Steps in Preparing Feasibility Study

By | December 8, 2008

Various approaches have been used in preparing a feasibility study according to individual preferences. Some give more emphasis on ocular observation without quantitative and qualitative verifications of the market and other factors considered in starting or expanding a business enterprise.  But some are very careful in their investment by verifying all aspects of the project study in a scientific survey.

Suggested steps to prepare a feasibility study

  1. Identify and recognize the people or firms that will be involved in preparing the various aspects of the study.
  2. Examine the market feasibility both in terms of ocular observations and the actual scientific survey. Determine if there is ample excess demand and a competitive market position of the project. If not feasible, abandon the idea immediately and think of another business project.
  3. Find out if the project or idea is technically feasible. Determine if the resources to be used are available on a long term basis and at a reasonable cost. If not feasible, abandon the project or idea.
  4. Proceed with the management study. Management study involves in determining if the organizational set up carry out its function effectively and that qualified persons under the circumstances are available.
  5. If management is feasible, determine if it is financially feasible. Financial feasibility means that the budget or financing shall be available at a reasonable cost and there is a financial support and is deemed profitable.
  6. If government project, assess the social desirability of the project and it will have an economic benefits to the people living in the community and its vicinities.
  7. Lastly, prepare the summary of the feasibility study including the brief description of the project and the major assumptions made such as market projections, share and prices, investment costs, method of financing. Also, prepare the summary of findings and conclusions regarding market feasibility, technical feasibility and financial feasibility.