A feasibility study is a controlled process for identifying problems and opportunities, determining objectives, describing situations, defining successful out-comes, and assessing the range of costs and benefits associated with distinguishing solutions to a problem. A feasibility study is used to support the decision-making process and should be utilized prior to the development of a full business plan. Typically, a feasibility study can be between four and eight pages, and it should be included in the business plan or as a separate document.
Our feasibility studies will include the following areas.
- Marketing Viability
- Technical Viability
- Company Model Viability
- Management Model Viability
- Economic Model Viability
- Financial Model Viability
- Exit Strategy Viability
A feasible business venture is one where the company will generate adequate cash-flow and profits, withstand the risks it will encounter, remain viable in the long-term, and meet the goals of the founders. The venture can be either a start-up business, the purchase of an existing business, an expansion of current operations, or a new enterprise for an existing company.
The conclusions of the feasibility study should outline in depth the various scenarios examined and the implications, strengths, and weaknesses of each. The project leaders need to study the feasibility study and challenge its underlying assumptions. This is the time to be skeptical.
Don’t expect one alternative to “jump off the page” as being the best scenario. Feasibility studies do not suddenly become positive or negative. As you accumulate information and investigate alternatives, neither a positive nor negative outcome may emerge. The decision of whether to proceed is often not clear cut. Major stumbling blocks may emerge that negate the project. Sometimes these weaknesses can be overcome. Rarely does the analysis come out overwhelmingly positive. The study will help you assess the tradeoff between the risks and rewards of moving forward with the company project.
Remember, it is not the purpose of the feasibility study or the role of the consultant to decide whether or not to proceed with a business idea. It is the role of the project leaders to make this decision, using information from the feasibility study and input from consultants. company feasibility study, and the market feasibility study.