An Economic Feasibility Study is a document that must be prepared if you are bidding for a concession for a specific public good or service, and it typically constitutes a mandatory part of the tender documentation. For the allocation of a concession on the maritime domain, an Economic Feasibility Study is a mandatory attachment to the bid.
It is common for the tender documentation to prescribe the specific content of the study; thus, it can range from simple and concise to extensive and concrete. Naturally, this depends on the type of public services/goods in question and the estimated value of the concession.
The Economic Feasibility Study demonstrates the viability and profitability of the economic use of the public good or service. This requires creating a projection of operating revenues and expenses regarding the subject of the concession for the entire duration of the concession period. Within the study, the amount of the fixed and variable parts of the concession fee for the economic use of the good or service is determined. The amount of the concession fee, alongside the amount of investment into the concession subject, are the most frequent criteria by which received bids are evaluated and ultimately ranked.
Beyond the goal of winning the tender, it is crucial to ensure that the stated concession fee can be covered by operating revenues (along with other operating expenses necessary for performing the activity), and that the investment into the concession good has its own economic viability—whether direct or indirect.
Additional criteria that may be evaluated, and which form an essential segment of the Economic Feasibility Study, include the number of planned new jobs, as well as the bidder’s experience in performing the activity for which the concession is sought.
In our experience, more complex Economic Feasibility Studies are primarily required for the purpose of obtaining concessions on the maritime domain, specifically for ports, beaches, marinas, anchorages, hospitality facilities, etc.
Simpler examples of Economic Feasibility Studies are required for goods or services that can be provided on the maritime domain, such as: maritime and passenger agencies in ports, fuel supply for vessels, and similar activities.
For these more complex studies, it is highly recommended that they be prepared by an expert with the necessary experience and knowledge. The study must cover the entrepreneur’s historical performance, location analysis, technical-technological analysis, procurement and sales market analysis, and an economic-financial analysis that includes a projection of operating revenues and expenses, as well as an assessment of the return on investment.
Zobnica d.o.o. is focused on project preparation for obtaining financing from various sources, ranging from EU funds to commercial bank loans, as well as consulting on the preparation of various types of studies for concession applications. We have been successfully operating in the consulting market for 10 years, with clients coming from various industries and sectors. For institutional clients (Port Authorities, counties, and Local Self-Government Units), we have prepared feasibility studies for granting concessions, and for entrepreneurs, we have prepared economic feasibility studies for applying to concession tenders, giving us a comprehensive view of the process from both sides.
We understand that concession renewal for clients who have already invested significant funds into the concession subject is a very sensitive topic, and that obtaining a new concession is a vital and delicate matter for them; we approach it with the appropriate level of care.
The study preparation process should begin on time, even before the official publication of the concession tender, as alignment with tender conditions can be adjusted in a later phase.
If you require an Economic Feasibility Study and wish to have an informational conversation with us or receive a quote, please fill out the form at the following link, and we will get back to you as soon as possible.
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