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Feasibility Study Lec3

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14 views

Feasibility Study Lec3

Uploaded by

solankiauto16
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Feasibility study

LECTURE (3)
Market demand :- total value of
the product that would be bought
by a defined customers group by
a defined geographic area in
specific time period in a defined
marketing environment under a
defined marketing program
It could be calculated in units
It could specify by area
Or by type of market
 Types of Market to Measure:

Set of consumers who have some


Potential Market (100%)
interest in the product.

Set of consumers who have interest,


Available Market (40%) income and access to the product.

Set of consumers who have interest,


Qualified Available (20%) income, access and qualifications for
the product.

Served (target) Market Part of the qualified available that


(10%) the project would target.

Set of consumers who have already


Penetrated Market (5%) bought the product. 17
If total demand = 1000 Units and total supply = 500 Units,
then,

-Market gap = TD – TS = 1000 – 500 = 500 units.


-Market share is the amount from the gap that the project
wants to cover. It depends on the production capacity and the
market gap.

-Thus, if the production capacity for the project = 100, then,


market share of the project= production capacity / market gap
= 100/500 = 20%.

PETS Team / ECD 4


PETS Team / ECD 5


 Also while we are talking about
product , we have to know at
which cycle are we

 Product cycle is
Start up.
growth.
maturity.
saturation
shrinking.
 1- Consumption level method .
 2- Extrapolation method .
 3- Elasticity ( Income , price , cross ) .
 4- chain ratio method .
 5- End–use method " consumption Coefficient " .
 6- Area method potential :-

PETS Team / ECD 7


 1- Consumption level method .
 2- Extrapolation method .
 3- Elasticity ( Income , price , cross ) .
 4- chain ratio method .
 5- End–use method " consumption Coefficient " .
 6- Area method potential :-

PETS Team / ECD 8


To Measure
Demand

A) Methods to Forecast B) Methods to Estimate


Future Demand Current Demand

I) III) VI) Area


Consumption II) Trend Elasticity IV) Chain Market
Extrapolation V) End-use
Level Ratio (Consumption Potential
& Regression
Analysis Coefficient /
Proportional)
a) Simple Average a)Market
Buildup
b) Moving
Average b)Multiple
Factor
c) Weighted Index
Average
c)Buying
d) Average Power
Consumption (Market
per capita Opportunity)
22
a)Simple b)Moving c)Weighted d)Average
average average average consumption
method method method percapita

PETS Team / ECD


10

PETS Team / ECD


11

PETS Team / ECD


12

month Di Wi DiWi

5 180 180/480=0.375 180*0.375=67.5

6 130 130/480=0.271 130*0.271=35.23


1
7 170 170/480=0.354 170*0.354=60.2

total 480 162.94

PETS Team / ECD


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 Assumption:1) constant trend of demand.
2) assign weights.

 Advantage:1) easy
2)Assign weight for each time period so take
short time series.

 Dis advantage: assume constant trend of


demand.

PETS Team / ECD


14
Rule:
 Dn = Average Consumption Percapitan-1* Populationn

 Average Consumption Percapitan-1 =


𝑇𝑜𝑡𝑎𝑙 Consumption 𝑛-1
−
𝑃𝑜𝑝𝑢𝑙𝑎𝑡𝑖𝑜𝑛 𝑛-1

 Populationn = Populationn-1 (1 + annual pop growth rate)1

PETS Team / ECD


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 Advantage:
-it does not need large time.
- it is simple and easy method.

Disadvantage:
- assume that average consumption per capita
is constant over time ,which is an unrealistic
assumption .
- patterns of consumption are assumed to be
the same for all income classes which is
unrealistic also .

PETS Team / ECD


16

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