Five Aspects of

Feasibility Analysis
Five Aspects of Feasibility:
1. Market Feasibility
2. Technical Feasibility
3. Financial Feasibility
4. Economic Feasibility
5. Operational Feasibility
MARKET FEASIBILITY
Purposes for Market Feasibility:
1. to determine the extent to which
the product / service to be
generated is needed or
demanded; and
2. to design appropriate marketing
plans and strategies for the
project’s output.
Implications for Analysis:
 Hence, the quantity and quality of
the goods, services demanded, as
well as the trend over time of the
demand are surveyed.
 The levels and trend of supply are
similarly assessed to arrive at the
expected net demand.
 It is essentially towards the
expected net demand that the
project under consideration
should be directed.
Criteria for Market Feasibility:
1. magnitude of existing and
projected demand for the product
not covered by the current or
forecast supply;
2. Competitiveness of product with
respect to quality and price; and
3. Effectiveness of marketing
program and organization.
TECHNICAL FEASIBILITY
Purpose of Technical Feasibility:
 The purpose of the technical study
is to identify and analyze
alternative ways of carrying out
the project in terms of its size,
location, basic technical features,
resource requirements, & phasing
of implementation.
Implications for Analysis:
1. Cost for the alternative schemes are
estimated and compared.
2. In the case of agricultural devt
projects, this would involve
analysis of outputs and inputs of
individual farm units within the
project area through the use of
farm models.
3. This, in turn, leads to the
determination of the farm’s
operational and financial
feasibility through the use of
farm budgets.
Criteria for Technical Feasibility:
1. Size, location, and technology are
commensurate and appropriate to the
demand;
2. All technical features are reasonably
defined and found to be workable, &
adequate;
3. Input resources are available in the
required quantities and qualities; and
4. There is assurance that the
goods / services can be
produced in the quantities and
qualities required on a
continuing and dependable
basis.
FINANCIAL ASPECTS
Purpose and Implication for Analysis:
 The purpose of the financial study is to
determine the financial feasibility of the
project.
 Areas of investigation include a
comparison of the financial cost of project
implementation and operation with the
expected incomes over the project’s
lifetime.
ECONOMIC FEASIBILITY
Purpose:
 The purpose of economic
analysis is to determine the
project’s net contribution to the
national economic and social
welfare.
Implications for Analysis:
 This is done through a comparison
of the economic and social
benefits expected to be generated
from the project with the social
and economic cost of its
implementation and operation.
Criteria:
 The project is considered
economically feasible if after
proper discounting, the benefits
exceed costs.
OPERATIONAL FEASIBILITY
Purpose of Operational Feasibility:
 The purpose of the operational study
is to determine whether the project can
in fact be implemented and put into
operation, considering the political,
legal, organizational, managerial,
institutional, and other administrative
constraints which may impinge upon
the process of project implementation.
Criteria for Operational Feasibility:
1. Political acceptability and legality of the
project;
2. Adequacy of the organizational &
institutional arrangements for the project’s
implementation / operation; and
3. Availability and adequacy of resources for
the project’s implementation.
THE END