Strategic Alternatives

1. Introduction

This report is to identify key issues faced by Aqua Fish Canada (AFC) through thorough situation analysis, and then develop available strategic alternatives to meet budgeted revenue target. The next step is to give recommendation in order to address the major strategic issue and other operating issues through analysis and comparison of each alternative. The last one is to develop a feasible implementation plan.

2. Situational Analysis

2.1. Vision, Mission, and Goals:

The vision of AFC is to feed the global community, and its mission is to provide a sustainable source of fresh, disease-free fish to domestic and export markets through aquaculture farming. AFC strives to exceed environmental and quality standards and regulations, provide a safe environment for our employees, and generate reasonable financial returns to our shareholders.

The goals can be stated from two aspects: operation- increase the profitability of the current salmon operations, develop oversea markets and diversify product lines into shellfish farming; and finance- proposed investment should generate a minimum after-tax return of 10% within five years.

2.2. Stakeholders' Needs and/or Preferences:

It is critical to identify stakeholders' preference, because they defined AFC's strategic goal that the company strives to arrive at.

* Board: is composed of shareholders, and Fraser Coupland, Mary-Anne Fisher, and Paul Seminole. They expect to expand market share, increase profitability and gain high rate of return on investment.

* Creditors (bank): AFC has always banked with the Eastern Bank of Canada which requires AFC to maintain at least 20% profit margin to repaying its loan and interest.

* The customers of AFC care about product quality and the reasonable price

* Management: take actions to meet the strategic goals set by the board of directors; generate reasonable financial returns to shareholders; make a profit; develop strong, profitable and long-term relationship with customers with high quality products; provide a safe environment for the employees; protect marine environment and follow the regulation of the fishing industry and aquaculture in Canada.

2.3. Constraints:

* To obtain a line of credit no more than $3 million from bank at an annual interest rate of 8%, AFC must guarantee a gross profit margin of at least 20%.

* All the All facilities that process finfish or shellfish for export or interprovincial trade must be registered federally and must develop and implement a quality management program (QMP).

2.4. SWOT analysis:

The updated SWOT analysis is conducted in Appendix