Generation and Screening of Project Ideas Generation of Ideas Stimulating Ideas SWOT Charting Clear Objectives Cost Reduction

Productivity enhancement Increase Capacity Utilization Improvement in contribution margin Expansion into promising fields Fostering a conducive climate Monitoring the Environment Economic Sector Government Sector State of the Eco Ind Policy Rate of GDP Growth Govt Prog Cycle Tax regime Workd Economy link Subsidies, Incentives Fiscal n Trade Surplus Exim policy BOP Financing norm Supplier Sector Liquidity Availability and cost of raw materials Availability and cost of energy, telecom, manpower Capital, Ancillary units Corporate Appraisal A realistic appraisal of firm's strngth and weaknesses Marketing and Distribution Production n Operation Mkt image Condition n Plnt cpty Product lmage RM, Power, sub assembly Mkt Share Dgre of Vertical Integ Distribution network -ration Customer loyalty Location Mkt n Distribution cost Cost Structure

Technology Sector New Tech Collaboration Socio- demographic Population, Age Income, Education Women employment and empowerment Consumption/investment

Competition Sector # of firms and mkt sh of top 4 Product Differentiation Entry Barriers Quality,Price,Appeal functionality of product Mktg Policy n Practices

R&D R&D capacity of firm Track record of new R&D Lab and testing facility Coordination between R&D and Operations

Corp Resources n Manp Corp Image Clout with authorities Dynamism of top mgmt Competence and commit ment of employees State of Industrial Labour Relations

WACC

Finance and Accounting Financial Leverage and borrowing capacity Tax rate Shareholder Relation and Creditors relation

Accounting and control system Cash Flows and Liquidity

Tools for Identifying Investment Opportunities Porter Model Threat of New entrants Heavy Initial Investment Economies of Scale Control over distribution channel High switching cost Monopoly and govt policy Rivalry among existing firms # of competitors Firms capable of sustained competative battle Industry growth sluggish High FC pressure to increaee capacity utilization Overcapacity Price competition High Exit Barriers Life Cycle Approach Pioneering Stage Rapid Growth Stage Maturity and Stabilisation Stage Declining Stage

Pressure from substitute products Price-Performance trade off of substitute product is attractive. Low Switching Cost Substitute product firm very profitable Bargaining power of buyers Price cut, better service and induce competition among vendors, depress profitability Don't sell too much to one buyer Low switching cost Easy backward integration Bargaining power of sellers Raise RM Price, lower quality, curtain service Few Suppliers No strong substitute product High Switching cost for buyers

The Experience Curve Learning Effect Technological Improvement Economies of Scale Scouting for Project Ideas Analysing the performance of existing industries Review of Imports and Exports Govt Plan outlays Suggestions by Financial Institutions and Developmental Agencies Investigate Local materials and Resources Analyse economic and social trends Study new tech developments Draw Cues from consumption abroad Explore possibality of reviving sick units Identify unfuilfilled Psychological needs Attend Trade Fairs Stimulate Creativity for Generating New Product Ideas Modification, Rearrangement, Reversal, Magnification Reduction, Substitution, Adaptation, Combination. Hope that you chance upon a project idea. Preliminary Screening Compatability with Promoter Legal Availability of Inputs, Expertise Availability of Market Cost Risk Project Rating Inxed Sources for Positive Net Present Value Economies of scale Product Differentiation Effective Advertising and superior marketing Exceptional Service Innovative Product Features High Quality and Dependability Cost Advantage Marketing Reach Technological Edge Fiscal Barriers, Taxation, Entry Restrictions On Being an Entrepreneur Willingness to make sacrifice Leadership Decisiveness Confidence in the Project Marketing orientation Strong Ego Open Mindedness

Competition Sector # of firms and mkt sh Product Differentiation Entry Barriers Quality,Price,Appeal functionality of product Mktg Policy n Practices

Corp Resources n Manp Corp Image Clout with authorities Dynamism of top mgmt Competence and commit ment of employees State of Industrial Labour

g and control system Cash Flows and Liquidity

m substitute products ance trade off of substitute

duct firm very profitable ower of buyers er service and induce competition s, depress profitability much to one buyer

ower of sellers e, lower quality, curtain service

g cost for buyers