Feasibility Studies

Posted By: FinXcel a year ago

A feasibility study is a preliminary stage project assessment to determine its viability. It involves market analysis, financial and technical ascertainment of the project. Feasibility study assist investors to evaluate cash flow generation to ensure stability of a new business or expansion in an existing business

Why it is necessary to conduct Feasibility Study?

Due to rapid change in the Technology that counts on innovation, existing business operations can obsolete due to a competitive market. Further, financial and market analysis that presents competitors’ behavior, consumer trend, funds management, cost of doing business, gestation period, pertinent laws or regulations and other like factors shed an essential light over project to operate successfully.

Consumer preferences changes with new product choices and cost vis-à-vis quality matrix, that could classify even a well-known brand under a category of Question Mark / Dog Products in BCG Matrix. Therefore, before making an investment decision, above stated considerations is a key for any investor to start a new venture/project.

Phases of Feasibility Study

Market Analysis

This phase involves market study of below factors:

  • Prevailing and future market conditions.
  • Comparison of product/service to launch with the existing products/services, in terms of features, pricing, delivery channels, consumer response and value addition for target customers.
  • Dominant market players, and bridging gap with their strengths and weaknesses.
Technical Analysis

This phase is premised on the analysis of following technical factors:

  • Hardware / Software requirement.
  • Manpower requirements of skilled and unskilled labor.
  • Capital assets requirement.
  • Accommodation of business expansion in existing facilities.
Schedule Stage

At this phase, the time frame to establish a project is determined. Timeline to render a project successfully operational is crucial due to the dynamic nature of the business environment, so any unusual delays can entirely change the basis on which detailed feasibility study conducts

Financial Study

This phase is premised on the analysis of following technical factors:

  • Cost of start-up and legal expenditures
  • Profitability and expected Return on Investment (ROI).
  • Capital and operational cost.
  • Cash inflows/outflows.
  • Means to generate finance and financing costs.

How we stand out as an Expert Project Viability Analyst

We understand that each phase (Market, Financial and Technical Phases) of a feasibility study necessitate the use of a special skill-set to timely and effectively complete studies from all aspects of the market, financial and technical domains; hence, we have developed a team of experts who can deal with each phase based on their relevant experience and skill-set.

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