Rufen Sie uns einfach an, und wir beraten Sie gerne zu unserem Seminar- und Studienangebot.

Unsere Ansprechpartner:

Michael Rabbat, Dipl.-Kfm.
MBA Chief Operating Officer

Claudia Hardmeier
Kunden-Center
Studienbetreuung

Institute und Kompetenzzentren

Bindeglied zu einer Vielzahl an
Unternehmen und Organisationen

Erfahren Sie mehr ...

Forschung

Was Management-Forschung wirklich
leisten kann

Erfahren Sie mehr ...

Alumni

Wissenstransfer und
Erfahrungsaustausch

Erfahren Sie mehr ...

Referenzen

Feedback und
Teilnehmerstimmen

Erfahren Sie mehr ...

News

SGBS aktuell:
Wissen und
Anwendung

Erfahren Sie mehr ...

Klimaneutrale Seminare

Auf dem Weg zu
klimaneutralen Seminaren.

Erfahren Sie mehr ...

Juan Diego Flórez Association

Mit musikalischer Bildung
gegen Armut:

Erfahren Sie mehr ...

2.1. Characteristics of industrial projects

“An industrial project is the proposal for an investment to create, expand and/ or develop certain facilities in order to increase the production of goods and/ or services in a community during a certain period of time. Furthermore, for evaluation purposes, a project is a unit of investment which can be distinguished technically, commercially and economically from other investments.”1 Being a single and individual investment, the IP has to deliver a return2 that compensates the investor for the period the invested capital is tied-up and exposed to risk3. In most cases the return is expected to be of economic nature in form of cash flow (political and strategic reasons, e.g. projects for military defence, health or education, shall not be considered in this paper) and financial profit.

The production of goods requires production facilities which first have to be built. Hence, the design of the technology, the engineering of the facilities and the equipment and their construction and commissioning require time and the expenditures during the time window for the project realization (no goods produced, hence no revenue and no possible return) need also be covered by the investment. Depending on development of market demand and product prices the revenues are volatile and so is consequently the cash flow/ possible profit.

Industrial projects are unique in location, environmental conditions and community. Natural resources as feedstock and access to the markets, a different set of stakeholders add to every project’s uniqueness.

Illustration 1: Project phases according to UNIDO

Illustration 1: Project phases according to UNIDO

 

1 According to UNIDO Manual for evaluation of industrial projects, 1986; Although UNIDO sees only the proposal for an investment to be an IP this paper considers also the investment phase and the operation phase as part of the project. Though the divestment (exit) is also an integral part in the project’s life time and cost or revenue for dismantling or divestment should be included in the feasibility and economic evaluation, the exit phase is not discussed.
2 This paper does not consider political return, but only economic return
3 Risk associated to industrial projects and the return to capital is discussed in the following chapters