What Is Investment Project? Everything You Need To Know

What Is Investment Project?

An Investment project is a set of coordinated and interrelated activities that try to fulfill a specific purpose. In general, a period and a budget for the fulfillment of this purpose is recognized, which is why it is a concept very similar to a plan or program.

An investment, on the other hand, is the placement of capital to obtain a future profit. This means that, when investing, an immediate benefit is resigned to an unlikely one.

An investment project, therefore, is a proposal for action that, based on the use of available resources, considers it possible to obtain profits. These benefits, which are not safe, can be achieved in the short, medium, or long term.

Every investment project includes the collection and evaluation of the factors that directly influence the supply and demand of a product. This is called a market study and determines which market segment the project will focus on and the quantity of product that is expected to be marketed.

The investment project, in short, is a plan to which capital and material, human and technical inputs are assigned. Its objective is to generate an economic return at a certain term. For this, it will be necessary to immobilize long-term resources.

Investment project stages involve the identification of an idea, a market study, the decision to invest, the administration, and the evaluation of the results. Different specialists usually evaluate the project itself.

Four types of study for Investment Project

1. Market Study:

It is formed in turn by several stages, having in the first place the detailed definition of the product or service that is intended to be developed and offered.

After having found the identity of the project, it is necessary to ask if there is a level of demand that justifies its realization;

On the other hand, if it is a revolution, then the question will be whether it could positively impact the portion of the society to which it is directed. After this part, the investigation of the potential competitors and the characteristics of their offers, such as their success, prices and their sales history and presence in the industry.

2. Technical Study:

It is dedicated to determining the way and the resources with which the production will be carried out, going through the physical space that will be destined to that end, the best options to obtain the raw material, the machinery, the methods of work and the ideal profile of the employees to whom this stage will be assigned.

3. Financial Study:

We must not forget the budget, given that to reach a decision regarding each of the points just discussed, it is necessary to evaluate the inevitable economic impact.

And this is the study that is in charge of analyzing carefully the feasibility of the project and decides if it can be continued or if it is convenient to redesign the strategy to avoid considerable losses.

4. Organization Study:

As the name implies, it is about looking for the best way to start the company, finding the right means to bring to reality all the ideas that have been evaluated and accepted so far.

Conclusion:

It should be noted that in a team you can clearly distinguish between the creative department and the directorial department and that your communication must be clear and constructive to achieve objectives that satisfy everyone.

The most common is that the final product differs considerably from its initial conception, given the results of the four studies just detailed, for which it is necessary to keep alive the spirit of the creatives, at the same time they are asked for modifications that make their profitable and safe ideas projects.