PROJECT PLANNING AND MANAGEMENT

ASSIGNMENT
ON
“SELECTING A BUSINESS IDEA”

Submitted By:
MOHD MUDASSIR RAHAT
09-MBA-38
Finance
INTRODUCTION

A business model is the business concept put into practice. Here are five
business ideas from which one is selected on the basis of highest factor score
calculated by Project Rating Index Method.

Project Rating Index table is as follows:

Factors Weig Rati Factor

hts ng Score

TOTAL FACTOR
SCORE

Decision Rule:

If Calculated Index > Predetermined Value: ACCEPT

Else: REJECT

The terminologies used are defined as follows:

1. FACTORS- A factor is a limiting variable or constraint, when a

business idea comes into picture.
2. WEIGHTS- Weight is relative importance of Factors.
3. RATING- Rating is the ranking of Factors according to their
importance.

2
 4. FACTOR SCORE- It is the value of Weight multiplied by Rating of
a particular factor.

The five Business Ideas that are chosen are listed below:

I. MINERAL WATER BUSINESS

II. GAS REFILLING BUSINESS
III. MOBILE RETAIL BUSINESS
IV. SCHOOL BAG BUSINESS
V. BAKERY BUSINESS

Project rating index for each business is calculated as follows:

BUSINESS IDEA NO.1: MINERAL WATER BUSINESS

Project Rating Index Table I

Factors affecting Weig Rati Factor

Business hts ng Score
Know how 0.2 3 0.6
Capital 0.1 3 0.3
Technology 0.1 3 0.3
Labor Force 0.1 4 0.4
Materials 0.3 1 0.3
Location 0.1 3 0.3
Legal Constraint 0.1 3 0.3
TOTAL FACTOR 2.50
SCORE

3
BUSINESS IDEA NO. -2: GAS REFILLING BUSINESS

Project Rating Index Table II

Factors affecting Business Weight Ratin Factor

s g Score
Know how 0.10 4 0.4
Capital 0.10 3 0.3
Technology 0.05 4 0.2
Labor Force 0.20 4 0.8
Materials 0.20 2 0.4
Location 0.30 3 0.9
Legal Constraint 0.05 5 0.25
TOTAL FACTOR 3.25
SCORE

BUSINESS IDEA NO. -3: MOBILE RETAIL BUSINESS

Project Rating Index Table III

Factors affecting Weig Ran Factor

Business hts k Score
Know how 0.20 5 1.0
Capital 0.40 3 1.2
Technology 0.10 3 0.30
Labor Force 0.05 2 0.10
Materials 0.05 1 0.05
Location 0.15 3 0.60
Legal Constraint 0.05 5 0.25
TOTAL FACTOR 3.95
SCORE

4
BUSINESS IDEA NO. -4: SCHOOL BAG BUSINESS

Project Rating Index Table IV

Factors affecting Weig Ran Factor

Business hts k Score
Know how 0.10 5 0.50
Capital 0.20 3 0.60
Technology 0.05 5 0.25
Labor Force 0.10 3 0.30
Materials 0.25 1 0.25
Location 0.25 2 0.50
Legal Constraint 0.05 5 0.25
TOTAL FACTOR 2.65
SCORE

BUSINESS IDEA NO. -5: BAKERY BUSINESS

Project Rating Index Table V

Factors affecting Weigh Ran Factor

5
 Business ts k Score
Know how 0.15 3 0.45
Capital 0.20 3 0.60
Technology 0.20 4 0.80
Labor Force 0.20 3 0.60
Materials 0.10 2 0.20
Location 0.05 4 0.20
Legal Constraint 0.10 5 0.50
TOTAL FACTOR 3.35
SCORE

CONCLUSION:

Highest factor score is 3.95 of the idea Opening a Play School.

Thus, the best business idea among five ideas is proved to be OPENING A
MOBILE RETAIL BUSINESS.