Feasibility study : setting up a broiler farm in Malta

Abstract

Purpose As a result of Malta's accession to the EU and the removal of levies on chicken meat, the way Maltese producers operate has changed and new challenges have cropped up. This farm has been in operation since 1985 and at present, they are considering renovating the existing premises together with expanding the farm's capacity. Therefore, the aim of this study is to determine whether it is economically viable to perform these changes to the farm. Design The study begins with an overview of the poultry and broiler industry in Malta. It continues with a review of the literature on the investment appraisal techniques that were used to measure the financial viability of the project and other important factors that were considered. The next section describes how the data for this study was gathered. This study then concludes with a financial evaluation and recommendations for similar future studies. Findings The researcher conducts a vast financial evaluation with the use of the investment appraisal techniques mentioned in the literature review. It was found that this project is financially viable. Conclusion On the basis of the results obtained, management should proceed with this project as it is financially worthwhile to do so. However, this study is only meant to serve as a source of information to help management make an informed decision. Implications This study shows that the shareholders of this farm would be better off if they invest in this project as it yields a return which is higher than they require.