A FEASIBILITY STUDY means to determine if a business opportunity is possible, practical and viable. It is useful when starting up a new business or identifying a new opportunity for existing business. It guides the enterpreneur in actually starting up and running the business venture.
A FEASIBILITY STUDY means to determine if a business opportunity is possible, practical and viable. It is useful when starting up a new business or identifying a new opportunity for existing business. It guides the enterpreneur in actually starting up and running the business venture.
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A FEASIBILITY STUDY means to determine if a business opportunity is possible, practical and viable. It is useful when starting up a new business or identifying a new opportunity for existing business. It guides the enterpreneur in actually starting up and running the business venture.
Copyright:
Attribution Non-Commercial (BY-NC)
Available Formats
Download as PPT, PDF, TXT or read online from Scribd
business opportunity is possible , practical & viable. A feasibility study enables a realistic view at both the positive & negative aspects of opportunity. Feasibility studies are useful when starting a new business or identifying a new opportunity for existing business. PREPARATION OF FEASIBILITY REPORT The feasibility study process involves making a rational decision with a preparation of feasible report. It guides the enterpreneur in actually starting up & running the business venture. It can help in proper utilization of resources. STEPS INVOLVED IN PREPARATION OF FEASIBILITY REPORT
Selection of factory location .
Demand analysis of product. Market potential measurement. Capital saving and project 5 costing. Working capital requirements. Profit & tax planning. Economic, technical, financial, & managerial feasibility of project. SELECTION OF FACTORY LOCATION DEMAND ANALYSIS OF PRODUCT The success of any project depends on the demand for the output produced by it. Catering an unfulfilled need should the ultimate objective of commercial projects, if they should succeed. Identifying the need , or the potential demand for the product is the main issue involved. The market and demand analysis involves: Identification of target market Designing the market strategy. Estimating the quantity of demand. MARKET POTENTIAL MEASUREMENT Market potential measurement involves: Market Research Segmentation Market Positioning Developing the marketing mix stategies. Strategies for distribution intensity. Budgeting the marketing strategies. Capital Saving Decisions National Saving The sum of private saving and government saving. Private Saving is the sum of household saving and business saving. Business saving is net profits retained in the business, i.e. not distributed to owners. Household saving is disposable income minus consumption expenditure. As measured, it ignores ‘capital gains’ of households. Capital Saving Decisions
Some factors affecting household saving are:
The real interest rate Disposable income Purchasing power of net assets [i.e. real wealth] Expected future income WORKING CAPITAL REQUIREMENT Working capital is the excess of current assets over current liabilities. It is employed for financing the current operation of the business. It is required to meet day-to-day transaction of the business. Working capital estimation is difficult b’coz there is always an element of uncertainity in all types of the business. PROFIT & TAX PLANNING