{"id":33599,"date":"2020-03-04T18:56:10","date_gmt":"2020-03-04T23:56:10","guid":{"rendered":"https:\/\/www.myedme.com\/login\/?p=33599"},"modified":"2020-03-04T18:56:14","modified_gmt":"2020-03-04T23:56:14","slug":"conducting-a-feasibility-study","status":"publish","type":"post","link":"https:\/\/myedme.com\/login\/conducting-a-feasibility-study\/","title":{"rendered":"Conducting a Feasibility Study"},"content":{"rendered":"\n

As the name suggests, a feasibility analysis\n is designed to assess whether your entrepreneurial endeavor is, in \nfact, feasible or possible. By evaluating your management team, \nassessing the market for your concept, estimating financial viability, \nand identifying potential pitfalls, you can make an informed choice \nabout the achievability of your entrepreneurial endeavor. A feasibility \nanalysis is largely numbers driven and can be far more in depth than a business plan (discussed in The Business Plan<\/a>).\n It ultimately tests the viability of an idea, a project, or a new \nbusiness. A feasibility study may become the basis for the business \nplan, which outlines the action steps necessary to take a proposal from \nideation to realization. A feasibility study allows a business to \naddress where and how it will operate, its competition, possible \nhurdles, and the funding needed to begin. The business plan then \nprovides a framework that sets out a map for following through and \nexecuting on the entrepreneurial vision.<\/p>\n\n\n\n

Organizational Feasibility Analysis<\/h3>\n\n\n\n

Organizational feasibility aims to assess the \nprowess of management and sufficiency of resources to bring a product or\n idea to market Figure 11.12<\/a>.\n The company should evaluate the ability of its management team on areas\n of interest and execution. Typical measures of management prowess \ninclude assessing the founders\u2019 passion for the business idea along with\n industry expertise, educational background, and professional \nexperience. Founders should be honest in their self-assessment of \nranking these areas.<\/p>\n\n\n\n

\"A<\/figure>\n\n\n\n

Figure 11.12 An\n analysis of organizational feasibility focuses on resource needs and \nmanagement capabilities. (attribution: Copyright Rice University, \nOpenStax, under CC BY 4.0 license)\n<\/p>\n\n\n\n

Resource sufficiency pertains to nonfinancial \nresources that the venture will need to move forward successfully and \naims to assess whether an entrepreneur has a sufficient amount of such \nresources. The organization should critically rank its abilities in six \nto twelve types of such critical nonfinancial resources, such as \navailability of office space, quality of the labor pool, possibility of \nobtaining intellectual property protections (if applicable), willingness\n of high-quality employees to join the company, and likelihood of \nforming favorable strategic partnerships. If the analysis reveals that \ncritical resources are lacking, the venture may not be possible as \ncurrently planned.47<\/a><\/sup><\/p>\n\n\n\n

Financial Feasibility Analysis<\/h3>\n\n\n\n

A financial analysis\n seeks to project revenue and expenses (forecasts come later in the full\n business plan); project a financial narrative; and estimate project \ncosts, valuations, and cash flow projections Figure 11.13<\/a>.<\/p>\n\n\n\n

\"A<\/figure>\n\n\n\n

Figure 11.13 An\n analysis of financial feasibility focuses on expenses, cash flow, and \nprojected revenue. (attribution: Copyright Rice University, OpenStax, \nunder CC BY 4.0 license)\n<\/p>\n\n\n\n

The financial analysis may typically include these items:<\/p>\n\n\n\n