City College of Angeles

Institute of Business Management

Feasibility Analysis

Founders:
Inda, Jessa Fe
Miclat, Rea M.
Waje, Ruffa Jen B.
Samson, Ericson
 Sole Line's Shoe Boots

"Shoe innovation:The right selection"

Sole line will sell unique but in affordable price shoes in the
market namely "Shoe Boots",where it has 2 styles in 1
shoe ,it can be boots or a rubber [Link] the reason that
today's generation look for trendy and unique shoes,where
it can be useful in many activities or events.
Compared to other regular shoes ,Sole Line will produce a
hand made and a high quality shoes to fulfill/provide our
future clients expectation and needs at having an affordable
[Link] will look forward to become a benchmark in the
market that are admired and favoured to its uniqueness and
creativity.
Part 1: Product/Service Feasibility
Assessment Tools

Concept Statement Test (Summarize)

* Strengths of the product or service idea—

* Suggestions for strengthening the idea—

* Overall feasibility of the product or service concept—

 The number of people who thing the idea is feasible-

 The number of people who think it isn’t feasible-

* Other comments and suggestions—

Conclusion:

A. Product/Service Desirability

[Link]/Service Demand

[Link]/Service Feasibility

__ Not Feasible

__ Unsure

__ Feasible
Part 2: Industry/Market Feasibility
Assessment Tools

Industry Attractiveness

Figure 1 shows the different locations of the footwear establishments. Most of them are located in the
CALABARZON and the National Capital Region because of the availability of the materials needed in
manufacturing the merchandise.

Figure 1: Location of Footwear Establishments

Source: NSO 2009 List of Establishments

Local Demand

Most of the footwear manufacturers seem to be contented with the local market for the following reasons: (1)
higher profit margin, (2) lesser paper work, (3) lesser people to deal with and (4) no pressure on the delivery
time. Local markets rely on direct selling, boutiques, and department stores to sell their products. Few
enterprises have their own stores. The industry’s highest production is during the months of October,
November and May. This can be attributed to Christmas and school opening seasons. The lowest is during the
month of July, caused by clearance and inventory sales.

Source: National Statistics Office 2010

Top Footwear Manufacturers

1. Nike Philippines Inc.

2. SS Ventures International, Inc.
3. Paramount Footwear Co., Inc.
4. Production Village Corporation
5. Stefano Footwear Corporation
6. Beach Rubber Co., Inc.
7. Philippine Shoe Expo Marketing Corporation
8. Soltec Inc.
9. Islander Footwear Manufacturing Corporation
10. Mendrez Shoes Manufacturing Corporation
Industry Attractiveness Assessment Tool

Low Potential Moderate High

Potential Potential
We all know that have
1. Number of Many Few None many shoe companies
invented any form or
competitors design that capable to the
sight of people.

Old. We all know that

2. Age of industry Old Middle aged Young almost of wearing a boots
is older because some of
them is working in public
market.p

Strong growth
3. Growth rate of Little or no Moderate Strong growth because we our the

industry growth growth one that invented a

shoe in two forms.

High because we our

4. Average net income Low Medium High the one selling a pair

for firms in the shoe in two forms in

industry not unlike
industry the other maker of
shoe.

Because we our concentrate

5. Degree of industry Concentrated Neither Fragmented to do a new product that
capable in are consumer but
concentration concentrated they have a doubt that it is
make an impact in the

nor fragmented market .

growth phase
6. Stage of industry life Maturity Growth phase Emergence
because we our
cycle phase or phase growing industry
which you were
decline phase going to make or
build a task and
doing it step by

step process .

7. Importance of “Ambivalent” “Would like to “Must have” Must have

because we offer
industry’s products have” a product that
and/or services to capable their
lifestyle
customers

8. Extent to which Low Medium High Medium

because some
business and of our materials
environmental are using a
trends are moving in plastic that
contain it in
favor of the industry polution
 Medium because
9. Number of exciting Low Medium High
some our
new product and consumer are like
to bought is the old
services emerging product
from the industry

10. Long-term prospects Weak Neutral Strong Strong because

we begin to
create an idea
that make an
impact in the
market.

Target Market Attractiveness Assessment Tool

Low Moderate High Potential

Potential Potential

1. Number of Many Few None Many because we have a lot

of shoe maker in the world
competitors in that invented a unique shoe
target market that came their imagination.

2. Growth rate of Little to no Slow growth Rapid growth Slow growth because we
our starting in a product
firms in the target growth that they not existing in a
market market

3. Average net Low Medium High High because we our

producing in a product
income for firms in that no similarities in
the target market other product.

4. Methods for Unclear Somewhat Clear Clear because were

generating clear contributing a
revenue in the some payment
industry that occupy our
income.

5. Ability to create Unable to May or may Can create Can create because
“barriers to entry” create not be able to we create a new
for potential create idea to get the
competitors intention of a
consumers un a
new image.

6. Degree to which Satisfied Neither Unsatisfied Unsatisfied because

customers feel satisfied or we begin a first
product that cannot
satisfied by the dissatisfied
saw it in the market.
current offerings in
 the target market

7. Potential to Low Moderate High High because we

employ low cost started a product in
the market that make
guerrilla and/or
it in our own idea
buzz marketing
techniques to
promote the firm’s
product or services

8. Excitement Low Medium High High because we

surrounding new enter a new
product/service product in a
offerings in the market.
target market

Market Timeliness Assessment Tool

Low Potential Moderate High

Potential Potential

1. Buying mood of Customers are Customers are in Customers Our customer

they moderate
customers not in a a moderate are in an in buying mood
buying mood buying mood aggressive just because
they to be jugde
buying the product
mood before they buy.

We got a fast
2. Momentum of the Stable to Slowly gaining Rapidly momentum in a

market losing momentum gaining markat just because

we create an idea
momentum momentu that can't provide in
other company
m
Moderate
3. Need for a new firm in Low Moderate High
because we need
the market with your some places to
market the
offerings or geographic product that
location possible to make
an impact to the
consumer

4. Extent to which Low Medium High Medium

business and
environmental trends
are moving in favor of
 the target market

5. Recent or planned Large firms Rumors that large No larger Rumors to be

entering a large
entrance of large firms entering the firms may be firms firm in the
into the market market entering the entered market because
we talk about a
market the market new product
or are that passesd to
other person
rumored
to be
entering
the market

Conclusion

Industry attractiveness Moderate patential is highly industry

attractiveness rather than the low
patential and high potential.

A.

Target market attractiveness Moderate patential is highly target market

attractiveness rather than the low
patential and high potential.

B.

Market timeliness Moderate patential is highly market

timeless rather than the high potential.

C.

D. Industry/market feasibility Feasible because we create a new image

in the market that the curiosity to buy of
Not Feasible Unsure
the consuner is high.
Feasible
Part 3: Organizational Feasibility
Assessment Tools

Management Prowess Assessment Tool

Low Moderate High

Potential Potential Potential

1. Passion for the Low Moderate High

business idea

2. Relevant industry None Moderate Extensive

experience

3. Prior entrepreneurial None Moderate Extensive

experience

4. Depth of Weak Moderate Strong

professional and
social networks

5. Creativity among Low Moderate High

management team
members

6. Experience and None Moderate High

expertise in cash
flow management
7. College graduate No college Some college Graduated or
education education but are currently
not currently in in college
college

Resource Sufficiency
An explanation of the rating system used in the first portion of the table is as follows:

1 Available

2 Likely to be available: will probably be available and will be within my

budget

3 Unlikely to be available: will probably be hard to find or gain access to,

and may exceed my budget

4 Unavailable

5 NA: not applicable for my business

Resource Sufficiency Assessment Tool

Ratings Resource Sufficiency

1 2 3 4 5 Office space

1 2 3 4 5 Lab space, manufacturing space, or

space to launch a service business

1 2 3 4 5 Contract manufacturers or outsource

providers

1 2 3 4 5 Key management employees (now and

in the future)
 1 2 3 4 5 Key support personnel (now and in the
future)

1 2 3 4 5 Key equipment needed to operate the

business (computers, machinery,
delivery vehicles)

1 2 3 4 5 Ability to obtain intellectual property

protection on key aspects of the
business

1 2 3 4 5 Support of local and state government

if applicable for business launch

1 2 3 4 5 Ability to form favorable business

partnerships

Ratings: Strong, Neutral, or Weak

Weak Proximity to similar firms (for the

purpose of knowledge sharing)

Neutral Proximity to suppliers

Strong Proximity to customers

Neutral Proximity to a major research

university (if applicable)

Conclusion

A. Management prowess

B. Resource sufficiency

C. Organizational feasibility (circle the correct response)

Not Feasible Unsure
Feasible

D. Suggestions for improving organizational feasibility

PART 4: FINANCIAL F EASIBILITY

Assesment Tools

Total Start-up Cash Needed

• The total startup cash needed can be estimate using the following table.

Total Start-up Cash Needed (To Make First Sale)

Capital Investment Amount

Property

Office Space 16,420.00

Rent Expense 10,000.00 (Non-Commercial) Residential
Water 220.00/month minimum
Electricity 5,000.00/month (including all equipment

Furniture and Fixtures

Office Chair 1,700.00/1pc 1,700.00

Office Table 1,500.00/1pc 1,500.00
Customers Chairs 1,500.00 1,500.00
Electric Fan 1,500.00 x 2 3,000.00
Sewing Machine 10,000.00 10,000.00
Sewing Materials (needle etc.) 10,000.00 10,000.00

Other Equipment
Research and Development

Materials (canvas)
PVC (1yard)
Shoe Sealer (1pc) 79.00
Rugby bottle (1bottle) 57.00
Outsole/Insole (1pair x 100.00) 600.00
Cotton 180.00
Sewing Materials 250.00
Leather (1yard) 250.00
Waterproof Zipper (5yards x 62.50) 312.50

Transportation during canvass 800.00

TOTAL START-UP CASH 61,868.50

Operating Expenses Amount

Legal, accounting, and professional services 8,000.00 (Monthly)

Advertising and promotions 3,000.00

(Flyers, Posters, Business card)

Deposits for utilities 5,000.00

Licenses and permits 8,000.00

(BIR, Mayors permit)

Lease payments 1,000.00 (Annually)

Salary and wages 12,000.00 (Monthly)

Payroll taxes 2,000.00

Tools and supplies 20,000.00

Starting inventory 10,000.00

Cash (working capital) 100,000.00

TOTAL START-UP CASH NEEDED 169,000.00

 Comparison of the Financial Performance of Proposed Venture to Similar Firms Assessment Tool

Annual Sales

Estimate of Proposed Venture’s

Explanation of How the estimate was
Annual Sales—Year 1 computed

Estimate of Year 1 Sales PHP 119,880.00

Below Average Average Above Average

Estimate sales every month:10 pairs x P999.00= P9,990.00

P9,990.00x12 months. = P119,880.00(estimate year 1 sales)

Net Income

Estimate of Proposed Venture’s

Explanation of How the estimate
Net Income—Year 1 was computed
Estimate of Year 1 Net Income. P58,011.50

Below Average Average Above Average

Net Sales: P119,880-

Expenses: P61,868.50

Net profit: P58,011.50

Overall Financial Attractiveness of Proposed Venture Assessment Tool

Low Moderate High

Potential Potential Potential

1. Steady and rapid growth Unlikely Moderately likely Highly likely

in sales during the first
one to three years in a
clearly defined target
market

2. High percentage of Low Moderate Strong

recurring
income—meaning that
once you win a client,
the client will provide
recurring sources of
revenue

3. Ability to forecast Weak Moderate Strong

income and expenses
with a reasonable
degree of certainty
4. Likelihood that internally Unlikely Moderately likely Highly likely
generated funds will be
available within two
years to finance growth

5. Availability of exit Unlikely to May be available Likely to be

opportunity for investor be available
if applicable unavailable

Conclusion (report finding for each area)

A. Total startup cash needed.

P61,868.50

B. Financial performance of similar businesses

C. Financial feasibility (circle the correct response)

Not Feasible Unsure Feasible

D. Suggestions for improving financial feasibility

Overall Feasibility: Summary and Conclusion

Overall Feasibility of the Business Suggestions for Improving the

Idea Based on Each Part Feasibility

Not feasible

Product/Market Feasibility Unsure

Feasible ✔

Not feasible

Industry/Market Feasibility Unsure

Feasible ✔

Not feasible ✔

Organizational Feasibility Unsure

Feasible
 Not feasible

Financial Feasibility Unsure

Feasible ✔

Not feasible

Overall Assessment Unsure

Feasible ✔