Feasibility Study: Business Proposal by Researcher 1, Researcher 2, and Researcher 3, Lecture notes of Financial Market

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FEASIBILITY STUDY TITLE TYPEWRITTEN IN INVERTED PYRAMID, 14-POINT, ARIAL, BOLD, AND ALL CAPS A Feasibility Study Presented to the Faculty of the College of Business Administration AMA Computer College, South Superhighway Makati City In Partial Fulfillment of the Requirements for the Degree Bachelor of Science in Business Administration By Name of Researcher 1 Name of Researcher 2 Name of Researcher 3 August 2022 1 TABLE OF CONTENTS 2 Chapter 2 MANAGEMENT FEASIBILITY Introduction Start writing here… Legal Structure of the Business Start writing here… Organization Chart Start writing here… Insert organization chart here… Job Descriptions, Duties and Responsibilities Start writing here… Employee Benefits Start writing here… 3 Chapter 2 ECONOMIC FEASIBILITY Introduction Guide (remove texts in red fonts when done): Write a short introduction on what the chapter is all about and what are the sections being discussed. Start writing here… Demand Analysis Guide (remove texts in red fonts when done): Demand is the customer’s desire for a particular product, at the given price, which he/she is ready to buy in one market at different prices during a given period of time. Demand analysis is the process of understanding the customer demand for a product or service in a target market. Companies use demand analysis techniques to determine if they can successfully enter a market and generate expected profits to expand their business operations. Start writing here… Supply Analysis Guide (remove texts in red fonts when done): Supply implies the quantity (how much) of a product or service which are offered by the manufacturer for sale at various prices to the customers, during a given period of time. Supply Analysis is a research and analysis done to understand the supply trends and responses to changing market and production variables. Supply Analysis takes into account the production costs, raw material costs, technology, labour wages etc. The analysis helps the manufacturers and companies to understand the impact of these variables on supply and eventually demand. Start writing here… Sales Forecast Guide (remove texts in red fonts when done): Sales forecasting is the process of estimating future sales. Accurate sales forecasts enable companies to make informed business decisions and predict short-term and long-term performance. Companies can base their forecasts on past sales data, industry-wide comparisons, and economic trends. Start writing here… Products/Services Price Units sold per month Sales per Month Year 1 Sales 4 TOTALS Marketing Strategy Guide (remove texts in red fonts when done): Use this section to detail the overall strategy you will use to position yourself within the market to meet your customers’ needs. Whatever your strategy, you goal should be to differentiate yourself from your competitors to encourage customers to choose your business first. The specific elements that make up your marketing strategy are typically referred to as the marketing mix. Each element can be varied to broaden the appeal of products and services, and will therefore have a direct impact on sales. The 4 P's of marketing ● Your PRODUCT (or SERVICE) - describe your long-term product strategy in detail; what features and benefits do you offer?; what makes your product/service different from your competitors’? ● The PRICING of your product/service - price is a critical component of your marketing mix. Why? Because choosing the right price for your products/services will help you to maximize profits and also build strong relationships with your customers. By pricing effectively you will also avoid the serious financial consequences that can occur if you price too low (not enough profit) or too high (not enough sales). ● Your POSITION (place) in the marketplace - Place represents the location where a product can be purchased. It is often referred to as the distribution channel. This may include any physical store (supermarket, departmental stores) as well as virtual stores (e-markets and e-malls) on the Internet. This is crucial as this provides the place utility to the consumer, which often becomes a deciding factor for the purchase of many products across multiple product categories. ● The PROMOTION of your product of service - State how you currently promote and market your business now (or intend to). Compare (where applicable) what your competitors do for promotion, noting what does and doesn’t work for them as well as yourself. Regardless of how good your business is, if you don’t promote it and tell people you exist, it’s unlikely you will make many sales. Start writing here Marketing Plan 5 Price Start writing here… Technology Requirements Guide (remove texts in red fonts when done): Every business needs at least some kind of technology to operate. The technology component of your feasibility study should include discussions about telephone answering systems, computer hardware and software, computer network and internet connection, multi- function printer, and other office machines. Don't overlook items like cash registers and potentially the ability to accept credit cards and process checks. You might need special devices to accommodate the disabled, or teleconferencing equipment and facilities. Smartphones are almost a must for most businesses, and you might need alarm or camera systems. Description Amount Source Machines and Equipment Guide (remove texts in red fonts when done): This refers to the machines and equipment necessary to make the product or complete the service. Description Amount Source Production Process 8 Guide (remove texts in red fonts when done): This is a step-by-step description of how the product is made or the service completed. Start writing here… Production Materials Guide (remove texts in red fonts when done): This refers to the major materials that you will use to make a product or complete a service. There are two types of production materials, direct materials and indirect materials. Direct materials refer to the materials that become part of, or are directly related to the product you make or service you offer. Indirect materials refer to some materials that are usually used in small amounts to make a product or complete a service. Start writing here… Production Schedule Guide (remove texts in red fonts when done): This gives in detail how the work is going to be spread out in the next 12 months. This has to be made in order to ensure that the number of units to be sold or services to be completed, based on the projected sales, are produced in time. Among others, the schedule will show the status of production at any point during the production period; the specific periods when production or service will start and when the product or service will be completed. Start writing here… Inventory Schedule Guide (remove texts in red fonts when done): Inventory refers to the stock of materials, supplies, and spares required for making the product or completing the service. The inventory record will keep you informed of the date of purchase, quantity purchased, cost, date released for production, quantity issued, and remaining balances. Keeping track of these items will ensure that you do not only have the materials you need to make the product or complete the service on short notice but also to prevent you from keeping obsolete or expired materials in your stock. Start writing here… Product Delivery Guide (remove texts in red fonts when done): You can make the best product in the world, but if you don't have a delivery strategy for getting it to your customers, you'll end up with a fully stocked warehouse and no incoming revenue. Product delivery should be thoughtfully planned and executed and should fit into your company's overall mission and marketing strategy. Start writing here… 9 Manpower Requirement Guide (remove texts in red fonts when done): This comes in the form of direct labor and indirect labor. Direct labor refers to the people who are actually involved in making the product or completing the service. In the soap business, this will be the mixer. Indirect labor refers to the people who perform tasks that do not have anything to do directly with making the product or completing the service. They are the production helpers, quality control inspector, supervisor, etc. Start writing here… Project Timetable (Gantt Chart) Guide (remove texts in red fonts when done): This is a list of all the activities you are to do prior to launching the business and the timeframe for accomplishing them. Preparing the Gantt Chart is a useful exercise that allows you to have a view of the pre-operating activities and their cost implications. These activities include writing of the business plan, negotiation for financing, construction or improvement of the building, acquisition of machinery and equipment, recruitment (and training, as applicable) of personnel, registration of the business etc.. Start writing here… 10 Other Pre-Operating Expenses Total Start-Up Costs Start writing here… Capital Requirement Guidelines (remove when done): The capital requirement is the sum of funds that your company needs to achieve its goals. Plainly speaking: How much money do you need until your business is up and running? You can calculate the capital requirements by adding founding expenses, investments and start-up costs together. By subtracting your equity capital from the capital requirements, you calculate how much external capital you are going to need. Particular Amount Total Start-Up Costs Less: Owner’s Capital Contribution Total Amount to be Financed Loan Repayment Schedule Guidelines (remove when done): When you take out a loan, you are required to pay it back to the lender within a specified period of time. The repayment includes both the principal amount along with the interest over a predefined number of monthly installments. Simply put, the act of repaying the loan through a series of scheduled payments generally referred to as EMIs that includes both the principal amount outstanding and the interest component is known as the Repayment Schedule. It is also called an Amortization Table. Start writing here… Insert Loan Amortization Table here… 13 Projected Income Statement Guidelines (remove when done): An income statement, also known as a profit and loss statement, shows your revenues, expenses and profit for a particular period. If you are developing these projections prior to starting your business, this is where you will want to do the bulk of your forecasting. The key sections of an income statement are: 1. Sales – This is the money you will earn from whatever goods or services you provide. 2. Cost of Sales – This represents the direct costs related to the manufacturing or purchasing of goods which has been sold. 3. Gross Income – computed as Sales less Cost of Sales 4. Operating Expenses – Be sure to account for all of the expenses you will encounter, including general and administrative costs such as accounting and legal fees, advertising, bank charges, insurance, office rent, telecommunications, etc. 5. Net Income – computed as Gross income less Operating Expenses. Start writing here… Statement of Financial Position Guidelines (remove when done): Statement of Financial Position or commonly known as the Balance Sheet will present a picture of your business’ net worth at a particular time. It is a summary of all your business’ financial data in three categories: assets, liabilities and equity. Start writing here… Cash Flow Statement Guidelines (remove when done): A cash flow projection will demonstrate to a loan officer or investor that you are a good credit risk and can pay back a loan if it’s granted. The three sections of a cash flow projection are: ● Cash revenues – This is an overview of your estimated sales for a given time period. Be sure that you only account for cash sales you will collect and not credit. ● Cash disbursements – Look through your ledger and list all of the cash expenditures that you expect to pay that month. ● Reconciliation of cash revenues to cash disbursements – This one is pretty easy: you just take the amount of cash disbursements and subtract it from your total cash revenue. If you have a balance from the previous month, you’ll want to carry this amount over and add it to your cash revenue total. Start writing here… 14 Financial Ratios Liquidity Ratios Liquidity ratios are financial ratios that measure a company’s ability to repay both short- and long-term obligations. Common liquidity ratios include the following: The current ratio measures a company’s ability to pay off short-term liabilities with current assets: Current ratio = Current assets / Current liabilities The acid-test ratio measures a company’s ability to pay off short-term liabilities with quick assets: Acid-test ratio = Current assets – Inventories / Current liabilities The cash ratio measures a company’s ability to pay off short-term liabilities with cash and cash equivalents: Cash ratio = Cash and Cash equivalents / Current Liabilities The operating cash flow ratio is a measure of the number of times a company can pay off current liabilities with the cash generated in a given period: Operating cash flow ratio = Operating cash flow / Current liabilities Leverage Financial Ratios Leverage ratios measure the amount of capital that comes from debt. In other words, leverage financial ratios are used to evaluate a company’s debt levels. Common leverage ratios include the following: The debt ratio measures the relative amount of a company’s assets that are provided from debt: Debt ratio = Total liabilities / Total assets The debt to equity ratio calculates the weight of total debt and financial liabilities against shareholders’ equity: Debt to equity ratio = Total liabilities / Shareholder’s equity The interest coverage ratio shows how easily a company can pay its interest expenses: Interest coverage ratio = Operating income / Interest expenses The debt service coverage ratio reveals how easily a company can pay its debt obligations: 15 Chapter 6 SOCIO-ECONOMIC FEASIBILITY Introduction Guidelines (remove when done): The socio-economic study shows the contribution of the business to the government and to the society. This area proves that the business existed not only for profit purposes, but also for the improvement of the welfare of the people. Start writing here… Contribution to the government Start writing here… Contribution to the society Start writing here… 18 APPENDIX A Legal Requirements to Establish a Business 19 APPENDIX B Permits and Licenses 20 APPENDIX E Machines & Equipment 23 APPENDIX F Furniture & Fixtures 24 APPENDIX G AEQ Analysis Table 25