Feasibility Study

•Suppose after graduating, you want to establish a coffee shop. After calculating your would-be business costs, what else do you need?

•You need to know where to locate your business and how much it costs, the time and money on obtaining permits, the goods to offer and the marketing strategies on how to get people to patronize your business.

•You need to determine whether a project is workable and financially worthwhile before you spend large amounts of money on it. In short, you need to conduct a feasibility study.

What is a feasibility study?

•This is a systematic analysis of all factors that influence the probability of success of a specific undertaking. It is designed to determine whether a project is feasible, and if found feasible, to find out the degree of probability. It covers the market, technical, financial and management aspects of the business.

Parts of the Feasibility Study

• Chapter 1▫ Introduction▫ Statement of the Problem▫ Significance of the Study▫ Scope and Delimitation of the Study ▫ Definition of Terms ▫ Review of Related Literature and Studies

• Chapter 2▫ The Marketing Aspect

• Chapter 3▫ The Management Aspect

• Chapter 4▫ The Technical Aspect

• Chapter 5▫ The Financial Aspect

• Chapter 6▫ The Socio-Economic Aspect

Chapter 1

•Introduction States the brief history of the line of business

you are planning to start. States an introduction of your

product/business. States the reasons why you want to start the

business

•Statement of the Problem Enumerates the questions to be answered at

the end of the feasibility study Make atleast 3.

•Significance of the Study Enumerates the groups of people that will

benefit from the study.(atleast 3 groups of people)

States the reasons how and why they will benefit from your study.

•Scope and Delimitations of the Study This section states the focus of your study. This includes what you will and what you will

not include in your paper. You may include the products/services that you

will/will not offer in the business.

•Definition of Terms Defines terms used in your study, terms that

have specialized meanings which should be stated in order not to have multiple interpretations.

Example:Filmmaker. A person that directs or

produces a film.

•Review of Related Literature and Studies

Related Literature may be any article that can support the validity of your paper. Give atleast 3.

Relates Studies refer to any study/thesis that can be a good basis of your study. Give atleast 2.

Chapter 2- The Marketing Aspect This is considered as the most indispensable

part of a FS.

Objectives of the Marketing Aspect1. To enumerate the opportunities and threats of the business. 2. To classify the strengths and weaknesses of the company.3. To define the different factors in the external environment that is expected to affect business operations.

The Marketing Aspect

•Marketing analysis Why will your product/business be

successful? What situations will affect the success of your

project?

•Opportunities What are the special characteristics of your

product/ business?

The Marketing Aspect

•Threats What can be some problems encountered by

the business?•Strengths

How can the company compete with others?

•WeaknessesWhat can be the loopholes of your product/ business?

The Marketing Aspect

•Demand Analysis Why will the consumers patronize your

product? Are the consumers willing and have the

capability to pay for the product?•Supply Analysis

Who and where will your supply come from? Will there be enough supply to cater to your

demand?

Chapter 3- The Management Aspect This chapter deals with the organization and it is in this aspect that the proponents identify the key officers and key personnel, basic considerations in forming organization, form of ownership, organizational chart, project scheduling and perform job analysis.

Objectives:1. Identify the form of ownership to be adopted2. Know the project originators of the business3. Present job descriptions and job specifications of the business.

The Management Aspect

•Project Schedule Divides each part of the plan into activities

citing its covered period as well as the tasks expected to be finished in each activity.

Ex. Activity 1: Feasibility Study Preparation Period Covered: June- September 2014

▫In this period, the proponents spent their time collecting data through researches, surveys, interviews, observations and other possible ways to know the possible outcome and viability of the proposed product.

The Management AspectForm of Business Ownership

Sole/partnership/corporation

Internal Organization*Manpower/ Job Analysis-states the qualifications and requirements for a particular job

(job title, description and job specification)

Ex: Job Title: Accounting Officer Job Requirement:

-college graduate-atleast 6 months experience as accounting officer

Job Description:- handles the money received from day-t-day operation of the

business- supervises the preparations of the statement of account and

maintain the accounting records. Salary: 12, ooo php/month

Chapter 4- The Technical AspectThis part determines the technical soundness of a business. It gives all the details necessary for the business to operate.

Technical Specifications of the ProductWhat is the main product?What is it made of?Describe it physically together with its container (if,

applicable)

Raw MaterialsHow are the raw materials bought/gathered?Where do the materials come from? Why do you buy it from there?

The Technical AspectBuilding and Facilities

Where will the operation of the business be? House? Building?

Is it rented or owned? How much?Will it be bought or renovated? By how much?

Office and Plant LocationWhere exactly will the location be?

Chapter 5- The Financial AspectThis part shows the financial standing of the business and its viability in the market.

Objectives:Discuss the needed capital.Discuss the projected income of the business.Determine how many years it will take to recover

the investments.

The Financial AspectStatement of AssumptionEx:

1. Projected sales is 80% of the projected production budget.

2. Sales and purchases are on account.3. Account receivables are collected next month after

the sales.4. Accounts payables are paid next month after the

purchases.

State the Cash Flows of the business: • Capital• Expenses • Projected (Expected Income)

Chapter 6- The Socio-Economic Aspect

Ex:Employment and Income:

The proponents decided to hire workers in the vicinity of Tanay, Rizal which is also their target market. The business can benefit the families by giving appropriate amount of salary with favorable benefits that can help improve their standard of living.

GovernmentThe business will fulfill its obligation by paying

taxes promptly and accurately. Also, the business can help people in times of calamity by giving donations.

Chapter 6- The Socio-Economic Aspect

Ex:Community:

The community can benefit from the business for the owners can sponsor some of the community’s projects or have some scholarship grants.

Social ImplicationThe business will help generate the income for

the community and at the same time, cultivate creativity of the Filipino people.

Format• Font Style & Size: Calibri, 11• Spacing: 1.5• Alignment: Justified• Margin: Left:1.5” Right, Top & Bottom: 1”• Folder: ordinary,paper, short• –no slide, just staple

▫AC 2Y2-2 Yellow▫AC 2Y2-4 Blue▫AC 2Y2-1 Violet▫BM 2Y2-1 Red▫BF 2Y2-1 Brown

Coolfix Salonwhere grooming is a lifestyle

Proponents:Kara LopezAlvin JavierPSY 2Y2-1

Submitted to:Ms. Lhara Laureta

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