This document discusses the importance of conducting market assessments and feasibility analyses before starting a new business project. It outlines the key steps in assessing the market, including analyzing demand, competitors, and trade practices. The document also explains that a project feasibility analysis should evaluate the financial, technical, social, economic, and managerial aspects of a potential project to determine its viability. Conducting thorough market and feasibility assessments is important for the success, survival, and growth of a new business venture.

1. Management
04_4 – Before starting the project
Suhas Dutta

2. Syllabus coverage
• To understand what constitutes a business opportunity,
scanning the environment for opportunities, evaluation of
alternatives and selection based on personal competencies.
• An overview of the steps involved in starting a business
venture – location, clearances and permits required,
formalities, licensing and registration procedures
• Assessment of the market for the proposed project
• To understand the importance of financial, technical and social
feasibility of the project.
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3. Today, we shall cover
• Market assessment
• Project feasibility analysis
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4. Lets watch
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• 5 marketing tools

5. Market assessment
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6. Market assessment
• In a competitive economic system, the success, survival and
growth of enterprise warrants market assessment
• Need
oDetermine what the customers want – depending on their education,
employment, age, income, status etc
• The important elements are:
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Market
demand
analysis
Competitive
situation
Trade
practices

7. Market demand analysis
• The variables which determine market demand are:
• The entrepreneur should be in touch with vendors, and
customers
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Product Total volume
Total
purchased
Customer
group
Geographical
area
Time period
Marketing
environment
Marketing
programme

8. Competitive analysis
• Entrepreneurs should have a clear sense of competitors and
know:
oNumber of competitors
oCompetitor market share
oCompetitor product SWOT
oMarket perception and image
oTrade practices
oMajor customers
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9. Understanding trade practices
• Know the intermediaries:
oAgents, brokers, chain stores, malls, export houses etc.
• Important to know trade practices
oDiscounts
oPseudo offers
oCredit facilities
oHome delivery
oGifts etc.
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10. Forecasting market demand
Surveys
•Direct oral interviews
•Indirect surveys
•Mailed questionnaire
•Schedules sent through enumerates
•Through agencies
Statistical
•Time series
•Regression
•Extrapolation
Leading indicators Others
•Market factor analysis
•Simulation
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11. Project feasibility
analysis
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12. Project feasibility analysis
Market
analysis
Financial
analysis
Technical
analysis
Social
profitability
analysis
Economic
analysis
Managerial
analysis
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13. Market analysis
• Method of screening project ideas as well as evaluating project’s
feasibility in terms of markets:
• Methods used to estimate the market demand are:
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Area of
market
Distribution
channels
Trade
practices
Competition
Existing
demand
Survey
Sales
experience
Market
segmentation

14. Financial & technical analysis
Financial analysis
• Aspects need to be analyzed:
oInitial capital requirement
oTotal project cost
oRequirement of fixed capital and
working capital
oCash flows and fund flows
Technical analysis
• Aspects that require
analysis:
oMachinery and equipment
oLocation of the plant
oPlant layout
oPower and communication
facilities
oRaw materials
oWork force etc.
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15. Others
Social profitability analysis Projects and companies need to be socially aware
and help the society by constructing schools, and
hospitals and participating in community
development projects
Economic analysis •Economic trends
•Extent of competition
•Price structure
•Cost of the project
•Demand for the product
•Trade cycles
Managerial capability Required for long term feasibility of the project
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16. Further readings / viewings
• History of corporations (Part 2)
• http://www.abhinavjournal.com/ima
ges/Commerce_&_Management/Ja
n13/13.pdf
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