CAVITE STATE UNIVERSITY

Rosario Campus
Rosario, Cavite

MANAGEMENT STUDIES DEPARTMENT
(Business Management)

Long Examination

FEASIBILITY STUDY
BMGT198
Sample of a Feasibility Study
Required: Given below outline format, use the paragraphs below to prepare a sample Feasibility Study entitled
Feasibility Study of Establishing Cindys Fast Food Branch along Plaza of Balanga, Bataan
(120 pts)
1. General Objectives
1.1. Description of the Business Project
1.2. Project Time Table
1.3. Management of the Business
2. Product and Market Aspects
2.1 Market Outcome
2.2 Market and Selling Price
3. Technical Aspect
3.1 Location Factor
3.1.1 Topography
3.1.2 Cost of Land
3.1.3 Security

3.2 Size and Layout of the Building
3.3 Equipment
4. Project Cost
4.1 The Land and the Building
4.2 Sources of Financing
5. Business Operation
5.1 Revenues



The state-of-the-art tables, chairs and utensils will enhance the customers feeling that they are in a five-star
hotel. Very affordable, the food will enthrall every customer to come and savor the food over the widely spaced
tables on the immaculately marbled floor. The electronically flushing system of the restrooms will motivate the
customers to force their friends and relatives to frequent this new Cindys Branch at the heart of the Balanga.
All minor details considered, the project will start serving the five thousand targeted daily customers within five
months. The contractors will complete the fence and the framework of the building in the first month. They will
finish the walls and the floors in the second month. They will install the electrical and the air conditioning units
in the third month. After the first and second layer coating, they will complete the final painting in the fourth
month and finally they will landscape and plant balled-trees in the fifth month. As the project will be in
progress, the company will busy the facilities to be used.
The proposed business will need a two-storey building in a 2,000 square-meter lot with a parking space at the
rear. The customer will drive in the left entrance greeted by the water-sprinkled Indian trees partly shielding the
establishment from the fumes coming from the busy street. Embraced by the multi-colored lights, the trees will
set the cosmopolitan setting to a rustic atmosphere. The building will be constructed to hide the stockroom
complementing the architectural masterpiece. The smoothly cemented exit passing through the well-manicured
lawn will draw sights of satisfaction from the customers.
A variety of expensive fireworks commence the business to attract the children, students, parents, and
professionals. This opening blast will have been advertised a month before. The initial big crowd from the
different districts of the province will keep growing to actualize the managements vision that this Cindy
Branch will be the most profitable among the food chains in the City.
To maximize the 40 x 50 meter land area, the engineers will erect the 20 x 30 meter proposed two storey
building, leaving five meters at both sides and 18 meters fronting the street. Only two meters will be left at the
back of the building. This will ventilate the establishment.
With three managers alternately scheduled on the eight hour duty to man the 95crew in the 24 hour service, the
business will surely satisfy the customers, propelling profit to soar. The personnel will make a customer feel
that he is the only one served amidst the queuing multitude. The high wage given by the company and, likewise,
the humane treatment of the superiors will inspire the crew to render machine-precise service.
At the center of Balanga Plaza, this food center will surely draw customers from the cross-section of society.
The following factors will back-up the companys foresight:
The 2,000 square-meter lot does not need labeling because the area is already flat and it is located in high
location. No matter how strong the typhoon will be, the rains will not flood the area. The customers will not be
drawn away from enjoying the services of Cindys.
The customers can order from a variety of choices in the counter staffed with beautiful and handsome ever-
smiling crew. The waiters will serve the orders in the well-crafted, smoke free dining areas with both oriental
and western motifs to fit their number and their tastes. These areas will enhance customer privacy as the
customers enjoy eating while talking about the gossips of the town, or as they engage in a highly intellectual
calisthenics about a hot political issue. The area will also conduce lovers to cement their relationship with their
soul-penetrating interlocked gazes that only lovers could fathom, as they savor their food.
The fertile business venture will cheapen the current P20,000 per square meter piece of land. The forty five
million peso worth of property will double after only three years of operation.
The place will be safe. Secretly installed cameras will monitor every move to ensure the security of the
customers. Four security guards simultaneously assigned to the area will guarantee the safety of the clients. This
will be backed up by policemen assigned at the outpost nearby.
The Bataan Builders will construct the building. This construction company will use modern building
equipment like a cement mixer, caterpillar, automatic digging drill, and other state of the art construction
materials.
This project will cost about P 45,000,000.00 which is roughly broken into the following:
Cost of 2,000 meter lot P 40,000,000.00
Cost of 2 storey building P 4,000,000.00
Accessories and Equipments P 1,000,000.00
Total Cost P 45,000,000.00
The 45 million pesos worth of land is the biggest of the capital investment but it is worth it because unlike the
other expenses, the land value will appreciate through the years. The contract with the Bataan Builders for the
proposed two-storey building is P 4,000,000. This includes materials and labor. With the five-month paying
scheme, Cindy will pay P 800,000 every month until the last month. The food center will need P 1,000,000 for
the imported accessories like tables, chairs and other needs.
The proprietor will put in P 5,000,000. The remaining P 40,000,000 will be borrowed from the bank.
With 50 thousand monthly net income target from about five thousand daily customers, the proposed branch
projects the following net income by month and years:
First month P 1,500,000.00
First year P 18,000,000.00
Second year P 36,000,000.00
Third year P 54,000,000.00
Fourth year P 72,000,000.00
After four years of operation, this venture will have gained P 11,000,000 as shown in the following
computations:
Net income in four years P 72,000,000.00
Minus the sum of investments P 61,000,000.00
Difference P 11,000,000.00
Loaned money from the bank P 42,500,000.00
Interest of loaned money P 17,000,000.00
Franchise P 1,000,000.00
Maintenance P 500,000.00
Total P 61,000,000.00


END OF THE EXAM