EDP Notes

The need for screening of the ideas arises because all the ideas generated may not be
promising. Only the most promising or most profitable ideas are to be selected for further study.
The process of evaluating the project ideas with a view to select the best and promising idea after
eliminating the unprofitable ideas is called screening of project ideas. The following factors need to
be considered:
1) Cost of The Project: A study of the cost structure under material cost, labour cost, factory
overheads etc., will give a good idea regarding different types of costs.
2) Profitability: The project yielding higher return must be selected.
3) Marketing Facilities: Existing and potential demand in domestic and export market, nature of
competitions, sales and distribution system, consumption trends etc., should be assessed and
evaluated before taking the final decision.
4) Availability of Imputs: The resources and imputs required for the project must be reasonably
assured. The availability of skilled workers is to be ensured before launching an enterprise.
5) Consistency with Government Regulations and Priorities.
6) Compatibility with the Entrepreneur: The idea must suit the interest, personality and
resources of the entrepreneur. It should not be beyond his capacity.