Feasibility study is an analysis of how viable a project can be. It seeks to evaluate the prospect of a project as well as to ascertain if a project should be accepted or not. Feasibility study is essential in an organization as it is a tool that is often used to determine the profit potential of projects that is intended to embark on, feasibility study gives you an insight on how best you can undergo your project as well as know the resources that will be needed and projected revenue of the project. In order words, feasibility study is a study of how feasible a project can be.
If you are delving into a project or business, or you are seeking for sponsors for your project, you will need a feasibility study. The study of how feasible your projected project can be also enables you to know the problems that you might likely face. There are some steps which you need to follow when writing your feasibility study.
The Content Summery Of A Feasibility Study
Executive summary: The executive summary summarily summarizes your content. It aims to enable the viewer have an overview of your study. This step is the first which the reader will see, however it is the last thing that you the writer will write due to the fact that you have to complete the study before you can achieve the knowledge of summarizing your work.
What you offer: You have to describe the products or services that you intend to offer, especially from the perspective of your projected customers. It is here you are going to describe who your potential supplier is, how you intend to go about your production and as well as the distribution channels of your goods/services, you also have to discuss how prospective this project will, e.g. the projected cost and revenue, etc.
Your Intending target market: You have to know the particular target market which you intend to go into, you also need to put into consideration, your close substitute, the group you are targeting, as well as your strategy that you intend to use to penetrate the market.
Your price and projected profit: Here, you state the viable price of your intended product/services and as well describe how you came up with this price, and mention also, the price of your current close substitute, and how you have derived your price.
Brace for initiation: You have to brace the reader or management, up for the initiation of the project, here, you let them know how important it is to start the project as soon as possible, you also let them know the effect of inaction to the company.
Location: You will also include the location which the project wants to be initiated and also the reason why that location has been chosen. This has to be adequately evaluated. You have to explain why it will be advantageous to the company to choose your location.
Staffing: You need to identify the human resources that will be needed for your project to be successful, how many people will you be needing? What is the cost of getting human resources? What training will be required of them? What will they function as? All these questions needs to be answered and analyzed for your management in the feasibility study.
Capital: You need to make analysis on the capital which the project will be needed, it must also include the operational cost (which includes salaries, e.t.c) you also need to to explain how the cost of capital has been evaluated.
Viability: You have to also describe how viable your project is, this implies that you have to sell your idea to the reader as much as possible, you can as well use mathematical or financial tools, you need to plot your graphs, as well as use the Net Present Value financial tool. This will further show extensively, the viability of the project. Remember, this is a very important part of your feasibility study, so you have to be convincing and elaborate, you as well need to be realistic and reference each cost so that the reader can be sure of its authenticity.
Recommendations: You have to recommend the project to your management (unless, of course, you don’t believe in the project) recommendation about more study, more fact findings, and more investigation should also be given here. You can also recommend other similar project which you feel the knowledge will aid your feasibility study, you have to as well put into consideration, the authenticity of your report.
Others: You are expected to beef up your work, create your table of content, as well as your references, you can also add your sources of help which aided you to write your feasibility study, dot your ‘i’s and cross your ‘t’s. Ensure there is a flow in your work and that your reader is carried along from beginning till the end of the study. Make your work spicy, above all, make it convincing!
Feasibility study will help your business to diversify/start up successfully. It will enable you to know what you need for the project that you want to go into, and if the project is worth it. Good luck!