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Feasibility Study: Dr. Rhia D. Cervantes

This document provides an overview of a feasibility study for a proposed business project. It defines a feasibility study as an evaluation of the viability and profitability of a proposed project based on market factors, competition, technology and financial resources. It outlines the purpose, nature, qualities and classifications of a feasibility study. Key aspects that must be analyzed are also described, including marketing, demand and supply analysis, and identifying any gaps between projected demand and supply.

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Patricia Camille Dela Cruz
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63 views49 pages

Feasibility Study: Dr. Rhia D. Cervantes

This document provides an overview of a feasibility study for a proposed business project. It defines a feasibility study as an evaluation of the viability and profitability of a proposed project based on market factors, competition, technology and financial resources. It outlines the purpose, nature, qualities and classifications of a feasibility study. Key aspects that must be analyzed are also described, including marketing, demand and supply analysis, and identifying any gaps between projected demand and supply.

Uploaded by

Patricia Camille Dela Cruz
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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FEASIBILITY STUDY DR. RHIA D.

CERVANTES
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 DECISION MAKERS
A SYSTEMATIC INVESTIGATION WHICH ASCERTAINS WHETHER A
BUSINESS UNDERTAKING IS VIABLE AND IF SO, THE DEGREE OF ITS
PROFITABILITY
IT IS AN ANALYSIS OR RESEARCH INTO THE PRACTICALITY OF
A PROPOSED PLAN OR METHOD, BASED ON FACTORS LIKE
MARKETPLACE, COMPETITION, AVAILABLE TECHNOLOGY,
MANPOWER AND FINANCIAL RESOURCES.
AN ANALYSIS OF THE ABILITY TO COMPLETE A PROJECT
SUCCESSFULLY, TAKING INTO ACCOUNT THE LEGAL,
ECONOMIC, TECHNOLOGICAL, SCHEDULLING AND OTHER
FACTORS.
FEASIBILITY ANALYSIS – IT IS A PROCESS BY WHICH FEASIBILITY IS MEASURED
NATURE OF FEASIBILITY STUDY
1. SYSTEMATIC INQUIRY – STEP BY STEP PROCESS; DIFFERENT PHASES AND
ASPECTS
2. PROPOSED BUSINESS ACTIVITY – INTENDED TO MAKE PROFIT, REGULARLY
UNDERTAKEN, FINANCIAL IN CHARACTER
3. VIABILITY OF ALL AREAS – ENSURE A HIGHER CHANCE OF ATTRACTING AND
CONVINCING PROSPECTIVE INVESTORS
4. MEASUREMENT OF PROFITABILITY LEVEL- INTENDED FOR PROFIT-ORIENTED
ORGANIZATIONS
PURPOSE OF FS
1. ENHANCE THE SUSTAINABILITY OF A PARTICULAR BUSINESS CURRENTLY UNDERTAKEN
2. FACILITATE EASILY THE EVALUATION OF A PROJECT’S SUCCESS IN ALL AREAS COVERED BY THE
STUDY
3. SEEK THE INFUSION OF ADDITIONAL FRESH WORKING CAPITAL INVESTMENT OR EXPECTED
RETURN ON INVESTMENT
4. DETERMINE THE RECOVERY PERIOD OF CAPITAL INVESTMENT OR EXPECTED RETURN ON
INVESTMENT
5. SERVE AS MEASURING INSTRUMENT IN EVALUATING ACTUAL PROJECT RESULT AGAINST WHAT
THE STUDY REVEALS
6. REDUCE, IF CANNOT BE TOTALLY AVOIDED, THE EXPECTED BUSINESS DIFFICULTY THAT MAYBE
EXPERIENCED DURING ACTUAL IMPLEMENTATION
7. MEET AND SATISFY THE REQUIREMENTS SET BY THE INVESTORS OF THE PROPOSED BUSINESS
PROJECT
QUALITIES OF A GOOD FS
1. COMPREHENSIVE – SHOULD FULLY COVER ALL THE AREAS THAT NEED TO BE
SCRUTINIZED. THE OVERALL PERSPECTIVE OF THE PROPOSED PROJECT SHOULD BE
PRESENTED SO THAT USERS CAN EASILY MAKE AN ECONOMIC DECISION.
2. OBJECTIVE – UNBIASED PRESENTATION OF THE FINDINGS OF THE STUDY BASED ON A
FAIR EVALUATION AND CRITICAL ANALYSIS OF DATA FROM VARIOUS SOURCES
3. SIMPLE – LANGUAGE AND EXPRESSIONS USED IN A FS SHOULD BE SIMPLE TO
ENHANCE UNDERSTANDING
4. RELIABLE – THERE IS A HIGH DEGREE OF TRUTHFULNESS IN THE AVAILABLE DATA, IN
THE ANALYSIS AND EVALUATION, AND IN THE CONCLUSION OF THE STUDY.
USEFULNESS OF FS
USED FOR PROJECT DESIGN OR REDESIGN
CAN MINIMIZE THE BUSINESS DIFFICULTY THAT MAYBE EXPERIENCED IN THE ACTUAL
IMPLEMENTATION OF THE PROJECT
CONSIDERED AS THE MOST RELIABLE INSTRUMENT IN MAKING DECISION WHETHER TO
IMPLEMENT OR DISCARD A PROJECT
MOST COMPREHENSIVE MEDIUM WITH WHICH TO EVALUATE A PROJECT IN TERMS OF
FUNDING OR ADDITIONAL FRESH CAPITAL OR TAX EXEMPTION INCENTIVES
EFFECTIVE TOOLIN EVALUATING THE PROFITABILITY LEVEL AND SUSTAINABILITY OF A
PROPOSED PROJECT.
FACTORS AFFECTING PREPARATION OF
A FS
TYPE OF INDUSTRY
SIZE OF THE PROJECT
PURPOSE OF THE STUDY
PARTY PREPARING THE STUDY
RESQUIREMENTS OF THE PROSPECTIVE INVESTORS
CLASSIFICATION OF FS
•AS TO AMOUNT OF INVESTMENT – IN TERMS OF CAPITAL, A BUSINESS
ENTITY CAN EITHER BE MICRO, SMALL OR MEDIUM-SIZE
MICRO – P3 MILLION AND BELOW
SMALL AND MEDIUM SIZE – P3 MILLION TO P350 MILLION
LARGE – P350 AND UP
•AS TO STATUS OF THE PROJECT – CAN BE FOR A NEW PROJECT OR FOR
EXPANSION OF THE BEXISTING BUSINESS ENTERPRISE
AS TO INDUSTRY CLASSIFICATION – CLASSIFIED ACCORDING TO INDUSTRY SUCH AS :
1. MANUFACTURING
2. REAL ESTATE
3. ELECTRONICS
4. TRANSPORTATION
5. ENTERTAINMENT
6. AGRICULTURE
7. MERCHANDISING
8. UTILITIES
AS TO NATURE OF MANAGEMENT – CAN BE ADMINISTERED BY NEWLY-
HIRED MANAGERIAL PERSONNEL OR BY EXISTING SET OF OFFICERS

AS TO LIABILITY OF INVESTORS – DEPENDS ENTIRELY ON THE TYPE OF


THE PROPOSED BUSINESS. IT CAN BE SOLE PROPRIETORSHIP,
PARTNETSHIP OR COPRPORATION
FS VS. BUSINESS PLAN
PROPOSED NAME OF THE BUSINESS
- SHOULD BE REFLECTIVE OF THE BUSINESS IDENTITY
- REFLECTS THE PHILOSOPHICAL VALUES AND CULTURE THAT THE COMPANY CHERISHES
- PROFESS THE BRAND IDENTITY OF ITS PRODUCT
- BE APPEALING TO THE CUSTOMERS
DESCRIPTION OF THE INDUSTRY
DESCRIBES THE INDUSTRY WHERE THE BUSINESS BELONGS
CITE RECENT TRENDS IN THE GLOBAL MARKET THAT HAVE BEARING TO THE INDUSTRY
INDICATE CURRENT PROGRAMS AND THRUSTS OF THE NATIONAL GOVERNMENT FROM WHICH THE
PROPOSED PROJECT WILL BENEFIT
WHAT IS THE NATURE OF THE INDUSTRY?
WHAT ARE THE TRENDS IN THE GLOBAL MARKET?
WHAT ARE THE DEVELOPMENTS IN THE PROGRAMS OF THE NATIONAL GOVERNMENT?
ARE THERE BARRIERS IN THE FORM OF HIGHER TARIFFS AND OTHER CUSTOM REQUIREMENTS?
WHAT MAKES THE PROJECT ATTRACTIVE?
WHAT ARE THE BRIGHT PROSPECTS OF THE PROPOSED PROJECT?
DESCRIPTION OF THE PROJECT
DECSRIBES THE NATURE OF THE PROJECT AND THE PRODUCT OR SERVICE IT WILL PRODUCE
OR SERVE
DESCRIBE THE STAGE THE PROJECT IS PRESENTLY IN
WHAT PRODUCT OR SERVICE WILL THE BUSINESS PROVIDE?
IS THE STUDY A RESULT OF REGIONAL STUDIES OR SONSULTATIONS?
WHAT IS THE POTENTIAL OF THE PRODUCT IN THE MARKET?
WHO IS THE MAJOR CONSUMER OF THE PRODUCT OR SERVICE?
WHAT IS THE PRIMARY RAW MATERIAL REQUIRED TO PRODUCE THE PRODUCT?
MARKETING ASPECT
OBJECTIVES OF THE MARKETING ASPECT:
1. TO ENUMERATE THE OPPORTUNITIES AND THREATS OF THE BUSINESS
2. TO CLASSIFY THE STREGTHS AND WEAKNESSES OF THE COMPANY
3. TO DEFINE THE DIFFERENT FACTORS IN THE EXTERNAL ENVIRONMENT THAT IS
EXPECTED TO AFFECT BUSINESS OPERATIONS
MARKETING ASPECT
INTRODUCTION
PRODUCT/SERVICE DESCRIPTION
COMPANY LOGO
COMPANY NAME
FORMS OF ADVERTRISEMENTS
TARGET MARKET
HISTORICAL DEMAND AND SUPPLY ANALYSIS (5 YEARS)
PROJECTED DEMAND FOR THE PRODUCT/SERVICE (5 years)
PROJECTED SUPPLY FOR THE PRODUCT/SERVICE ( 5 YEARS)
PROJECTED DEMAND – SUPPLY GAP ANALYSIS
MARKET SHARE
MARKETING STRATEGY FOR THE PRODUCT/SERVICE
PRODUCT SERVICE DESCRIPTION
WHY IT IS NEEDED?
WHAT IT IS MADE UP OF?
WHAT SOURCES IT WILL BE DERIVED FROM?
WHAT IT WILL LOOK LIKE?
HOW LONG SHOULD IT TAKE TO CRAETE IT?
HOW WILL WE KNOW WHEN IT IS COMPLETE OR DONE?
COMPANY LOGO
LOGOS TRIGGER PEOPLE’S MEMORIES OF
PREVIOUS EXPERIENCES WITH THE
COMPANY
LEAVES A GREATER IMPACT THAN WORDS
ALONE
A LOGO DESCRIBES A COMPANY OR
ORGANIZATION WITHOUT LENGTHY
EXPLANATION
INCREASES VISIBILITY AND SALES
COMPANY NAME
FORMS OF ADVERTISEMENTS
TARGET MARKET
HISTORICAL DEMAND AND SUPPLY
ANALYSIS (5 YEARS)
DEMAND
IDENTIFY THE CUSTOMERS
GATHER INFORMATION ON TOTAL PAST DEMANDS
EVALUATE PAST DEMAND PATTERNS
FORECAST FUTURE DEMANDS
EVALUATE FUTURE DEMAND PROJECTIONS
WHERE TO GATHER DEMAND DATA?
MANUFACTURERS, RETAILERS
TRADE ASSOCIATIONS
BANGKO SENTRAL NG PILIPINAS (BSP)
DEPARTMENT OF FINANCE (DOF)
DEPARTMENT OF TRADE AND INDUSTRY (DTI)
NATIONAL ECONOMIC AND DEVELOPMENT AUTHORITY (NEDA)
NATIONAL STATISTICS OFFICE (NSO)
BUREAU OF CUSTOMS (BOC)
OTHER GOVERNMENT OFFICES
EXISTING AND PROSPECTIVE USERS OF THE PRPODUCT
SUPPLY
DEPARTMENT OF TRADE AND INDUSTRY (DTI)
NATIONAL ECONOMIC AND DEVELOPMENT AUTHORITY (NEDA)
NATIONAL STATISTICS OFFICE (NSO)
BUREAU OF CUSTOMS (BOC)
BOARD OF INVESTORS (BOI)
EVALUATING SUPPLY GROWTH
PATTERN
IS THE SUPPLY PATTERN INCREASING OR DECREASING?
DOES THE PERCENTAGE OF INCREASE REMAIN CONSTANT?
ARE THERE GOVERNMENT PROJECTS THAT SIGNIFICANTLY INFLUENCE THE SUPPLY
GROWTH PATTERN?
ARE THERE NEW USES FOR THE PRODUCT?
ARE THERE MOVES FROM THE PRIVATE SECTOR THAT WILL SIGNIFICANTLY INFLUENCE THE
SUPPLY?
There are four steps in any total-market forecast:
1. Define the market.
2. Divide total industry demand into its main
components.
3. Forecast the drivers of demand in each segment
and project how they are likely to change.
4. Conduct sensitivity analyses to understand the most
critical assumptions and to gauge risks to the baseline
forecast.
GAP ANALYSIS

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