Feasibility Analysis

BBA- VI
CAMPION COLLEGE
 Feasibility Analysis
- Process of evaluating the future of a project idea
within the limitations of project implementation in
a practical way. It mainly covers the following:
- Product/ Service feasibility
- Industry/ Target Market Feasibility
- Organizational Feasibility
- Financial Feasibility
 Product/ Service Feasibility
Assessment of overall appeal of the product.
-Crucial Technical -Machine and Tools
Specifications -Instruments
-Design - Work flow
-Durability -Product Development
-Reliability - Blueprints
-Product Safety - Models
-Standardization - Prototypes
-Engineering - Product Testing
requirements - Plant Location
 Product/ Service Feasibility
To confirm that the proposed product/ service is desirable and serves
a need in the marketplace.

1. Product/ Service Desirability:

a. A description of product/ service
b. The Intended Market Share
c. The benefits of the product/ service
d. Company’s position
2. Product/ Service Demand:
a. Buying Intentions Survey
b. Library, Internet, and Gumshoe Research
 Industry/ Target Market Feasibility
Portion of the industry which it wants to appeal

- Market Potential -Selection of test

- Identification of - Actual market test

potential customers - Analysis of market

-Potential market shares - Market planning

- Sales Price Projections issues

- Market testing - Packaging

- Price differentiations
 Industry/ Target Market Feasibility
Assessment of the overall appeal of the industry

• Two Primary Components

1. Industry Attractiveness
- Younger
- In early life- cycle
- Growing
- Not crowded

2. Target Market Attractiveness

 Organizational Feasibility
To determine whether a proposed business has sufficient management
expertise, organizational competence, and resources

- Personal - Determination of
requirements organizational
responsibilities
- Required skill levels
- Potential organizational
- Managerial
development
requirements
- Competitive analysis
- Determination of

individual responsibilities
 Organizational Feasibility
To determine whether a proposed business has sufficient management
expertise, organizational competence, and resources

•Two Primary Components

1. Management Ability
- Passion
- Understanding of the market
- Management Culture
- Robust

2. Resource Sufficiency
- Specialized skills
- Adequate labor pool
 Financial Feasibility
- Required financial -Potential sources for
resources funds
-Fixed and Current - Cost of borrowing
assets - Repayment Conditions
-Necessary working - Operation Cost
- Available financial Analysis
resources - Fixed and Variable
- Required borrowing Costs
- Projected Cash Flow
- Projected Profitability
 Financial Feasibility
1. Total Start- up cash needed
a. Cost of Production
b. Cost of Financing
c. Cost of FA/ CA
d. Cost of Intangible Assets
e. Cost of Developing Business
2. Financial Performance of similar business
3. Overall Financial Attractiveness of the
Proposed Venture
* Table 3.3
 Sample Feasibility Study 1
• Pg. 94
• Pg. 97
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