ECONOMIC FEASIBILITY

Hello,

I hope you have found other topics on this series interesting? In case you have not been following, you can read previous posts on this series:

I feel excited to share more light through the study of Economic feasibility.

                                               

Economic feasibility study is one of the components of feasibility study. Economic feasibility study is done to provide certain information on the following: 

• Project site 

The study should provide information on how economical the project location will contribute to the viability of the intended project/business. This study should be done based on its accessibility to raw materials for production and its nearness to the market. 

•  The availability of trained and trainable labor 

In the terms of sourcing for qualified and skilled personnel, the economic study should state the category of qualified or trainable labor that can and needed to be sourced, if need be for the services of expatriates  and how much it will cost to source in terms of finance and time.  

•  The availability of infrastructure 

What is the level of infrastructure available within the economy which should include the following 

Utilities: Electricity and social amenities 

The road services to the site 

• The overall economic impart of the project 

Every project must be able to meet a need or want . The need or want metamorphose into demand. So, it necessary to evaluate the overall economic impact of the project or service as it meets the needs of the economy. 

                                                 

Luke- Morgan and his research fellow in an unspecified documented date identified what economic feasibility involves. According to them, it involves the following processes: 

• Identification of all capital expenditures 
• Identification of all variable costs related to the proposed business venture 
• Identification of people and skills required to operate 
• Identification of project related costs 
• Identification of all fixed costs 

                        

• Estimation of all capital expenditures  
• Estimation of all variable costs related to the proposed business venture 
• Estimation of project related costs 
• Estimation of all fixed costs 
• Determination of wages, salaries and benefits 
• Development and improvements of infrastructure 
• Advertising and promotion 
• Legal fees 
• State and local government development taxes