3.0.

MARKET FEASIBILITY
The market study will pinpoint the projects general to specific market feasibility
topics. It presents the market and an analysis of past, present and future demand and
supply situations for the particular product or service. If the conditions presented are
feasible then a look at the marketing practices of the competitors (from which guide
will design the marketing strategies) will be studied. The market study will present a
summary of sales projections of the project studys entire duration and the projects
marketing system and forms design.

3.1. Market Description

State the markets general description:

size and composition
geographical location
area
population
age group
income level
religious background
sex
job category
family size

The very first consideration is to determine the market demand for the project. Is
there sufficient demand?

3.2. Demand

State the demand situation of the product or service.

Present the past five or ten years demand (consumption) of the product or
service indicating the sources/methods of information. Simple presentation of
demand measurement methods like theoretical and analytical can be used.
Present the figures as to their particular data source.

Example of Demand Figure Data

Remarks/Explanation to
Year Local Foreign Total
some Figures

Source: ________

Project these figures for the next five or ten years, indicating the various
forecasting methods used, the particular choice among the methods used and
the reasons for using such method. Example methods are the following:

o Arithmetic Straight Line

o Arithmetic Geometric Curve
o Statistical Straight Line
o Statistical Semi-Log
o Statistical Parabolic

Example of Projected Demand Figures

Year of Operation Total Projected Demand
 Present an in-depth analysis and conclusion from all the information just
obtained.
Come up with a sensitivity analysis presentation on the project values of the
demand.

3.3. Supply

Write here the supply situation of the market.

Present the past five or ten years supply (production) situation of the
product/service indicating the sources of information like production,
importations, product substitutes.
Supply figures used in determining the market share can be computed as
follows:

Proposed production capacity (volume)

----------------------------------------------- x 100% per year
Total supply available for the same year,
per year including the proposed rated capacity

Present the information as to their particular geographical/company sources,

local or foreign

Example of Supply Figures Data

Geographical Sources Total
Year
Source A Source B Etc.

Source: ______________

Project these figures for the next five to ten years, indicating the various
forecasting methods used like the one used in the demand data and the
particular choice from among the formulas used and the reason for using.

Example of Projected Supply Figures

Year of Operation Project Supply

Come up with an in-depth analysis and conclusion to the information as

obtained above.
Present a sensitivity analysis on the projected supply figures of the
product/service.

Having obtained your Demand and Supply Figures, present an analysis and prove
demand exceeds supply. This means an opportunity in penetrating the market.

3.4. Demand-Supply Analysis

From the demand and supply figures obtained, present the same figures,
including the choice of projection side by side, taking note of the discrepancies.
Demand (D) Supply (S) D-S Gap
Year Percent Unsatisfied
(units) (units) (units)
(1) (5) = (4)/(2)x100%
(2) (3) (4) = (2) (3)
Past
1
2
N
 Projected
1
2
N

The presentation of the preceding table is divided into past and projected to
which a more systematic analysis and conclusion could then be made.
Show that demand is greater than supply throughout/at most of the studys
time presentation. This will be one of the reasons to defend the ability to enter
the market.
Come up with an analysis/sensitivity analysis of the projected demand-supply
gap and present conclusions.

Once market penetration possibilities are found feasible, proceed to study the
marketing characteristics of the target. This step shall familiarize you on the practices
of the competitors in their marketing of similar/related products/services.

3.5. General Marketing Practices

1. Legal Information State national and local government policies and

agencies/offices that shall affect/assist in the marketing of
products/services.
2. Current Market Conditions Present the market share of the major
competitors, including their geographical and demographical boundaries
and limits. Break down the presentation to present the local and foreign
markets involved, if any.
3. Competitors Marketing Strategies Present in detail the competitors
market and marketing strategies. Consider the competitors:

Incentives and Benefits

Budget Allocations
Marketing Research and Development
Sales force
Quality Standards
Product-Mix Strategies
Market timing and Schedule
Pricing Policies
Terms and Conditions of Sales
Channels of Distribution
Transportation and Delivery Strategies
Branding and Packaging Strategies
Advertisement and Promotions
Storage (Warehousing) Strategies
Physical Distribution Strategies

Knowing the competitors marketing strategies, design the projects marketing

schemes, taking note on the improvements to the current system.

3.6. Proposed Marketing Program

1. Incentives and Benefits Present the national and local government marketing
assistance packages and programs that may benefit the project.
2. Market Conceptualization State the marketing philosophies and tasks. State
also the marketing system and current environment and of the projection years.
3. Market Segmentation and Budgeting If the proposed project will be in the
export business, present the market as separate from the local and the
 percentage to total. Present also the marketing sales force/personnel and its
budget allocation.
4. Product-Mix and Marketing-Mix Strategies Present the proposed:
Target Market
Sales Force Determination
Marketing Research and Development
Product-Mix Strategies
Market Timing and Scheduling
Pricing
Terms and Conditions of Sales
Channels of Distribution
Transportation and Delivery
Branding and Packaging
Advertisement and Promotion
Storage (Warehousing)
Physical Distribution

Be sure to propose the best marketing alternatives for the project. They must be
practical and simple to produce the best desired results. Afterwhich, estimate the
projected sales as a climax to the proposals.

3.7. Projected Sales

Project each of the products/services yearly sales values. The simplest method
is to multiply each of the products yearly production sales capacity by their
corresponding years projected selling prices.
Present a table showing the sales forecasts for the next five to ten years,
stating major assumptions used in arriving at the values.
Come up with a sensitivity analysis of the sales projections.

Example of Sales Projections

Products & Year
Year 1
By-Products N
Unit Price Quantities to be sold Sales Revenues
Description Expor Expor
Export Local Local Total Local Total
t t

3.8. System and Forms Design

Present the projects flow of marketing operations and standard operating

procedures clearly showing internal and external relationships to other parts of
the organization and environment, an explanation of the proposed system,
illustrated in a flow-diagram format.
Show some sample designs of proposed marketing forms to be used in
operations, clearly detailing their explanations, uses, channels, who and how
will they be accomplished.

The determination of the projects marketing feasibility will dictate the design of the
production requirements.