27. Additionally, the current value of the project cash flows is of $17,081,476.27, which is higher than the initial cost (Investopedia, 2010). This leads to the conclusion that the implementation of the project is recommendable.
From the analysis of the net present value, it is also possible to assess the project from the standpoint of its internal rate of return. The IRR for the new automated storage and retrieval system is of 83%. In optimal conditions, this figure would be compared against the value of another investment project. Yet, in the absence of an alternative, the high value of the IRR is sufficient to reveal the high capability of the new ASRS to generate positive organizational outcomes.
Given the analyses so far conducted, a conclusion is being formed in that the implementation of a new automated storage and retrieval system is a positive investment project for CanGo. All the internal benefits would eventually materialize in a better consolidated competitive position, making the investment even more worthwhile. Today, CanGo is a competitive organization, whose financial ratios -- such as profitability, liquidity, efficiency or debt ratios -- are similar with industry averages. This virtually means that the new automated storage and retrieval system could represent an opportunity for the company to improve its ratios above the industry average.
Yet, in order to ensure its success, several recommendations are noteworthy:
The contraction of an outside...
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