HOW FEASIBILITY STUDY/REPORT IS IMPORTANT TO AVOID LOSSES FOR NEW ENTREPRENEURS
Feasibility study is the tool for business owners to evaluate and change in their business. This change may involve in developing a new product in your business, improve the existing product, changing the market strategy by expanding.
An entrepreneur has other ideas such as allowing the family members to join hands for the new expanding of his/her business. If the feasibility analysis indicates that the goal cannot be met in this business the entrepreneur can stop the idea investing much in his new business. A change in your business always involves risk and through feasibility study identifies to contribute the risk, this effect gives the business opportunity for the entrepreneur.
The feasibility study gives each stage to the business planner to do two things:
• Set goal or criteria by which you business will or will not proceed to the next planning phase.
• Try to make decision for proceeding to the next stage or stop the idea at that point.
These steps involve in starting the new business at the beginning.
If the entrepreneur sets a goal to make profit of Rs.100,000 per year, and the profit must increase at least Rs.50,000 or it is a bad idea for proceeding. But for the business the market shows the business is more to get Rs.10,000 extra for the new business idea so the entrepreneur decides not to involve in this project, looking for new opportunity.
Before looking the new opportunity for the business the entrepreneur should involve the methods to obtain the results. Here are the questions to get the results.
• Were the techniques involved in getting accurate results?
• Did your marketing people survey accurately what the customer needs?
• Do this cost of our products is accurate for the production and distribution?