1

Chapter 1: Introduction

1.1 Background and Significance of the Project

Slung is a name of drinking water brand. Slung in Northern Thai language is mean water dipper. Slung Company provides pure drinking water to serve to 1 to 5 stars hotel in Chiang Rai. Slung Drinking Water has located at Ban Du, Chiang Rai. Chiang Rai is the northernmost large city in Thailand far from Bangkok 824 km. Chiang Rai has 18 districts. 124 Tombons. 1,751villages.The northern near Tachileik city and have high way line with Burma. In the future that have relation bridge Thailand-Laos 4 position R3A road that Chiang Kong (R=road, 3=Thai, China, Laos, A=Asia). However, Chiang Rai has National Park, Forest Park, Arboretum, National Reserved Forest this attraction tourist to travel destination. Source: 202.129.0.133/createweb/00000/00000-1011.html www.chiangraifocus.com/district, th.wikipedia.org/wiki/

Chiang Rai is the province that most famous about tourist attraction. So, in every year the tourists from several countries would like to come to. Following figure1 and figure2 that show the number of visitors Chiang Rai. When the visitors come to Chiang Rai increase our company will get profit as well follow to the number of tourists stay at hotel

Number of visitors of Chiang Rai

Thai Foreigner Total

2006 1,043,161 289,357 1,332,518

Visitors 2007 1,135,659 300,776 1,436,435

2008 1,339,190 402,056 1,741,246

2009 1,430,375 249,873 1,680,248

Figure 1 Number of visitors of Chiang Rai.

Source: http://www.chiangrai.net/dashboard19/

Number of revenue of tourism in the Chiang Rai

Thai Foreigner Total

2006 7,012.43 2,361.77 9,374.20

Revenue(Million) 2007 2008 7,462.35 7,770.31 2,356.60 2,863.61 9,818.95 10,633.92

2009 6,603.43 2,801.21 9,404.64

Figure 2 Number of revenue of tourism in the Chiang Rai

Source: http://www.chiangrai.net/dashboard19/

We brimming with confidence in the future prospects of our company. Slung drinking water has cleaner production and fast delivery to confirm the products international production standard achievement. You can also be confident about the absolute cleanliness of every drop of Slung drinking water. We promise that we will produce drinking water to Chiang Rai people forever.

1.2 Project Objectives

1. To analyze about current situation in drinking water industry. 2. To know about trouble and solution which possible when during the business 3. To calculate and estimate about profit and financing after running business 4. To know about possible and suitable of drinking water business 5. Analysis of key supply-side and demand trends 6. Detailed segmentation of international and local products 7. Historic volumes and values, company and brand market shares 8. Five year forecasts of market trends and market growth

1.3 Benefits of project

1. Received knowledge about competitive and trouble of drinking water industry 2. Understand in structure of drinking water business 3. Know about technical of strategy for use or apply to belong with drinking water business 4. To be able to calculate and estimate in financial of drinking water industry

1.4 Activities/Time frames

NO. 1 2 3 4 5 6 7 8 9

Time 17 Nov 13 19-24 Nov 2013 week 3 week 4 week 5 week 6 week 7 week 8 week 9 Topic submission

Activity

Discussion about information of firm Planning to process organization Separate duty of each person Find out of information of our business Start working Promote product Collect information Prepare for project presentation

Chapter 2: Industry Profile

2.1 Nature of Industry Water is essential to human life. In the past, water is easy to find in river or lagoon, but in present to have the growth of social, advances of technology, and environment changes. It's make the result in river or lagoon is not clean. United States Environmental Protection Agency said that 80% of all diseases to caused from impure drinking water and more toxic contamination; which make to easy illness of human. Water makes up 70-75% of the body weight of the average human being. People can survive about 4 weeks by without food but no longer than 3 days by without water. Water has many different functions inside the body. It forms the bulk of blood and tissue fluid and it's essential for transporting nutrients, hormones and waste products around the body. Water helps to control the delicate balances within the cells. Nowadays the drinking water company has a high market value approximately 4000 million baht per year and to have investors combination both small and large around 2000 person. Drinking water is tending to grow more several factors. For example the degradation of natural water resources which follow to development of economic and industrial. In addition, the amount of population that more increased in everyone, so its make that people want to use more water. Source: http://boc.dip.go.th/index.

2.2 Situation of Industry Drinking waters are industry influence business in Thailand, It is the main factor of daily life especially in urban society. The behaviors of Thai peoples have change from past. Now a day Thai people need quality product and concern about health that are the reason of business to growth quickly. Drinking water continued to see healthy growth in 2011, boosted by the ongoing marketing activities for leading brands like Crystal from Serm Suk PCL, Namthip from Thai Namthip Co Ltd, Nestl Pure Life from Nestl (Thailand) Ltd, Singha from Boon Rawd Brewery Co Ltd, and Chang from Thai Beverage PCL. Still bottled water continued to dominate more than 90% of both total value and volume sales. The rest was accounted for by

functional bottled water and carbonated bottled water with 8% and 1% value shares, respectively. Source: http://www.euromonitor.com/bottled-water-in-thailand/report There are many drinking water company in Chiang rai, This business have a high industry. There are 9 brands such as Sigha, Nestle pure life, Taweeporn, Sairung, Kaew Tip and Arun Tip. Market share of drinking water Business in Thailand Market share of drinking water Business in Thailand
Sigha Nestle pure life Taweeporn,Sairung, Kaew Tip and Arun Tip. 24% 61% 15%

Figure 3 Market share in brand of drinking water business in Thailand Salung drinking water distributes to all offices in Chiang rai. Package of Slung drinking waters are gallon and contain 18.9 liter, which convenient for office because the office use cooler is mainly. Life drinking water tried to make a difference to compete with other company. Our company focuses to be clean drinking water for good health of customer. Our drinking water pass to percolate and the package pass through several step of cleaning for receive quality product 2.3 Product/Service Slung drinking water provides drinking water and serves to customers. The main target group is the 1-5 star hotels in Chiang Rai. The most important issue which Slung drink always concern is quality. Our company chooses glass bottles instead of plastic bottles because of the remarkable feature of its clear and it wont cause odor or taste of the water changes will not change shape when its transporting and handling goods. And it can maintain the product for long life more than it can be recycled. Its stable when its stack and save our money.

The safety accessibility of drinking water is major concerns throughout the world. NSF international accredited by the American National Standards Institute (ANSI). Slung drink is NSF international standard drinking water. And we got the certificate from Thai Food and Drug Administration (FDA, 2009). Our product contains 500ml of water. We use water from groundwater sources. Our product is processed by RO and UV and the price is 60 Baht per 24 bottles. We sell only the pack of 24 bottles Promotion. Slung drinking water satisfies customer by deliver the product punctually. The main target is group is the 1-5 star hotels in Chiang Rai. Our product can shipping directly to customer for convenience. Customer can comment about product and service about our company.

Chapter 3: Market Feasibility study

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3.1 General Environment Analysis 3.1.1 Political The Government has set a policy to encourage both Thais and foreigners to travel more in Thailand in order to double the countrys tourism earnings in the next five years. Deputy Prime Minister and Minister of Tourism and Sports, Mr. Chumpol Silapa-archa, said that a target had been set to increase Thailands tourism income to more than one trillion baht by 2016, compared to 590 billion earned in 2010. According to Mr. Sombat, during the past few years, around 14.5-16 million tourists visited Thailand annually. The Ministry of Tourism and Sports expects that the number of international visitors will increase to 30 million in the next five years (Governments Policy on Tourism, 2010). From Government's policy on tourism, "The Ministry of Tourism and Sports expects that the number of international visitors will increase to 30 million in the next five years" will result in a lot of tourists come to Chiang Rai. If a growing number of tourists increase, the hotels access number will increase as well. Our business will be getting more profitable in next 5 years too. 3.1.2 Economic

Figure: 4 Thailand Gross Domestic Products (GDP) Refer to Gross Domestic Product of Thailand since 2002-2012; it demonstrates that Thai economic has grown in further; furthermore Gross Provincial Product (GPP) of Chiang Rai also increases every year as well. The Gross Domestic Product (GDP) in Thailand was worth 345.65 billion US dollars in 2011, according to a report published by the World Bank. The GDP value of Thailand is roughly equivalent to 0.56 percent of the world economy. GDP in Thailand is reported by the World Bank Group. Historically, from 1960 until 2011, Thailand GDP averaged 85.5 USD Billion reaching an all time high of 345.7 USD Billion in

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December of 2011 and a record low of 2.8 USD Billion in December of 1960. The gross domestic product (GDP) measures of national income and output for a given country's economy. The gross domestic product (GDP) is equal to the total expenditures for all final goods and services produced within the country in a stipulated period of time. This page includes a chart with historical data for Thailand GDP (Trading economics, 2012). 3.1.3 Social Chiang Rai is the center travel of northern part of Thailand that attractive to people who want to travel in attraction place in Chiang Rai because Chiang Rai is peace town which appropriate to tourist want to relax and rest. There have many green natural, cultural attract place. From Association of Tourism and Sports in Chaing Rai have organized festival for attraction tourist every year as flower festival. In addition Chiang Rai has boundaries near Myanmar, Laos and China; tourist can easy to travel around near bounder such as tourist can shop products in cheap price. So, this is the reason that why tourist want to travel in Chiang Rai. 3.1.4 Environment The current environmental problems considered top priorities issues that we need to pay attention because natural resources are used for the purpose in daily activities of humans; it rapidly declines natural resource. We can see the changes of the environment and natural variability explicitly. Slung Drinking water is an organization that recognizes the need for environmental protection throughout and dedicated to operate within the framework of environmental policy, we have developed the system. Combination with the environment is substantial to reflect the company's position in the environment and to set an example to other industries in terms of environmental management. The process has been established for the protection of both water and air pollution, such as wastewater treatment (Sermsuk ,2012). For the environmental management as well as research and development packaging them a glass bottle instead of plastic bottles because, feature is clear The glass will not cause smell or taste of the water like some kinds of plastic packaging and glass containers will not change shape when force during transportation. Also can maintain the quality of the product can also to used for glass recycling have on the stack is stable and easy to transport ( Pirun ,2009). 3.1.5 Technology Nowadays, Technology is more importance for daily life of everyone; we are becoming to the globalization period. Internet is provided for people and Internet is vary necessary to everyone must use for learning new technology, connect or contact people for increase new relationship, listening to music, play games, or used for research information educational academic entertainment for relax or can get new information from many ways. For example, tour company have provide website to offer information to customer which make customer easy to find about package tour such as Chiang Rai tour company have to set

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website for customer can look about information of them company always time; the website is name as http://www.chiangrai-tour.com/. Customer can plan trip before decision to buy trip. 3.2 Competition Analysis 3.2.1 Competitors Analysis Slung Drinking water has serve to 1 to 5 stars hotel in Chaing Rai. The business that produce drinking water have many business which have same objective as to send drinking water in hotel, but we will focus on the competition company have 3 companies who serve pure drinking water in hotel around Chiang Rai have as; Singha Drinking water, Chang Drinking water and Crystal Drinking water below as ;

Brands Singha water Crystal water

Price 60 60

Unit 24 24

Price/Unit 2.50 2.50

Figure: 5 Singha drinking water logo Singha Corporation Co., Ltd. is a subsidiary of Boon Rawd Brewery Co., Ltd., the first and largest Brewery of Thailand. The company was incorporated to oversee the beverage business of Boon Rawd Brewery Co., Ltd. and is responsible for the operation and marketing of beer, soda water, drinking water and various energy drinks and beverage producers. At present,Boon Rawd Brewery is the owner of Singha,Leo , B ing,Purra,Pun Dee,and Masita trademarks. They provide both PETE and glass bottles. For glass bottles to sell 60 baht/pack per1 pack has 24 bottles. Source: http://www.boonrawd.co.th/brb/en/01_learning.html

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Figure: 6 Crystal drinking water Crystal is a popular brand in Thailand. They are the fist brand to get the standard of NSF (The National Sanitation Foundation) in USA. Crystal water is under the slogan Kid Ja Duem Nam Duem Cryatal(If you think drinking the water you should select Crystal). They provide both PETE and glass bottles. For glass bottles to sell 60 baht per pack, 1 pack has 24 bottles. Source: http://www.crystal.co.th/index.html

Figure: 7 Chang drinking water logo Thai Drink Co., Ltd plans to achieve the sales target for the second half this year at 20 litres of Chang drinking water, distributed via nationwide channels. With regards to current drinking water market, Mr Marut is of the view that some players have aggressively launched marketing campaigns to snatch the market of drinking water worth 18,000 million. Meanwhile, the bottled water market has exhibited a steady growth in line with the rising consumption of bottled water over the past five years. Thai Drinks managing director believes that there is still room for the company growth, which will be driven by its extensive range of product portfolio to meet different consumer need. They provide both PETE and glass bottles. For glass bottles to sell 60 baht per pack, 1 pack has 24 bottles. Source: http://www.thaibev.com/en08/detailnews.aspx?ngID=338&tngID=1

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3.2.2 Customer Analysis The target group that Slung Drinking water want to serve as 1- 5 star in hotel and restaurant in Chiang Rai . Our company is dependent on hotels to distribute our products which we act as suppliers business to business (B2B), which are not our direct customers and we need to have enough products to meet demand of the hotels. All hotels have room amount 4,348 rooms in 1-5 stars hotels in Chiang Rai. Each room has to serve drinking water at lease 2 bottle per day and amount 114 restaurants. We can guarantee that consumers will get drinking water to more quality and clean always and we provide drinking water to follow right production standard from the national Sanitation Foundation; which to the opportunity of our company to distribute our product.

HOTEL IN CHIANG RAI No . 1. 2. 3. Name Anantara Golden Triangle Resort & Spa Katiliya Mountain Resort & Spa Le Meridian Chiang Rai Resort & Spa Location Chiang Saen Mae Chan Muang Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Star 5 5 5 Total Room s 77 53 159 289

No . 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.

Name Phowadol Resort & Spa Golden Pine Resort & Spa Laluna Hotel Resort & Spa Teak Garden Spa Resort The Mantrini Boutique Resort Poonyamantra Resort Imperial River House Resort Imperial Golden Triangle Resort Phu Chaisai Mountain Resort & Spa Dusit Island Resort Chiang Rai Wiang Inn Hotel The Legend Chiang Rai Boutique River Resort & Spa Suanthip Vana Resort Homestay Chiang Rai Rasa Boutique Hotel Chiang Rai

Location Muang Muang Muang Muang Muang Mae Chan Muang Chiean Sean Mae Chan Muang Muang Muang Mae Suay Muang Muang

Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Nov-Fab Nov-Fab Mar-Oct Mar-Oct Mar-Oct

Star 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 Total

Room s 154 80 79 72 63 65 36 73 50 271 260 78 30 6 30 1,347

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No . 1. 2. 3.

Name Greater Mekong Lodge Doi Tung Lodge Rimkok Resort Hotel

Location Chiang Saen Mae Fah Luang Muang

Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct

Star 3.5 3.5 3.5 Total

Room s 56 47 256 359

No . 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.

Name Akha River House Wangcome Hotel Chiang Rai Huai Khum Village Resort Baan Suan River View Resort Inn Come Hotel Plam Garden Hotel Chiang Rai Baan Nattawadee Ban Khun Yom Hotel Mohnfahsai Home Resort Thammachart Resort Rai Saeng Arun Santico Resort Bura Resort Chiang Rai Ban Chomna Resort Maesalong Villa Wanasom Wellness & Asthetic Resort Serene at Chiang Rai Hotel Siam Triangle Hotel De River Boutique Resort Prai Nurn Resort Saenphu Place Hotel Luck Swan Resort & Spa Monmaen Resort & Spa Nak Nakara Hotel Chayadel Resort Baan Soontree Resort Kong Garden View Resort Pimann Inn Hotel Golden Land Hotel La Vue En Rose

Location Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Chiang Saen Muang Muang Muang Mar Salong Muang Chiang Saen Chiang Saen Chiang Saen Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang

Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct

Star 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3

Rooms 5 215 80 31 110 33 15 40 19 50 14 20 8 15 74 60 52 52 24 6 98 36 13 25 14 20 32 20 79 28

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31. 32. 33. 34. 35. 36. 37. 38.

Chiang Rai Grand Room Hotel Koko Hut Resort Baan Lanna Hotel Art Ann Hotel Paek Inn Chiang Rai At Chiang Rai Resort Ammarin Resort Baan Siam Hotel

Muang Muang Muang Muang Muang Muang Muang Muang

Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab

Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct

3 3 3 3 3 3 3 3 Tota l

70 8 41 31 145 20 20 59 1,682

No . 1. 2.

Name Nim See Seang Chiang Rai Chiang Sean River Hill Hotel

Location Muang Chiang Saen

Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct

Star 2.5 2.5 Tota l

Rooms 79 60 139

No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

Name Khum Chao Resort YMCA International Hotel Chiang Rai Red Rose Hotel Chiang Rai Pongprabath Resort M Residence & Hotel Diamon Park Inn Chiang Rai & Resort Tree House Residence Baan Bua Guest House Ruean Inn Hotel Wannarit Resident Chote Home Gallery Baan Bua Home stay Ban Lom Jen Home stay Nice Inn Town Residence Golden Triangle Inn Sirin Place Boutique Apartment B2 Night Bazaar Hotel B2 Chiang Rai Hotel The Room Resident Chiang Rai Sukthavorn Residence

Location Mae Sai Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang Muang

Season High Low Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Mar-Oct Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Nov-Fab Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct Mar-Oct

Star 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 Total

Rooms 12 50 50 9 68 78 20 17 50 5 16 10 9 5 20 30 30 30 20 13 512

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No . 1.

Name Nantathong Place

Location Muang

Season High Low Nov-Fab Mar-Oct

Star 1

Rooms 20

Total: 4,348 Rooms There are 4,348 rooms in 1-5 stars hotels in Chiang Rai. In the hotel provide at least 2 bottles per room. The consumers have drinking water to quality also. This is the opportunity of our company to distribute our product. We provide pure drinking water with the standard and certificated form Food and Drug Administration. RESTAURANT IN CHIANG RAI PROVINCE
Location: Muang Chiang Rai

No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 20. 21. 22. 23. 24.

Name Pong Chaingrai Radnha look chin pla sod dee Ha Yak look chin pla 100% Nayok Yuyen Muang Tong Yunnan Saharoad Hlee Ocha Clock tower Imperial Golden Triangle Resort Rawin Udummit Coffee Tee Noi Ice-cream Salim -Tum Tim Krop MK - Sukki Khawtum Nayok Khawtum Fha Sang Khawtom Meena J. Jarern Chai China Town

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25. 26. 27. 28. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 60. 61.

Kuay TeawNam-ngeaw Kuay Teaw Nam-ngeaw Nongbua Kuay Teaw Sri boon ruang Nay Hung Nuea wua rod yeam Ba-Mhee Chaing rai Vegetarian Hall53 Kuay Teaw Ruea Yok loa Kong Nae Jintanas Chicken Kar Moo Rabemg Tong KruaAromdee Kum Jaw Nang K Luie Hot-Pot Jae Dang Chum Cha Chaleng Barn Fishing Park chan maung Chaing Rai In C&C Shum Ka Nom Jean Bubfea. Toob Sing Nakronprathom Nakronprathom2 .Ban Kanum Jean Banwiream Peasa Hot-Pot Pan Oha Phat Buree Fha Sai Hot-Pot Mae Pim Yungtong

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62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87.

Rhat Buree Rim Nam Lap Pla Ha Yaek Lotuse Bakery House Dusit Island Resort Chiang Rai Weang Tan Sri Trung Nung Bua Eak Ocha Krua Season Nam Krun The Golden Tringel Restaurant Lotus Chiang Rai Aea Restaurant Khaw Soi Poor Jai Khaw Soi Essalam Tong Tung Tork Tong Phoo Thai Kai Yang Rean Mai Laddawan Lu mangda Lap Panang Lung Suk Carabow Weang In Cafe Sbangha Khan Tok Slung Khum Lu Lum

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Location: Mae Sai No. 1. 2. 3. 4. 5. 6. 7. 8. Jing lai shun New Somboon Khee Pochana Rabeang Keaw Rim Nam Klua Pian Thong Pa Nang Mae ouy keaw Location: Chiang Rai Mae Sai No. 1. 2. 3. 4. 5. Name Doi Aob Garden Song Nutrition Souvenir and Canteen Sakina Laos Sookie style Location: Mae Chan District No. 1. 2. 3. 4. Name Kun Tum Bistro Rim Chan Inn Anong Lanna noodle style Chan Kum house Location: Doi Mae Salong, Mae Fah Luang District No. 1. 2. 3. 4. Name Mae Salong coffee conner Sakoora Aim Nutrition Wang Phu Tan Location: Chiang Saen Distrist No. 1. 2. 3. 4. 5. 6. Name Kung Tan 5 Chiang Chiang Saen Riverside Restaurant Thi Kitchen Rabiang Khong Rim Khong 3 Ying Name

Total: 114 restaurants

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3.2.3Competitive Analysis Drinking water industry has high competition because it easy to produce the important problem is a lot of competition in the same product almost of their drinking water suitable with household and peoples. This is a reason why our industry focuses in hotel. Characteristic of glass bottles water have three important competitions are Singha, Chang and Crystal. We believe that we will focus at the low price than competitor. And for the result we will got much of market share by contact with hotel. Slung drinking water has National Sanitation Foundation (NSF) and Corporate Social Responsibility (CSR), so we ensure hotels will choose Slung drinking water.

3.3 STP Analysis 3.3.1 Segmentation Life Drink segment customers which are hotels in Chiang Rai by using demographical factor. The stars of each hotel demonstrate the reputation. The customer of Life Drink water is every one. Starting with child, youth to old age as well. Future, water is to be a great tasting, natural, low calorie.

Major Factors in Considering Hotel Standard The major factors taken into consideration in the assessment and certification of an individual hotel and resort property are: Physical aspects Such as location and surrounding Construction aspect The physical structure of the hotel, system in place, security system, etc. Facilities for hotel guests Taking into consideration guests who are resident at the hotel as well as guests who frequent the hotel and use services provided. Quality of service and the ability of maintain quality Includes such criteria as personality, the quality of services, cleanliness, hygiene, etc. The maintenance of the hotel and the above mentioned facilities The Thai hotel standard covers three aspects

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The standard of construction and facilities The standard of maintenance The standard of services

According to Tourism Authority of Thailand, this classified hotel in Chiang Rai into 7 classes. We also use this assessment criterion to segment our customer too.

Number Of Hotel In Chiang Rai

38

20 15 1 1 star 2 star 2 3 3

2.5 star

3 star

3.5 star

4 star

5 star

Figure 8 Hotels in Chiang Rai 3.3.2 Targeting After we got 7 segmentations of our customer, we found the highest number of hotel is in 3 to 5 star hotel. Therefore, we focus on this kind of hotel because we strongly believe this all those 3 to 5 star hotel have high purchasing power as well.

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3.3.3 Positioning High quality

High price

Figure 8 Slung drinking water positioning We have to make the decision to choose the position of the product in for the investment and the image of the product that the company needs. Slung drinking water set the positioning following figure 8. We provide drinking water in low price but high quality. We ensure that our company has high quality because the company has been certified by NSF.

3.4 Marketing Mix Strategy 3.4.1 Product - Our product contains 500 ml of water. We use water from groundwater sources. Our product is processed by RO and UV. Moreover, product is also including with Ozone . - Our product is contain in crystal plastic bottle and crystal water - The label is including with brand, capacity, manufacture, point and registration. 3.4.2 Price - The price is 60 Bath per 24 bottles. We sell only the pack of 24 bottles 3.4.3 Promotion - Free delivery 3.4.3 Place - We focus on all Hotels and restaurant in Chiang Rai to main customer because they need to use water every day for their customer. Moreover, to sell in only Chiang Rai it also reduces cost and support the business together for entrepreneur in Chiang Rai

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3.5

Sale Forecast

For the based year of sale forecast, we found the number of 1-5 stars hotel rooms in Chiang Rai which are 4,348 rooms. We try to catch 20% of all room which is 869.6 rooms. Each room provides 2 bottles of water in mini bar. Our sale is 1,739.2 bottles a day in based sale. There are 24 bottles in one pack. So, we have to provide 72.4 packs per one day. For a month selling, there are 2173.9 packs which are produced. After our firm run the business and be able to expand number of customer, we found that the sale is going to increase 25% from the same month of last year. Tourism seasonal is also important for our business. The sale of high season (November to February) is increased 50% from based year follow number of tourist and hotel reservation. Sale forecasting in hotels Hotel rooms Forecasted 20% Provides 3 bottles/room 24 bottles/pack Sale forecast/month Sale increase 45 percent in high season 4348 869.6 2608.8 108.7 3261 4728.45

For the based year of sale forecast, we found the number of 1-5 stars hotel rooms in Chiang Rai which are 4,348 rooms. We try to catch 20% of all room which is 869.6 rooms. Each room provides 2 bottles of water in mini bar. Our sale is 1,739.2 bottles a day in based sale. There are 24 bottles in one pack. So, we have to provide 72.4 packs per one day. For a month selling, there are 2173.9 packs which are produced. After our firm run the business and be able to expand number of customer, we found that the sale is going to increase 25% from the same month of last year. Tourism seasonal is also important for our business. The sale of high season (November to February) is increased 50% from based year follow number of tourist and hotel reservation. We also forecast restaurants at Chiang Rai too. In Chiang Rai have 114 restaurants. We try to sell 30% of all restaurants in Chiang Rai. The sale is going to increase 10% for every year. At high season we can increase sale more than other season. Than the sale of high season is 50% every year at high season.

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Sale for casting in restaurants Restaurant Forecasted 30% Provides 16 bottle/Restaurant 24 bottle /pack Sale forecast/month Sale increase 50% in high season 114 34.2 547.2 22.8 684 1026

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Table: Sale Forecast Calculation

Year 1

Product

Price

Jan 4,286

Feb 4,286

Mar 2,857

Apr 2,857

May 2,857

Jun 2,857

Jul 2,857

Aug 2,857

Sep 2,857

Oct 2,857

Nov 4,286

Dec 4,286

Total 40,000

Unit Sale 60
Year 2

Product Unit Sale

Year 3

Price 60

Jan 5,135

Feb 5,135

Mar 3,469

Apr 3,469

May 3,469

Jun 3,469

Jul 3,469

Aug 3,469

Sep 3,469

Oct 3,469

Nov 5,135

Dec 5,135

Total 48,292

Product Unit Sale

Year 4

Price 60

Jan 5,922

Feb 5,922

Mar 4,561

Apr 4,561

May 4,561

Jun 4,561

Jul 4,561

Aug 4,561

Sep 4,561

Oct 4,561

Nov 5,922

Dec 5,922

Total 60,176

Product Unit Sale

Price 60

Jan 7,988

Feb 7,988

Mar 7,277

Apr 7,277

May 7,277

Jun 7,277

Jul 7,277

Aug 7,277

Sep 7,277

Oct 7,277

Nov 7,988

Dec 7,988

Total 90,168

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Year 5

Product Unit Sale

Total sale
Year 1

Price 60

Jan 9,461

Feb 9,461

Mar 6,307

Apr 6,307

May 6,307

Jun 6,307

Jul 6,307

Aug 6,307

Sep 6,307

Oct 6,307

Nov 9,461

Dec 9,461

Total 88,300

Product

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Revenue 257,160 257,160 171,420 171,420 171,420 171,420 171,420 171,420 171,420 171,420 257,160 257,160 2,400,000
Year 2

Product

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Revenue 308,100 308,100 208,140 208,140 208,140 208,140 208,140 208,140 208,140 208,140 308,100 308,100 2,897,520
Year 3

Product

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Revenue 355,320 355,320 273,660 273,660 273,660 273,660 273,660 273,660 273,660 273,660 355,320 355,320 3,610,560

28

Year 4

Product

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Revenue 479,280 479,280 436,620 436,620 436,620 436,620 436,620 436,620 436,620 436,620 479,280 479,280 5,410,080
Year 5

Product

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Revenue 567,660 567,660 378,420 378,420 378,420 378,420 378,420 378,420 378,420 378,420 567,660 567,660 5,298,000

29

3.6

Marketing Expense

First year we invite F&B manager of 82 hotels to grand opening at SaunTung and Khom in Chiang Rai for promote people and tourist in Chiang Rai. The grand opening we select Ton Aor Studio to set up the event. Ton Aor Studio will provide and design the entire event. The cost is 200,000 Bath. Source: Ton Aor Studio We create web-site to show the overview of Slung drinking water and more information about company. The topic in web-site can divide into 5 topics. 1. Overview of company 2. Contact 3.Product and process 4.CSR and 5.Online shop The web hosting is www.hostinglotus.com. Source:http://www.hostinglotus.com/ We create brochure for 82 hotels in Chiang Rai and provide every years on January, April, and October. We put the brochure at lobby of 82 hotels in Chiang RaiThe content in brochure is show the map and attractions in Chiang Rai. Source: Muang Rung printing We create bin that screen our logo to provide at tourist attraction in Chiang Rai such as Chiang Rai walking street, Doi Tung, Phu Che Fah and Night bazaar for tourist and people to throw the garbage. And to show the brand to know around Chiang Rai. Source:http://www.weloveshopping.com/template/a21/showproduct1.php?pid=17464355&sh opid=234522&showm=&groupproduct=1212301 In year 3-5, we support scholarship for Suksasongkraw Maechan School for students who have good academic 10 people on Children's Day and support for team Chiang Rai united

30

Marketing expense

Year 1 Brochure Trash Web-site Grand opening Total

Jan 5,400 40,000 289 200,000 245,689

Feb -

Mar -

Apr 5,400 5,400

May -

Jun -

Jul -

Aug -

Sep -

Oct 5,400 5,400

Nov -

Dec -

Total 16,200 150,000 289 200,000 366,489

Year 2 Brochure Trash Web-site Total

Jan 5,400 8,000 289 13,689

Feb -

Mar -

Apr 5,400 5,400

May -

Jun -

Jul -

Aug -

Sep -

Oct 5,400 5,400

Nov -

Dec -

Total 16,200 8,000 289 24,489

Year 3 Brochure Trash Web-site scholarship support CRUTD Total

Jan 5,400 289 20,000 20,000 53,689

Feb -

Mar -

Apr 5,400 5,400

May -

Jun -

Jul -

Aug -

Sep -

Oct 5,400 5,400

Nov -

Dec -

Total 16,200 8,000 289 20,000 20,000 64,489

31

Year 4 Brochure Trash Web-site scholarship support CRUTD Total

Jan 5,400 289 20,000 20,000 53,689

Feb -

Mar -

Apr 5,400 5,400

May -

Jun -

Jul -

Aug -

Sep -

Oct 5,400 5,400

Nov -

Dec -

Total 16,200 8,000 289 20,000 20,000 64,489

Year 5 Brochure Trash Web-site scholarship support CRUTD Total

Jan 5,400 289 20,000 20,000 53,689

Feb -

Mar -

Apr 5,400 5,400

May -

Jun -

Jul -

Aug -

Sep -

Oct 5,400 5,400

Nov -

Dec -

Total 16,200 8,000 289 20,000 20,000 64,489

3.7

Conclusion

Life provides water drink to 1-5 star hotels in Chiang Rai. We forecast sale drink in 5 years. Income of Life drink will increase every year. The base unit we need to sell in every month is 2,713 bottles. So, we have to provide 72.40 packs per one day. Our product is processed by RO and UV. Singha drinks and Crystal are the Slung competitive. We sell 60 baht per pack. One pack has 24 bottles. We set the promotion by not chart about delivery. November-February is high season and March-October is low season of our product. We forecast our sale about 2,900,000 baht per year

32

33

Chapter 4: Technical Feasibility Study

34

4.1 Production and Operational 4.1.1 Product Characteristics

Figure 9 Glass bottle Slung drinking water provides the water into the glass bottle. Size of glass bottle is 500ml. Glass bottles can be reused several times and high durability. The glass bottle can help reduce the amount of garbage on the planet. We use high quality of glass and we focus on good clean. We purchase glass bottle from Tan Soon Huat and Wellgrow Glass Industries. More than 30 years experience in manufacturing glass bottles up to 1.3 million barrels per day (120 tons), or 39 million bottles per month with a unique technique. Slung serviced from Tan Soon Huat and Wellgrow Glass Industries both of purchase glass bottles and printing on glass bottles. Source: http://www.xn--12cb8cydc8m6b.net/

Figure 10 MAXI cap Maxi cap.Under a rubber cap, liner are edge leakage. Easy to open, easy to drink Price per Case (Case contains 9,500 pieces). We purchase from K. Panit Company. Source: http://www.lek11.com/?lang=th

35

4.1.2 Specification

Figure 11 Slung drinking water logo Outstanding design, outstanding quality by Slung drinking water is the slogan of our product. Highlight of the drinking water is a unique design to make it easier to remember. Slung drinking water standard by NSF / ANSI, this is regulated by NSF International. Which guarantee that our drinking water is clean and pure 100%. 4.1.3 Production and Service Process Production

Figure 12 Life drinking water process chart

Slung choose from Aquacheme Co.,Ltd. installed a water filtration system for drinking water. Aquacheme Co., Ltd. Introduced to produce integrated drinking water and fill drinking water into bottles.

Figure 13 Aquacheme Co.,Ltd

36

Why we select Aquacheme? 1. Aquacheme Co.,Ltd have over 34 years experience in Water Treatment Industry. 2. Hundreds of commercial/industrial systems in operation. 3. Aquacheme Co.,Ltd products are being used in over 100 countries worldwide. 4. From packaged systems to custom engineered systems. 5. Aquacheme Co.,Ltd have the expertise to provide systems for drinking water, boiler feed water, seawater desalination, ultrapure water, water reuse and other applications. 6. Aquacheme Co.,Ltd offer the most competitive price in the industry. All units are factory tested to insure the quality of all products. 7. Aquacheme Co.,Ltd customers include major national and international companies in every field of application. 8. Aquacheme Co.,Ltd stock more components for all sizes of RO systems than any other company. Aquacheme products are used by companies all over the country across many industries. Listed below are just a few of those companies:

Figure 14 Companies who use the service from Aquacheme. Source: http://www.aquacheme.com/

37

4.1.4 Location

Figure 15 Land Bandu, Chiang Rai

Figure 16 Location This land is located at Bandu, Chiang Rai Thailand. Rates 1,700,000 Baht. Our land consists of two major parts is office and factory drinking water

38

4.1.5 Facility Layout

Figure 17 Life drinking water factory overview

Figure 18 Office layout

39

Figure 19 Factory layout

Figure 20 Toilet layout

Figure 21 Parking lots layout

40

Figure 22 Guardhouse layout

Figure 23 Lockers fire extinguishers and fire equipment 5 species.

Figure 24 Emergency lighting

Figure 25 Fire alarm bells

41

4.1.6 Machines, Equipments, Tools Aquacheme offers a wide array of products to help you improve the performance of your Water Treatment System: 1. Water Filters

1.1 Sand Filter 1.2 Anthracite Filter 1.3 Carbon Filter 1.4 De-Iron Filter 1.5 Softener

1.6 Demineralized System or De-Ionized System 1.7 Reverse Osmosis System (RO)

42

2. Water Filter Media 2.1 Sand

2.2 Anthracite 2.3 Manganese Sand 2.4 Ion Exchange Resin - Strong Acid Cation Exchange Resin - Strong Base Anion Exchange Resin 2.5 Cartridge Replacement - 1, 5, 10, 50 - Length 10", 20", 39", 40"

43

3. 3.1 Boiler Compound - Scale Preventer - Corrosion Preventer 3.2 Cooling - Anti Lichen - Anti Calces and Rust 3.3 ALUM, LIME, Flocculant or Polymer 3.4 HCl 35%, NaOH 4. Measuring Chemical Pump 5. Other equipment such as Ejector, Strainer and etc.

For the price of all drinking water systems and packaging is 229,000

44

No. 1

Product

Detail Glass bottle 500ml

Unit 10,000

Price/Unit 4.8

Total 48,000

*2

MAXI cap

1cases (1 case= 9,500 pieces)

5,900 per case

5,900

Plastic case

417

220

91,740

Suzuki carry lpg

399,000

798,000

Total 943,640

45

Office Equipment No. 1 2 3 4 5 6 7 8 9 10 Item Desk Office chair Sofa Phone Air condition Computer Printer Calculator Cabinet Paper Quantity 5 5 1 3 2 4 1 5 1 10 Price/unit 3,590 1,490 13,950 270 15,500 16,500 3,900 120 4,590 150 Total Total 17,950 7,450 13,950 810 31,000 66,000 3,900 600 4,590 1500 147,750

Bathroom Equipments and devices No. 1 2 3 4 Item Bathroom Water Closet Basin Mirror Bin Quantity 5 5 5 5 Price/unit 3,900 1,390 299 159 Total No. 1 2 Area Factory Office 28,740 Total 19,500 6,950 1,495 795

3 4 5 6

Guardhouse Parking Toilet Wall

Facility - 30 light bulbs - 5 factory fans - 10 light bulbs - 3 telephones and internet - 2 air-conditions - 2 light bulbs - 5 light bulbs - 5 light bulbs - 30 light bulbs

4.1.7 Organization Chart Slung Drinking water has good employees that have more quality and to have appropriate ability which follow to each duties that company want to receive to work in company. In Slung Drinking water have the people who work in company amount 17peoples; have general manager 1 position, marketing manager 1 position, accountant 1 position, coordination 1 position, maintenance technician 1 position, workman 6 positions, housekeeper 1 position, security guard 1 position, shipper 2 position and driver 2 position. We believe that all employees that we choose them which to make slung company to achieve the goal too fast.

46

No 1 2 3 4 5 6 7 8 9 10

Position General Manager Marketing Manager Accountant Maintenance Technician Coordinator Workman Housekeeper Security Guard Shipper Driver

Quantity 1 1 1 1 1 6 1 1 2 2 Total 17

Monthly Salary 23,000 15,000 12,000 10,000 9,000 9,000 9,000 9,000 9,000 9,000 177,000

The qualification of each position which Slung Drinking water use criterion making a decision to select employees. Ownership is importance person who have a leader of Slung Drinking water. Ownership may be corporeal (title to a tangible object such as a house) or incorporeal (title to an intangible object, such as a copyright, or a right to recover debt). Possession does not necessarily mean ownership because not automatically transfer title.

Source: http://www.businessdictionary.com/defination/ownership.html/ General Manager is primarily responsible for guiding employees in achieving the goals and ambitions of the organization. They ensure that all processes and practices are working in a proper manner. They discuss with other members of the top management and devise any specific goals, which are to be accomplished within a certain time period. As they oversee all processes, they have to pay minute attention to monthly or quarterly functioning of each individual practices. They need to hire wellexperienced and efficient managers for handling the operations of individual practices in a company.

Source: http://humanresources.about.com/od/glossarym/g/manager.htm Qualification Bachelors degree of management or a field relate to slung companys specialty To have experience to work more than 3 years Male or Female, age 26- 45 years old

Marketing Manager performs many duties aimed at developing and implementing the long-term and short-term marketing strategies of his employer. The broad scope of this task requires him to interact heavily with various departments of his firm

47

including research and development, manufacturing, supply chain, sales and in some industries, legal and compliance. Depending on the size of his organization, a marketing manager may also oversee a team of junior marketing professionals. Source:http://www.knowthis.com/principles-of-marketing-tutorials/what-ismarketing/role-of-marketing/ Qualification Bachelors degree of marketing or a field relate to slung companys specialty If you ever have experience; Slung Drinking water will special considered. Male or Female, age 23- 35 years old Monitoring and analyzing market trend. Strong verbal and written communication skill.

Accountant is Slung Drinking water has to manage revenue and expense for example that management the cost of production, the cost of income of employees and it has manager to manage for money and divided for the revenue and expense. Accountants who specialize in management accounting analyze and record financial data for their employer or client to ensure they make wise business choices.

Source:http://www.associatedcontent.com/article/346256/the_role_of_accounting_in_busi ness.html Qualification To have graduated from high vocational Certificate in accounting program Male or Female, age 23-35 years old Be able to use Microsoft Office program Be able to management accounting duties also include completing performance evaluations, overseeing assets and expenses, preparing budgets and writing reports. Coordinator is someone whose task is to see that work goes harmoniously. Coordinator can also be another name for an administrative assistance, or sometimes an employee slightly higher-ranking than admin assistance. However, the term can refer to a position within an organization or business significant responsibilities for acting as a liaison between departments. Source: http://en.wikipedai.org/wiki/Coordinator

48

Qualification To have graduated from grade 12 of high school or vocational certificate Male or Female, age 22-30 years old Good communications skills Good attention to detail To have high responsibility and have good relationship

Maintenance Technician is somebody who maintain the day-to-day operations and to assume responsibility for maintaining the physical asset of property under the direction of the property.

Source: http://wiki.answer.com/Q/what_is_a_Maintenace_technican Qualification To have graduated from grade 12 of high school or vocational certificate in engineer program Male or Female, age 22-35 years old Good command English Good knowledge of Microsoft office program

Workman is a man who performs manual labor for wages. The role has work inside Slung Drinking water which production slung drinking water. Qualification To have graduate from lower secondary school or upper level Male, age 20-30 years old

Housekeeper is a person, often hired, who does or directs the domestic work and planning necessary for inside slung company, as cleaning company

Source: http://www.dictinary.reference.com/browser/housekeeper Qualification Male or Female, age 20 years old upper than year To have graduate from lower secondary school or upper level Have more experience about cleaning

Shipper is someone who send goods for shipment, by packaging, labeling and arranging for transit, or who coordinates the transports of goods

49

Qualification To have graduate from lower secondary school or upper level Male, age 20 30 years old To have driver License and can drive car To have knowledge about Chiang Rai Province To have strong man

Driver is a person or thing that drives car and to tranfer goods to customer as puchuation. Qualification To have graduate from lower secondary school or upper level Male, age 20 30 years old To have driver License and can drive car To have knowledge about Chiang Rai Province To have honest and punctuation

Security Guard is a person hired by a private organization to guard a physical plant and maintain order. Qualification To have graduate from lower secondary school or upper level Male, age 20 30 years old To have honest and punctuation

4.2 Cost of investment 4.2.1 Pre- operation cost Slung Drinking water hired Aquacheme Co.Ltd to install operating produce and process of slung drinking water. The reason that we select Aquacheme Co.Ltd because they have a broad knowledge of applied science, such as chemical engineering, mechanical engineering, electrical engineering and electronics. Aquacheme Co.Ltd has 34 year history of providing the highest quality service standards and to offer the most competitive price in the industry. All units are factory tested to ensure the quality of all products. The pre- operation cost has amount 229,000 Baht. Souce: http://www.aquacheme.com/

50

4.2.2 Investment Cost Investment Cost Land Equipment in factory Bathroom Equipment and Devices Office Equipment Supply Car Total Cost 1,700,000 229,000 28,740 147,750 145,640 798,000 3,049,130

51

Chapter 5: Financial

52

First Year Revenue Sale Total revenue Cost of goods sold Raw Material Direct labors Costs Total cost of goods sold Gross profit/ loss Operating expense Selling and marketing expense Salary Expenses Social security insurance expenses Telephone cost Electrcity expense Installation Expense Register commercial Fuel expense Fire insurance expense Depreciation Total operating expense EBIT Taxes(30%)

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

257,160 257,160

257,160 257,160

171,420 171,420

171,420 171,420

171,420 171,420

171,420 171,420

171,420 171,420

171,420 171,420

171,420 171,420

171,420 171,420

257,160 257,160

257,160 257,160

2,400,000 2,400,000

84,315 112,320 196,635 60,525

84,315 112,320 196,635 60,525

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 25,215

84,315 112,320 196,635 60,525

84,315 112,320 196,635 60,525

1,011,780 1,347,840 2,359,620 40,380

195,689 57,600 7,080 1,800 2,800 229,000 15,000 15,000 2,600 20,091 546,660 486,135 20,091 104,371 43,846 15,000 57,600 7,080 1,800 2,800

57,600 7,080 1,800 1,900

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 134,086 20,091 103,471 128,686 15,000 57,600 7,080 1,800 1,900

57,600 7,080 1,800 1,900 15,000 20,091 103,471 128,686

57,600 7,080 1,800 1,900 15,000 20,091 103,471 128,686

57,600 7,080 1,800 1,900 15,000 20,091 103,471 128,686

57,600 7,080 1,800 1,900

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 134,086 20,091 104,371 43,846 15,000 57,600 7,080 1,800 2,800

57,600 7,080 1,800 2,800 15,000 20,091 104,371 43,846

206,489 691,200 84,960 21,600 26,400

15,000

15,000

229,000 15,000 180,000

20,091 103,471 128,686

20,091 103,471 128,686

2,600 241,092

1,657,961

53

Net income Retained earning at beginning Retained earning at ending

486,135

486,135

43,846 486,135 529,981

128,686 529,981 658,667

134,086 658,667 792,753

128,686 792,753 921,439

128,686 921,439 1,050,125

128,686 1,050,125 1,178,811

128,686 1,178,811 1,307,497

128,686 1,307,497 1,436,183

134,086 1,436,183 1,570,269

43,846 1,570,269 1,614,115

43,846 1,614,115 1,657,961

1,657,961

54

Second Year Revenue Sale Total revenue Cost of goods sold Raw Material Direct labors Costs Total cost of goods sold Gross profit/ loss Operating expense Selling and marketing expense Salary Expenses Social security insurance expenses Telephone cost Electrcity expense Fuel expense Fire insurance expense Depreciation Total operating expense EBIT Taxes(30%) Net income Retained earning at beginning Retained earning at ending

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

308,100 308,100

308,100 308,100

208,140 208,140

208,140 208,140

208,140 208,140

208,140 208,140

208,140 208,140

208,140 208,140

208,140 208,140

208,140 208,140

308,100 308,100

308,100 308,100

2,897,520 2,897,520

84,315 112,320 196,635 111,465

84,315 112,320 196,635 111,465

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 11,505

84,315 112,320 196,635 111,465

84,315 112,320 196,635 111,465

1,011,780 1,347,840 2,359,620 537,900

13,689 57,600 7,080 1,800 2,800 15,000 2,600 20,091 120,660 9,195 9,195 1,657,961 1,667,156

57,600 7,080 1,800 2,800 15,000 20,091 104,371 7,094

57,600 7,080 1,800 1,900 15,000 20,091 103,471 91,966 91,966 1,660,062 1,752,028

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 97,366 97,366 1,752,028 1,849,394

57,600 7,080 1,800 1,900 15,000 20,091 103,471 91,966 91,966 1,849,394 1,941,360

57,600 7,080 1,800 1,900 15,000 20,091 103,471 91,966 91,966 1,941,360 2,033,326

57,600 7,080 1,800 1,900 15,000 20,091 103,471 91,966 91,966 2,033,326 2,125,292 20,091 103,471 91,966 91,966 2,125,292 2,217,258 57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 1,900 15,000 20,091 103,471 91,966 91,966 2,217,258 2,309,224

5,400 57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 2,800 15,000 20,091 104,371 7,094 20,091 104,371 7,094 57,600 7,080 1,800 2,800 15,000

24,489 691,200 84,960 21,600 26,400 180,000

20,091 108,871 97,366 97,366 2,309,224 2,406,590

2,600 241,092 1,272,341 734,441 734,441

7,094 1,667,156 1,660,062

7,094 2,406,590 2,399,496

7,094 2,399,496 2,392,402

55

Third Year Revenue Sale Total revenue Cost of goods sold Raw Material Direct labors Costs Total cost of goods sold Gross profit/ loss Operating expense Selling and marketing expense Salary Expenses Social security insurance expenses Telephone cost Electrcity expense Fuel expense Fire insurance expense Depreciation Total operating expense EBIT Taxes(30%) Net income Retained earning at beginning Retained earning at ending

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

355,320 355,320

355,320 355,320

273,660 273,660

273,660 273,660

273,660 273,660

273,660 273,660

273,660 273,660

273,660 273,660

273,660 273,660

273,660 273,660

355,320 355,320

355,320 355,320

3,610,560 3,610,560

84,315 112,320 196,635 158,685

84,315 112,320 196,635 158,685

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 77,025

84,315 112,320 196,635 158,685

84,315 112,320 196,635 158,685

1,011,780 1,347,840 2,359,620 1,250,940

40,689 57,600 7,080 1,800 2,800 15,000 2,600 20,091 147,660 11,025

57,600 7,080 1,800 2,800 15,000 20,091 104,371 54,314

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 31,846

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

57,600 7,080 1,800 1,900 15,000 20,091 103,471 26,446

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 31,846 57,600 7,080 1,800 2,800 15,000 20,091 104,371 54,314

57,600 7,080 1,800 2,800 15,000 20,091 104,371 54,314

51,489 691,200 84,960 21,600 26,400 180,000 2,600 241,092 1,299,341 48,401 48,401

11,025 2,392,402 2,381,377

54,314 2,381,377 2,327,063

55,214 2,327,063 2,271,849

49,814 2,271,849 2,222,035

55,214 2,222,035 2,166,821

55,214 2,166,821 2,111,607

55,214 2,111,607 2,056,393

55,214 2,056,393 2,001,179

55,214 2,001,179 1,945,965

49,814 1,945,965 1,896,151

54,314 1,896,151 1,841,837

54,314 1,841,837 1,787,523

56

Fourth Year Revenue Sale Total revenue Cost of goods sold Raw Material Direct labors Costs Total cost of goods sold Gross profit/ loss Operating expense Selling and marketing expense Salary Expenses Social security insurance expenses Telephone cost Electrcity expense Fuel expense Fire insurance expense Depreciation Total operating expense EBIT Taxes(30%) Net income Retained earning at beginning Retained earning at ending

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

479,280 479,280

479,280 479,280

436,620 436,620

436,620 436,620

436,620 436,620

436,620 436,620

436,620 436,620

436,620 436,620

436,620 436,620

436,620 436,620

479,280 479,280

479,280 479,280

5,410,080 5,410,080

84,315 112,320 196,635 282,645

84,315 112,320 196,635 282,645

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 239,985

84,315 112,320 196,635 282,645

84,315 112,320 196,635 282,645

1,011,780 1,347,840 2,359,620 3,050,460

40,689 57,600 7,080 1,800 2,800 15,000 2,600 20,091 147,660 134,985

57,600 7,080 1,800 2,800 15,000 20,091 104,371 178,274

57,600 7,080 1,800 1,900 15,000 20,091 103,471 136,514

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 131,114

57,600 7,080 1,800 1,900 15,000 20,091 103,471 136,514

57,600 7,080 1,800 1,900 15,000 20,091 103,471 136,514

57,600 7,080 1,800 1,900 15,000 20,091 103,471 136,514

57,600 7,080 1,800 1,900 15,000 20,091 103,471 136,514 20,091 103,471 136,514 57,600 7,080 1,800 1,900 15,000

5,400 57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 2,800 15,000 20,091 104,371 178,274

57,600 7,080 1,800 2,800 15,000 20,091 104,371 178,274

51,489 691,200 84,960 21,600 26,400 180,000 2,600 241,092 1,299,341 1,751,119 525,336

20,091 108,871 131,114

134,985 1,787,523 1,652,538

178,274 1,652,538 1,474,264

179,174 1,474,264 1,295,090

173,774 1,295,090 1,121,316

179,174 1,121,316 942,142

179,174 942,142 762,968

179,174 762,968 583,794

179,174 583,794 404,620

179,174 404,620 225,446

173,774 225,446 51,672

178,274 51,672 126,602

178,274 126,602 304,876

1,225,783

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Fourth Year Revenue Sale Total revenue Cost of goods sold Raw Material Direct labors Costs Total cost of goods sold Gross profit/ loss Operating expense Selling and marketing expense Salary Expenses Social security insurance expenses Telephone cost Electrcity expense Fuel expense Fire insurance expense Depreciation Total operating expense EBIT Taxes(30%) Net income Retained earning at beginning Retained earning at ending

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

567,660 567,660

567,660 567,660

378,420 378,420

378,420 378,420

378,420 378,420

378,420 378,420

378,420 378,420

378,420 378,420

378,420 378,420

378,420 378,420

567,660 567,660

567,660 567,660

5,298,000 5,298,000

84,315 112,320 196,635 371,025

84,315 112,320 196,635 371,025

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 181,785

84,315 112,320 196,635 371,025

84,315 112,320 196,635 371,025

1,011,780 1,347,840 2,359,620 2,938,380

40,689 57,600 7,080 1,800 2,800 15,000 2,600 20,091 147,660 223,365

57,600 7,080 1,800 2,800 15,000 20,091 104,371 266,654

57,600 7,080 1,800 1,900 15,000 20,091 103,471 78,314

5,400 57,600 7,080 1,800 1,900 15,000 20,091 108,871 72,914 20,091 103,471 78,314 57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 1,900 15,000 20,091 103,471 78,314

57,600 7,080 1,800 1,900 15,000 20,091 103,471 78,314 20,091 103,471 78,314 57,600 7,080 1,800 1,900 15,000

5,400 57,600 7,080 1,800 1,900 15,000

57,600 7,080 1,800 2,800 15,000 20,091 104,371 266,654

57,600 7,080 1,800 2,800 15,000 20,091 104,371 266,654

51,489 691,200 84,960 21,600 26,400 180,000 2,600 241,092 1,299,341 1,639,039 491,712

20,091 103,471 78,314

20,091 108,871 72,914

223,365 304,876 528,241

266,654 528,241 794,895

78,314 794,895 873,209

72,914 873,209 946,123

78,314 946,123 1,024,437

78,314 1,024,437 1,102,751

78,314 1,102,751 1,181,065

78,314 1,181,065 1,259,379

78,314 1,259,379 1,337,693

72,914 1,337,693 1,410,607

266,654 1,410,607 1,677,261

266,654 1,677,261 1,943,915

1,147,327

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Chapter 6: Risk Management

59

Risk management is a central part of all organizations strategic management. It is the process which aims to help organizations understand, evaluate and take action on all their risks with a view to increasing the probability of their success and reducing the likelihood of failure. Risk management is increasingly recognized as being concerned with both positive and negative aspects of risk. Therefore this standard considers from both perspectives. And risk management gives comfort to that the business is being effectively managed and helps the organization confirm its compliance with corporate governance requirements. In addition, Risk Management is relevant to all organizations whether they are in the public or private sector, or whatever they are large or small. It should from part of the culture of the organization, with an effective policy and program led by top management with clear responsibilities laid down for every manager and employee to be involved in the management of risk. It support accountability, performance measurement and reward thus promoting efficiency at all level. Slung drinking water analyzes the risk that company may face during running business. It is really important for our firm. We have to identify the risk and try to solve them as smooth as possible. All those risks can be separate into 2 types including; external and internal risk.(IRM, 2011).

6.1 EXTERNAL RISK As well as physical threats from the external environment such as infrastructure disruption, financial crime, floods, terrorism, computer viruses and malicious attacks, businesses are subject to continual exposure from political, regulatory, legal, economic, social and technological change as well as competitor activity and industry change. Developing a structured risk approach integrated with the enterprise risk framework enables a company to reduce the key exposures whilst also making the most of its opportunities(Luxon Risk Systems,2009).

6.1.1 RISK OF TECHNOLOGY CHANGING Changes in technology bring about the wholesale restructuring and demise of whole industries. The whole way of doing business for many sectors is being changed by the rapid growth in Web, Internet, IT and communications technologies. Drinking business has depended to technology which really important factor that helps our business produce effective product. Moreover, high technology is able to help us save time and human resources producing. We try to apply innovative machine such as washing fillings machine. On the other hand, many people prefer buying drinking water from water cabinet service. It make some drinking water company loses profit. But we are not affected from this issue because ordinary or household are not our target. We focus on 1-5 star hotel and restaurant in Chiang Rai which require pure drinking water contain in glass bottle. Thus, the risk of

60

technology for our product can be solve by apply appropriate machine for our production by concern about necessity (Stewart A. Leech,2011). 6.1.2 RISK OF COMPETITION IN THE MARKET Many other variables can impact the competitive position of a company, including training, marketing, location, policies, branding, recruitment and reward schemes while analysis of competition risk can appear complex and daunting, failure to manage this risk can lead to disastrous consequences. There are many competitors who run the business similar to our company. It is really important factor that makes our company gains lesser profit. We have to share the market with competitor both current and new entrance business. Thats why we try to create differentiation to compete with all those business. Our company tries to catch the luxurious hotel in Chiang Rai to be our customer. (Marsh,2012).

6.1.3 RISK OF SUBSTITUTE PRODUCT There are many products which can be substitute water such as juice and carbonated drink. Those products can be choosing for customer. Green tea is really dangerous competitor. According to sale of Oishi Green tea, this company earned about 8,000 million baht in 2010. Because, they do hard marketing by put more than 300 million baht for do the promise. Thats why they can hold about 65% of green tea market share (Oishi Green Tea, 2011). Actually, substitute product like juice, soft drink, and green tea are not one factor in physical need. Physical need is comprised with breathing, food, water, shelter, clothing, and sleep. Water is really important for human life. As people have known, everyone have to drink 8-10 glasses water a day. So, substitute good cant impact drinking water industry(Maslows Hierarchy of needs, 2009).

6.1.4 RISK OF CHANGING CUSTOMERS NEED Nowadays people around the world concern about environmental impact. Global warming, the unusually rapid increase in Earths average surface temperature over the past century primarily due to the greenhouse gases released by people fossil fuels, is important problem (NASA, 2011). Most of people try to apply the theory about 3Rs: reduce, reuse, and recycle in their daily life (3Rs, 2011).

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6.1.5 RISK OF NATURAL DISASTERS It is really lucky because of Chiang Rai has rarely faced dangerous natural disasters like water flood and storm. There is only one problem which is wildfire in summer around March April. Fire smoke covers almost the area. People are unable to breathe and some of them are asthmas. By the way, it does not affect ordinary business sector, but it impact tourism sector. However, the period that Chiang Rai face smoke problem is in low season. The number of tourist arrival at accommodation normally decreases from high season about 50%. Thats mean this problem happen during in unimportant period. So, this risk cant make us lose much profit as well(NAPCOR, 2003).

6.2 INTERNAL RISK One way to express risk is to divide it into internal and external groups. Internal risk is risk to your company's bottom line from forces that come from within -- disgruntled employees, money lost due to poor communication and other risks that come from employees interacting with one another. External risk, on the other hand, is risk that comes from outside your company negative public relations, a recession or anything else that comes from external forces.Internal risk management is disaster identification and mitigation. Its all about what can go wrong, and what can be done to prevent it. Internal risk management starts with a list a list of the possible disasters. A prevention and mitigation strategy is then developed for each risk. The process is simple and straight-forward. Just going through the process gets many of the risks under control, and it is essential to getting the risks solidly under control. The quality of internal risk management is a factor in the execution of external risk management. The more the internal risks are kept under control, the less risky the overall bet is. Always consider the internal risk management when evaluating the probability of loss. All those risk can be identified as below(Luxon Risk Systems,2009).

6.2.1 RISKS OF HUMAN RESOURCES Risk is a part of personal and business world. Understanding risk is the first step in risk management. The risk assessment tool is known widely and used effectively in project management and execution, finance and accounts, manufacturing, and marketing(Bhima Rao,2008). Risk involved in Human Resource Management function and its assessment is yet to take a firm root. Formal risk analysis and risk management in HR can help to evolve strategies to minimize the disruptions of plans, control cost and control loss. Slung Drinking Water Company always concern about human resources .we believe in ability of employee and we choose by focus on their qualification and high performance because good performance. We trend employee for high performance and good human resource can help our company. For the risk of human resource, our companies we focus on satisfy of employee and we try to do things that they needs and solve problem(Bhima Rao,2008).

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6.2.2 RISK OF MACHINE PERFORMANCE In Slung Drinking Water Company we have aplenty fully of machine and we use for our product such as washing and filling water. We use technology for save time for produce product if low machine performance can affect to product so, we always repair and maintain machine by hire maintenance technician for keep work effectiveness, high performance, reliability, safety and save energy(ABB Jokab Safty,2012). New Machines: The following requirement is given by the Machinery Directive:The manufacturer is under an obligation to assess the hazards in order to identify all of those which apply to his machine; he must then design and construct it taking account of his assessment.The standard EN ISO 14121-1 gives guidance on the information required to allow risk assessment to be carried out. The standard does not point out a specific method to be used. It is the responsibility of the manufacturer to select a suitable method(ABB Jokab Safty,2012). Machines in Use: Risk assessment must be carried out on all machines that are in use; CE-marked as well as not CE-marked:To fulfill the requirements from Directive 89/655/EEC (concerning the minimum safety and health requirements for the use of work equipment by workers at work) risk assessment has to be made(ABB Jokab Safty,2012).

6.2.3 RISK OF QUALITY OF THE PRODUCT Slung Drinking Water Company provides drinking water to server in the 1-5 star hotel and restaurants in Chiang Rai. That we planning, control and continuous quality improvement to achieve the production and quality assurance to consumers get quality product and satisfy product .our company we always have been verified from government sector like Food and Drug Administration (FDA) for determine the mistake that occurred in this product and solve it as well because if something that make product fail that make effect to our company(Luxon Risk Systems,2009).

6.2.4 RISK OF HEALTH AND SAFETY A risk assessment is nothing more than a careful examination of what, in your work or activities, could cause harm to people, so that you can weigh up whether you have taken enough precautions or should do more to prevent harm. The aim is to make sure that no one gets hurt or becomes ill. Accidents and ill health can ruin lives, and affect your business too. You are legally required to assess the risks in your business(Stewart A. Leech,2011). The important things you need to decide are whether a hazard is significant, and whether you have it covered by satisfactory precautions so that the risk is small. Once this process has been started the work activities and workplace should be broken into small units and potential hazards identified e.g. workplace transport requires one risk assessment and

63

poor light levels would require another. Specific conditions, such as snow, may require a risk assessment to be undertaken at the time or when conditions change(Stewart A. Leech,2011). We have produced some simple checklist forms to use when developing your risk assessments to identify hazards, those at risk and the control measures that need to be taken within your business. These checklists are not exhaustive and it is recommended that you use them as a starting point in the risk assessment process and amend or supplement it accordingly to suit your operation (Health and Safety - Risk Assessment Checklists,2009).

6.2.5 FINANCIAL RISK Most of the firm have to faces to financial risk because its refers to revenue and expenses of each company. Slung Drinking Water Company tries to prevent this problem by setting well financial planning. We estimate our performance with 3 situation including; sale decrease 5%,10%,and 15%, cost and expense increase 5%, 10%, and 15%, and interest increase 5%, 10%, and 15%. The results of our calculation have shown as below; Year 1 2 3 4 5 5% 120,000 144,876 180,528 270,504 264,900 Sale Decrease 10% 240,000 289,752 361056 541008 529,800 15% 360,000 434,628 541584 811,512 794,700

Year 1 2 3 4 5

5% 2,477,601 2,477,601 2,477,601 2,477,601 2,477,601

Cost 0f goods sold Increase 10% 2,123,658 2,123,658 2,123,658 2,123,658 2,123,658

15% 2,713,563 2,713,563 2,713,563 2,713,563 2,713,563

64

Chapter 7: Summary

65

Summary Water is the essential of human being. Our body is made up by 70-75% of water. No one can live without water over 3 days. So, everyone needs water to maintain their life. This is the one of the important reason of why people choose to work this business. Drinking waters are industry influence business in Thailand. Slung drinking water is the kind of produce and delivers drinking water business in Chiang Rai. The reason that this business choose Chiang Rai is because Chiang Rai the hearth of northern in Thailand that have many attraction place to create the tourists have more interest in Chiang Rai and the population of Chiang Rai is increase in every year. In here, the more tourists in Chiang Rai are made to more restaurants and hotels in Chiang Rai. In 2009, the number of tourist in Chiang Rai is over 20000. So, this is the good place for doing this business. The main target of Life drinking water is 1-5 star hotels and restaurant in Chiang Rai. Drinking water industry has high competition because it easy to produce the important problem is a lot of competition in the same product almost of their drinking water suitable with household and peoples. This is why we focus to the hotel. The total rooms of 1-5 star hotels are 4348 rooms and 114 restaurants. We forecast our sale about 2,500,000 baht per year. We use water from groundwater sources. Our product is processed by RO and UV. We provide pure drinking water with the standard and certificated from NSF. The one thing needs to think about is competitors. There are 3 companies that provide water to hotels. The main focus competitors are Singha ,Crystal and Chang drinking water. We believe that we will focus at the quality than competitor and CSR. And for the result we will got much of market share by contact with hotel and restaurant. Our product contains 500ml of water. We sell only the pack of 24 bottles Promotion. We set the promotion by free delivery. Internet Network is compared as library. They can serve every information that they want to know and can get new information from many ways. Therefore we choose provide website to information about our firm at www.Slungdrinkingwater.com. Customer can get information method about life water and order and choose product.

66

Slung Drinking Water

Pichaphan Kanokkan Jirapat Pannisa Patchareeya Simuk Suchada Nan Zi Mo Hom

Sangkae Aeksiriwaranon Tanyapiban chinakai Kangwan Yutithum Ketcham

5131205152 5331205001 5331205012 5331205059 5331205064 5331205091 5331205095 5331207064

Project Feasibility Study and Evaluation 2012

School of Management Mae Fah Luang University

67