|Feasibility analysis is the process of determining the implementability of the proposed project. It is needed to take to take the final decision whether the proposed project is appropriate to commit (invest) resources or not. It examine the viability of the project through detail investigation. For this purpose, it requires a multi-disciplinary team consisting|
Since feasibility analysis is a series of studies and investigations to examine the project and its capacity to meets the objectives, the project is undertaken to implement if the analysis gives green signal of project success.
- Choice of technology.
- Design requirement.
- Human resource requirement.
- Size, location and geology.
- Technical risk.
- Legal provision related to technical collaboration.
- Production capacity of the project.
- Aggregate demand of customer.
- Consumption trend.
- Distribution channel.
- Level of competition.
- Sales forecasting and estimated revenue.
- Availability of required raw materials.
- Quality standard.
- Cost and price structure.
- Marketing policy and strategies.
- Capacity of environment to support the project.
- Resource management aspect.
- Environment impact assessment (guideline issued by government)
- It examine the positive and negative impact of the project on the environment.
- It focuses the impact of the project on flora-fauna, quality of air and water, scenic beauty, society, noise pollution, soil erosion, resource depletion.
Economic and Financial Analysis
Financial analysis is conducted to measure the financial sustainability of the project. It studies the adequacy of needed fund and proper settlement of the fund. Generally the technique capital budgeting are used in these analysis. However the areas of focus in this analysis are:
- Total capital requirement
- Source of fund
- Projected cash flow
- Accounting and reporting system
- Projected profitability
- Break Even Point (BEP)
i) Form of the project Organization:
- Appropriateness of the organizational structure.
- Relationship of authority and responsibility.
- Communication system.
- Personal availability and their experience, qualification.
- Job description.
- Need of training.
- Relationship with stakeholders.
- Relationship with functional department.
- Relationship with regulatory agencies.
- Required cost and resources.
- Estimated time schedules.
- Quality standard.
- Use of planning and controlling techniques.