1. Financial Analysis: Estimate Price & Profitability Paper #3 Entrepreneurship & Innovation Feasibility Analysis: Part 4

2. 6 Steps of Feasibility Analysis 1.Determine which Industry to choose 2.Capture & Assess the Business Idea 3.Research the market and customers 4.Gather Competitive Intelligence 5.Estimate Price & Profitability 6.Future Action Plan

3. I. Is Funding is Easily Obtained?  have to invest a HUGE amount; more than I am willing to risk.  not sure how much funding business will require.  need to invest quite a bit of money; but I can afford to risk it.  need to invest a moderate amount ; I can afford to risk it.  don’t have to invest much money at all; I can comfortably risk it.

4. II. Revenue stream is continuous ?.  I never know what’s going to come in (seasonality, large contracts, etc.)  Monthly sales fluctuate significantly but are somewhat predictable.  Sales vary month to month due to sales cycles and products offered.  sales generally will be steady from month to month.  steady sales from month to month..

5. III. Accounts Payable are collected prior to sales.  1.We wait over 30 days for customers to pay.  2.The typical customer pays within 30 days.  3.Customers pay at the time of service or when they receive the product.  4.Our customers make an upfront deposit that covers the direct costs of the product/service.  5.Cash is king! The entire price of the product/service is paid prior to delivery. http://www.focussport.com/images/decalcar.gif http://www.firstresearch.com/IndustryAnalysis/commercialprinting.asp

6. IV. Hiring and retaining employees is easy.  1.Turnover will be high. The cycle of hiring and training will be continuous.  2.I will spend lots of time and money hiring and training employees.  3.For now, I can control labor costs by using subcontractors as the company grows.  4.I have well-qualified employees and expect a low turnover rate.  5.This is great! I have top employees and a zero turnover rate!

7. V. Inventory/ Service providers are dependable.  1.Don’t not have a clue where to get most of the inventory/supplies I need.  2.I’m not completely sure about where I’m going to get the inventory/supplies I need.  3.I’ve found them, but only a few companies can give me what Ineed.  4.Many companies can supply what I need.  5.No problem! Numerous companies with good reputations can supply what I need. http://www.emsnow.com/newsarchives/archivedetails.cfm?ID=14329

8. VI. Gross margin is 100 percent.*  My gross margin is low since our costs of direct materials and labor are high.  2.My gross margin is fairly low since our costs of direct materials and labor are relatively high.  3.My gross margin is average with average costs of direct materials and labor.  4.We have some costs of direct materials and labor, but they are lower than average.  5.Nearly 100 percent! No significant direct costs of materials or labor exist. 82 %

9. VIII. Legal problems do not exist.  1I’ve got problems. I am facing legal action. (violation of a non-compete from a former employer.)  2.I will have problems. I have multiple business owners, high liability products, leasing issues, or products that must be legally protected.  3.I am concerned about protecting my personal assets from legal liability.  4.Legal problems do occur in this industry, but most can be anticipated and managed with proper planning.  5.Few lawsuits or legal harassments occur in this entire industry.

10. VIII. Wealth is generated through exit strategy.  1.I will not be able to sell my business when I am ready to exit.  2.I don’t know if I can sell my business without me as the owner.  3.I will be able to sell some of the proprietary assets of the business.  4.I will be able to get a reasonable amount of money since I plan to build proprietary assets.  5.My exit strategy will allow for a profitable way out of the business.