Writing feasibility study is very essential in business so that entrepreneurs or businessman may know if the proposed business or ideas is profitable. Time and effort in writing feasibility study is worth since feasibility study serves as an evaluation and analysis of a proposed business or proposed project to know if it is technically feasible and it is feasible within the estimated cost.
Here are some components to consider in writing a good feasibility study:
– Introduction
Background information of the proposed business or proposed project will be described such as the proposed name and purpose of the business. It also includes the skills and experience of the business investors.
– Business or Project Description
Information about the business or project as well as the nature of industry or nature of the project is discussed in this section.
– Market Analysis
Current and potential demand of the product or idea is determined. Also, it contains information about the buyers as well as the sales forecast over the first three years.
– Management Analysis
Skills and talent of the management team or personnel involved in the business or the project should be included. It contains the primary duties of each personnel with the organization structure.
– Technical Analysis
Detailed requirements of the facilities, inventory and production control is identified. Also, it provides the raw material needed and other utilities.
– Risks and Problems
Major and minor risks and problems of the proposed business opportunity or project are elaborated.
– Economic Analysis
Cost and benefit analysis discussed.
– Financial Analysis
Total estimated cost of the proposed business or project are included as well as the projected cash flow and profitability.