Testing the Concept in the Market

Feasibility Analysis Used to test a business concept Determines if an idea for a new business is practical. Questions addressed- Are there customers who want what you have to offer? What conditions might be present for you to decide to go forward with the business?

To determine feasibility Research the industry Trends Barriers Profit margins Talk to customers (target market) Measure interest in product Understand needs and wants

To determine feasibility Study the competition Talk to Visit Research Talk to their customers Talk to suppliers Create a competitive grid Look at start up resource needs Purchasing equipment Leasing or buying facility? Carry companies expenses until you can turn a profit

The Competitive Grid Competitors Customers Benefits Direct Indirect Competitor’s target market Benefits Benefits customers receive from the business (not the products)

The Competitive Grid Distribution Strengths and Weaknesses Direct Indirect (use of middleman) How does the product get there? Strengths and Weaknesses Analyze with your opinion