© 2004 Ewing Marion Kauffman Foundation

Feasibility Plan Product/Service • Purpose of product/service • Stage of development • Product limitations • Proprietary rights • Governmental approval • Product liability • Related services and spin-offs • Production FP.1 © 2004 Ewing Marion Kauffman Foundation

Feasibility Plan The Market • Current market size • Growth potential • Industry trends • Competition profile • Customer profile • Customer benefits • Target markets • Market penetration FP.2 © 2004 Ewing Marion Kauffman Foundation

Price and Profitability Feasibility Plan Price and Profitability • Price list • Sales estimate • Cost of product/service • Gross margin • Three-year operating expenses and assumptions • Three-year operating statement • Start-up costs • Capital expenditures FP.3 © 2004 Ewing Marion Kauffman Foundation

Feasibility Plan Sample Income Statement Sales $100,000 Cost of goods 50,000 Gross margin 50,000 Expenses Utilities 2,400 Salaries 18,000 Payroll taxes and benefits 3,600 Office supplies 300 Insurance 300 Legal and accounting 1,000 Telephone 600 Travel 2,000 Auto expense 1,500 Advertising 5,000 Entertainment 1,000 Miscellaneous 3,600 Total expenses $39,300 Pretax profit $10,700 FP.4 © 2004 Ewing Marion Kauffman Foundation

Plan for Further Action Feasibility Plan Plan for Further Action • Needed capital • Entrepreneur’s role • Business plan Pitfalls Positives • Licensed potential • Corporate partners • Proprietary rights • Infrastructure members FP.5 © 2004 Ewing Marion Kauffman Foundation