A feasibility study is an analysis of how successfully a project can be completed, accounting for factors that affect it such as economic, technological, legal and scheduling factors. Project managers use feasibility studies to determine potential positive and negative outcomes of a project before investing a considerable amount of time and money into it.
A feasibility study tests the viability of an idea, a project or even a new business. The goal of a feasibility study is to place emphasis on potential problems that could occur if a project is pursued and determine if, after all significant factors are considered, the project should be pursued. Feasibility studies also allow a business to address where and how it will operate, potential obstacles, competition and the funding needed to get the business up and running.
There are several components of a feasibility study:
Description – a layout of the business, the products and/or services to be offered and how they will be delivered.
Market feasibility – describes the industry, the current and future market potential, competition, sales estimations and prospective buyers.
Technical feasibility – lays out details on how a good or service will be delivered, which includes transportation, business location, technology needed, materials and labour.
Financial feasibility – a projection of the amount of funding or startup capital needed, what sources of capital can and will be used, and what kind of return can be expected on the investment.
Organizational feasibility – a definition of the corporate and legal structure of the business; this may include information about the founders, their professional background and the skills they possess necessary to get the company off the ground and keep it operational.
A feasibility plan is quite similar but different to a business plan. The difference between a feasibility study and business plan is frequently misunderstood. The key difference is that while feasibility study investigates the options and viability of an idea, the business plan works towards making the idea successful. We offer these feasibility plans in order to help you assess the viability of your business idea.
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