The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective, the document/study covers various aspects of project concept development, start-up, production, marketing, finance and business management. The document also provides sectoral information, brief on government policies and international scenario, which have some bearing on the project itself. This particular pre-feasibility is regarding production of purified drinking water on commercial basis which comes under food sector. Before studying the whole document one must consider following critical aspects, which forms the basis of any investment decision. 3 CRUCIAL FACTORS & STEPS IN DECISION MAKING FOR INVESTMENT IN THE PROJECT Before making any investment decision, it is advisable to evaluate the associated risk factors by taking into consideration certain key elements. For establishing a water purification plant critical factors that should be considered before launching are described below. •The market for purified bottled / mineral water is a growing market, but offers tough competition. •Perception / positioning of the new brand. Usually the top target market for bottled mineral water follows the perception. If the perception is positive, the results will be higher sales. The positive perception for distributors and final customers may result from direct consumer experience, awareness, direct promotional activities, print media and TV advertising. •Distribution is very important for the success of new brand. The stronger the distribution the more successful will be the new brand. The distribution strategy should be designed after a careful study of the market for going for regional distribution or for nation wide distribution. •Pre-launch advertising is vital for positive perception of the product which will result in higher product acceptance. •Availability of product at A class, B class or C class shops should be decided before launching the product and availability should be persistent. Table 3-1 Project Time Lines
S. NoActivityTime (Months)
2Plant order and lay out3
The construction of civil works has been estimated to be completed in two months and the plant order, lay out and installation is estimated to have a time period of three months. The time required for pre-opening operations is one month. It also includes pre-launch advertisements on TV and in print media. The project time line may extend and cut back depending upon the start of activities on parallel basis or one after another. 4 PROJECT PROFILE
This proposed project presents an investment opportunity for establishing a bottled water plant for providing pure drinking water. The proposed product line will consist of bottles of 1.5 and 0.5 liters. In the initial phase of the project only 0.5 liter and 1.5 liters bottles will be introduced in the local market. After successful introduction of the new brand of bottled water the product line may be extended to 15 and 20 liter Jars.
The total cost of the project has been worked out to be BDT. 20.23 million. This includes a fixed cost of BDT. 17.96 million and a working capital requirement of BDT. 2.27 million. Period of construction is two months for civil works and three months for machinery & equipment layout and installation.
Two sources of water can be used for purification purposes on commercial basis. •Ground Water
The ground water option is relatively costly as it involves more treatment. The ground water available in different areas has different chemical composition and the treatment would vary depending upon the chemical composition from area to area. The water...