Feasibility Study

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What is a Feasibility Study? Meaning.

A Feasibility Study or feasibility analysis is a preliminary evaluation of an idea to determine if its worth pursuing. More precise it's a preliminary analysis of a proposed business idea, plan, project or strategy to provide an overview of the primary related issues and to determine whether it is viable strategically, financially and operationally. It may or may not also include an analysis of potential scenarios and a recommendation on the best solution to use.

It provides a lot of information necessary for a business plan. Because putting together a business plan is a significant investment of time and money, it makes sense to ensure first that there are no major roadblocks facing the business idea before that investment is made. Identifying roadblocks is the primary purpose of a feasibility study.

Concept Statement

A FS is often preceeded by a concept statement: A 1-page description of the business/idea.

• Given to people/advisors who provide feedback on the potential of the idea.
• The purpose of this feedback is:
  • Give a sense of the viability of the business idea.
  • make suggestions for how the idea can be strengthened or altered before proceeding.
• Normally prepared before conducting a full feasibility analysis.

Typical Chapters of a Feasibility Study. Areas.

Feasibility studies typically look into following areas:

• Product or Service Feasibility and Issues
  • Concept Test: gauge customer interest, desirability, purchase intentions
  • Usability Test: determine ease-of-use and users perceptions of using product
• Strategic / Market Feasibility and Issues
  • Industry Attractiveness
  • Market Timeliness
  • Identification of a Niche Market
• Organizational Feasibility and Issues
  • Management Prowess (ability, passion, expertise, experience)
  • Resource Sufficiency (focusing on the non-financial ones)
• Financial Feasibility and Issues
  • Capital Requirements
  • Financial Rate of Return
  • Overall Attractiveness of the Investment
• Optional: Technical Feasibility and Issues

They should not go in too much depth, but should contain a basic analysis only.

In general, if the idea is deemed feasable in all areas, the FS should be followed by a full business plan.

If the idea is deemed not feasable in at least one area, it should be either improved first or else dropped.

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Information Sources Various sources of information regarding Feasibility Studies. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Establishing an Innovative Social Enterprise Social Entrepreneurship, Entrepreneurial Organization This presentation elaborates on social entrepreneurship and innovation. It includes the following sections: 1. Workshop (...) Preparing a Feasibility Study Feasibility Analysis This presentation gives an introduction into the concept of idea/business feasibility studies. The presentation consists (...) Analyzing Financial Feasibility Financial Feasibility Analysis, Project Selection, ROI, NPV, IRR Presentation about Feasibility Studies in the Financial Area. The presentation includes the following sections: 1. Fina (...) Concept Testing and Conjoint Analysis for New Products Concept Test, Concept Statement, Conjoint Analysis, Product Design, Product Innovation Presentation about concept testing and conjoint analysis, including the following sections: 1. Evaluating with Customer (...) Feasibility Study for Project Development of a Public Private Partnership Feasibility Study, Infrastructure Development, Public Private Partnership This presentation covers the topic of feasibility studies in developing a Public Private Partnership-project and include (...) Writing a Business Plan for a Social Enterprise Social Enterprise, Innovation, Entrepreneurship, Corporate Social Responsibility This presentation provides information about the business planning involved in entrepreneurship. It includes the followi (...)

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Compare with: Cost-Benefit Analysis  |  SOSTAC  |  Business Incubator  |  Industry Attractiveness  |  Entrepreneurial Organization  |  Decision Tree  |  Opportunity Cost  |  Required Return  |  RAPID Approach  |  Marketing Mix  |  PEST Analysis  |  SWOT Analysis  |  Mind Mapping  |  Theory of Constraints  |  Total Cost of Ownership  |  Net Present Value  |  Discounted Cash Flow (DCF)  |  Free Cash Flow  |  Payback Period  |  Garbage Can Model

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