1. Demand and Market Appraisal of Project
Dr. Raghu Bista & Mr. Pramod Niroula
NASC,

2. Appraisal
Project appraisal involves critically examining the basic data, assumptions and methodology used in project preparation to assure project’s viability, profitability, sustainability. In case of Market Appraisal, the demand/needs of the project is examined.

3. Project Appraisal: Market Aspects
A market appraisal reviews the project ‘s demand, number of local beneficiaries, prices of services or products, distribution mechanism, future market growth to ensure it will generate profits or it will able to recover costs. The study is to assure marketability of the project.

4. Marketing as a Matching Process
A matching process to ensure that marketing mix and internal policies are appropriate to the market forces.
Wants, needs and demands Vs supply?
Potential Vs Penetrated Demand?

5. Marketing
Marketing is the business function that identifies an organisation’s customer needs and wants, determines which target markets it can serve best, and designs appropriate products, services, and programs to serve these markets. (sources: Kotler, P. and Armstrong, G, Principles of marketing, Prentice hall International)

6. Review of Market and Demand Study
Is the demand expressed a real need or only demanded for particular benefits of certain group?
Market and demand appraisal reviews how the demand size, demand growth, number of populations/ organisations that have demand for the product/service
How much is the unfulfilled demand?
What sources of data were used in analyzing market.

7. Review of Market and Demand Study Cont..
What price of product/service will be charged? How it was analyzed?
Analysis of competitors, their strength, weakness
Distribution mechanism etc.

8. Free Services and Market Study
Free services also have demand. Free services also compete in the market.
Production units including public schools, roads, hospital without having any market price must not be interpreted to mean that there is no demand, no competition, no substitute.

9. Process of Appraisal Review size of demand in multiple years
Reliability of sources of data
Objective and methods of market survey to find market related data
Examine assumptions, and methodology
Examine analysis of product, price, promotion related data
Assure Sufficiency of analysis
Conduct further study and analysis

10. Demand Forecasting Methods
Survey Method (Simple and for short term, more qualitative in nature)
Expert Opinion Pool
Market Experiment Method
Delphi Method
Statistical Method (Complex and Long term, quantitative nature)
- Trend Projection Method
Barometric Method
Econometric Method
Index Number Method
Decision Tree Method

11. Collection of Market Information
Review the Data sources: primary and secondary
The important secondary sources are national census, national survey, economic survey, reports of export promotion centre, reports of respected ministry
Market Survey
Is the collected data sufficient and reliable?

12. Market survey
Secondary information may not provide sufficient information. In that case, further information can be collected by market survey

13. Objectives of Market Survey
How much is the total demand?
At what rate the market is growing?
What are the size of different segments?
What needs they want to fulfill?
Existing supplier/ Possible market entrants
Are they dissatisfied with the present products?
How many of them are dissatisfied?
What quality is desirable to satisfy them?
How much they can spend?
What quality is acceptable? etc

14. Market Segmentation
Dividing a market into distinct groups (segments) of buyers with different needs, characteristics or behaviors who might require separate services or marketing mix

15. Undifferentiated Marketing
Marketing Mix
Undifferentiated Market
Company
Customer
Undifferentiated marketing

16. Differentiated Marketing
Marketing Mix 1
Marketing Mix 2
Marketing Mix 3
Marketing Mix 4
Marketing Mix 5
Segment
Segment 2
Segment 3
Segment 4
Segment 5
Company
Customers
Differentiated marketing

17. Concentrated Marketing
Marketing Mix
Segment 1
Segment 2
Segment 3
Segment 4
Segment 5
Company
Customers
Concentrated marketing

18. Concentrated Marketing Approach
A concentrated marketing approach where organisations target one specific segment out of the identified different segments. Selecting specific groups of people (poor and volnurable) and designing service mix accordingly.

19. Evaluating market segments
Segment size and growth
Segment attractiveness (for example if already served by many competitors, it may be less attractive). Particular segment is less attractive if there is less entry barrier, substitutes limit the potential price, if targeted customer can bargain price.
Organisation’s objectives and resources

20. Marketing mix decision
Product
quality, design, packaging, service, warranty etc.
Price
Pricing strategy
Promotion
Advertising
Personal sale
Public relations
Sales promotion
Place
Channel of distribution
Transport
Warehouse

21. Pricing
How much to price for goods/services of the project so that product will be accepted in the market ?
Is the data related to pricing is scientifically collected and analysed?

22. Distribution
Examination of different distribution process of the selected segments.
Evaluating different distribution process
Assuring Suitable distribution strategy

23. Promotion Evaluating alternative ways of promotion
Choosing suitable ways

24. Competitive Strategy
Differentiation Strategy (by product features, quality etc.)
Low cost Strategy (offering product or service of same quality at lower price in a sustainable manner)
Focus strategy (Serving particular segment with higher quality)

25. Marketing Mix of Service
Price
Product
Promotion
Place
People
Physical Evidence
Process

26. People in service Delivery
Production and consumption of service simultaneously.
Employees behaviors like courtesy, friendliness, responsiveness affect perceived service quality.
Service reliability (quality of consultant) is within the control of person

27. Process
Service production and delivery involves performing a process besides utilizing materials, equipment, and personnel. Customer participates in service deliver process. So the process is very important in the success of service operations. The process constitutes the service itself.

28. Physical Evidence
Physical evidence is defined as the environment in which the service is delivered and in which the firm and customer interact, and any tangible commodities that facilitate performance or communication of the service

29. Marketing Plan Is marketing plan suitable? Is it sufficient?
Is it implementable?
Revising plan

30. Assurance of Market Viability and Marketing Plan
Is project viable?
Will it be successful considering the demand and market?
Is the demand/market study sufficient?
Is marketing plan sufficient?

31. Thank You