Small Business Management- Sample of Feasibility Study

Feasibility Study

Fish Farming

The Other Woman In Marriage

Table of Content

Description Page

1. Cover page x

2. Table of content x

3. Introduction/Executive summary x

4. Background x

5. Marketing/Need Assessment x

6. Technical Evaluation x

7. Governance & Management Structure x

8. Financial Evaluation x

9. Conclusion x

EXECUTIVE SUMMARY

Introduction

. Farm-reared fish offer a new alternative agricultural crop that can potentially replace those which are declining in popularity or profitability. Healthy farm-reared fish, guaranteed free of diseases, pesticides, and other harmful toxicants.

. The objective of this feasibility study is to assess the viability of setting up a commercial fish farm raising a variety of fish species for exports and the local market.

Market/Need Assessment

. Most of the net growth in fish production over the past 20 years has come from the development of fish farming, especially in the developing countries. At 11% per year, fish farming or aquaculture has in fact been the fastest growing source of food and agricultural income worldwide for the past 20 years.

Technical Evolution

. The system recommended is one that grows fish in nursery tanks, then grades and splits the population into larger grow out tanks as the fish gain weight.

Governance and Management Structure

. The total initial Manpower requirement for the project is approximately 41 personnel

. The sponsors of the project may find it preferable to won and operate the business through a private limited company.

Financial Evaluation

. The total cost of the project is estimated at N80 million Naira including working capital of N5 million. Financial operating results for the first five years is given below.

Earnings Forecast

Description	Year 1	Year 2	Year 3	Year 4	Year5
Revenue Receipts (Income)	30,000	55,620	57,289	59,007	60,777
Gross Profit	27,000	44,862	46,197	54,512	56,262
Operating Profit	21,000	44,862	46,197	47,566	48,969
Net Profit	8,970	24,480	25,348	26,238	27,150

Conclusion

. The proposed Hatcher cum research and development unit at the project would play a critical role in the further expansion of the project by experimenting on more exotic and high value species some of which sell for hundreds of dollars in western markets.

1.1 BACKGROUND

Fish farming involves the raising of fish, usually for food, commercially in tanks or enclosures.

1.2 Objectives and Scope of Study

The objective of this feasibility study is to assess the viability of setting up a commercial fish farm raising a variety of fish species for export and the local market.

MARKET/NEED ASSESSMENT

2.1 Global Trade in Fish Products

While fishing must surely be one of the oldest recorded sources of livelihood, it is only recently (comparatively) that fish has become an important components of diet of those especially living in developing countries.

2.2 Description and evaluation of fish farming techniques

A number of aquaculture practices are used worldwide in three types of environments (freshwater, brackish water, and marine) for a great variety of culture organisms.

2.3 Project Brief

The proposed project will be involved in inland fish farming using intensive techniques producing high value species for exports.

TECHNICAL EVALUATION

3.1 Components of Recirculation Aquaculture

Tank Production Systems

A recirculation fish farming system comprises of a number of major components that are necessary for the management of the system. This includes both site and system components.

3.2 Site components

The site components include equipment and structures that are not part of the actual recirculation system. The following site components are recommended.

Land, Building, Pump House, Feed Mill Extruder, Hatchery and R and D Facilities, Three Phase Electricity, Emergency Generator, Bulk Feed Storage.

3.3 System components

System components include equipment that is directly involved in the culture of the fish within the recirculation system. Major system components include the following:

Oxygen Generator or Source of Aeration, Mechanical Filtration, Biological filtration, Sterilization, Heating and Cooling, Lighting, Tanks, Pumps and Pipes.

3.4 Water Quality Management

As fish live and breathe within water, it is important that optimum water quality conditions are maintained within the recirculation system especially when fish are stocked at high densities.

3.5 Stock Management

Culture stock must be managed carefully to ensure the health, survival and growth of the animals. This is particularly important in recirculation systems as the fish are held under very high density conditions.

3.6 Approximate completion Schedule

The activities related to the overall establishment of the unit are expected to take 6months.

GOVERNANCE AND MANAGEMENT STRUCTURE

4.1 Governance

A special purpose company may be established to own and operate the project. The project will be managed by a Board of Directors to be headed by a Chairman. Board will be assisted by a Managing Director who in turn will be supported by General Managers Technical, Operations, Finance and Admin, and marketing and sales.

4.2 Corporate Status of the project

The sponsors of the project may find it preferable to own and operate the business through a private limited company.

FINANCIAL EVALUATION

Here, we evaluates various financial aspects of the project (Cost of project, earnings forecast, rates of return, payback period, cash flow, balance sheet, etc.).

Note that you will bring in the followings and calculations - if you are using it for your business, you will need an accountant to complete these for you as they will on table:

5.1 Cost of Project

5.1 Projected Profit and Loss Account

5.1 Projected Income Statement

5.4 Projected Cash flow Statement

5.5. Projected Balance Sheet

5.6 Conclusion

Globally there is a shift away from conventional extensive fish farming techniques due to a variety of reasons such as a large land requirement, a need for ample amount of water and low yields per unit area.