Week 6 - What is the Purpose of a Feasibility Study?

Question 1

It is a detailed examination of whether or not a proposed business venture is likely to be successful

Answer 1

Feasibility Study

Question 1

is an important first step in starting a new business.

Answer 1

Feasibility Study

Question 2

aims to provide information that will help business owners make informed decisions about their new venture.

Answer 2

Feasibility Study

Question 3

The feasibility study will answer important questions about the proposed business, including:

Answer 3

1. o What is the target market for this business?
2. o Who are the competitors?
3. What are the costs associated with starting and running this business?
4. What are the potential risks and rewards associated with this venture?
5. How much revenue can this business generate?
6. What are the estimated profits and losses for this business?
7. What is the potential for growth in this industry?

Question 4

How Do You Write a Feasibility Study?

Answer 4

1. Outline your target market and how you plan to reach them.
2. Discuss your product or service in detail and explain why it is unique and needed.
3. Outline your financial projections and explain how you plan to make a profit.

Question 5

Seven (7) Steps to Do a Feasibility Study

Answer 5

1. Conduct a Preliminary Analysis
2. Prepare a Projected Income Statement
3. Conduct a Market Survey, or Perform Market Research
4. Plan Business Organization and Operations
5. Prepare an Opening Day Balance Sheet
6. Review and Analyze All Data
7. Make a Go/No-Go Decision

Question 6

is necessary to determine whether a full feasibility study is warranted.

Answer 6

A preliminary investigation

Question 7

During this stage, key information will be gathered to assess the project’s potential and make a preliminary decision about its feasibility.

Answer 7

Conduct a Preliminary Analysis

Question 8

This should include a review of relevant documents, interviews with key personnel, and surveys of potential customers or users.

Answer 8

Conduct a Preliminary Analysis

Question 9

To do a feasibility study, you must create a

Answer 9

projected income statement

Question 10

will show how much money your business is expected to make in the coming year

Answer 10

Your projected income statement

Question 11

It will include both your estimated revenue and your estimated expenses.

Answer 11

projected income statement

Question 12

this document will be essential in helping you make informed decisions about your business.

Answer 12

projected income statement

Question 13

is an important step in any feasibility study

Answer 13

Conducting market research

Question 14

There are a variety of ways to conduct market research.

Answer 14

One popular method is to conduct a survey. You can survey potential customers directly or use data from secondary sources such as surveys conducted by other organizations. You can also use focus groups or interviews to get feedback from potential customers.

Question 15

When starting a business, one of the first things you need is to plan your

Answer 15

organization and operations.

Question 16

This involves creating a structure for your company and figuring out the logistics of how you will run it.

Answer 16

Plan Business Organization and OperationsThere are many factors to consider when planning your organization and operations, such as:

Question 17

There are many factors to consider when planning your organization and operations, such as:

Answer 17

1. Company Structure: What type of company will you be (sole proprietorship, partnership, corporation, etc.)? What will the hierarchy look like?
2. Location: Where will your business be located? Will you have a physical storefront or operate online only?
3. Marketing: How will you promote your business?

Question 18

is a snapshot of the company’s financial position at the beginning of the business venture.

Answer 18

opening day balance sheet

Question 19

The purpose of the opening day balance sheet is

Answer 19

to give an idea of the amount of money that the company has to work with and track its expenses and income as they occur.

Question 20

This information is vital to making sound business decisions. The opening day balance sheet will include the following:

Answer 20

1. Cash on hand
2. Accounts receivable
3. Inventory
4. Prepaid expenses
5. Fixed assets
6. Accounts payable
7. Notes payable
8. Long-term liabilities
9. Share

Question 21

The analysis should consider both the positive and negative aspects of the proposed project.

Answer 21

Review and Analyze All Data

Question 22

The financial analysis should be

Answer 22

thorough, and all assumptions should be documented.

Question 23

The risk assessment should

Answer 23

identify any potential risks and mitigation strategies.

Question 24

It is important to know when to cut your losses when starting a business.

Answer 24

Make a Go/No-Go Decision

Question 25

is a key part of a feasibility study, and it can help you determine whether or not your business idea is worth pursuing.

Answer 25

The go/no-go decision

Question 26

is all about risk assessment

Answer 26

Making the go/no-go decision

Question 27

How to Conduct a Feasibility Study

Answer 27

1. To begin, we do a preliminary study of the business case to define what is included and what we are examining and attempting to find is realistic.

(PRELIMINARY STUDY)

2. Following that, we generate a forecasted income statement. We need to understand the revenue sources; how are we going to profit from this? Where does the income originate? Additionally, we must do a market study.

(FORECASTED INCOME STATEMENT)

3. We need to find out whether this is a demand for our product. How much demand does this have? Is there a market for this product or service?
4. Plan your company’s structure and operations, which is the fourth step. Specifically, what type of organization do we need, and what resources do we have? Do we have any specific personnel needs?
5. We also plan to generate a balance sheet on the first day. What are the income and expenses, and how can we be confident we’ll be able to decide whether we’re going to make our ROI?
6. As a result, we plan to go through and examine all of our data before making a final decision on whether or not to go forward. In other words, are we going to pursue this project or business opportunity?

Question 28

When starting a business, you must create two very important documents:

Answer 28

a feasibility study and a business plan

Question 29

is a preliminary document that assesses the feasibility of a proposed business.

Answer 29

A feasibility study

Question 30

It looks at the market potential, the competition, the costs and benefits of starting the business, and the risks and rewards involved.

Answer 30

A feasibility study

Question 31

is a more detailed document that outlines how a business will be run and what its goals are.

Answer 31

business plan

Question 32

It includes information about its mission statement, its products and services, its target market, its finances, and its management team.

Answer 32

business plan

Question 33

Some reasons to do a feasibility study include:

Answer 33

1. You are considering a major change or investment
2. You want to assess the viability of a new business or product
3. You need to understand the risks and potential rewards associated with a project

Question 34

some reasons not to do a feasibility study include:

Answer 34

1. You are pressed for time and don’t think the study will provide enough value to justify the time commitment.
2. You are confident that your idea is feasible, and a study will only confirm what you already believe.
3. The change or investment is not significant enough to warrant the study.