Capital budgeting is making long-run planning decisions for investment in project. Capital budgeting is vital in marketing decisions. Decisions on investment, which take time to mature, have to be based on the returns which that investment will make. Unless the project is for social reasons only, if the investment is unprofitable in the long run, it is unwise to invest in it now. Often, it would be good to know what the present value of the future investment is, or how long it will take to mature (give returns). It could be much more profitable putting the planned investment money in the bank and earning interest, or investing in an alternative project.
The present project on Project Evaluation of Franchisee Business of SSI Computer Education tells about the allocation of financial resources for the project. The project is undertaken for Vision Technologies, Hyderabad whose promoters already have some operations like IIFL Ltd Franchisee and Call Center Operations. The organization is further planning to expand its operations into computer education on a large scale by taking the franchisee rights for SSI Computer Education, a renowed player in the industry.
A proposal for the Franchisee Business of SSI Computer Education is made to combat to the increasing demand for computer education. The organization aims to cash in on the brand name and technological support offered by SSI Computer Education. From the detailed study and analysis of different factors, it can be concluded that the project is very attractive and can place the institute in the top most bracket of earning potentiality. Considering the projected growth in the industry, a pay back period of 4 years, a very good Net Present Value and an internal rate of return of 25%, the project merits a serious consideration.