SAMPLE FORMAT OF A PROJECT FEASIBILITY STUDY

I. EXECUTIVE SUMMARY

A. Name of the project and the name of the firm

B. Location: Head Office, Factory or Plant Site

C. Project Background

D. Brief Description of the Project

1. Purpose/Nature of the Business

2. Organization Plan (form of ownership and the key functions performed

by the major departments/divisions.)

3. Market Plan (target market, products, promo, placement, prices and

project sales.)

4. Technical Plan (Projected production volume per production cycle, and

the number of production cycles per year.)

5. Financial Plan

- Total Project Cost

- Sources of Financing
- Payback Period
- ROI
- IIR
- Break-even volume and sales

E. Conclusions and Recommendations

I. ORGANIZATION ASPECTS

F. Form of Ownership

G. Organizational Structure

H. Duties and Responsibilities of Personnel

I. Qualifications required and the proposed salaries and benefits

J. Project Timetable

II. MARKETING ASPECTS

K. Existing Market Situation

1. Uses and users of the product/service – type, number, income and

areas of dispersion.
- product specification/ description
- uses of product in relation to quality or features

2. Products of competitors – feature of competitors, products in terms of

size, packaging (if applicable), unit of measurement when sold in the
market, and the like.

3. Promotional activities of competitors such as advertisement, personal

selling, sales promotion e.g. discounts, prizes, etc., and product
display.

4. Placement or channels of distribution or trade intermediaries used by

competitors.

5. Prices -- prices of competitors’ products

6. Other trade practices in the industry.

L. Supply and Demand Analysis

 1. Supply data for the past 5 years (if available)
a) local production (volume an sales)
b) importation (volume and sales)

2. Project Supply for the next 3 –5 years

a) local production
b) importation
c) discuss the factors affecting the availability of supply

3. Demand Analysis
a) Is it a primary demand or a derived demand?

If it is a derived demand, what is the pattern of consumption

for the primary product? Example, the demand for leather is
a derived demand from the primary demand for leather
shoes, bags, etc. in order to know the demand for leather,
one has to determine the pattern of consumption of leather
shoes and bags.

b) Establish the pattern of consumption in the past 5 years

or establish the per capita consumption based on
established standards set by the relevant authority.

c) Discuss the factors affecting the pattern of consumption

for the future.

d) Make a projection of the future demand of the product.

4. Supply and Demand analysis

a) Establish the supply and demand gap

b) Establish the market share that the firm wishes to target

or to “capture”.

M. Proposed Marketing strategy

1. Target Market
a) Who are the proposed buyers?
b) What is the geographical location of the buyers?

2. Proposed product(s)
- features of the product such as size, weight, color ( if applicable),
packaging, and other relevant characteristics.

3. Proposed promotion activities (if any)

a) Form – such as advertisement, personal selling, sales
promotion, product display.
b) Budget
c) Timing or frequency
d) Who will be responsible for the promotion, the producer
or the middlemen?

4. Placement – what will be the proposed channel of distribution?

5. Price – what will be the proposed pricing policy of the company?

6. Projected sales volume and peso sales:

Year Product(s) Price(unit) Projected Sales Projected

Volume Peso Sales

III. TECHNICAL ASPECTS

N. Product

1. Description of the product(s) including specifications relating to their

physical, mechanical and chemical properties.

2. Uses of the product(s)

O. Manufacturing Process
 1. Description of the process sowing detailed flow charts indicating
material and labor requirements of each step, and the normal duration
of the process.

P. Plant size and Production Schedule

1. Rated annual and daily capacity per shift, operating days per year,
indicating factors used in determining capacity.

2. Expected production volume for the next five (5) years considering
start-up and technical factors.

Q. Machinery and Equipment

1. Machinery and equipment layout, indicating floor plan

2. Specifications of the machinery and equipment required indicating

rated capacity.

3. List of machinery and equipment to be purchased and origin as to local

or imported.

4. Quotations from suppliers, machinery guarantees, delivery dates,

terms of payment and other arrangement.

5. Comparative analysis of alternative machinery and equipment in terms

of cost, reliability, performance and spare parts availability.

R. Plant Location

1. Location map showing plant location

2. Desirability of location in terms of distance from source of raw

materials, markets, and other factors. Comparative study of different
locations indicating advantages and disadvantages (id a new project)

S. Production Cost

Detailed breakdown of production costs, indicating the elements of cost

per unit output.

II. FINANCIAL ASPECTS

A. For Existing Projects

1. Audited financial statements (balance sheets, income statements, cash

flow) for past three (3) years to reflect the following:

a) Aging receivables

b) Schedule of fixed assets showing capitalized cost,

estimated useful life, and depreciation method used.

c) Schedule of liabilities.

d) Financial trends and ratio analysis

e) Elements of production, selling, administrative and

financial expenses.

2. Financial analysis to show the rate of return on investment, return on

equity, break-even volume and price analysis.

B. For New Projects

1. Total Project Cost

2. Initial capital requirements

3. Pre-operating cash flows relative to the project timetable.

4. Financial projections for the projected five (5) years of operations to

include balance sheets, income statements, cash flows.
 5. Supporting schedules to the financial projections to include:

a) collection period sales

b) inventory levels
c) payment period of purchases and expenses
d) elements of production cost, selling, administrative and
financial expenses.

6. Financial analysis showing return on investment, return on equity,

break-even volume and price analysis.

III. SOCIAL COST BENEFIT

Contribution to society and economy in terms of:

1. employment generated
2. distribution of income
3. dollar earnings/savings
4. utilization of indigenous materials
5. dispersal of industries
6. taxes
7. others