Feasibility Study App Tutorial

Tutorial Step in using Feasibility Study Application

We are going to analyze a simple proposed business. Let’s start with insert data.

  1. Insert your Project Name

Example : Burger Franchise

2.   Choose your Currency Symbol

Example : $

3.   Determine Your Project Lifetime (Years)

Example : 6 years

4.   Determine Hurdle Rate – minimun return for this project

Example : 22%

5.   Input your Tax

Example : 15%

6.   Select Investment Tab

7.   In List of Investment(s), Insert your need for investment for this project

Example :

Item Name          : Initial Franchise Fee

Price                    : 19500

Item Name          : Buy Cart

Price                    : 37500

Item Name          : Equipment & Material

Price                    : 3500

9.   Click Add

10. Repeat item 7 until all your investment(s) is inserted

11. Switch to Equity / Loan page

12. Insert Current Equity

13. Insert Loan Interest Rate

14. Select Income Tab

15. In List of Income(s), Insert your expected income for this project

Example :

Item Name          : Selling 3.000 Burger A @ $4 each

Price                    : 12000

Item Name          : Selling 2.250 Burger B @ $5.5 each

Price                    : 12375

Item Name          : Selling 600 Merchandise @ 10 each

Price                    : 6000

17. Click Add

18. Repeat item 16 until all your income(s) is inserted

19. Switch to Income Summary page

20. Insert you expected income growth each year for the following lifetime project

Example : 2% per year

21. Click Expenditure Tab

22. Insert your expected expenditure for this project

Example

Item Name     : Buy Meat, Egg, Cheese

Price               : 12750

Item Name     : Pay Employee Salary

Price               : 7200

Item Name     : Pay Utilities (Electrical, Water, etc)

Price               : 3000

Item Name     : Pay Space Rent

Price               : 5000

23. Click Add 

24. Repeat item 22 until all your expenditure(s) is inserted

25. Switch to Expenditure Summary page

26. Insert you expected expenditure growth each year for the following lifetime project

Example : 1% per year

27. Click General Tab

28. Click Calculate Button

 

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6 Responses to Feasibility Study App Tutorial

  1. Rogelio Nueva Espana says:

    Is this app is applicable to all types of business geographically and in Real Estate in particular. Great tool for investors.

  2. Rogelio Nueva Espana says:

    Great!……:-) I appreciate if you could possibly publish more tutorial about construction & real estate business. Many thanks.

    • DotStripes says:

      Hmm… Let’s say that if you want to build a new hotel which would cost about US$ 10 Millon for 2 years of construction (Year one is 40% of capex and year two is 60% of capex). Total rooms that will be build is (let’s say…) 100 rooms. Each rooms are the same and they are cost rate around US$ 200/day. Each Year this rooms of the hotel averagely occupied almost 45%. Assuming 1 year is 365 days.

      Now talk about cost of operation, The hotel fixed cost is US$ 200.000 each year and my variable cost is US$ 25 per each rooms occupied.

      My tax is 15% for government. My Hurdle Rate is 14% (Hurdle Rate is minimum rate for running the business rather than putting my money into the bank or other investment with lower risk)

      So based on that expectation, if i run the business for 10 years will it bring me benefit or not?

      Based on that example, i just input all that into the app and the result should be
      NPV = US$ 998.285
      IRR = 16,79%
      Disc Payback Period = 8,02 years

      Based on that result means that i should run the business because after 10 years of operating the hotel, i will gain profit US$ 998.285 or i will get my investment money (which is US$ 10 million) after i operate my business for 8,02 years.

      That is my tutorial about this knowledge.

      Hope it helps.

      ^^ good luck in trying our app.

      Regards,
      dotstripes

  3. Behzad says:

    Hi
    I would like to get more example to learn and also I would like to know all of the above mentioned Items
    How can I know about these
    Best Tegards
    Behzad Moslem

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