Chap 4 - Feasibility Study

8/7/2019 Chap 4 - Feasibility Study

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DEFINITION

Preliminary evaluation of a business idea,

conducted for the purpose of determining

whether the idea is viable or worth pursuing.


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INTRODUCTION


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PURPOSE

Narrow businessalternatives

Identify reasonsNOT to proceed

Provide qualityinformation for

decision making

Give focus to theproject and

outlinealternatives

Provide athorough

examination of

all issues

Provide athorough

examination


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FEASIBILITY OR VIABLE BUSINESS IDEA

EXPECTED

Generate adequate cash flow and profit.

Withstand the risk it will encounter.

Remain viable in the long term. Meet the goal founder.


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FLOW OF FEASIBILITY STUDY


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1. MARKET FEASIBILITY

An assessment of the overall appeal of the

market for the product or service being

proposed


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MARKET FEASIBILITYS ASPECTS

Market

Competitor

other businessesthat provide

similar, substituteor alternative

product/service tothe same market

Customers

target markets forthe organizationsproduct or service

Service

any activity orbenefit that oneparty can offer to

another

Product

anything that canbe offered to a

market

Demands

total potentialpurchase that is

expected from thetarget market

Share

portion of themarket that the

business cancontrol


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2. TECHNICAL FEASIBILITY

Concerned with determining whether the

business has the necessary technology and

equipment to produce the intended

product/service


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TECHNICAL FEASIBILITY ASPECTS


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3. ORGANIZATIONAL FEASIBILITY

Identifying the strengths and weaknesses of the existing

business, opportunities and threats as presented by the

environment, the resources required to carry through, and

ultimately the prospects for success


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4. FINANCE FEASIBILITY

An assessment of the financial aspect of the

business.

To analyze finance and resources.


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FINANCE FEASIBILITY INFORMATION

Start-up Cost

Finance

ProfitabilityAnalysis

Total cash requiredto start the business

Internal Finance

External Finance

Determine whetherthe propose ventureis generate profit.


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CONCLUSION

The feasibility study should give us a clear idea

whether the proposed business is a sound

business idea. If so, we can proceed with the

preparation of the business blueprint


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Q & A

THANKS FOR LISTENING!

Documents

Chap 4 - Feasibility Study