Proposing Value to Customers: A Critical Analysis

The assignment content discusses the storage management facility offered by a company to attract businesses to its port. The port's unique feature is temperature control, which sets it apart from other ports in the vicinity. To reach out to potential customers, the marketing plan involves segmentation, targeting, and positioning strategies, focusing on medium where business owners can be easily reached. Technology will also be used through professional social media platforms like LinkedIn. The company is willing to invest a substantial amount of capital upfront and adjust its budget based on customer response. Additionally, the assignment also covers critical path diagrams, which identify A, D, and E as the critical path activities that must be completed within a defined timeline. Lastly, it discusses the concept of net present value (NPV) and how it can be applied to assess investments made by the port.

Question #1: Value Proposition
Introduction
The port is planning to market its new facility that has brought in various features. The sub-
sections ahead in this question are trying to understand the new service aspects of the port that
has been developed. Moreover, the target audience of the port will also be assessed on various
parameters. The strategic goals of the port have been discussed. The port seems to be has some
value proposition that will be disseminated to the customers using the marketing plan. In the end,
the complete discussion has been concluded.
New Service Aspects
The port has developed the storage system facility. The new storage facility has multiple
warehouses, and facility to control the temperature as per the requirements of the product.
Moreover, the storage system facility has been made secure by installing the security monitoring
facility. The security monitoring facility has various elements such as the installation of night
vision camera on various corners of the port and within the storage facility. Along with that, the
storage facility will allow the users in having easy access to the multimodal transport and up to
date cargo facilities. The cargo facilities will be brought in using the external parties so that the
specialized service can be provided to the individual users or entities. The new service is
expected to attract more customers and increase the profitability. It has been expected that the
provision for security aspects at the storage facility along with the presence of temperature
control functionality will attract the customers who look for facilities that provide right
environment and security for their products. There are various elements that get down from the

ships that are temperature sensitive and are costly. These costly products attract uncalled for
attention of unethical individuals in the locality. Therefore, the presence of security will ensure
that the product stays safe till it is in the storage.
Target Customers
The target customers of the port are users from the precincts and those in its hinterland (Li et al,
2016). The target users are the local and non-local individuals who prefer to supply products
using the port. The storage facility on the port will be used to store their products. The major
focus will be on the exporting businesses who prefer storing their products at the port few days
earlier to the export due date. Moreover, the importing businesses can also be taken into
consideration that brings products from other countries or location (Hafiz, 2016). It would be a
preferable choice for them to use the port’s storage facility. The storage facility will be
functioning during all times and, therefore, the businesses that need to receive the products or
goods in the middle of the night will also not face major challenges.
The target customers, as stated earlier are all the exporters preferably from the precincts and
hinterland. Along with that, the importers have also been kept on the list in case there are
businesses that prefer to look for storage facility that are brought in rather than sent out.
Port’s Strategic Goals
The strategic goals for the port has been identified that will ensure that the port facility is moving
in the right direction while attracting its target customers. Mentioned below are the two strategic
goals identified for the port:
1. Premium Quality Facilities and Services

The initial goal of the port is to ensure that the storage services that have been installed on the
port are of premium quality so that it can attract all type of businesses to store their goods. The
port has ensured that the quality of the services and facilities are of international standard. The
port has placed inspectors who will be assessing the quality of the storage facility on regular
intervals to ensure that the storage facility maintenance is being done as per the developed
policies and the strategic goals. The businesses that are huge in size and of good reputation
would preferably look for the storage facility that provides right environment for their products.
Therefore, the focus on the premium quality facilities and services has been considered as the
initial strategic goal of the port management.
2. Integration of the Port with International Logistics System
The port management will focus on integrating the port with the international logistics system to
give it further global exposure. The integration will ensure that the storage facility is used more
as the demand of the same will rise due to increment in the traffic. The major purpose behind this
strategic goal is to attract more businesses to use the improved storage facility. It is expected that
the integration of the port with the international logistics system will improve the reputation
among the various international businesses. The increase in the reputation is likely to attract
more businesses towards the facility being provided by the port.
Value Proposition
The value proposition of the port is based on the three aspects, namely, the offering of the port,
the offerings present in the marketplace, the need of the customers, and the value that is being
proposed by the port to these customers. The image given below cleverly shows the four aspects
in an appreciable manner:

As stated earlier, the offering of the company is good storage management facility for the goods
exporting businesses. At present, there are various ports that are trying to attract the businesses
with their state of the art facilities in every aspect. This port is also trying to do the same with the
extension in the storage management facility. Most of the port in the vicinity does not provide
the facility of temperature control. This is an added advantage of this port which is likely to
attract more customers at this port. Moreover, there are customers who procure or export
products that prefer to be kept in controlled environment and therefore those customers would
prefer this port rather than others. Moreover, the customers who prefer both, the right level of
goods security and the temperature control are most likely to choose this port’s storage facility
than others.
The port has proposed this value to the various customers and the use of marketing plan given in
the next section will ensure that the right individuals come to know about this facility.
Marketing Plan

The marketing plan has been developed to ensure that the value proposition of the company
reaches the customers and increment in the storage facility is witnessed (Hollensen, 2015). There
are various aspects of the marketing plan that need to be considered. The initial aspect is
segmentation, targeting, and positioning (Hawkes, 2013). The segmentation and targeting has
already been done in previous section. The major focus of this section will be on positioning the
storage service of the port among the target customers.
As the target customers of the storage facility are the businesses. Therefore, only those medium
will be used to attract these customers where the owner or management of these businesses can
be found easily. Some of the preferred channels of communication are business newspapers,
business magazines, and business news channels. Moreover, the large size banners can also be
used at the major port area to ensure that the individual visiting the port come to know about the
service available out there.
The use of technology will also be preferred in communicating with the business owners and the
business managers who engage in exporting services. The professional social media like
LinkedIn will be used to connect with the individuals who are looking for reliable storage
services at the port (Mahajerani et al, 2015). Moreover, the agents will be used for the businesses
that are huge in size and is expected to bring major profitability for the port in the longer run.
The marketing budget has been prepared considering the bottom-up approach and the port is
ready to invest substantial amount of capital in the beginning to reach out to its targeted
customers. The adjustment in the budget will be based on the response from the customers.
Conclusion

It is expected that the port will be able to attract the target customers if the effective marketing
plan is followed to convey its value proposition. The port has facilities that are found at few
ports. Moreover, as the facility is new, therefore businesses might prefer to use it.

Question #2: Critical Path Diagram
a. The image below shows the information developed from the given data:
b. The critical path identified is A, D, E. The critical path suggests that the activities are
mandatory to be finished within the defined timeline else it will impact the duration of the whole
project. It can be observed from the data above that the early finish, late finish, late start and
early start of the three identified activities amount to zero slack that is there is no scope in the
duration. Therefore, to finish the project on time, the duration defined on the critical path need to
be followed (Frid and Sruk, 2014).

Question #4: Net Present Value
Introduction to Net Present Value
The Net Present Value or NPV is used to understand the current worth of the investment that will
be made over a time period (Chen and Reynolds, 2012). The net present value is helpful in
understanding whether the investment is fruitful or it will result in loss. The overall incoming
and outgoing of the money is understood using this concept. The calculation applied for the net
present value is the difference between the present value of the future cash flow and the present
value of the investment being made.
Application of NPV to Small Regional Port and Implication
The application of Net Present Value to the small regional port has many issues particularly if
the port is a public asset and commercial entity as well. Mentioned below are the issues that have
been identified in relation to the same:
1. The port being the public asset, it is the liability of the port to ignore the expected return
form the port earnings and investment in the infrastructure for the benefit for the public.
However, such thing is not financially viable and might impact the long term operation of
the port.
2. The next aspect of the port is that it is a commercial entity and, therefore, considering net
present value becomes a default choice and making decisions that are financially sound
and beneficial for the port. However, such decisions might shorten the facility that could
have been brought in considering its public asset aspect.

3. If the net present value has been applied to the port, then the management has to ensure
that the expected return is brought within the defined duration (Leyman and Vanhoucke,
2017). Moreover, the management cannot make decisions that are financially unsound
and impacts the future return.
4. As the port is small and regional, therefore lesser customers can be expected at the port.
This states that the port management cannot invest the amount that has lower or negative
NPV as the return expected is less.
The Net Present Value assessment for the port investment is essential to understand whether the
investment being made will be profitable in the days to come. The port management, in this case
where the size of the small and expected traffic on the port is low, has to consider the net present
value seriously. The reason behind the serious consideration is the thought that whether the right
returns can be expected from the investment. However, as the port comes under dual boundary,
that is, it is for the public and a commercial center at the same time, the investment consideration
becomes challenging. The complete reliance on the assessment of investment will not be
considered as honest justification on the ground of public investment.
It can be suggested that as the port is small and expected traffic will be small, therefore focus
should be on the public asset management rather than gathering commercial benefits.

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