Analyse the Performace of Existing Industries Examine the Inputs and Outputs of Various Industries Review Imports and Exports

Generation of Ideas Monitoring the environment Corporate appraisal Scouting for Project Ideas Preliminary Screening Project rating index Sources of positive not present value On being an entrepreneur

Availability of Inputs Adequacy of Market Reasonableness of cost Acceptability of risk level Compatibility with the Promoter Consistency with Government Priorities Availability of Inputs Adquacy of the Market

Corporate Appraisal A realistic appraisal of corporate strengths and weakness is essential for identifying investment opportunities which can be profitably exploited. The broad areas of corporate appraisal and the important aspects to be considered under them are as follows:

Marketing & Distribution a. Market image b. Product Line c. Market Share d. Distribution Network e. Customer Loyalty f. Marketing & Distribution costs

Production & Operations Condition & capacity of plant & machinery Availability of raw materials, sub- assemblies, & power Degree of vertical Locational advantage Cost structure

Production & Operations (contd.) Availability of Inputs Adequacy of Market Reasonableness of Cost Acceptability of Risk Level

Compatibility with the Promoter The idea must be compatible with the interest, personality, and resources of the enterpreneur. According to Murphy, a real opportunity has three characteristics: (i) It fits the personaility of the entrepreneur—it squares with his abilities, training, and proclivities. (ii) It is accessible to him. (iii) It offers him the prospect of rapid growth and high return on invested capital.

Consistency with Governmental Priorities Is the project consistent with national goals and priorities? Are there any environmental effects countrary to governmental regulations? Can the foreign exchange requirements of the project be easily accommodated? Will there be any difficulty in obtaining the license for the project?

Availability of Inputs Are the capital requirements of the project within manageable limits? Can the technical know-how required for the project be obtained? Are the raw materials required for the project available domestically at a reasonable cost? If the raw materials have to be imported, will there be problems? Is the power supply for the project reasonably obtainable from external sources and captive power sources?

Adequacy of the Market The size of the present market must offer the prospect of adequate sales volume. Further, there should be a potential for growth and a reasonable return on investment. To judge the adequace of the market the following factors have to be examined.