WHAT IS CONSIDERED IN A FEASIBILITY STUDY?

ECONOMIC. Information related to the project site; availability of trained or trainable labor; utilities; rail, air, and road service to the site' and overall economic impact of the project.

MARKET. Information on the sales organization and management, nature and extent of market and market area, marketing plans for sale of projected output, extent of competition, and commitments from customers or brokers.

TECHNICAL. These shall be prepared by individuals who have previous experience in the design and analysis of similar facilities or processes proposes in the application. This should include the suitability of the site for the intended use including an environmental impact analysis. The report shall be based upon verifiable data and contain sufficient information and analysis so that a determination may be made on the technical feasibility of achieving the levels of income or production that are projected in the financial statements. The repost shall identify any constraints or limitations in this financial projections and any other facility or design related factors which might affect the success of the enterprise. The report shall also identify and estimate project operating and development costs and specify the level of accuracy of these estimates and the assumptions on which these estimates have been based. For the purpose of the technical feasibility reports, the project engineer or architect may be considered an independent party provided neither the principals of the firm nor any individual of the firm who participate in the technical feasibility report has a financial interest in the project, and provided further that no other individual or firm with the expertise necessary to make such a determination is reasonably available to perform the function.

FINANCIAL. An opinion on the reliability of the financial projections and the ability of the business to achieve the projected income and cash flow. An assessment of the cost accounting system, the availability of short-term credit for seasonal business, and the adequacy of raw materials and supplies.

MANAGEMENT. Evidence that continuity and adequacy of management has been evaluated and documented as being satisfactory.