Feasibility study preparation and analysis

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FEASIBILITY STUDY PREPARATION AND ANALYSIS

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Feasibility study preparation and analysis

  1. 1. FEASIBILITY STUDY PREPARATION AND ANALYSIS
  2. 2. INTRODUCTION •FEASIBILITY STUDY - It is an evaluation and analysis of the potential of the proposed project which is based on extensive investigation and research to give full comfort to the decisions makers. •FEASIBILITY ANALYSIS – It is a process by which feasibility is measured.
  3. 3. CONDUCTING A FEASIBILITY STUDY  Too often, we launch new ideas without thinking through what our market is  Preparing a feasibility study will help you determine if there is sufficient demand for the product or service AND can the product or service be provided on a profitable OR sustainable basis?
  4. 4. BEFORE YOU BEGIN WE SHOULD THINK ABOUT THE FOLLOWING QUESTIONS  What defined market am I trying to reach?  What specific companies/organizations are servicing this market?  Are they successful?  Something similar?  What is their market share?  Is the market saturated or wide open?
  5. 5. QUESTIONS CONTINUED..  What is the size of the market?  Is it growing?  Is it stable, volatile, trendy?  How can you reach this market?  How are competitors currently reaching the market?  What do customers expect from this type of product or service?
  6. 6. QUESTIONS CONTINUED..  What are the business models of competitors?  What core competencies must the product or service have?  What are “customers” willing to pay for this service or product?  What is your competitive advantage?
  7. 7. MARKET ASSESSMENT  A market assessment may be conducted to help determine the viability of a proposed product in the marketplace.  The assessment will help you identify opportunities in the market or market segment  If no opportunities are found, then you don’t have to continue on with the feasibility study.  If opportunities are found, the market assessment can give focus and direction to the “big idea”.
  8. 8. OVERVIEW OF FEASIBILITY STUDY  Description of the project  Market feasibility  Technical feasibility  Financial/Economic feasibility  Organizational/Managerial Feasibility  Results/Next Steps/Conclusion
  9. 9. WHY DO A FEASIBILITY STUDY ?  Gives focus to the project  Narrows alternatives  Surfaces new opportunities  Enhances the probability of success by addressing factors early that could affect the project  Provides quality information for decision making  Helps in securing funding  Helps to increase investment in idea
  10. 10. FOUR TEST FOR FEASIBILITY •OPERATIONAL FEASIBILITY •TECHNICAL FEASIBILITY •SCHEDULE FEASIBILITY •ECONOMIC FEASIBILITY
  11. 11. FINANCIAL ANALYSIS TOOLS •BREAK EVEN ANALYSIS •PAYBACK PERIOD ANALYSIS •CASH FLOW ANALYSIS •NET PRESENT VALUE •RETURN ON INVESTMENT ANALYSIS
  12. 12. THANK YOU

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