What is a Feasibility Study?
Feasibility studies are similar to business plans and for this reason we use the same basic business plan framework to conduct a feasibility study. However the purpose and the level of detail are different.
Feasibility studies are most often used by the entrepreneur to help assess whether or not the business makes sense from a financial perspective – i.e. is it financially viable? There will be many assumptions and several scenarios developed to test different options and opportunities. Various threats and risks will also be considered. Sometimes a hurdle will appear that is so significant that the project is halted during this phase.
A business plan is often targeted towards potential funders (investor, lenders and government agencies) who are more interested in seeing the complete story on how the business will be operated. They are more concerned with the potential of the business to grow and sustain a positive cash flow over time. For these reasons the business plan requires significant detail.
Because a feasibility study requires fewer resources to develop than a business plan it is generally less costly to develop. If a particular feasibility study results in a “no go” decision then significant time and money are saved. If the feasibility study indicates that a project is feasible then the information acquired during the study phase can be used to further develop the business concept into a full business plan.
Our Process
Entrepreneurs have differing needs when it comes to feasibility studies. This is why we offer a “no obligation” meeting with each potential client to assess their needs.
We are then able to prepare a proposal for the client’s review. If necessary, the client can also use the proposal to seek funding to conduct the feasibility study.
The proposal will outline the deliverables, the time line and the cost, as well as provide information on our firm. If we are engaged to conduct the assignment, we will then ask the client to sign a contract (i.e. acceptance of the proposal).