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Reports from the Sales Manager indicated that contracts have been lost because some clients wantto engage a courier who can deliver to their regional offices, in particular Newcastle, Wollongong andthe Central West. Fast Track is currently unable to meet this demand and therefore, some potentialclients have been lost. This became a motive to expand operations for both financial and customerservice reasons.
2.0 – Company StructureThe company is family owned, with 3 family members acting as a Management Board andresponsible for approving all business decisionsManaging Director – responsible for daily operational management decisionsLogistics Manager – responsible for the scheduling of the trucks and drivers20 truck drivers5 office support employees – responsible for administration, accounts, human resources andsales2.1 – Facilities and EquipmentComputersManualsGPSPDATrucks3.0 – Marketing ActivityDirect sales TelephoneInternet listingsMail-outs4.0 – Business OperationsThe company communicates with employees via email for head office employees, and a printedmonthly newsletter for drivers. Policies and procedures are provided through employee manuals thatare kept in each truck.Trucks are fitted with a GPS system to assist drivers in navigating to each pick-up and drop-oflocation. They are also assigned a PDA that provides drivers with details of each delivery and recordswhen a job starts and finishes. The data from this device is sent back to head office to competeproductivity reporting.4.1 – Strategy to Expand BusinessFast Track Couriers currently allocates 2 drivers per truck to ensure that drivers are able to load andunload heavy packages. The strategy going forward is to remove the need for 2 drivers per truck byinstalling an automatic lif gate on the back of each truck, at a cost of $10,000 per truck. Thisindicates that only 1 driver is needed per truck, as no heavy lifing is required. Hence, it will allowFast Track to purchase 10 new trucks and use the existing drivers for regional routes. Each new truck will cost $60,000, including installation of an automatic lif gate. The money topurchase the trucks will be borrowed from the bank on a business plan.
5.0 – Financial Information and ForecastsAnnual salesCurrent sales Estimated sales (Year 1)$17 million$22 millionAnnual net profitCurrent net profitEstimated net profit$1.9 million$3.2 millionIncreased costsLoan repaymentsOperating costs (fuel servicing, etc.)+$200,000 per annum+$2.2 millionAdministrative costsLabour Costs+$100,000Nil
6.0 – Risk AnalysisSince drivers are typically negative about change, there is a risk that the turnover of drivers mayincrease. Hence, proposing the sudden change could be done in a positive note by ofering highersalary and rewards if sales manage to increase significantly. By doing so, this could motivate thedrivers to engage in the sudden change and as well as getting involved in organisation activities. If allelse fails, Fast Track Couriers could retain the accepting drivers and recruit new drivers.