Objective 2.13

Students will employ entrepreneurial discovery strategies (Feasibility Study) to generate feasible ideas for business ventures/products. ESSENTIAL QUESTIONS 1.What is a feasibility study? 2.What are the benefits of conducting the study? 3.What possible causes of action could be taken following a feasibility study?

Provides an overview of the primary issues related to a business/venture idea. It determines if the business venture is feasible or “doable”.

Determines whether the business/venture idea makes sense. Are there any make or break issues that would prevent your business from being successful in the marketplace? Identifies roadblocks facing your business/venture BEFORE you make an investment. To answer the question: Should I proceed with this project?

Provides a lot of information necessary for the business/venture plan. Good market analysis is a necessary in order to determine the business/venture feasibility. Identifies reasons NOT to proceed Provides documentation that the business was thoroughly investigated (will help with getting financing, as well as help to attract equity investment) Identifies new opportunities through the investigative process.

Already know it is feasible (another business is already doing it and is successful). Why do one when one was done a few years ago? Just a way for consultants to make money. Market analysis has already been done by the business that sold us the equipment. A feasibility study is a waste of time. These may sound like good answers but remember... you may need to live with these decisions for a long time.

Market Considerations... Technical Considerations... Financial Considerations... Organizational/Managerial Considerations... Competitive Considerations...

Current or projected demand for your proposed product or service(s)? What are the target markets for your product or service? What competition exists in this market? Is the location of your proposed business location likely to affect the success of your business? What is the projected supply in your area of the products or services needed for your project?

Technology may or may not be of critical importance or it may not. Compare a daycare center to a manufacturing enterprise. If Technology is a consideration: What are the needs for the business/venture? What other equipment does your business need? Where will you get it? When will you get it? What does it cost?

Start-up Costs Operating Costs Revenue Projections Sources of Financing Profitability Analysis

What organizational Structure is the right one for your business/venture? Who will serve on the Board of Directors and what are their qualifications? What qualifications are needed to manage this business? Who will manage the business? What are the staffing needs?

What competition exists in this market? Can you establish a market niche which will enable you to compete effectively with others providing this product or service? How much is your competition charging for similar product?

In order for a feasibility to be useful it must be COMPLETE and include (at a minimum) the following elements: 1.Project Scope Defines the business problem and/or opportunity to be addressed. 2.Current Analysis Define and understand the current method of implementation, such as a system, a product, etc. 3.Requirements Financial, Human Resources, Material, Equipment Depends on the project 4.Approach Recommended solution or course of action to satisfy the requirements. 5.Evaluation Examines the cost effectiveness of the Approach selected. 6.Review All of the preceding elements are then assembled into a Feasibility Study and a formal review is conducted with all parties involved. Source: it.toolbox.com/blogs/irm-blog/the-elements-of-a-good-feasibility-study-23199

Strategic plan used to evaluate your business Strengths – characteristics of business that gives it an advantage on other businesses of the like. Weaknesses - disadvantages Opportunities – chances to improve product/service within the market Threats – elements that could cause trouble (competitors)

Strengths Weaknesses Opportunities Threats Unique idea Cost Manpower Expansion Liability Need Car ride