milkery
DESCRIPTION
feasibility study analysisTRANSCRIPT
Milkery> A Thailand-based “milk shop business” and bakery
> Located in front of Mae Fah Luang University
> Target group primarily focused on university students
CRITERIA NOTES EVALUATION
General
Quality of project study report
Thoroughness in details manifesting diligent research work
CRITERIA NOTES EVALUATION
Marketing Aspect
Realism of market data/validity of assumptions
Appropriateness of market survey design
CRITERIA NOTES EVALUATION
Marketing Aspect
Soundness of marketing program and strategy
Rationality of pricing strategy
CRITERIA NOTES EVALUATION
Technical Aspect
Efficiency of production operations
Realistic production rates, yields, and cost
CRITERIA NOTES EVALUATION
Technical Aspect
Quality control integration with the production operations
Safety considerations
CRITERIA NOTES EVALUATION
Financial Aspect
Consistency of financial projections with the technical and market projections
All financial information in the Financial Analysis are consistent with other parts of the study, except:> The breakdown of Investment Costs> Administration Costs
Inconsistent data could lead to inaccurate and misleading information, which could ultimately result in improper decision making.
Economic viability/feasibility in terms of IRR NPV and/or payback period is within acceptable and realistic range for the industry
> Absence of comparative data> Incorrect application of net cash inflows in computing NPV, IRR, and payback period> The study uses 4% as its discount rate
> Difficulty in understanding level of competitiveness in the industry and assessing position in the market> Net Cash Inflow to be used in the computation of payback period, NPV and IRR should reflect projected net cash inflows for each specific year> For a more accurate result, the rate to be used in the computation of NPV should be the weighted average cost of capital (WACC)
CRITERIA NOTES EVALUATION
Financial Aspect
Sensitivity of economic feasibility to changes/ variabilities in the values of the forecast parameters
The study includes a sensitivity analysis as to decrease in sales, increase in costs and increase in interest for 5 years.
This is a relevant and useful method of contingency so that a more realistic estimate of future operations can be reasonably assured
Appropriateness and accuracy of the valuation of economic feasibility and the attendant financial statements
Statement of Cash Flows include Depreciation Expense as a cash outflow
Depreciation charges should be not be deducted from the Statement of Cash Flows
CRITERIA NOTES EVALUATION
Organization Management
Identification and staffing of key result areas of the organization
Effectiveness of organizational structure toward attainment of corporate objectives