WhatisfeasibilityStudy/ analysis?

FEASIBILITY REPORTFeasibility ReportEntrepreneurship & Small Business Management11Presented by:Naseeb Ali (2011-EE-502)Yasoon Aslam (2011-EE-504)

Feasibility ReportEntrepreneurship & Small Business Management2Feasibility ReportEntrepreneurship & Small Business Management3WhatisFeasibilityStudy/ Analysis?Feasibility ReportEntrepreneurship & Small Business Management4Feasibility Study/Analysis?TheFollowing QuestionsThatCanBeAnsweredByAFeasibilityStudy:Isthereademand for theproduct?Whoelseis producingsimilar products?Whatisneededto maketheproduct?whatisthecostof producingaproduct? Whatisthelikely profit?

Feasibility ReportEntrepreneurship & Small Business Management5Simply..To reduce the risk of failure and losing money, potential producers should go through the different aspects of running their business in discussions with friends and advisors before they commit funds or try to obtain a loan. This process is known as doing a feasibility study. When the results are written down, the document is known as a feasibility report.Feasibility ReportEntrepreneurship & Small Business Management6A Feasibility Study is Valuable for: Starting a new business Expansion of an existing business Adding an enterprise to an existing business Purchasing an existing businessFeasibility ReportEntrepreneurship & Small Business Management7A Feasible Business will: Generate adequate cash flow and profits, Withstand risks, Remain viable in the long-term Meet the goals of the foundersFeasibility ReportEntrepreneurship & Small Business Management8Reasons to Do a Study Gives focus to the project. Narrows the business alternatives. Identifies new opportunities. Identifies reasons not to proceed. Provides valuable information for go/no go decision. Increases probability of business success by identifying weaknesses early Provides documentation that the idea was thoroughly investigated. Helps attract funding from lenders, grant providers, etc. Helps attract equity investment

Feasibility ReportEntrepreneurship & Small Business Management9Feasibility Study Outline Description of the process Market feasibility Technical feasibility Financial/Economic feasibility Organizational/Managerial feasibilityFeasibility ReportEntrepreneurship & Small Business Management10Market Feasibility Industry description. Industry competitiveness. Market potential Access to market outlets. Sales projection

Feasibility ReportEntrepreneurship & Small Business Management11Technical Feasibility Determine facility needs. Suitability of production technology. Availability and suitable of site. Raw materials. Other inputs.

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Financial/Economic Feasibility Estimate the total capital requirements. Estimate equityandcredit needs. Budget expected costs and returns.

Feasibility ReportEntrepreneurship & Small Business Management13Organizational/Managerial Feasibility Business structureFeasibility ReportEntrepreneurship & Small Business Management14Report Writing Introduction Body Subject-by-Subject Point-by-Point Conclusion confusionFeasibility ReportEntrepreneurship & Small Business Management15IntroductionSince feasibility reports are used to solve a problem by comparing two (or more) solutions to the problem in a fair and objective manner, the introduction to a feasibility report must Identify and explain the problem that needs solving; Specify two (or more) solutions to the problem; and Specify the two (or more) criteria that will be applied to each solution to see which of the solutions best solves the problem.

Note: sometimes the criteria are referred to as standards of judgment, as bases of comparison, or as points of comparison. Only one of these terms should be used in a given feasibility report.

Feasibility ReportEntrepreneurship & Small Business Management16BodyThe body of a feasibility report is always organized using the comparison/contrast pattern of organizationNote: a pattern of organization may sometimes be referred to as a rhetorical strategy.The two versions of the comparison/contrast pattern of organization that may be applied to the body of a feasibility report are known as Subject-by-Subject Organization or Point-by-Point OrganizationNote: when the number of subjects (solutions) being compared/contrasted is four or fewer, either of these two organizations may be used in the feasibility report, but when the number of subjects (solutions) being compared/contrasted is five or more, the point-by-point version is the best one to be used.

Feasibility ReportEntrepreneurship & Small Business Management17Subject by Subject When using this means of organizing a feasibility report, the report writer should divide the body of the report into the same number of sections as there are subjects (solutions) being compared/contrasted. Then each section is subdivided into the same number of subsections as there are criteria being applied to the subjects. Then each subsection discusses the merits of one subject (solution) when all the criteria are applied to it. The end of each section states the conclusion that is reached by applying the criteria to all the subjects.

Feasibility ReportEntrepreneurship & Small Business Management18Point by Point When using this means of organizing a feasibility report, the report writer should divide the body of the report into the same number of sections as there are criteria being applied to the subjects (solutions). Then each section is subdivided into the same number of subsections as there are subjects being analyzed. Then each subsection discusses the merits of all the subjects when one criterion is applied to them. The end of each subsection states the conclusion that results from the application of the criterion to all subjects.

Feasibility ReportEntrepreneurship & Small Business Management19ConclusionThe last section of a feasibility report two important tasks must be performed: Summarize the conclusions resulting from the study Make a recommendation as to which solution best solves the problem of the study.

Note: sometimes a feasibility report is called a recommendation report.

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