companiescanidentifypotentialrisksandopportunities,informtheirfinancial models,andmakeinformeddecisionsregardinggrowthstrategies,investment,and operationaladjustments.Forexample,changesininterestrates,akeyeconomicfactor,can influencefinancialmodelsandthevaluationsofcompanies.Similarly,technological advancementslikeautomationcanimpactlaborcostsandfreecashflowestimationsin financialmodels(Peterdy,n.d.). viii 2.5InternalAnalysis 2.5.1SWOTAnalysis ASWOTanalysisaimstoidentifyinternalandexternalfactorstogiveasnapshotofthe businessenvironment.Itfocusesonassessinginternalstrengthsandweaknesses,aswellas externalopportunitiesandthreats.Whiletheanalysisprovidesacomprehensivelistofthese factors,itdoesnotdirectlysuggeststrategicactions. 2.5.2TOWSAnalysis ATOWSanalysisisdesignedtodevelopstrategiesbylinkinginternalandexternalfactors, resultinginactionableplans.Itemphasizesevaluatingexternalopportunitiesandthreats alongsideinternalstrengthsandweaknesses.Byintegratingtheseelements,theanalysis generatespracticalstrategiesthatguidedecision-makingandstrategicplanning. 2.6FinancialStatement 2.6.1BalanceSheet AccordingtothePrincipleofManagerialFinance(Gitman&Zutter,2012),abalancesheetis aconcisesnapshotofacompany'sfinancialstatusataspecificmoment.Itdetailsthe company'sassets,whichareitsownedresources,andbalancesthemagainstitsliabilities, whichareitsdebts,andequity,whichrepresentstheowners'contributions. 2.6.2IncomeStatement AccordingtothePrincipleofManagerialFinance(Gitman&Zutter,2012),anincome statementoffersafinancialoverviewofacompany'sperformanceoveradefinedperiod.It summarizestheresultsofthefirm'soperations,typicallyforayearendingonaspecificdate, usuallyDecember31.Thisstatementhighlightsthecompany'srevenues,expenses,and profitsduringthespecifiedtimeframe. 2.6.3StatementofCashFlow AccordingtothePrincipleofManagerialFinance(Gitman&Zutter,2012),Thestatementof cashflowssummarizesacompany'scashmovementsoveraspecificperiod.Itdetailscash flowsfromoperating,investing,andfinancingactivities,andalignsthesewithchangesinthe company'scashandmarketablesecuritiesduringthattime.Thisstatementprovidesa comprehensiveviewofhowcashisgeneratedandusedwithinthefirm.