1. NEED FOR PROJECT FORMULATION:
• SELECTION OF APPROPRIATE TECHNOLOGY. EG.
USAGE OF MODERN TECHNOLOGY
• THROUGH EXAMINATION OF DESIGNS AND
MARKETING IS REQUIRED
• INFLUENCE OF EXTERNAL ECONOMIES EG.
…POLITICAL
• DEPENDENCE ON OTHER INDUSTRIES FOR RAW
MATERIAL, SPARE PARTS, SERVICES ETC.
• REQUIRED FOR TECHNICALLY QUALIFIED
PERSONNAL
• KNOWLEDGE ABOUT GOVERNMENT REGULATIONS.
• INDUSTRIAL GUIDELINES.
3. FEASIBILITY ANALYSYS:
• IT IS THE PROCESS OF EVALUATING THE FUTURE OF A
PROJECT IDEA.
• DETERMINES THE DESIRABILITY OF INVESTING
• 3 POSSIBILITIES ARE THERE FOR THIS ANALYSIS
- FEASIBLE
- NOT FEASIBLE
- DATA NOT ADEQUATE FOR CONCLUSION
• 3 FEASIBLE STUDY ARE THERE – PREFEASIBLE STUDY
- FEASIBILITY STUDY
- PROJECT REPORT
4. # PREFEASIBILITY STUDY:
INFORMATION ARE COLLECTED AT THIS STAGE LIKE –MARKET & PLANT CAPACITY
- LOCATION
- TECHNOLOGY
- MANPOWER
- MATERIAL INPUT.
# FEASIBILITY STUDY:
IT IS A DETAILED ANALYSIS ON DIFFERENT ASPECTS LIKE
• ECONOMIC
•TECHNICAL
•MANAGERIAL
•ORGANIZATIONAL
•COMMERCIAL &
•FINANCIAL
THE MAIN AIM OF THIS STUDY IS TO FIND ALTERNATIVE SOLUTION , IF THE PROJECT IS
NON-VIABLE AND MAKE IT A VIABLE BY ADJUSTING THE PARAMETER.
5. TECHNO ECONOMIC ANALYSIS:
IT IS CONCERNED WITH IDENTIFICATION OF PROJECT DEMAND &SELECTION OF
TECHNOLOGY FOR THE PROJECT.
DETERMINATION OF PROJECT DEMAND POTENTIAL
• ESTIMATION IS DONE BASED ON DEMAND FORECASTING
• 3 STAGES ARE INVOLVED – 1) SITUATION ANALYSIS ( STUDIES DEMAND
FORECASTING)
• 2) DATA COLLECTION & COMPILING
• 3) INTERPRETATION & PRESENTATION OF DATA
SELECTION OF OPTIMAL PROJECT STRATEGY
INFINITE SERIES OF STRATEGIES ARE THERE & SELECTING THE BEST OUT OF IT &
PROCEEDING THE PROJECT.
6. PROJECT DESIGN & NETWORK ANALYSIS:
• IT IS heart of the project
• It defines the individual activity - comprising a
project - and - interrelationship - between these
activities.
• The activity & its relationship is shown in network
diagram.
• The network analysis is done to identify the
optimal course of action to execute it within the
minimum time within the resources
7. INPUT ANALYSIS:
• Input Analysis is mainly concerned with identification, quantification and
evaluation of project inputs.
• This include identify the nature of resource, estimate the magnitude of the
required resource, evaluate the possibility of uninterrupted supply.
• Resource are needed in 3 stages
• - Preinvestment stage, < resource for investigation of various
aspects of project idea. FOR THIS Less resource is needed
• - Construction stage < non-recurring resource to develop the
project structure . FOR THIS Maximum resources is needed
• - normalisation stag < Raw material & other consumables on
recurring basis
8. FINANCIAL ANALYSIS:
Financial analysis is done to know the financial feasibility
of the project.
It involves estimation of the project cost & revenue and
funds required for project.
It analyseS if the project generates the revenue
9. COST BENEFIT ANALYSIS:
• Cost benefit analysis estimates the social cost
and social benefits .
• It analyze the social profitability of the project.
• It evaluates the impact of the project of the
society
10. FESIBILITY REPORT:
• The details gathered from feasibility studies are
presented in tables reports and statements are
consolidated into one master report called project
report or feasibility report.
• It contains background information of industry to
which project belong and the company.
11. The criteria of project selection includes
Investment size
Location
Technology
Equipment
Marketing
Power & Water
Others Performance
Working capital requirements
Labour
12. • PROBLEMS FACED DURING THE ESTABLISHMENT OF A NEW
ENTERPRISE
• PROMOTION OF BUSINESS (
• INVESTIGATION (PROPER INVESTIGATION IS REQUIRED)
• FORM OF BUSINESS ORGANISATION ( PARTNERSHIP, JOINT
STOCK COMPANY, ETC FOR DECISION MAKING)
• ADEQUATE CAPITAL ( IS NEEDED)
• SIZE OF BUSINESS UNIT
• SELECTION OF SITE(AVAILABILITY OF RAW MATERIAL…)
• EFFICIENT MANAGEMENT (DIRECT & POSITIVE RELATIONSHIP)
• LAUNCHING AN ENTERPRISE ( AFTER SOLVING THE ABOVE
PROBLEMS , ENTERPRENEUR CAN START HIS BUSINESS)
