Is your business/venture Feasible? Capable of being done or carried out? E

How about a Feasibility Study? the process of determining whether an entrepreneur’s idea is a viable foundation for creating a successful business. It determines if the business venture is feasible “doable”.

What is the Purpose of a Feasiblity Study? Determines whether the business/venture idea makes sense. Are there any make or break issues that would prevent your business from being successful in the marketplace? Identifies roadblocks facing your business/venture before you make an investment.

Benefits of a Feasibility Study Provide a lot of information necessary the business/venture plan. ✓ Good market anyalsis is a necessary in order to determine the business/venture feasibility. Identifies reasons not to proceed Provides documentation that the business was thoroughly investigated (will help with getting financing, as well as help to attract equity investment) Identifies new opportunities through the investigative process.

Reasons NOT to conduct a Feasibility Study... Already know it is Feasible (another business is already doing it and is successful). Why do one when one was done a few years ago? Just a way for consultants to make money. Market analysis has already been done by the business that sold us the equipment. A feasibility study is a waste of time. These may sound like good answers but remember... you may need to live with these decisions for a long time.

Conducting the Feasibility Study... Market Cosiderations... Technical Considerations... Financial Considerations... Organizational/Managerial Considerations... Competitive Considerations...

Market Considerations Current or projected demand for your proposed product or service(s)? What are the target markets for your product or service? What competition exists in this market? Is the location of your proposed business location likely to affect the success of your business? What is the projected supply in your area of the products or services needed for your project.

Technical Considerations Technology may or may not be of critical importance. Compare a daycare center to a manufacturing enterprise. If Technology is a consideration: ◦ What are the needs for the business/venture? ◦ What other equipment does your business need? Where will you get it? When will you get it? What does it cost?

Financial Considerations Start-up Costs Operating Costs Revenue Projections Sources of Financing Profitability Analysis

Organizational / Managerial What organizational Structure is the right one for your business/venture? Who will serve on the Board of Directors and what are their qualifications? What qualifications are needed to manage this business? Who will manage the business? What are the staffing needs?

Competitive Considerations What competition exists n this market? Can you establish a market niche which will enable you tom compete effectively with others providign this product or service? How much is your competition charging for similar product?

Characteristics of a well conducted Feasiblity Study A good Feasibility Study will highlight the issues with the current plan and what needs to be done before the project is successful. Answers the following questions ◦ Are customers willing to purchase our goods and services? ◦ Can we provide the product or service to customers at a profit?

Possible Courses of Action after a Feasibility Study Increases chances of the project being a success Informed decision making Reduces wasting money Records what you know about the project The Feasibility Study Report can be used to support your funding application

Procedures for determining the feasiblity of a venture/product. Is the industry as a whole profitable? Is the industry characterized by high profit margins or razor-thin margins? How essential are its products or services to customers? What trends are shaping the industry’s future? What threats does the industry face? What opportunities does the industry face? How crowded is the industry? How intense is the level of competition in the industry? Is the industry young, mature, or somewhere in between?