Strategies for reaching profitability targets Sample Clauses

Strategies for reaching profitability targets. As stated above, it is likely that only few or none of the BIOCORE processes will reach the target of an IRR of 25%. We will not stop at this finding but will ask what measures could be taken for reaching this profitability target. The first objective could be to increase revenues. Since the physical product outputs are given, this would have to be achieved through higher product prices. We will therefore look, first, at the impacts of increased prices for all biorefinery end products through a politically motivated price support mechanism. Since any such subsidy system would need strong arguments in order to attain political support, we will compare the level of necessary price support for BIOCORE products with the current support for biofuels. Second, we look at the effects of increased market prices for single end products through the GreenPremium mechanism. The second objective could be to cut costs. Those production costs could be defined that would generate the desired profitability, i.e. the so-called target costs. The basic idea of