The foundations of feasibility studies for small projects. The feasibility study is a detailed and regular analytical plan followed by individuals, in order to be able to reach satisfactory results for the project or to reach results expected to occur in the project in the long term. It also determines for the project owner whether he can move forward in starting the implementation The project, or stopping and making any adjustments to study its feasibility or completely disregard this project, and search for another project idea, and in today’s article we will learn together the foundations of feasibility studies for small projects to ensure the success of the project on the ground.
Foundations of feasibility studies for small projects
First, we can define the feasibility study as a study carried out by everyone who implements a new or already existing project, by collecting a set of information from the ground and analyzing it well in order to determine the cost that the project needs.
As well as knowing all the technical needs necessary for it, and then determining the feasibility or the return resulting from this project during a specific period of time. The feasibility study is divided into several sections, some of which are basic and others depend on the type of project.
The feasibility study includes important foundations that every owner of a new project idea must follow to achieve the best possible success and profit rate, which include the following:
Determine project objectives.
Preparing the initial feasibility study.
Preparing a detailed feasibility study, divided into a feasibility study (marketing, technical, financial, economic, social and environmental).
As for how to implement the feasibility study, you can complete it on your own, but you must have sufficient experience in this field, and how to work with it in order to avoid any losses when implementing the project.
Or you can use one of the companies specialized in the field of feasibility studies, because they are familiar enough to advance your project and avoid putting it at risk.
One of the best companies that you can rely on is the Technical Company for Administrative and Economic Consultations for major governmental and private institutions and factories. It is also one of the most professional companies in the field of feasibility studies for various projects.
The technology company is also distinguished by providing any necessary advice that the client needs when implementing his project.
Feasibility study for small projects
The feasibility study is represented in a set of elements that can be summed up in costs, profitability returns, and the results that the project owner ultimately obtains from his own project.
Thus, he can determine the extent of the success of his project in proportions and numbers before starting it with the actual steps. The following are the most important steps for making a feasibility study for a small project.
First, the goal of creating the project:
In the beginning, you must determine the motives that made you choose this particular project, in order to start with it, whether they are from your own experiences for this project and the extent of the experience and skills you have acquired that will make you run or work on such a project.
You can also specify the shape or quality of your project in terms of the services or products that it will provide, whether it is a restaurant, a workshop, or otherwise.
Second, the capital required to implement the project:
You have to determine the value of the capital you need to build the project because it will be determined by a set of other factors, which will control the shape of your project and the extent of profitability it will achieve. The capital determines the following points:
Project Size By determining the capital, you can know the size of the project you will start with and its equipment.
The volume of marketing Capital also controls the amount of advertising that will be available for your project and the extent of your ability to reach the audience.
Third, calculate the project costs:
The costs are divided into three basic parts and a sub-part, but you may not need it in small projects. These parts are the construction expenses, in addition to the basic, variable and fixed costs, which are as follows:
Construction costs, which are the costs of the place and preparing it to work from machines and equipment in the case of the factory, or tools and supplies for display in stores, in addition to advertising and marketing costs.
Fixed costs, which are paid on a monthly basis, and are represented in the commercial rent of the place, labor and the like.
Variable costs such as the resources needed to operate the project such as water, electricity, gas and raw materials, if any.
Fourth, the profit calculation:
After you have determined the costs, you must start calculating the returns for the project by determining the expected sales volume over a specific period, as well as the expected profit rate that you will get through those sales.