A feasibility study is a document that contains an analysis of the feasibility of creating a particular product or service. It allows investors to determine whether they should invest their own money in the proposed business project.
Instructions
Step 1
Use the following structure when drafting a feasibility study: - initial data and conditions; - market characteristics and company capacity; - material factors of production activities; - location of the company; - design documents; - information about the organization of the enterprise and overhead costs; - labor resources; - forecasting the timing of the project; - financial and economic analysis of the project.
Step 2
Write the general information about the project, that is, the overall intent in the feasibility study. Indicate the location and participants of the business project. Then make a brief description of the industry to which the project belongs. Next, analyze supply and demand and estimate the market size. After that, identify the main potential consumers of products (services), as well as the main competitors.
Step 3
Write a justification for the selected region for placing the project from the point of view of market conditions. Provide the main parameters in the feasibility study: the type and range of products (services), the scope of the enterprise's services.
Step 4
Provide data on capital costs in the feasibility study. Provide an estimate of the capital (one-time) costs required to implement the business project in question. Calculate the amount of operating costs. To do this, refer to the feasibility study for an estimate of operating (annual) costs.
Step 5
Make a production program in the feasibility study. Describe all types of products (services) that the company plans to produce within the framework of the analyzed project, indicating the volume of production activities and sales prices. Make a rationale for the main price indicators.
Step 6
Note how the funding for the project is planned. To do this, draw up a scheme for financing a business project, which will contain a description of all sources of obtaining loans, their purpose and repayment terms.
Step 7
Assess the commercial viability of implementing the created business plan. Make calculations of the main economic indicators based on the necessary initial data, which are accepted for the economic analysis of the project. In turn, the calculated part of the feasibility study should contain the following calculation material: a table of the company's cash flow, a balance forecast.
