A feasibility study analyzes the viability of a proposed business idea or project. It aims to answer the question of whether the idea will work and if it should be pursued. The feasibility study process involves gathering information on market factors, operational details, financial projections, legal structure, and an honest assessment of risks and chances of success to help secure funding from investors or banks and serve as a foundation for a full business plan. A thorough feasibility study can help ensure a good business idea is not buried due to a lack of research and preparation.
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Feasibility Study Guide
1.
2. Feasibility study is an analysis of the
viability of an idea. The feasibility study
focuses on helping answer the essential
question of “should we proceed with the
proposed project idea?” All activities of
the study are directed toward helping
answer this question. Hofstrand (2009)
3. A feasibility study looks at the
viability of an idea with an
emphasis on identifying potential
problems and attempts to answer
one main question: Will the idea
work and should you proceed with
it?
4. The information you gather and present in
your feasibility study will help you:
List in detail all the things you need to
make the business work;
Identify logistical and other business-
related problems and solutions;
5. • Develop marketing strategies to
convince a bank or investor that your
business is worth considering as an
investment; and
• Serve as a solid foundation for
developing your business plan.
8. Includes a description of the
industry, current market,
anticipated future market potential,
competition, sales projections,
potential buyers, etc.
9.
10. Details how you will deliver a
product or service (i.e., materials,
labor, transportation, where your
business will be located,
technology needed, etc.).
11.
12. Projects how much start-
up capital is needed,
sources of capital, returns
on investment, etc.
13.
14. Defines the legal and corporate
structure of the business (may also
include professional background
information about the founders and
what skills they can contribute to
the business)
15. Discusses how the business can
succeed. Be honest in your
assessment because investors
won’t just look at your
conclusions they will also look
at the data and will question
your conclusions if they are
unrealistic.
16.
17. Set of documents prepared by a firm's management to summarize its
operational and financial objectives for the near future (usually one to
three years) and to show how they will be achieved.
It serves as a blueprint to guide the firm's policies and strategies, and is
continually modified as conditions change and new opportunities and/or
threats emerge.
When prepared for external audience (lenders, prospective investors) it
details the past, present, and forecasted performance of the firm.
And usually also contains pro-forma balance sheet, income statement,
and cash flow statement, to illustrate how the financing being sought
will affect the firm's financial position.
Read more: http://www.businessdictionary.com/definition/business-plan.html#ixzz3mmcGXfhQ
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