If your company is planning a new project, it is essential to carry out an economic feasibility analysis, as this tool will indicate whether the project is financially viable and whether it is worth moving forward.
Even those who deal with investment analysis on a daily basis know how challenging it is to accurately predict scenarios. With this in mind, we present a step-by-step guide to performing a reliable and assertive financial feasibility analysis. Check it out!
Here you will find:
Step 1: Revenue projection
Step 2: Projecting costs and investments
Step 3: Analysis of financial indicators
Step 4: Scenario analysis
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Step 1: Revenue projection
Revenue projection in the economic feasibility project
The first step in economic feasibility analysis is revenue uganda whatsapp data projection, which consists of predicting the project’s revenue sources and how they are expected to scale over time. This is a critical and challenging step, as it involves working with demand forecasts and assumptions about market behavior.
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Typically, this projection is made for a horizon of 3 to 5 years, as this is the period in which a project is expected to start generating financial returns. However, in the case of larger and more complex projects, such as infrastructure, the projection horizon may extend to 10 years or more, depending on the nature and objectives of the project.
How to improve revenue projection accuracy?
Knowledge of the target audience : Demographic studies of the region where the project will be implemented, for example, help to identify the characteristics and behavior of potential customers.
Competitor analysis : Evaluating the performance of direct and indirect competitors allows you to identify market trends, unexplored opportunities and areas for improvement.
Identifying opportunities and market gaps : Assess existing gaps in the market that your project can fill. This could range from the lack of a particular product or service to the opportunity for innovation.
Step 2: Projecting costs and investments
Projection of costs and investments in projects
This step of the economic feasibility analysis involves identifying and calculating all costs associated with the project, both variable and fixed, and understanding the investments required to implement the new venture.
Variable costs : These costs change depending on the project's production or sales volume. Examples include commissions, fees, cost of goods sold, raw materials, among others. It is essential to project these costs realistically, considering their direct impact on the project's financial results.
Fixed costs : These are recurring expenses that do not vary with production, such as rent, salaries, water, electricity, among others. They must be calculated in detail to ensure that all financial obligations of the project are correctly accounted for.