Micro Hydro Power Management

1
Micro Hydro Power Management

• Recommended Steps
• in Business Development
• - a Check List

2
Content of Presentation

• Recommended steps
• Market Assessment
• Business Type Assessment
• Production Process Examination
• Resource Need Assessment
• Investment Requirements
• Impacts on the Environment
• Detailed Feasibility

3
Recommended Steps

• Assessing the market potential
• Assessing specific business forms / niches
• Examining specific production processes and
  services which may be viable
• Assessing the man power and natural resource
  requirements
• Assessing the overall feasibility of the business
  
• Assessing required investment
• Assessing potential impacts on the environment

4
Market Assessment

• What should be considered?
• Market area? Far or near?
• Who are the consumers? What is their capacity to
  absorb the product / services ?
• How to sell?
• How to promote?
• Is there serious competition ? How many ?
• What is the market chain? Who are the middlemen?
• What is the competitors pricing strategy?

5
Business Type Assessment

• Things to consider are
• Type of business service or product?
• Location - production site / office suitable /
  available etc.
• Past experience with running an enterprise ?
• Is it dependant or does it require involvement of
  other businesses ? How would such an arrangement
  work?

6
Production Process Examination

• What is the technology ?
• Is it reliable ?
• Can local manpower operate or repair it ?
• What about spare parts ?
• What is the normal production rate ?
• How much energy does it require ?
• How much energy per unit product is required ?
• Manpower required ?
• Etc.

7
Resources Need Assessment

• Is capable local manpower available ?
• Is local managerial capacity available ?
• What are the labour costs ?
• What raw materials are needed?
• How much do they cost ?
• Where can raw materials be sourced ?
• Are the raw materials available locally ?
• How much is needed per unit product ?
• What are the transport costs ?

8
Investment Requirements

• What are the investment costs ?
• What do they cover ?
• Production equipment
• Man power
• Raw materials
• Promotion
• Marketing and distribution
• Where to access funding ?
• Can this be repaid (financial viability) ?

9
Impacts on the Environment

• Are formal approvals required if so how are
  these obtained ?
• Are there any impacts on the community ? ?New job
  opportunities ?
• Are there any impacts on the environment ?
  ?Positive / negative ?
• Does the community accept the existence of the
  business ?
• Are there any cultural issues to be considered ?
• How can the community participate / be integrated
  ?

10
Detail Feasibility

• Detail feasibility means the management has to
  calculate in detail the financial and technical
  feasibility of the proposed enterprise
• The parameters of feasibility are
• Potential market product absorbance
• Investment requirement
• Man power plan
• Raw material availability
• Production operational costs and other costs

11
Detail Feasibility

• The parameters of feasibility are
• Pricing strategy
• Cash flow projection
• Calculation of payback period
• Calculation of net present value and internal
  rate of return
• Impacts on the environment
• Etc.
• The result of the feasibility study will be
  critical in mobilizing finance, which ultimately
  determine whether the proposed venture will
  materialize or not