POWER POINT MATERIAL PREPARED BY LECTURER: AHMED EL RAWAS Lecturer.Ahmed El Rawas 1 Feasibility study

Grading system Lecturer.Ahmed El Rawas 2 30% for 7 th week exam 40 % for final exam 20% for the project 10% for attendance and participation

success Lecturer.Ahmed El Rawas 3 Any successful project, company, factory, individual based on three main factors Technicality ( the main factor, the knowhow, talent) Finance marketing

What is project cycle Lecturer. Ahmed El Rawas 4 The planning process of developing a new product, idea or service has been described in many ways. Here we look at the project cycle through these five phases: Identification: Preliminary idea creation,, pre-feasibility studies, ( identify the phenomena ). Deliberation: conducting feasibility studies, decision to proceed with the project. Implementation: business plan. Securing capital, construction, obtaining permits, hiring management. Operation: Mobilization of manpower, equipment and materials to carry out the plan. Evaluation: Determining what worked and did not work (in preparation to plan again).

INTRODUCTION 5 Chapter (1) Lecturer. Ahmed El Rawas

chapter content 6 1. Overview and definition of the feasibility study 2. What is executive summary? 3. Why Are Feasibility Studies so Important? 4. The Components of a Feasibility Study 5. Feasibility study main points Lecturer.Ahmed El Rawas

Feasibility study overview 7 FEASIBILITY STUDIES A feasibility study is the process that every person or company should do before starting any project. A well prepared and researched study could save hundreds of thousands of dollars further down the road. A successful feasibility study may be accepted or rejected. Lecturer. Ahmed El Rawas

Feasibility study overview It helps avoid risk and answers questions, like: Will it work ? How will it work ? What is needed ? When is the best time ? How much investment is needed ? What will the return be ? Lecturer.Ahmed El Rawas 8

Definition of Feasibility Studies 9 A feasibility study is a study looks at the viability of an idea with an emphasis on identifying potential problems and attempts to answer one main question: Will the idea work and should you proceed with it? Before you begin writing your business plan you need to identify how, where, and to whom you intend to sell a service or product. You also need to assess your competition and figure out how much money you need to start your business and keep it running until it is established Lecturer.Ahmed El Rawas

Feasibility Study vs. Business Plan A feasibility study is not a business plan. The separate roles of the feasibility study and the business plan are frequently misunderstood. The feasibility study provides an investigating function. It addresses the question of “Is this a viable business venture?” The business plan provides a planning function. The business plan outlines the actions needed to take the proposal from “idea” to “reality.” Lecturer.Ahmed El Rawas 10

(2)Executive summary 11 Is a term used in business for a short document that summarizes a longer report, proposal or group of related reports in such a way that readers can rapidly become acquainted with a large body of material without having to read it all. It will usually contain a brief statement of the problem or proposal covered in the major document(s), background information, concise analysis and main conclusions. It is intended as an aid to decision making by business managers. Lecturer.Ahmed El Rawas

Difference between Executive summary and Abstract 12 An executive summary differs from an abstract in that an abstract will usually be shorter and is intended to provide a neutral overview or orientation rather than being a condensed version of the full document. Abstracts are extensively used in academic research where the concept of the executive summary would be meaningless. Lecturer.Ahmed El Rawas

(3) why is feasibility study so important? 13 The information you gather and present in your feasibility study will help you: List in detail all the things you need to make the business work. Identify business-related problems and solutions. Develop marketing strategies to convince a bank or investor that your business is worth considering as an investment. Serve as a solid foundation for developing your business plan. Even if you have a great business idea you still have to find a cost-effective way to market and sell your products and services. Lecturer.Ahmed El Rawas

14 Market Feasibility: Includes a description of the industry, current market, anticipated future market potential, competition, sales projections, potential buyers, etc. Financial Feasibility: Projects how much start-up capital is needed, sources of capital, returns on investment, etc. Lecturer.Ahmed El Rawas (4)The Components of a Feasibility Study

The Components of a Feasibility Study 15 Organizational Feasibility: Defines the legal and corporate structure of the business (may also include professional background information about the founders and what skills they can contribute to the business). Technical Feasibility: Details how you will deliver a product or service (i.e., materials, labor, transportation, where your business will be located, technology needed, etc.). Production process includes input, processing and output. Lecturer.Ahmed El Rawas

Technical study includes 16 1-Technology and operational This involves questions such as whether the technology needed for the system exists, how difficult it will be to build, and whether the firm has enough experience using that technology. The assessment is based on an outline design of system requirements in terms of Input, Processes, Output, Fields, Programs, and Procedures. This can be quantified in terms of volumes of data, trends, frequency of updating, etc in order to estimate if the new system will perform adequately or not. Lecturer.Ahmed El Rawas

Technical study location analysis. Location analysis typically involves testing geographic locations for a real estate development project, and usually involves real estate land. Market Feasibility take into account the importance of the business in the selected area. Lecturer.Ahmed El Rawas

Technical study includes 18 3-Resource availability This involves questions such as how much time is available to build the new system, when it can be built, whether it interferes with normal business operations, type and amount of resources required, dependencies, etc. 4-Culture In this stage, the project's alternatives are evaluated for their impact on the local and general. an enterprise's own culture can clash with the results of the project. Lecturer.Ahmed El Rawas

Financial study includes 1-Financial statements includes balance sheet, income statement and cash flow statement. 2-Financial ratios. Includes liquidity, profitability, efficiency and capitalization ratios 3-Source of finance ( loans or equity ) 4-Appraisal methods. ( Pay back period, IRR, NPV) Lecturer.Ahmed El Rawas 19

Marketing study includes What is marketing study? 2. What is marketing Mix? 3. What is market structure? 4. What is the Product-Market Growth Matrix? 5. What is SWOT analysis? 6. What is competitive profile? 7. What is market segmentation? 8. What is customer analysis? Lecturer.Ahmed El Rawas

Organizational study includes 1-Describe basic organizational design and organization chart 2-Describe the human resources availability, recruitment and training needs, and the reasons for the employment of foreign experts, to the extent required for the project 3-Indicate key persons (skills required) and total employment (numbers and costs) 4-include professional background information about the founders and what skills they can contribute to the business 5-manning table Lecturer.Ahmed El Rawas 21

Introduction of the project includes Title/ name of the project Vision and mission statement Project objectives Estimated budget Country review Project background/ industry outlook Source of information table of references Lecturer.Ahmed El Rawas 22