The paper “ Going for Growth by Investing in People, Products and Plant” is an inspiring example of a business assignment. Investments are guided by entrepreneurial skills. Any decision to put money into any venture is guided by the probable returns from the same. There are many factors considered when making such decisions. These include labor and production costs. In this case, the Hazelwood Sandwiches Company seeks to carry out extensive market research and investment appraisal. This is important in ensuring that the company stays relevant in the evidently dynamic market. Question 1Before making an investment, it is prudent that one possesses an effective understanding of the market of operation.
This is important in making an informed investment move. The process of studying the market and developing an understanding of the same is collectively referred to as investment appraisal. It involves a series of market evaluations through a number of mechanisms which result in the comparison of the business’ key objectives which are profitability under the existent market forces (Willey, 2012). There are a number of investment appraisal methodologies including net present value which investigates the ability of the market to repay the investment given the numerous present market factors such as inflation.
One of the most preferred of these methods is the direct payback method in which the investor calculates the number of years it may take the business to return the initial investment. Another investment appraisal method is the accounting rate of return which bases its assessment of the market on its ability to earn profit to the investment. Despite their different approaches to the appraisal, the methods safeguard the interest of the business by trying to determine its profitability and above all its longevity.
The life of a business is of great importance to the investor since the longer a business stays viable, the more the investor earns. The company makes an extensive capital investment with the sole aim of achieving the business objective. Capital investment is the amount of money that the enterprise invests in fixed assets that are directly used before implementing its investment plan.
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