FEASIBILITY STUDY General Format & Content Guide

Preliminary Section
a. Title Page
b. Approval Sheet
c. Acknowledgment
d. Table of Contents
e. List of Tables
f. List of Figures

Executive Summary
Project Proponents
Proposed Name of the Business
Type of Business Organization
Location of Head Office and Factory
Market Feasibility
Technical Feasibility
Management Feasibility
Financial Feasibility
Socio-Economic Feasibility

Chapter I - Introduction
Background of the Study/Rationale of the Study
Statement of the Problem/ 5 Questions
Scope and Limitations
Significance of the Study
Definition of Terms

Chapter II – Market Aspect

Brief Chapter Description
Demand Analysis (results of the market survey)
Supply Analysis (results of the market survey)
Demand and Supply Analysis
Industry Update (current market situation & industry, facts and Figures)
Competition or Competitors Profile (Major Players of the Industry)
Market Analysis (Opportunities and Threats)
Marketing Strategy
Product Strategy
Place/Placement Strategy
Price Strategy
Promotion Strategy
Timetable of Action Plans/Marketing Activities

Chapter III – Technical Aspect

Brief Chapter Description
Product/Service Description
Production Process/Service Process (narrative)
Operations Flow (illustration)
Production Schedule
Project Site ( with vicinity map)
Project Layout (Plant or Factory layout)
Site Development Plan
Building and Facilities
Floor Plan
Electrical Plan
Plumbing Plan

Manpower Requirement (Technical only)

Machineries and Equipment

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FEASIBILITY STUDY General Format & Content Guide
Raw Materials
Utilities
Waste and Waste Disposal Methods
Legal Requirements (pre-operation and operating period)

Chapter IV – Management Aspect

Brief Chapter Description
Company Vision and Mission
Company Goals and Objectives
Form of Business Organization
Organizational Structure
Job Description and Specification
Management Policies, Rules and Regulations
Management Control System

Chapter V – Financial Aspect

Brief Chapter Description
Total Project Cost
Source of Financing
Financial Assumptions
Projected Financial Statements
Projected Statement of Comprehensive Income
Supporting Notes/Schedules
Projected Statement of Financial Position
Supporting Notes/Schedules
Projected Cash Flow Statement
Supporting Notes/Schedules

Financial Ratios and Analysis (Quantitative & Qualitative)

A. Ratio Analysis
Solvency Ratios and Analysis
Profitability Ratios and Analysis
Liquidity Ratios and Analysis
B. Investment Analysis
Net Present Value
Internal Rate of Return
Payback Period
C. Break Even Point Analysis

Chapter VI – Socio-Economic Aspect

Brief Chapter Description
Social Desirability
Economic Contribution/Implication

Chapter VIII – Project Plan Implementation

Functions/Duties and Responsibilities of the Proponents
Gantt Chart/PERT-CPM

Chapter VII – Conclusion and Recommendations

Conclusion (by Aspect)
Marketing
Technical
Management
Financial
Socio-Economic
Recommendations (as a whole)

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FEASIBILITY STUDY General Format & Content Guide

Executive Summary
(Present rich support on each aspect to show that the business is feasible.)
Project Proponents
Name of the proponent-researchers
Proposed Name of the Business
Name of the business and brief description of the name as to how it was chosen or how it was derived.
Type of Business Organization
State whether the business is a sole proprietorship, partnership or corporation
Location of Head Office and Factory
The location of the factory, if it is a manufacturing type of business, or the location of the warehouse/s if
the business set-up so suggests, is to be indicated here.
Market Feasibility
Highlight on:
The availability of demand and surplus of market demand over market supply (potential buyers of the
products/services)
Marketing edge over other competitors with respect to product, place, promotion and pricing.
Result of the market study (market profile: demographic, biographical, and psychological data)
Technical Feasibility
Highlight on:
Availability of raw materials and cost (in the locality)
Availability of manpower/skill and cost
Availability of machineries and equipment and cost
Capital outlay for facilities (buildings or structures) is within budget
Management Feasibility
Highlight on:
Attainability of VMGO
Management Policies, Rules and Regulations
Financial Feasibility
Highlight on:
Solvency
Profitability
Liquidity
Socio-Economic Feasibility
Strike on the social desirability as can be perceived by the majority of people. Stress on major impact or
contribution it would make to the people. Strive to emphasize on intangible aspects of the project. Try to
relate how the present project would invigorate commercial activities or spur economic initiatives.

Chapter I - Introduction

Background of the Study/Rationale of the Study (see Lecture)

Provide literature reviews on the business, current market observations or trends and rationale for
selecting or choosing the kind of business.
Statement of the Problem
Draw comprehensive questions on each of the five major chapters of the study, that is, marketing,
technical, management, financial, and socio-economic aspects.

Scope and Delimitations

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FEASIBILITY STUDY General Format & Content Guide
Observe the suggested content. It is advised that variables selected and determined for the study,
sources of data, method(s) to be used in data gathering and analysis, timeframe, and constraints that
might be encountered in the conduct of the investigation.
Significance of the Study
Identify individuals, groups or organizations who/which can directly gain from the conduct of the study
and clearly rationalize how each would be benefited.
Definition of Terms
Define concepts or terms which are highly technical or scientific in nature and which are mentioned in
the manuscript of the study. Other terms may be conceptually defined if necessary illumination and
understanding of the readers is desired.

Chapter II – Marketing Study

Brief Description of the Chapter

State the content of the chapter or what can be read in the whole chapter.

Objectives of the Market Study

Research Methodology

Results and Discussion

Demand Analysis
Present past demand data. Past data refers to secondary data readily obtainable from private
organizations and government agencies related to sales of a particular product or services in a particular
period of time. These data are also called as service statistics. In its absence, present demand data
through survey may be opted and result from the same shall be presented and discussed.

The past data relates to product consumption evidenced by sales records of a business entity similar to
the proposed business feasibility study.

In the absence of past demand data, present demand data may be obtained or studied.

In-depth analysis and sensitivity analysis of the demand and supply values would be desirable to be
provided. Factors that may affect the demand and supply or the interaction of the market forces may
very well animate the discussion.

Tabular presentation with corresponding narrative discussion or explanation is desired.

Table 1.1 Demand of Mangoes for Year 2011-2015 (in tons)

Year Local Foreign Total

Fresh Dried
20011 12,040 6,088
20012 12,989 8,123
20013 13,877 9,987
20014 14,689 10,766
20015 15,399 12,131
Source: Bureau of Agricultural Statistics, Guimaras

Supply Analysis

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FEASIBILITY STUDY General Format & Content Guide
Present past supply data. Present supply data may suffice the absence of past supply data.

Table 1.1 Supply of Mangoes for Year 2003-2008 (in tons)

Year Local Foreign Total

Fresh Dried
2003 12,040 6,088
2004 12,989 8,123
2005 13,877 9,987
2006 14,689 10,766
2007 15,399 12,131
Source: Bureau of Agricultural Statistics, Guimaras

* Present data that relate to purchase volume, size, and frequency.

(see Lecture)

Demand and Supply Analysis

The demand and supply analysis provide an illustration that demand exceeds supply. It is important to
show that demand overwhelms supply or potential demand is expected in particular period or
forthcoming period. Certainty and details may be shown.

In this section, the past demand and supply are shown and projected. Several methods are available. (see
Lecture)

Year Demand Supply Demand-Supply Gap Percent

Unsatisfied
(D-S/D)
Fresh Dried Fresh Dried Fresh Gap
2017 12,040 6,088 10,653 5,455
2018 12,989 8,123 10,990 6,773
2019 13,877 9,987 11,568 8,913
2020 14,689 10,766 12,543 9,443
2021 15,399 12,131 13,881 10,229
2008
2009
2010
2011
2012

As mentioned, in the absence or in supplement of the past demand and supply data, discussion of the
results of the market survey as to present market demand and supply data may be presented.

Industry Study and Update

Researcher should be able to identify which industry category the business belongs. In addition to this,
current economic features, market size and growth rate, geographic scope, number of sellers and buyers,
pace of technology change, competitive forces, and drivers of change should be given attention in the
local setting and abroad.

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FEASIBILITY STUDY General Format & Content Guide
Competition or Competitors Profile
Attention should be focused on the local competitors or those competitors who would have direct effect
on the slice of demand of the product or service of the business within the range or magnitude of the
target market identified. Their company size, both structural and financial, should be noted. Careful
discussion of their capabilities for expansion, their manpower strengths (i.e., managers or consultants),
their innovative strengths and weaknesses are essential key points.

Proposed Marketing Program

Product Strategy
State or describe the unique features of your product that will make the buyers prefer it over the
competitor’s product. Strike on the utility or functionality feature of the product, packaging sizes
and design.

If the product is agricultural, describe its quality, usage, and benefits one may derive from its
consumption. If the product is processed, special ingredients and its benefit may be mentioned.

If the product is technology-related, describe features as to its functionality and how different or
unique or what sets apart the product from the competitor.

The product category as to product-mix width (number of product) and product-mix width
(number of items per product line) may be noted if it is not demands importance to the study.

Brand names to be adopted if required should be stated. Packaging details as to size, packaging
materials (plastic, carton, etc), and labeling and design (font style, size, and color) are essential to
be noted.

Place/Placement Strategy
Describe why is the place chosen. (Are the bulk of consumers present in the locale?)
Describe how the product will reach the consumers or buyers.
Describe the channel of distribution from the: manufacturer to consumer, manufacturer to
retailer to consumer, manufacturer to wholesaler to retailer to consumer)
Describe the storage space and indicate if it is owned or rented.

Price Strategy
Explain or provide basis for the product pricing (if it based on manufacturing cost, competitor’s
pricing, seasonality, based on quality, legal laws, etc.).

Likewise explain why the product is higher (if it is priced higher) than the competitors or why it is
lower (should the case be).

Some reasons for high costing are that the product/s is/are designed for high-end consumer and
its (quality) make or craft. Lower pricing may be due bulk buying discounts or designed for low-
end consumers.

Pricing incentive scheme or strategy may likewise be discussed.

Promotion Strategy
Present the plan how the product will be made known to the consumer.
How the product will be conveyed? (Will it be through internet, broadcast, radio, mail, posters,
sales presentation, market demo, free samples, gifts, contest sponsors, calendar, leaflets, etc)

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FEASIBILITY STUDY General Format & Content Guide
Present the schedule of promoting the product and how much will be paid for each of the
promotional or advertising activity. Specify if there are promotional schemes available like cash
discounts, volume purchase discounts, or membership discounts.

Timetable of Action Plans/Marketing Activities

Indicate the Marketing Action Plans or Activities. A combination of narrative discussion and tabular
presentation would be desirable.

Chapter III – Technical Aspect

Brief Description of the Chapter

State the content of the chapter or what can be read in the whole chapter.

Product/Service Description
A detailed description of the product as to dimension, composition (mechanical, chemical, physical
properties), and quality specifications.

Agricultural products can be described as to its scientific names, specie, color, size, weight, and other
distinctive qualities. Its intended utilization or major use may be expounded and major consumers may
be specified.

Technological products can be described as to its modifications or unique or particular feature which is
not present or exceeds the competitor.

Service products can be described as to the service intended to provide, the system of providing the
service, the designs or the materials to be used.

Drawings, pictures, photo and others means of illustration may be provided.

Production Process/Service Process (narrative)

Describe the steps in the production process. Cite the equipment used in each step and its corresponding
capacity or the input quantity that can be processed in a period of time. Consider also the maintainability
of equipment and availability of spare parts.

If no equipment will be used, estimate the capacity of input one worker can process can or may permit in
a period of time.

For service-oriented business, describe in detail the process from beginning to completion of the service.

Operation Flow
A particular operation in the conduct of business or service should be illustrated for this purpose. (A
flowchart with description or explanation may be provided)

Production/Service Schedule
A. Manufacturing
For agricultural endeavors, state the intended volume or number of product to be produced per
season or time period appropriate for the kind of venture.

B. Trade
State the desired output per appropriate time basis (per hour, per day) with consideration of the
machine capacity.

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FEASIBILITY STUDY General Format & Content Guide
Project Site (Store, Plant or Factory Site)
Provide the complete address of the site and total area size. State the factors why is/was the site chosen.
Discuss its conduciveness for service or production of the product. Elaborate on future expansion
potential.
Several reasons may be cited as it would specifically apply to the choice of the project store or plant site,
hence:
1. Accessibility – paved road/road network
2. Suitability to the kind of business (e.g. vegetation) or availability of factors (e.g. irrigation,
water supply)
3. Climate
4. Land/undivided tract of land
5. Proximity to market
6. Visibility
7. Geographical advantage to competing firms
Provide the vicinity map here.

Site Development Plan (with Store, Plant or Factory Layout)

Provide the details of developments planned or viewed to be necessary. Make sure that costing is
reflected in the project cost. Depreciation expense should it be recorded or treated as Organizational
Cost need to be recorded in the financial statement.

Scaled drawing or illustration of the perspective view (front, rear, side: left and right, and aerial) should
be provided or as deemed necessary.

For presentation, the following should be present. Costing of the same should be incorporated in the
total project cost.

1. Building and Facilities

2. Floor Plan
3. Electrical Plan
4. Plumbing Plan

Legal Requirements
State the prerequisite or essential requirements before the establishment or putting up of the business
and the legal requirements during the operating period. Data with particular attention to requirements
and sequence or order of obtaining the licenses or permits should be given importance. Corresponding
cost per licenses or permits may be provided. Table is suggested for presentation.

Machineries and Equipment

Present the machineries and equipment and the corresponding usage. A picture or illustration should be
provided for each of the items. The table below may be utilized for the said purpose.

Name Picture Description Quantity Unit Cost Total Cost

(use, rated
capacity)

In the appendices, indicate the machineries and equipment, the price, and where it was canvassed.

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Utilities
State what particular utilities will be needed and why such will be required.

For electrical consumption, provide a listing of equipments to be used. The computation of the kilowatt
costing using an electric cost factor below may be used and should be reflected on the appendice.

*Kilowatt consumption per hour/1000kw = computed consumption x factor x no. of hours used for a day

Table below for the same may be adopted or modified.

No. Description (Machinery or Kilowatt per Estimated Hours Total

Equipment requiring electricity) Hour Consumed per Consumption
Consumption month per Month
1
2
3

For water consumption, estimated usage per cubic meter may likewise be drawn through the table. Rates
per cubic meter consumption may be obtained from the current local water provider.

Monthly rates and additional communication cost estimates can also be provided with the use of table.

Raw Materials
State what raw materials or supplies would be needed for the completion or processing of the products
or services. The use of table noting each description (or additional illustration through drawings or
pictures if available), usage or purpose to the completion of the product, and other essential information
may be described or provided.

Manpower Requirement
State the number and description How many and what particular jobs are needed or required. State
whether there would be a need for staff training. State what a particular skills are needed. State basis for
the salarization of staff.

Waste and Waste Disposal Methods

Mention the description of waste products, volume, schedule or time of disposal, site of disposal, and the
means of disposal. Likewise mention provisions for waste disposal site or recovery site. Should there be
treatment to waste, the process or method of the same should be elaborated. Corresponding costs for
the activity (cost of design, cost of infrastructure, and cost of treatment) should not be overlooked.
Architectural design or illustration should be provided for the purpose.

In cases wherein waste products can be used for other purposes or can be sold, estimates as to volume,
estimate or current pricing, and realizable earning should be cited through the narrative or the use table.

*Make sure that the disposal method adheres to what the law prescribes or that it will not be inimical to
society or community where the business operates.

Chapter IV – Management Aspect

Brief Description of the Chapter

State the content of the chapter or what can be read in the whole chapter.

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FEASIBILITY STUDY General Format & Content Guide

Company Vision and Mission

State here the vision and mission of the business.

Company Goals and Objectives

State here the goals and objectives of the business.

Form of Business Organization

Describe the form of business organization (single, partnership, corporation, cooperative) and its
advantages or the reason why it was chosen.

Organizational Structure
Provide an illustration of the organization structure. A brief description may be provided to describe the
relationships.

Job Description and Specification

Describe the particular job descriptions and specifications of each of the particular positions cited in the
organizational chart.

Management Policies, Rules and Regulations

State the designed policies, rules and regulations distinctively.

Management Control System

Describe the system of managing attendance, time-recording (logbook maintaining), job evaluation, merit
rating, employment testing and others. Transactional process illustration may be provided.

CHAPTER V
FINANCIAL STUDY

Objective of the Financial Study

Total Project Cost
Provide here the investment pertaining to the pre-operating procurement of machinery and equipment,
the site development, the organizational cost (relating to costs spent to licenses and other statutory
requirements), and other relevant pre-operating costs.

Source of Financing
State the source of financing or who will or are to finance the establishment of the proposed business.
State also alternative sources of financing and the amount and terms of financing.

Financial Assumptions
Present the cost and sales assumptions as to increases and decreases in each of the items within the
period five (5) years.

Financial Statements
Projected Statement of Financial Position
Projected Statement of Comprehensive Income
Projected Cash Flow Statement

Financial Ratios and Analysis

Provide at least 5 essential analysis tools for each of the ratios and the corresponding explanation.
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FEASIBILITY STUDY General Format & Content Guide

Solvency Ratios and Analysis

Profitability Ratios and Analysis
Liquidity Ratios and Analysis
Break Even Point Analysis
Payback Period
Net Present Value
Internal Rate of Return

Chapter VI – Socio-Economic Aspect

Social Desirability
State here the benefits other than what the employees and government may derive from the operation
of the business. Describe its impact on population, market activities, infrastructure, landscape, ecology
and others.

Economic Contribution/Implication
Present here the monetary benefits the employees may obtain for working in the project. Table for this
purpose may be used. Describe the effect of these benefits in their standard of living, purchasing power,
improved recreational needs, and others. The table for project employees and the government may be as
follows:
For employees:
Year Salaries Allowances Incentives Total
1st
2nd
3rd
4th
5th
Total

For government:
Year Income Tax Licenses/Permits Other Fees Total
1st
2nd
3rd
4th
5th
Total

Chapter VII – Project Plan Implementation

Gantt Chart (or PERT-CPM)

Present here the activities through the use of Gantt chart beginning from the project conceptualization to
dry-run and start of normal operations.
Functions/Duties and Responsibilities of the Proponents
State the functions of individuals or proponents during the pre-operating period in relation to the
activities identified in the Gantt chart.

Chapter VIII – Conclusion and Recommendations

Conclusion (by Aspect)

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FEASIBILITY STUDY General Format & Content Guide
Highlight particularly on the strengths on each of the aspects to strengthen claim of the proposed
business feasibility.

Marketing
Technical
Management
Financial
Socio-Economic

Recommendations (by Aspect or as a whole)

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