A feasibility report assesses the viability of proposed project plans or methods from a technical, commercial, and financial angle. The study helps narrow down the risk factors in the implementation of a project.
The feasibility report of a manufacturing plant entails the examination and assessment of a proposed project -- whether it’s viable to manufacture the product to meet customer needs. The report assesses but is not limited to the following (as applicable): staying within budget and finding appropriate resources, location, technology, facilities, tools, capacity, software, and staff with the skills required, including support functions, available or anticipated to be available as required to implement the project.
A feasibility report looks at a variety of factors to determine whether a new venture will be profitable and worthwhile now or in the future. A preliminary analysis is the first step in preparing a report. Interviews with stakeholders are conducted, market research is carried out, and a business strategy is formed. If everything looks good, real research is initiated. This involves the selection of a proper location, a listing of technological requirements, market analysis, a description of the marketing strategy, an outline of the required human capital, a project timetable, and funding. The report outlines estimated costs as well as projected advantages.
The following steps are involved in conducting a feasibility study
The feasibility report differs from one organization to the next based on the instructions offered by the company. Most reports usually include the following key sections
Before making the final recommendation, the conclusion offers a review of the report to highlight important arguments, advantages, and drawbacks of each option evaluated.
The final portion, as the name implies, comprises the best recommendation to be made based on the assessments and approaches outlined previously.
When contemplating the launch of a new project or product, feasibility reports are critical. Accepting a proposed business strategy is an investment for any firm; it is imperative to review all aspects of a project from pre-planning to the conclusion.
Below are a few reasons why feasibility studies are important:
A typical feasibility report considers the practicality of four aspects of a project:
Feasibility reports of manufacturing plants assist project executives in assessing the viability of the project or commercial venture and identifying crucial elements that may contribute to its success. The analysis illustrates the possible return on investment as well as threats to the venture's success.
The study contains a detailed report on everything necessary to complete the project. It identifies funding and sources of capital and also includes a description of the new venture, a study of the market trend, the technology & equipment and the manpower required. The report often includes financial predictions, the probability of success, and a yes-or-no judgment based on key financial ratios and SWOT analysis.