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FEASIBILITY STUDIES A REQUIREMENT FOR STARTING A NEW COOPERATIVE BUSINESS IN NIGERIA

abstract

The project focuses on feasibility studies, which are required before launching a new cooperative business in Nigeria. It is impossible to overstate the significance of a well-prepared feasibility study in the cause cooperative information and investment drive. A well-prepared feasibility study can be used to obtain a bank loan and thus attract additional investment. Cooperative projects that are supported by thorough feasibility studies are difficult to terminate. The investment drive can only occur when there is enough money or resources. Alternative technology, production equipment, building, and other investments are available for any project. This study examines cooperative formation and investment motivation among registered cooperatives in Enugu East, Enugu South, Enugu North, and Enugu Central). The calculation of Tao Yamani Technique was used to determine sample size, and a sample size of 193 was chosen. The data was treated using simple percentage analysis and a hypothesis test. And recommendations and conclusions were derived from the data analysis findings.

CHAPTER ONE

INTRODUCTION

1.1BACKGROUND OF THE STUDY

For more than a decade, the Nigerian economy has been in shambles. The ongoing economic downturn has highlighted the importance of conducting feasibility studies before embarking on any project.

Feasibility studies entailed a closer examination of a project’s cost and benefit in order to determine whether such a venture is feasible, viable, and profitable.

The purpose of this research is to educate business owners and the general public about the importance of a feasibility report in any business venture, particularly a cooperative business venture. The investment drive can only occur when there is enough money or resources. A well-prepared feasibility study is required before starting a new cooperative business. A well-planned Feasibility studies can be used to secure bank loans and thus attract additional investment. According to Banmbank, a co-operative business with good feasibility studies is difficult to close down (2012). The accepted goal is to have the right goods in the right place at the right time and at the right price. He also believes that command is essential. A feasibility study is designed to complement and facilitate two critical functions: business planning and control. Thus, a feasibility study determines whether a proposed business opportunity will succeed or fail after carefully weighing alternatives against the firm’s goals. Different perspectives on why people form or join cooperative societies. Cooperative societies offer a different way of doing business.

the socio-economically disadvantaged people. It is obvious that the intention or motive for establishing a sole trade, partnership, or joint stock company is similar but not identical to that of establishing a new cooperative business in Nigeria.

According to Omuoha (2013), the profit motive motivates private entrepreneurs while the service to members motivates cooperatives. The need to choose between investment alternatives arises frequently in business decisions (Ude 2012). As a result, you must evaluate your project to determine whether it is worthwhile to go into business. Alternative technologies, production equipment, building, and other investments are available for any project. As each decision is reached, the problem of selecting the most viable solution arises. of the various alternatives.

1.2     STATEMENT OF THE PROBLEM

The number of business failures in Enugu state is increasing. “Starting a business is very easy, but staying in business is very difficult,” writes Louck (2011). Most businesses fail due to a lack of proper planning foresight on the part of their promoters. This is especially true for small-scale businesses with an owner and a few employees. The significance of feasibility studies in the process of establishing a new cooperative business cannot be overstated. The failure of a cooperative business venture calls into question whether feasibility studies were conducted. How effective were the feasibility studies? Were the provisions effectively implemented? What is the nature of the workforce’s quality?

The cooperative business is usually run on a daily basis.

in the hands of people who may lack the necessary skills and technicality.

It is against this background that the wants to embark upon the research topic titled “feasibility studies: a requirement for starting a new cooperative business in Nigeria.

1.3     OBJECTIVE OF THE STUDY

The primary goal of this research is to examine the utility of feasibility studies in the course of establishing a new cooperative business in Nigeria.

The specific goal is as follows:

1. Determine whether cooperative executives conduct thorough feasibility studies before launching a new cooperative venture.

2. To identify the causes of cooperative business failure.

3. Determine the extent to which cooperatives use feasibility studies as a tool for investment selection.

4. Determine the relationship between feasibility studies and cooperative business performance.

5. To recommend steps for conducting proper feasibility studies for efficient cooperative business performance.

1.4RESEARCH QUESTIONS

1. Do cooperative executives conduct thorough feasibility studies before launching a new cooperative venture?

2. What are the causes of cooperative business failure?

3. To what extent are feasibility studies used as a tool for cooperative investment selection?

4. What is the relationship between feasibility studies and cooperative business performance?

5. What steps should cooperatives take to conduct proper feasibility studies for efficient business performance?

1.5 RESEACH HYPOTHESIS

H1. Before starting a new cooperative business, cooperative executives conduct thorough feasibility studies.

H0. Cooperative executives do not conduct thorough feasibility studies before launching a new cooperative venture.

H2. Inadequate feasibility studies are attributed to the causes of cooperative business failure.

H0. The causes of cooperative business failure are not attributed to inadequate feasibility studies.

H3. To a large extent, feasibility studies are used as a tool for cooperative investment selection.

H0. Feasibility studies are used as a tool for cooperative investment selection to a limited extent.

1.5SIGNIFICANCE OF THE STUDY

This study will emphasize the importance of feasibility studies in establishing a new cooperative business in Nigeria.

This will be a huge help to those looking to start a new business.

It will also help to reduce business failure among cooperatives because people will recognize the importance of conducting feasibility studies during the cooperative formation/investment drive.

Aside from adding to the existing literature on this topic, it will be extremely useful to those who wish to conduct additional research on this or related issues.

It is also hoped that the adoption and implementation of the study’s findings and recommendations will help significantly in boosting our economy through business success generated by the study.

          1.6 SCOPE AND LIMITATIONS OF THE STUDY

This research focuses on feasibility studies, which are required when starting a new cooperative business in Nigeria. It also addresses the need for thorough feasibility studies in order to achieve high business performance. This work also investigates the causes of cooperative business failure and how these failures can be avoided and controlled.

During the course of this work, the researcher encountered significant financial and time constraints. Exorbitant, unreasonable, high and significant transportation costs, apathy, and a scarcity of cooperative books, journals, and other publications. The increased risk of traveling by road, as well as the geographical spread of the data base, were limitations in and of themselves.

1.7     DEFINITION OF TERM

Feasibility Analysis

A closer examination of a project’s costs and benefits to determine whether it is feasible, viable, and profitable to pursue as a business venture.

Report on Feasibility

A written, documented plan or blueprint for a business project’s operation.

Investment

Fund investment in assets with the goal of generating future returns.

Project

Plan to invest money in the purchase of assets or a combination of assets intended for installation in the business concern to yield a return.

Formation of a Cooperative Business

This is about how cooperative businesses can be established. It is the process of establishing a new cooperative business.

Cooperative Organization

It is a voluntary group of people who have come together to achieve a common goal.

 

 

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