Today, the term "investment" is very popular among the broad masses of the population.If earlier this was done only wealthy and big capitalists, the now all changed abruptly.Investment projects - what is this?How to implement them to obtain a constant and stable income?
The implementation of the business plan
Internationally, investment projects - are plans that are associated with investing for future profit.In a general sense, any new business idea somehow has to attract new capital.That is why in the broadest sense of investment projects - is activities related to the implementation of the business plan of the company to achieve the desired result.The process of implementation in the developed economies - is a series of coordinated and inter-related activities: Purchase of equipment and machinery, consulting services for the preparation of budget and project documentation, bidding, supervision of work, training of personnel, purchase of licenses, construction works and the like.
Project Life Cycle
project realization - it is always a long time (with rare exceptions).The economy operate on a term such as "project cycle".What does it mean?This is the time between the initiation of the project and its liquidation.This original concept for the solution of all financial activities and making the right decisions.The states through which investment projects - the so-called phases or stages.The stage of the life cycle is the period of time during which the dynamics of the main financial flows monotone, their structure is practically constant, and activities for the realization of the idea is almost constant.The length of the cycle means that the value of future income and expenses in terms of the present moment are different.
Birth ideas
Investment projects - it is, above all, the idea.The initiative for an infusion of funds can come from legal or natural person who wishes to take part in the process of investing.It can be the customer who is looking for a particular product, or the manufacturer of any product, which requires new financial injections.The initiator may be an investor who wants to invest money and does not know what the probability of success and what you can get out in the end.
importance of a business plan
financing investment projects - a process which always begins with a preliminary business plan development, and carry out the necessary calculations.What it is?The business plan of the investment project - the process of enterprise development.This is a standard document that describes in detail the concept of the most real project for investment, given its characteristics.The approach to the presentation and direct the development of the plan depends on the nature of the investment project.The business plan provides a clear and definite logical structure, unified in advanced economies.Particular attention is given to the competitiveness of products by attributes and price level.The forecast for the period of the life cycle of the project and products (or services) in particular.
financial plan
This is the most important part of the development phase of the project.It is in fact the main criterion for acceptance (or rejection) of the investment project, as the answer to the question, in what form and for what period of time will provide a return on invested capital.The financial plan is a reasonable calculation of income and expenses are recognized key performance indicators.Also calculated the payback period of investment in the project.
first stage.Concept
The first phase investment projects - is another concept.We estimate the viability of the project, to create a plan of technical requirements, selected sketches, calculated the necessary financial resources.To do this, pick similar objects, on which the calculation is carried out.This stage is characterized by an increase in expenses (quite rapidly) and a complete lack of income and cash flows.Also developed alternative investment projects.These projects, which provide a variety of deviations from initial goals and plans in view of the totality of causes (accident, problems with the implementation and financing, and so on).
second stage.Necessary acquisition
starts working capital and acquisition of fixed assets, so cash costs grow even more.Install new facilities, acquire the necessary patents and licenses.The effectiveness of the investment project - a parameter that is based on the reasonable and adequate disposal of fixed assets.The costs are also on the training of staff, advertising campaign, legalization of activities, detailed engineering, procurement and procurement - that is all that is needed for the project.Remittances, as the first stage, no.
third stage.Commissioning
At this stage of investment projects - it is quite ready for full operation of the plant.It is the third stage, they gradually put into operation.The sharp decline in spending and an increase in revenues associated with the receipt of proceeds from the start of implementation.At the end of the third phase of the financial income reached its peak.At this stage include insurance premiums, payment of employees' salaries, purchase of materials and raw materials, the proceeds of sales, payment of taxes, changes in required assets.
fourth stage.Stabilization
By this time the project has been operating stably and is characterized by a planned production of goods or services.The profit stabilized.On the whole, the fourth stage should rest in the business plan of the investment project.It is characterized by parameters such as production capacity utilization, efficient process itself to full automaticity, the achievement of a minimum level of cost of goods or services.
fifth stage.Results and prospects
By this time the investment projects have already fulfilled their own.There is a deterioration of the funds to support the production costs increase and cash flows are reduced.By and large, in nine cases out of ten projects is expected liquidation.But there is another scenario.What?
New Life
The purpose of the investment project - is primarily a profit.But what if the idea is not outdated, but is beginning to bear the loss?Reinvestment - this output.But what is it?This movement flows from one financial assets into more efficient.This action binds the free investment of capital by redirecting them to manufacture or acquisition of new assets to maintain capital assets.There are several variants of this development:
- investment for replacement, resulting in changing the existing facilities to the new;
- rationalization, modernization processes;
- change release programs;
- diversification, aimed at creating new products and new markets for the organization of its sales.
reinvestment investors profit from the sale of assets, tax cuts, the flow of funds through the sale of part of the working capital.Size costs in this case is significantly reduced.
control and monitoring
control - an opportunity for the head of the investment project to identify and review the plans and estimates to adjust tasks.Monitoring provides:
- constant monitoring (monitoring the process of implementation of the project);
- search for deviations from the target by a number of restrictions and criteria that are fixed in the budget, schedule, and so on;
- forecasting situation.
Objects control - facts, events, verification of specific actions and decisions.Overall monitoring exercise by the customer or the management of the enterprise on its behalf.Also, in accordance with the contract, the firm-developer or contractor has the right to conduct inspections.
