Enterprise- Project selection analysis

Presentation by
S S Narahari
Programme Manager
CED

Market feasibility
Technical feasibility
Financial feasibility
Economic feasibility
Ecological feasibility

Before starting any business, it is the
foremost and important point to analyze
the capabilities of the promoter’s to with
stand the gestation period of the business.

Analyze market
What would be the aggregate demand of
the proposed product in future?
What would be the target market.
What would be the market link

 Situational analysis
 Customers analysis – who are the buyers
of the product
_ Current Demand of
the Product
_ Customers willing to
Pay
 Competitors analysis_ Price and Warranty
 Channels of Distribution -Middle Man
 Others in the Industry

 Already available data
 Publications
 Industries surveys
 Annual reports
 information from Government departments

 Conduct Market Survey
 understand each target ( Industrial consumers/ Domestic
consumers)
 Understand the value and potential of each target
 which are the easiest to sell and most profitable
 Prioritize your target market
 Understand the Price
 Mfg price
 Landed price ( BEP)
 Avg Whole sale
 Avg Retail

 Mfg Process and technology
 Product mix
 Plant capacity
 Location and site
 Material Input and utilities
 Machinery and equipment
 Structures and civil works
 Project charts and civil works
 Project implementation schedule
 Environmental aspects

Steel can be made several methods
Cement can also made with dry process or
wet process
Paper can be made with by using sevarla
methods
Handlooms can be made with Pitlooms or
handlooms

Principal Inputs: Some times Raw material
plays Vital role
Latest developments in technology
 Technology with indigenous inputs may be or mostly preferred
 The technology adopted must be proven by successful use by
other units
 Appropriate Tech
 Whether tech is utilizes local RM/ Man power
 Technology produces matching the local needs?

Product mix is guided by market
requirements, size and quality of the item
is aimed at satisfying a broad range of
customers
Ex. Soap mfg with different sizes/ prices
/RMs.

Volume and number of units that can be
mfg during given period
 factors
 Technological requirements
 Input constraints—Power supply, RM availability ,Foreign Exchange
 Investment costs_
 Market Conditions-
 Resources of the firms- Managerial and Financial
 Government polices _ Atma Nirbhala Bharat

Location and Site
 Proximity to RM
 Markets
 Availability of Infrastructure
 Government policies

 Availability of Infrastructure
 Availability of Power
 Transportation
 Water
 Communication
Government policies
 Backward areas
Subsidies
Incentives

Pollution Control
Labour Situation- availability of Labour, skill, semi skill, un
skill etc, Labour rates,
Climatic condition.
General Living Conditions

Choosing the supplier
Quality of the machinery
Delivery schedules
Payment terms
Performance guarantees

Site preparation and development
Building structures
Outdoor works

Cost of the project
Means of finance
Eastimates of sales and production
Cost of production
Working capital requrments
Profitability projection
Projected cash flow
Projected BS

Land and site building cost
Plant and machinery
Miscellaneous fixed assets
Pre operative expenses
Working capital
Initial cash losses

A. Cost of production
B. Total Administration expenses
C.Total sales expenses
D.Royalty etc payable
Total Cost of Production (A+B+C+D)
Expected Sales
Gross profit before interest

Enterprise- Project selection analysis

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