feasibility study definition and process

1. Business
Technical
Writing
Ms. Richelle Lynne F. Cu

2. Adamsonian Prayer
Dear Lord,
Teach me the things that are important:
To be generous with Your gifts,
Compassionate to those who have less,
Just in the face of unfair circumstances,
True when the world's values contradict my own,
Gracious when things don't go my way,
And magnanimous when they do.

3. Adamsonian Prayer
May nothing else matter
Except Faith in Your goodness, my neighbor's, and mine,
Hope that things can get better,
And Charity that always sets things right.
May Your special Love for the Poor,
The mark of my uniquely Vincentian education,
Be the work I excel in,
The standard I constantly refer to,
And my courage when I meet You someday.

4. Adamsonian Prayer
O Mary conceived without sin,
Pray for us who have recourse to thee.
St. Vincent de Paul,
Pray for us.

5. Business
Technical
Writing
Ms. Richelle Lynne F. Cu

6. Objectives:
At the end of the lesson, students are expected to:
• determine the nature of feasibility study and how it works;
• identify the steps on how to conduct feasibility study;
• enumerate the components needed in conducting feasibility study;
• draw line between feasibility study and feasibility report;
• recognize viable lucrative business ideas;
• conduct a feasibility study for a viable business proposal and submit a
feasibility report.

7. Feasibility Study
• Feasibility study is the process of examining the
possibility and practicality of a project proposal,
business ventures, or business concepts and the
result is reported by the feasibility report.
• It determines and decides whether the proposal
will have a green or red light.

8. How does Feasibility
Study Work
• It examines how a business concept or idea can work in a long-
term basis especially in term of financial risks.
• It helps in recognizing potential cash flows.
• It assists business planners narrow down possibilities.
• It provides reasons for pursuing or neglecting a certain proposal.
• In terms of operational aspect, it reveals whether the plan is
practical or not predicated on the availability of necessary
resources.
• It provides the planner the knowledge on the business trends.
• It affirms if target customers will support the product, services, or
business concept.

9. Components of a Feasibility Study

10. Economic Feasibility
• is in fact, a kind of cost-benefit analysis of the involved and evaluated
project, that determines the possibility of implementation.
• This process highlights the SWOT analysis surrounding the project,
the needed resources, and its chances of success.
• This involves market, economic, strategic, and technical analyses.

11. Technical Feasibility
• analyzes the specific details on how a product or service can be
delivered to the target customers.
• This aspects include the materials to be used, needed labor, location
of the business and the technology for the whole operation.
• This aspect presents the flowchart or framework how the business
works, how the products or services are made and delivered, and
how the business physically reaches the market.

12. Operational Feasibility
• is tantamount to the availability of human resources.
• It checks how effective the created system solves the problem, how it
arrests opportunities identified in the process, and how it provides
the requirements identified at the beginning of the phase.

13. Operational Feasibility
• Experts believe that this aspect is the most difficult to determine and
assess unless management has high commitment to the proposed
project or business.
• Some variables are considered in this aspect as such:
• Manpower problems
• Labour objections
• Manager resistance
• Organizational conflicts and policies
• Social acceptability
• Government regulations

14. Schedule Feasibility
• sets the probability of the completion of the project in a given time-
frame or time limit.
• This aspect is appraised high when the project is finished on time or
ahead of time, otherwise, it’s gauged as poor.
• The math is simple here, when the project is unsuccessful, it loses its
benefits, expediency and probability, thus, it’s rejected, and other
method is applied.

15. Schedule Feasibility
• To ensure efficacy of this aspect, the proposal must feature: (Task
Management Guide, 2020)
• Project Estimation
• Gantt and PERT charts
• CPM (Critical Path Method)
• Change Management

16. How to Conduct Feasibility
Study

17. 1. Conduct a
Preliminary Analysis.
• Outline your plan.
• Focus on a market that the demand is greater than
the supply
• Think of a product or service that has distinct
advantage.
• Consider the challenges. Make sure they are
conquerable.

18. 2. Prepare a Projected
Income Statement.
• Begin with the expected income from the project.
• Identify the right investment to achieve the goal.
• Determine the services required and their cost.

19. 3. Conduct a Market Survey,
or Perform Market Research
• Make the research thorough and substantial.
• Hire researcher from the outside if no one has the
ability from the inside.
• Let the research give you the clearest picture of the
revenues for the project.
• Include in your study the market’s geographic
influence, demographics, competitors’ profile and
analysis, and market value

20. 4. Plan Business Organization
and Operations.
• Set up the initial operations of the proposed
business.
• Include the start-ups, fixed investments, and
operation costs.
• Through the cost, attend to things like equipment,
merchandising methods, real estate, personnel,
supply availability, overhead, etc.

21. 5. Prepare an Opening
Day Balance Sheet
• Get ready with the accurate estimate of assets and
liabilities.
• Include a list of items, source, cost and available
financing.
• Include list of liability like leasing or purchasing of
land, buildings and equipment, financing for assets
and accounts receivables.

22. 6. Review and
Analyze All Data
• Set up the initial operations of the proposed
business.
• Check and recheck the process as to income
statement, expenses, liabilities, etc.
• Design a contingency plan.

23. 7. Make a Go/No-Go
Decision
• Reexamine the components if they are worth
spending of time and money
• Check if these goals are aligned with the
organization’s strategic goals and long-term desire.
• Make your decision final after weighing all options.

24. Task 1
Explain comprehensively.
1. Why do projects need a project feasibility study?
2. Why does project feasibility include a project cost estimate?
3. What is the difference between feasibility study and feasibility
report?
4. What are the common questions that a feasibility study should
address?