difference between feasibility studies and business plan

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Difference between Feasibility Study and Business Plan

Feasibility Study and Business Plan are essential tools in the business development process. They serve different purposes and are conducted at different stages. A feasibility study helps determine the viability of a business idea; whereas, a business plan provides a detailed roadmap for executing that idea and achieving business goals.

What is a Feasibility Study?

A feasibility study is a comprehensive assessment conducted at the early stages of a business idea or project to evaluate its potential viability and identify potential risks and challenges. The primary purpose of a feasibility study is to determine whether the proposed business venture is feasible and worth pursuing further.

Features of the Feasibility Study are:

• Market Analysis: Feasibility Study evaluates the target market , including its size, growth potential, demographics, and competition. This involves researching customer needs, preferences, and behavior to assess demand for the proposed product or service .
• Technical Feasibility: A feasibility study assesses the technical requirements and capabilities needed to develop and deliver the product or service. This may involve evaluating technology, equipment, facilities, and expertise required for production or implementation.
• Financial Feasibility: A feasibility study conducts financial analysis to estimate the costs involved in starting and operating the business, as well as potential revenue and profitability. This includes preparing financial projections, such as income statements , cash flow statements , and Return on Investment (ROI) calculations.

What is a Business Plan?

A business plan is a comprehensive document that outlines the goals, strategies, operations, and financial projections of a business. It serves as a roadmap for the organization’s future direction and provides a detailed blueprint for how the business will be structured, managed, and operated.

Features of a Business Plan are:

• Executive Summary: A business plan gives a brief overview of the business concept, objectives, products or services offered, target market, competitive advantage, and financial projections.
• Company Description: It gives detailed information about the business, including its history, mission statement, vision, values, legal structure, location, and ownership.
• Market Analysis: A business plan is formed after analyzing the target market, including its size, growth potential, demographics, buying behavior , market trends, and competition. This section also outlines the business’s market positioning and competitive strategy.

Feasibility Study and Business Plan – FAQs

When should a feasibility study be conducted.

A feasibility study is typically conducted at the early stages of developing a business idea or project, before significant resources are invested. It helps entrepreneurs and stakeholders make informed decisions about whether to proceed with the venture.

Who conducts a feasibility study?

Feasibility Studies are often conducted by entrepreneurs, business owners, project managers, consultants, or other professionals with expertise in the relevant industry or field. They may also involve collaboration with specialists such as market researchers, engineers, financial analysts, and legal advisors.

When should a business plan be developed?

A business plan is typically developed after a feasibility study has been conducted and the decision to move forward with the business venture has been made. It provides a detailed blueprint for executing the business idea and achieving its objectives.

Who uses a business plan?

Business plans are used by entrepreneurs, startups, existing businesses, investors, lenders, partners, employees, and other stakeholders interested in understanding the organization’s goals, strategies, operations, and financial prospects.

What are the benefits of conducting a feasibility study?

Benefits of conducting a feasibility study include minimizing risks, identifying potential challenges and opportunities, validating assumptions, attracting investors or lenders, guiding decision-making , and increasing the likelihood of success for the proposed business venture.

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The Difference Between a Business Plan and a Feasibility Study

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Successful businesses don’t happen by chance; they are the result of careful planning and assessment. Whether you’re launching a startup or considering a new project, you need a roadmap that outlines your goals, strategies, and financial projections. This is where a business plan and a feasibility study come into play.

In this article, we will delve deep into the realms of business planning and feasibility analysis, exploring the crucial distinctions between these two fundamental tools.

Understanding Business Plans

Definition and Purpose

A business plan is a comprehensive document that outlines the objectives, strategies, and financial projections for your business. Its primary purpose is to provide a detailed roadmap for your company’s future. It acts as a strategic guide for entrepreneurs, investors, and stakeholders.

Components and Elements

Business plans typically consist of several key components, including:

• Executive Summary : A concise overview of the entire plan.
• Market Analysis : Research on the industry, competition, and target audience.
• Marketing Strategies : Detailed plans for branding, promotion, and sales.
• Financial Projections : Forecasts for income, expenses, and profitability.
• Operational Plan : Information on day-to-day operations and management structure.
• Risk Assessment : Identification and mitigation of potential risks.
• Exit Strategy : Plans for future expansion, sale, or closure.

Role in Business Operations

A business plan serves as a strategic document that guides your business operations. It provides clarity on your business model, goals, and how you intend to achieve them. Moreover, it is often a critical tool for attracting investors and securing financing.

Exploring Feasibility Studies

A feasibility study is a systematic analysis of the practicality and viability of a business idea. Its primary purpose is to determine whether a concept is achievable and sustainable. Feasibility studies are often conducted in the early stages of business development to assess the potential success of a project.

Key Components and Areas of Focus

Feasibility studies typically encompass the following key components:

• Market Research : Detailed analysis of the market, including target demographics, competition, and demand.
• Technical Feasibility : Evaluation of the project’s technical requirements and capabilities.
• Financial Feasibility : Assessment of the project’s financial viability, including cost estimates and revenue projections.
• Operational Feasibility : Examination of the logistical and operational aspects of the project.
• Legal and Regulatory Feasibility : Review of legal and regulatory requirements that may impact the project’s execution.
• Sensitivity Analysis : Testing various scenarios to assess the project’s adaptability to changing circumstances.

Determining Viability

A feasibility study is primarily concerned with determining the viability of a business idea. It helps answer critical questions, such as whether the project is financially feasible, whether the market will support it, and whether potential risks can be mitigated effectively.

Timing and Sequence

Chronological Order

One key difference between a business plan and a feasibility study is the chronological order in which they are typically created. Feasibility studies often precede the development of a business plan.

Why Feasibility Studies Come First

Feasibility studies are conducted early in the business development process to assess the viability of a concept before investing significant time and resources in a comprehensive business plan. If a feasibility study reveals that a project is not feasible, it can save a business from pursuing an unviable idea.

Data Collection and Analysis

Research and Data Collection

Both business plans and feasibility studies involve extensive research and data collection. However, the focus and purpose of this research differ.

Data Analysis in Business Plans

In business plans, data analysis is geared toward understanding the market, competition, and financial projections. It aims to provide a strategic direction for the business.

Data Analysis in Feasibility Studies

Feasibility studies conduct in-depth analysis, focusing on market research, technical feasibility, financial feasibility, and other areas to determine the practicality of a project. The goal is to evaluate whether the project is worth pursuing based on collected data and analysis.

Risk Assessment

Identifying and Mitigating Risks

Both business plans and feasibility studies address the critical aspect of risk assessment, but their approaches differ.

Risk Assessment in Business Plans

Business plans identify and outline potential risks but often focus on strategic plans to minimize and manage these risks.

Risk Assessment in Feasibility Studies

Feasibility studies dig deeper into the assessment of potential risks, challenges, and market uncertainties. They are essential for determining whether the project is too risky or whether risks can be effectively mitigated.

Financial Projections

Detailed Financial Forecasts

Both business plans and feasibility studies involve financial projections, but the depth of these projections varies.

Financial Projections in Business Plans

Business plans include detailed financial forecasts, such as income statements, balance sheets, and cash flow projections. These projections are integral for attracting investors and securing financing.

Financial Analysis in Feasibility Studies

Feasibility studies provide financial analysis that focuses on determining the project’s financial viability. They assess whether the project can be completed within budget and whether it has the potential to generate sufficient revenue to cover costs.

Market Analysis

In-Depth Market Assessment

Market analysis is an important aspect of both business plans and feasibility studies.

Market Analysis in Business Plans

Business plans provide an overview of the market, including target demographics, competition, and market size. Market analysis in business plans is often geared toward supporting sales and marketing strategies.

Market Analysis in Feasibility Studies

Feasibility studies conduct in-depth market research, delving into the specific needs of the target audience, competition, and market demand. The goal is to assess whether the market can support the project and whether it presents a viable opportunity.

Resource Allocation and Budgeting

Allocating Resources

Resource allocation and budgeting are considerations in both business plans and feasibility studies, but the focus varies.

Rea also: The difference between a traditional business plan and a lean startup plan

Resource Allocation in Business Plans

Business plans often include plans for allocating resources, such as staff, equipment, and capital. They outline budgetary requirements for various aspects of the business.

Resource Allocation in Feasibility Studies

Feasibility studies assess the resource requirements of the project and provide an estimate of the budget needed for project development. This information is essential for evaluating whether the project can be executed within the available resources.

Decision-Making Impact

Influencing Decisions

The outcomes of both business plans and feasibility studies have a significant impact on decision-making.

Impact of Feasibility Studies

Feasibility studies influence the decision to proceed with a business idea. If a feasibility study reveals insurmountable challenges, it may deter entrepreneurs from pursuing the project.

Role of Business Plans

Once a project is deemed feasible through the feasibility study, a business plan becomes the tool for executing the strategies and operations outlined in the feasibility study. It guides the day-to-day activities of the business.

Scalability and Adaptability

Adapting to Change

Scalability and adaptability are crucial aspects of both business plans and feasibility studies, but they approach change differently.

Scalability in Business Plans

Business plans may be less adaptable in the face of changing market conditions. They often represent a set path that the business intends to follow.

Adaptability in Feasibility Studies

Feasibility studies emphasize adaptability and flexibility. They recognize that market conditions can change rapidly, and the project may need to adapt to these changes to remain viable.

Integration for Success

The Synergy of Both Tools

While business plans and feasibility studies serve distinct purposes, they can complement each other effectively in the business development process.

How They Work Together

Business plans and feasibility studies work together to create a robust business strategy. The insights gained from the feasibility study can inform the development of a comprehensive business plan. The feasibility study’s findings on market viability, resource requirements, and potential risks can be integrated into the business plan’s strategies and financial projections.

Real-Life Examples

Learning from Successful Businesses

To illustrate the practical application of business plans and feasibility studies, let’s explore a few real-world case studies:

• Case Study 1: Tech Startup : A technology startup conducts a feasibility study to assess the demand for its innovative product. The study reveals strong market interest, leading the startup to create a business plan focused on market expansion and revenue growth.
• Case Study 2: Restaurant Chain : A restaurant chain plans to expand into a new region. A feasibility study helps determine the viability of the expansion, considering factors like competition and consumer preferences. Subsequently, the business plan outlines the specifics of the expansion, including location, marketing strategies, and financial projections.
• Case Study 3: Manufacturing Company : A manufacturing company conducts a feasibility study to explore the possibility of adopting new technology to improve efficiency. The study reveals that the technology is feasible and financially viable. A business plan is then developed to guide the implementation of the new technology, detailing the required resources and the expected impact on production.

“The Difference Between a Business Plan and a Feasibility Study” is not just a matter of paperwork; it’s a fundamental decision that can shape the future of your business. While both tools are critical, it’s essential to recognize their distinct purposes and when to employ them. The key is to leverage the insights from a feasibility study to inform the development of a robust business plan.

In your entrepreneurial journey, you may find that a hybrid approach that combines elements of both business plans and feasibility studies works best for your business. The critical factor is to maintain flexibility and be open to adjusting your planning strategy as your business evolves.

In summary, a feasibility study is the compass that guides you toward viable business concepts, while a business plan is the roadmap that leads you to your destination. Together, they form a powerful combination that can set your business on the path to success.

If you’re unsure about how to approach a feasibility study or develop a business plan for your specific business idea, seek professional guidance. Contact us at Dayo Adetiloye Business Hub via [email protected] or [email protected]. or give us a call at 08105636015, 08076359735 and 08113205312 to access expert assistance and take your business idea to the next level. Making the right decisions today can have a profound impact on the success of your business tomorrow.

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Difference Between Feasibility Study and Business Plan

Many people don’t know that there is a difference between a business plan and a feasibility study.

Frequently, clients reach out seeking a feasibility study, but after an in-depth conversation, it becomes evident that what they truly require is a comprehensive business plan. In this article, I’ll clarify this common misconception and provide a clearer understanding of the distinction.

So let us start with the first one, which will give us a brief overview of what a business plan and a feasibility study is all about

Table of Contents

What is the Difference Between Feasibility Study and Business Plan

Business plans and feasibility studies are vital business tools for analysis and for making business decisions. However, a feasibility study is not the same thing as a business plan because a feasibility study gives a conclusion or recommendation that would be completed prior to developing the business plan.

Feasibility Study

A feasibility study is done to determine whether a proposed business has a high enough probability of success that it should be undertaken. A feasibility study is carried out first in order to know if the business will be viable before venturing into it. Before a company can invest in a business or launch a new product, a feasibility study is done to determine if there will be a return on investment.

According to Rochester.edu, a feasibility study can be defined as “a controlled process for identifying problems and opportunities, determining objectives, describing situations, defining successful outcomes, and assessing the range of costs and benefits associated with several alternatives for solving a problem.”

It can also be used to make decisions about whether to launch a new product for an existing company or enter a new market. Feasibility studies are sometimes termed cost-benefit analyses because the projected costs of the project are compared to the expected benefits to yield a conclusion.

For instance, imagine that you have been an instructor in a company that provides IT training and certifications in the USA and you want to come to Africa to impact the knowledge by starting a new business and even adding training like IT Certification Practice Test Dumps , but you are faced with the big question, “Would my business fly?”. Is there a market for my services?

In this situation, the best decision is to conduct a feasibility study to determine if those IT programmes have an established market. If they are a company that needs interns trained by your company.

Business plans are guidelines for carrying out actions that the company’s management has already determined to be feasible. So a business plan is like a roadmap for your business that outlines goals and details how you plan to achieve those goals.

Business plans map out the direction a company intends to take to reach its revenue and profit objectives in the future. They are a compilation of numerous decisions made by the management team about how the company should be run. A business plan is done after a feasibility study has been carried out. If the recommendation of the feasibility study is negative, then there will be no need to venture into the business. Then, if the feasibility study says the business will be feasible, a business plan is developed, which will then map out plans and strategies to adopt in order to achieve business goals, including revenue generation, market penetration, customer acquisition, marketing, and sales strategies, among others.

A business plan can be done for internal or external use. The internal use of a business plan is for the management and staff of the company, while the external use is for shareholders, investors, bank loans, and customers.

Main Purpose of a Business Plan and a Feasibility Study

In short, a feasibility study gives a conclusion or recommendations, while a business plan gives a roadmap.

The feasibility study helps determine whether an idea or business is a viable option.  Therefore, a feasibility study is done first before investing a dime in the business. Before considering approaching investors, you must have done your research to know that the business is feasible before taking any decision. That is why a feasibility study gives a conclusion or recommendations.

A business plan will map out the roadmap and strategies to achieve your business goal because a business plan assumes a business is viable and presents the steps necessary to achieve success. If you are looking forward to approaching an investor or trying to get a bank loan, what you need is a business plan. Some investors might request for a feasibility study before the business plan

Outline of a Business Plan and a Feasibility Study

Below is the outline of a business plan:

• Executive Summary
• Business/Company Overview
• Products/Services
• Market/Industry Analysis
• Operation Plan
• Management/Personal plan
• Sales Forcast
• Financial Plan
• Appendices and Exhibits

A good outline for a feasibility study includes:

• Introduction
• Product or Service
• Market Environment
• Competition
• Business Model
• Market and Sales Strategy
• Production Operations Requirements
• Management and Personnel Requirements
• Regulations and Environmental Issues
• Critical Risk Factors
• Financial Predictions Including:  Balance Sheet, Income Statement, Cash Flow Statement, Break Even Analysis, and Capital Requirements

Challenges of a Business Plan and a Feasibility Study

Looking at both the business plan and feasibility study, you will discover that both attempt to predict future outcomes using assumptions about what is likely to happen in the business and the business environment, which include government policies, the market, competition, and risk, among others. Any poorly done feasibility study can lead to a costly mistake. If a business is not viable and the recommendation says it will be viable, the end result will not be palatable. This will affect the business plan and the operation of the business adversely.

A poorly done business plan—poor projections, strategies, analysis, business model, and environmental factors, among others—can easily be adjusted in the course of running the business, but the same cannot be said of a feasibility study because, in a feasibility study, an incorrect conclusion can be costly—it could mean launching a venture that has very little chance of surviving or approving a project that wastes the company’s human and financial resources.

If you need a standard business plan,  check out the list of Business Plan we have

Do you want us to develop a unique business plan for you, Check out our  business plan service page

I would love to hear your thoughts. Kindly use the comment box below to leave your comment.

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5 thoughts on “Difference Between Feasibility Study and Business Plan”

This is beautiful. Thank you for sharing this informative article by shading more light on the two.

I’ve been planning to hire a feasibility analysis service, so I’ll have an idea, whether my candle business is feasible. I agree with you that this must be done first before approaching the investors. It is also true that an incorrect conclusion in the feasibility study could be costly.

It’s inevitable! It helps you to make the right decision.

My business plan is ready but I will like you to review it

Alright, You can reach out to me on 07031542324 or email me at [email protected]

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Business Plan Vs. Feasibilty Study

by Brian Hill

Published on 1 Jan 2021

Business plans and feasibility studies are analysis and decision-making tools used by companies. Feasibility studies are used to determine whether a proposed action has a high enough probability of success that it should be undertaken. Business plans are blueprints for implementing actions that have already been deemed feasible by the company's management.

Many Decisions vs. One

Business plans map out the direction a company intends to take to reach its revenue and profit objectives in the future. They are a compilation of numerous decisions made by the management team about how the company should be run. Feasibility studies are designed to provide guidance for one decision. Feasibility studies are often done to decide whether to start the business or not -- whether the likelihood of success is high enough to make the financial risk worthwhile. They can also be used to make decisions about whether to launch a new product in an existing company, or enter a new market -- any activity where there is a question about whether the company should take the action or not. Feasibility studies are sometimes termed cost/benefit analyses because the projected costs of the project are compared to the expected benefits to yield a conclusion.

Although the content and emphasis of business plans vary by company and industry, all plans have many elements in common. They describe the products or services the company intends to sell, why customers need these products or services, the target customers, how the company intends to reach them through its marketing strategy, the background and capabilities of the management team, and risk factors the company may face. They also contain information on projected revenue and profit. Plans contain these specific elements because many times they will be read by investors or other people outside the company, and these individuals want to see very specific information in a plan. Feasibility studies may have some or many of the same elements of a business plan, including a description of the human resources required and financial projections, but all the information leads to a conclusion or recommendation.

Differences

A business plan assumes a business is going to succeed and presents the steps necessary to achieve success. Those in charge of conducting a feasibility study should not have a preconceived view about whether success will be attained. They must be as objective as possible. They conduct research and let the facts lead to the ultimate opinion given in the study. If the study's conclusion is that the project is viable, some of the research done may be included in the company's business plan, such as projections of the size of the market.

Both business plans and feasibility studies attempt to predict future outcomes using assumptions about what is likely to happen in the business environment -- the economy and the company's competition. But this environment is always changing and the assumptions a company uses in its projections of revenue or profit may prove to be incorrect. Companies find that some of the strategies in their plan do not work to the degree the business owner expected, and have to be adjusted. In the case of a feasibility study, an incorrect conclusion can be especially costly -- it could mean launching a venture that has very little chance of surviving or approving a project that wastes the company's human and financial resources.

Business Plan Vs. Feasibility Study

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If you're considering starting a business, you'll need both a feasibility study and a business plan. Both documents should be written after conducting thorough research and critical thinking, and conveyed in formats that others can understand. That way, you can show both to people whose opinions you value as well as to those you hope will invest in your idea. Before you begin, it's important to define and distinguish between a feasibility study and a business plan.

Defining Both Terms

A feasibility study is done before starting a business, when you have the idea for the business but you want to make sure it's feasible, or advisable. Put another way, is it worth your time, effort and money to create this business? Several different professionals may contribute to the study, such as an accountant, entrepreneurs who have opened successful businesses, and Realtors who advise on the worth of the location and pricing, comparing similar businesses in the area.

A business plan details how the business will operate. It assumes your feasibility study has been completed and it was determined the idea is viable. Now you're going to spell out your financial and other objectives, the methods you plan to use to achieve them, and your proposed organizational structure.

Consider the Similarities

Comparing the similarities between feasibility study and business plan is important because both are used in different ways to help you create a profitable business. Similarities between the two documents include:

• Timing : Both are initially done before the business opens, and can be conducted again later to determine the next steps on future ideas.
• Input : Both include input from several individuals or departments that have different skills. 
• Format : Both include other documents that are pulled together in order to compose the report.
• Components : Some of the issues analyzed are similar, including examining the target market, market conditions and financial costs.
• Usage : Both help the organization's management make decisions, and can also be shown to potential investors.

Understand the Differences

It's equally important to understand the difference between feasibility study and business plan . They are not the same, and one cannot substitute for the other. Differences include:

• Purpose : Feasibility studies determine whether to go ahead with the business or with another idea, whereas business plans are designed after the decision to go ahead has already been made.
• Methodology : Essentially, feasibility studies are research projects, whereas business plans are projections for the future.
• Risks : Feasibility studies determine the risks associated with the idea, whereas business plans explain how management will deal with the risks so that it will make a profit.
• Cost : Feasibility studies can require hiring outside professionals with expertise who will conduct thorough studies, whereas business plans are written by employees of the business, as part of their jobs.

Conducting a Feasibility Study

If you're doing the feasibility study yourself, conduct a complete competitive analysis considering the following:

• Product demand:  Is there a need or want for your product or service? Is the need already being met, or is there room for another product?
• Market conditions :  Who would buy your product and where are they?  Can you serve their location? Is the market saturated, or is there room/need for more products?
• Pricing:  What do current users pay for similar products? What do you need to charge so that you will be profitable, and will consumers pay your price?
• Risks : What are the risks associated with your idea?
• Probability of Success : Can you reasonably overcome the risks to become profitable?

Writing a Business Plan

Writing a business plan may seem daunting, but if you take it step-by-step, it will come to fruition. The Small Business Administration advises that business plans should include the following:

• Executive Summary : Include your mission statement, products and or services, some brief information about your leadership team and key employees, as well as the location of your business. To attract investors, add current financial information and projections for growth.
• Company description : Detail the problems your business solves; its target market; its competitive advantages, compared with the competition, and anything else that makes your company superior to others: i.e.,  product awards or recognition, big increases in sales, and so on.
• Market analysis : Perform competitive research of what other businesses are doing; their strengths and weaknesses, and how and why your business will be competitive and successful in the market.
• Organization or management: State the  legal status of your business, such as a corporation or partnership, and include an organizational chart showing management levels, departments, and so on.
• Service or product line : State what you will sell or provide and describe the benefits of each. Explain any research done, and any patents filed, and so on. 
• Marketing and sales : Explain in detail your marketing strategy and how sales will be made.
• Funding request : If necessary, detail the amount of funding you’ll need for the next five years - specifically,  what you’ll do with the funds, and the terms you’re asking for.
• Financial projections : This is the business’s financial outlook for the next five years. Include current financial statements, if the business is in operation.
• Appendix : This includes supporting documents or requested materials, such as resumes, product photos, letters of reference, patents, licenses and so on.
• MBN: Market Business News: What is a Feasibility Study? Definition and Examples
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Barbara Bean-Mellinger is a freelance writer who lives in the Washington, D.C. area. She has written on business topics for bizfluent.com, afkinsider.com, Harbor Style Magazine, the Charlotte Sun and more. Barbara holds a B.S. from the University of Pittsburgh and has won numerous awards in B2B and B2C marketing.

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• How to conduct a feasibility study: Tem ...

How to conduct a feasibility study: Templates and examples

Conducting a feasibility study is an important step in successful project management. By evaluating the viability of a proposed project, a feasibility study helps you identify potential challenges and opportunities, ensuring you make informed decisions. In this guide, we’ll walk you through how to conduct a feasibility study with practical templates and real-world examples, designed for project managers seeking to optimize their project planning process.

It can be exciting to run a large, complex project that has a huge potential impact on your organization. On the one hand, you’re driving real change. On the other hand, failure is intimidating. 

What is a feasibility study? 

A feasibility study—sometimes called a feasibility analysis or feasibility report—is a way to evaluate whether or not a project plan could be successful. A feasibility study evaluates the practicality of your project plan in order to judge whether or not you’re able to move forward with the project. 

It does so by answering two questions: 

Does our team have the required tools or resources to complete this project? 

Will there be a high enough return on investment to make the project worth pursuing? 

Benefits of conducting a feasibility study

There are several key benefits to conducting a feasibility study before launching a new project:

Confirms market opportunities and the target market before investing significant resources

Identifies potential issues and risks early on

Provides in-depth data for better decision making on the proposed project's viability

Creates documentation on expected costs and benefits, including financial analysis

Obtains stakeholder buy-in by demonstrating due diligence

Feasibility studies are important for projects that represent significant investments for your business. Projects that also have a large potential impact on your presence in the market may also require a feasibility assessment. 

As the project manager , you may not be directly responsible for driving the feasibility study, but it’s important to know what these studies are. By understanding the different elements that go into a feasibility study, you can better support the team driving the feasibility study and ensure the best outcome for your project.

When should you conduct a feasibility analysis?

A feasibility study should be conducted after the project has been pitched but before any work has actually started. The study is part of the project planning process. In fact, it’s often done in conjunction with a SWOT analysis or project risk assessment , depending on the specific project. 

Feasibility studies help: 

Confirm market opportunities before committing to a project

Narrow your business alternatives

Create documentation about the benefits and disadvantages of your proposed initiative

Provide more information before making a go-or-no-go decision

You likely don’t need a feasibility study if:

You already know the project is feasible

You’ve run a similar project in the past

Your competitors are succeeding with a similar initiative in market

The project is small, straightforward, and has minimal long-term business impact

Your team ran a similar feasibility analysis within the past three years

One thing to keep in mind is that a feasibility study is not a project pitch. During a project pitch, you’re evaluating whether or not the project is a good idea for your company and whether the goals of the project are in line with your overall strategic plan. Typically, once you’ve established that the project is a good idea, you'll run a feasibility study to confirm that the project is possible with the tools and resources you have at your disposal. 

Types of feasibility studies

There are five main types of feasibility studies: technical feasibility, financial feasibility, market feasibility (or market fit), operational feasibility, and legal feasibility. Most comprehensive feasibility studies will include an assessment of all five of these areas.

Technical feasibility

A technical feasibility study reviews the technical resources available for your project. This study determines if you have the right equipment, enough equipment, and the right technical knowledge to complete your project objectives . For example, if your project plan proposes creating 50,000 products per month, but you can only produce 30,000 products per month in your factories, this project isn’t technically feasible. 

Financial feasibility

Financial feasibility describes whether or not your project is fiscally viable. A financial feasibility report includes a cost-benefit analysis of the project. It also forecasts an expected return on investment (ROI) and outlines any financial risks. The goal at the end of the financial feasibility study is to understand the economic benefits the project will drive. 

Market feasibility

The market feasibility study is an evaluation of how your team expects the project’s deliverables to perform in the market. This part of the report includes a market analysis, a market competition breakdown, and sales projections.

Operational feasibility

An operational feasibility study evaluates whether or not your organization is able to complete this project. This includes staffing requirements, organizational structure, and any applicable legal requirements. At the end of the operational feasibility study, your team will have a sense of whether or not you have the resources, skills, and competencies to complete this work. 

Legal feasibility

A legal feasibility analysis assesses whether the proposed project complies with all relevant legal requirements and regulations. This includes examining legal and regulatory barriers, necessary permits, licenses, or certifications, potential legal liabilities or risks, and intellectual property considerations. The legal feasibility study ensures that the project can be completed without running afoul of any laws or incurring undue legal exposure for the organization.

Feasibility assessment checklist

Most feasibility studies are structured in a similar way. These documents serve as an assessment of the practicality of a proposed business idea. Creating a clear feasibility study helps project stakeholders during the decision making process. 

The essential elements of a feasibility study are: 

An executive summary describing the project’s overall viability

A description of the product or service being developed during this project

Any technical considerations , including technology, equipment, or staffing

The market survey , including a study of the current market and the marketing strategy 

The operational feasibility study evaluates whether or not your team’s current organizational structure can support this initiative

The project timeline

Financial projections based on your financial feasibility report

6 steps to conduct a feasibility study

You likely won’t be conducting the feasibility study yourself, but you will probably be called on to provide insight and information. To conduct a feasibility study, hire a trained consultant or, if you have an in-house project management office (PMO) , ask if they take on this type of work. In general, here are the steps they’ll take to complete this work: 

1. Run a preliminary analysis

Creating a feasibility study is a time-intensive process. Before diving into the feasibility study, it’s important to evaluate the project for any obvious and insurmountable roadblocks. For example, if the project requires significantly more budget than your organization has available, you likely won’t be able to complete it. Similarly, if the project deliverables need to be live and in the market by a certain date but won’t be available for several months after that, the project likely isn’t feasible either. These types of large-scale obstacles make a feasibility study unnecessary because it’s clear the project is not viable.

2. Evaluate financial feasibility

Think of the financial feasibility study as the projected income statement for the project. This part of the feasibility study clarifies the expected project income and outlines what your organization needs to invest—in terms of time and money—in order to hit the project objectives. 

During the financial feasibility study, take into account whether or not the project will impact your business's cash flow. Depending on the complexity of the initiative, your internal PMO or external consultant may want to work with your financial team to run a cost-benefit analysis of the project. 

3. Run a market assessment

The market assessment, or market feasibility study, is a chance to identify the demand in the market. This study offers a sense of expected revenue for the project and any potential market risks you could run into. 

The market assessment, more than any other part of the feasibility study, is a chance to evaluate whether or not there’s an opportunity in the market. During this study, it’s critical to evaluate your competitor’s positions and analyze demographics to get a sense of how the project will go. 

4. Consider technical and operational feasibility

Even if the financials are looking good and the market is ready, this initiative may not be something your organization can support. To evaluate operational feasibility, consider any staffing or equipment requirements this project needs. What organizational resources—including time, money, and skills—are necessary in order for this project to succeed? 

Depending on the project, it may also be necessary to consider the legal impact of the initiative. For example, if the project involves developing a new patent for your product, you will need to involve your legal team and incorporate that requirement into the project plan.

5. Review project points of vulnerability

At this stage, your internal PMO team or external consultant have looked at all four elements of your feasibility study—financials, market analysis, technical feasibility, and operational feasibility. Before running their recommendations by you and your stakeholders, they will review and analyze the data for any inconsistencies. This includes ensuring the income statement is in line with your market analysis. Similarly, now that they’ve run a technical feasibility study, are any liabilities too big of a red flag? (If so, create a contingency plan !) 

Depending on the complexity of your project, there won’t always be a clear answer. A feasibility analysis doesn’t provide a black-and-white decision for a complex problem. Rather, it helps you come to the table with the right questions—and answers—so you can make the best decision for your project and for your team.

6. Propose a decision

The final step of the feasibility study is an executive summary touching on the main points and proposing a solution. 

Depending on the complexity and scope of the project, your internal PMO or external consultant may share the feasibility study with stakeholders or present it to the group in order to field any questions live. Either way, with the study in hand, your team now has the information you need to make an informed decision.

Feasibility study examples

To better understand the concepts behind feasibility assessments, here are two hypothetical examples demonstrating how these studies can be applied in real-world scenarios.

Example 1: New product development

A consumer goods company is considering launching a new product line. Before investing in new product development, they conduct a feasibility study to assess the proposed project.

The feasibility study includes:

Market research to gauge consumer interest, assess competitor offerings, and estimate potential market share for the target market.

Technological considerations, including R&D requirements, production processes, and any necessary patents or certifications.

In-depth financial analysis projects sales volumes, revenue, costs, and profitability over a multi-year period.

Evaluation of organizational readiness, including the skills of the current management team and staff to bring the new product to market.

Assessment of legal feasibility to ensure compliance with regulations and identify any potential liability issues.

The comprehensive feasibility study identifies a promising market opportunity for the new business venture. The company decides to proceed with the new project, using the feasibility report as a template for their business development process. The study helps secure funding from key decision-makers, setting this start-up product initiative up for success.

Example 2: Real estate development deal

A property developer is evaluating the feasibility of purchasing land for a new residential community. They commission a feasibility study to determine the viability of this real estate development project.

The feasibility assessment covers:

Detailed analysis of the local housing market, including demand drivers, comparable properties, pricing, and absorption rates.

Site planning to assess the property's capacity, constraints, and technological considerations.

In-depth review of legal feasibility, including zoning, permitting, environmental regulations, and other potential legal hurdles.

Financial analysis modeling various development scenarios and estimating returns on investment.

Creation of an opening day balance sheet projecting the assets, liabilities, and equity for the proposed project.

Sensitivity analysis to evaluate the impact of changes in key assumptions on the project's scope and profitability.

The feasibility study concludes that while the real estate start-up is viable, it carries significant risk. Based on these findings, the developer makes an informed decision to move forward, but with a revised project's scope and a phased approach to mitigate risk. The comprehensive feasibility analysis proves critical in guiding this major investment decision.

Which phase of the project management process involves feasibility studies?

Feasibility studies are a key part of the project initiation and planning phases. They are typically conducted after a project has been conceptualized but before significant resources are invested in detailed planning and execution.

The purpose of a feasibility assessment is to objectively evaluate the viability of a proposed project, considering factors such as technical feasibility, market demand, financial costs and benefits, legal requirements, and organizational readiness. By thoroughly assessing these aspects, a feasibility study helps project stakeholders make an informed go-or-no-go decision.

While feasibility studies are a critical tool in the early stages of project management, they differ from other planning documents like project charters, business cases, and business plans. Here's a closer look at these key differences:

Feasibility study vs. project charter

A project charter is a relatively informal document to pitch your project to stakeholders. Think of the charter as an elevator pitch for your project objectives, scope, and responsibilities. Typically, your project sponsor or executive stakeholders review the charter before ratifying the project. 

A feasibility study should be implemented after the project charter has been ratified. This isn’t a document to pitch whether or not the project is in line with your team’s goals—rather, it’s a way to ensure the project is something you and your team can accomplish.

Feasibility study vs. business case

A business case is a more formalized version of the project charter. While you’d typically create a project charter for small or straightforward initiatives, you should create a business case if you are pitching a large, complex initiative that will make a major impact on the business. This longer, more formal document will also include financial information and typically involve more senior stakeholders. 

After your business case is approved by relevant stakeholders, you'll run a feasibility study to make sure the work is doable. If you find it isn’t, you might return to your executive stakeholders and request more resources, tools, or time in order to ensure your business case is feasible.

Feasibility study vs. business plan

A business plan is a formal document outlining your organization’s goals. You typically write a business plan when founding your company or when your business is going through a significant shift. Your business plan informs a lot of other business decisions, including your three- to five-year strategic plan . 

As you implement your business and strategic plan, you’ll invest in individual projects. A feasibility study is a way to evaluate the practicality of any given individual project or initiative.

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Feasibility study: definition, benefits and differences with a Business Plan

• Last updated on 09 January, 2024

Welcome to our series of articles on feasibility studies.

• What is a Feasibility study?
• What is a bankable feasibility study?
• How to do a feasibility study?
• Feasibility study consultants: expertise needed
• Cost of a feasibility study
• Car Park Feasibility Study: Key considerations
• Hotel Feasibility Study: Methodology
• Feasibility study of solar PV projects: Key components
• Feasibility study of real estate developments
• Feasibility study of marina projects

In this post, we will touch on all the basic concepts behind a feasibility study. definition, benefits of doing it, main parts, differences with a business plan, etc. Aninver Development Partners is a consulting firm specializing in Feasibility studies for projects such as hotels, infrastructure, energy, technology, etc. We assist clients globally. 

Definition of Feasibility study

A feasibility study is a comprehensive and systematic analysis and evaluation of a proposed project, business venture, or initiative to determine its practicality, viability, and potential for success. It involves a thorough examination of various factors, such as financial, technical, operational, legal, environmental, and market-related aspects, to assess whether the project is feasible and worth pursuing. 

The primary goal of a feasibility study is to provide stakeholders with essential information and insights to make informed decisions about whether to proceed with the project, abandon it, or make necessary adjustments to enhance its chances of success.

Differences between a feasibility study and a business plan

Feasibility studies and business plans are both important tools in the development and evaluation of a business or project, but they serve different purposes and are created at different stages of the process. Here are the key differences between a feasibility study and a business plan:

Differences in Purpose

• Feasibility Study : Feasibility studies are conducted in the early stages of project development or business planning. Their primary purpose is to determine whether a proposed project or business idea is viable and should be pursued. Feasibility studies focus on assessing the potential risks, challenges, and opportunities associated with the project.
• Business Plan : Business plans are created after the feasibility study, once it has been established that the project is viable. The purpose of a business plan is to outline in detail how the business will be structured, operated, and grown. It serves as a roadmap for the future of the business and is often used to secure financing.

Differences in Content

• Feasibility Study : A feasibility study includes an analysis of the project's overall concept, market research, technical requirements, financial projections, potential risks, and recommendations. It provides a high-level overview of the project's feasibility.
• Business Plan : A business plan is a detailed document that outlines the company's mission, vision, goals, organizational structure, market strategy, marketing and sales plans, financial forecasts, and operational details. It delves into the specifics of how the business will operate.

Differences in Timing

• Feasibility Study : Feasibility studies are conducted at the outset of a project or business idea to assess its potential feasibility. They help stakeholders decide whether to move forward with the project.
• Business Plan : Business plans are typically created after the feasibility study, once it has been determined that the project is feasible and worth pursuing. They provide a roadmap for the actual operation and growth of the business.

Differences in Audience

• Feasibility Study : The primary audience for a feasibility study includes project stakeholders, investors, and decision-makers who need to determine whether the project should proceed.
• Business Plan : Business plans are used to communicate the business's vision and strategy to a wider audience, including potential investors, lenders, partners, and employees.

In summary, a feasibility study is a preliminary assessment of the potential success of a project, while a business plan is a detailed document that outlines how a business will be run. The feasibility study helps determine whether a business plan should be developed, while the business plan provides a comprehensive strategy for the ongoing operation and growth of the business.

Feasibility study vs Pre-feasibility study

Let's explore now the key differences between a prefeasibility study and a feasibility study:

Purpose and Scope : A prefeasibility study and a feasibility study both play critical roles in project evaluation, but they serve distinct purposes. A prefeasibility study is typically the initial phase in the assessment process. Its primary purpose is to provide a preliminary evaluation of a project's potential viability. It helps stakeholders decide whether it's worth investing further resources into a detailed feasibility study. In contrast, a feasibility study goes into much greater depth and detail, assessing the project's practicality from technical, financial, operational, and market perspectives. It aims to provide a comprehensive understanding of whether the project is feasible and worth pursuing.

Level of Detail : One of the key distinctions between the two studies is the level of detail they encompass. A prefeasibility study offers a broad overview of the project, examining high-level factors like market demand, technical requirements, and rough cost estimates. It provides enough information to make an initial go/no-go decision. In contrast, a feasibility study drills down into finer details, providing precise financial projections, risk assessments, engineering specifics, and a comprehensive business plan. It seeks to leave no stone unturned in assessing the project's practicality.

Resource and Cost Implications : A prefeasibility study is generally less resource-intensive and cheaper to conduct compared to a full feasibility study. It acts as a cost-effective filter to eliminate unviable projects early in the evaluation process. Once a project passes the prefeasibility stage and proceeds to a feasibility study, it implies a commitment of more resources, time, and finances due to the comprehensive nature of the study. A prefeasibility study helps in efficient resource allocation by focusing only on the most promising projects, while a feasibility study is a more intensive process suitable for projects that have demonstrated a higher likelihood of success during the prefeasibility assessment.

Benefits of doing a Feasibility study

Conducting a feasibility study offers numerous benefits, making it an essential step in the decision-making process for any project, business venture, or initiative. Here are the key advantages of performing a feasibility study:

• Risk Assessment : Feasibility studies help identify potential risks and challenges associated with a project. By thoroughly examining technical, financial, operational, and market-related aspects, stakeholders can pinpoint areas of concern and develop strategies to mitigate or manage these risks effectively.
• Decision-Making : Feasibility studies provide critical information to decision-makers, helping them make informed choices about whether to proceed with a project. These studies offer a basis for go/no-go decisions, preventing resources from being wasted on unviable endeavors.
• Resource Allocation : By assessing the feasibility of a project, stakeholders can allocate resources more efficiently. They can avoid overinvesting in projects with limited potential and allocate resources to those with a higher likelihood of success.
• Financial Planning : Feasibility studies include detailed financial projections and cost estimates. This financial information is invaluable for securing funding from investors, lenders, or other sources. It helps in creating a solid business case.
• Market Insight : Market feasibility studies provide insights into customer demand, market trends, and competitive dynamics. This information is crucial for designing products or services that meet market needs and for formulating effective marketing strategies.
• Optimized Design : Technical feasibility studies ensure that a project's technical requirements and design are viable. They help in avoiding costly design flaws and ensuring that the project can be implemented as planned.
• Legal and Regulatory Compliance : Feasibility studies can identify potential legal and regulatory challenges. This allows for the development of strategies to navigate and comply with relevant laws and regulations, reducing the risk of legal complications later on.
• Enhanced Project Viability : Feasibility studies may lead to adjustments and improvements in the project plan, making it more viable and likely to succeed. This iterative process ensures that potential issues are addressed proactively.
• Investor and Stakeholder Confidence : When potential investors and stakeholders see that a comprehensive feasibility study has been conducted, they are more likely to have confidence in the project. This can make it easier to secure funding and support.
• Long-Term Planning : Feasibility studies not only assess the viability of a project in the short term but also help in long-term planning. They provide insights into the sustainability and growth potential of a business or initiative.

In summary, conducting a feasibility study is a valuable step in the project development process. It provides a structured approach to assess the viability of a project, manage risks, make informed decisions, secure financing, and set the stage for a successful venture. The benefits of a feasibility study extend beyond initial decision-making and contribute to the overall success and sustainability of a project or business.

Components of a Feasibility study

A feasibility study typically consists of several key components that provide a comprehensive evaluation of a project, business venture, or initiative. These components help stakeholders make informed decisions about the feasibility and viability of the proposed endeavor. The main components of a feasibility study include:

Executive Summary

The executive summary provides a concise overview of the entire feasibility study. It includes a brief description of the project, its objectives, and the key findings and recommendations. It serves as a quick reference for decision-makers.

Project Description

This section outlines the project's goals, objectives, and scope. It defines the problem the project aims to solve or the opportunity it seeks to capture. It also specifies the project's location and the stakeholders involved.

Market Analysis

Market analysis assesses the demand for the product or service within the target market. It includes information on target customers, market size, growth potential, competition, and market trends. This component helps determine whether there is a viable market for the project.

Technical Feasibility

Technical feasibility examines the project's technical requirements. It assesses whether the necessary technology, equipment, and resources are available or can be developed. It also identifies any technical challenges that may need to be addressed.

Operational Feasibility

Operational feasibility evaluates how the project will be implemented and operated. It includes details about project timelines, workflow, personnel requirements, and operational processes. This section helps in understanding how the project will function on a day-to-day basis.

Financial Feasibility

Financial feasibility is a critical component that includes detailed financial projections and analysis. It covers aspects such as startup costs, revenue forecasts, expense estimates, cash flow analysis, and return on investment calculations. It assesses the project's financial viability and potential profitability.

Legal and Regulatory Analysis

This section examines the legal and regulatory requirements that may impact the project. It identifies permits, licenses, or compliance issues that need to be addressed. Understanding and addressing legal and regulatory aspects are essential to avoid potential obstacles.

Risk Assessment

The risk assessment component identifies potential risks and challenges associated with the project. It evaluates the probability and impact of these risks and suggests risk mitigation strategies. Risks can be financial, technical, operational, market-related, or related to external factors.

Recommendations and Conclusion

In this section, the feasibility study summarizes the findings and presents clear recommendations based on the assessment. It often includes a conclusion that states whether the project is feasible and worth pursuing or whether it should be abandoned or modified.

The appendices contain additional supporting documentation and data, such as detailed financial spreadsheets, market research reports, technical specifications, and any other relevant information. These provide a more in-depth reference for stakeholders.

The main components of a feasibility study collectively provide a thorough assessment of a project's viability from multiple angles, ensuring that decision-makers have a comprehensive understanding of the project's potential, risks, and benefits.

Examples of Feasibility studies

Let's look now into some examples of feasibility studies for different types of projects and initiatives:

• Real Estate Development

A real estate developer is considering constructing a residential apartment complex in a growing urban area. A feasibility study would assess factors like market demand, location, zoning regulations, construction costs, potential revenue from rentals, and the financial viability of the project.

• Manufacturing Plant Expansion

A manufacturing company is considering expanding its operations by building a new production facility. The feasibility study would evaluate factors such as available land, infrastructure, equipment requirements, workforce, environmental impact, and the financial feasibility of the expansion.

• Small Business Startup

An entrepreneur is exploring the feasibility of starting a small restaurant in a specific location. The feasibility study would examine the local market, including competitors, target customer demographics, startup costs, regulatory requirements, and financial projections for the first few years of operation.

• Renewable Energy Project

A renewable energy company is considering the construction of a solar power plant. The feasibility study would assess the site's solar exposure, grid connection feasibility, equipment costs, revenue from energy sales, environmental impact, and the return on investment over the project's lifespan.

• Healthcare Facility Expansion

A hospital is contemplating an expansion to meet growing patient demands. The feasibility study would include an assessment of the required medical equipment, staffing needs, regulatory compliance, funding sources, and the anticipated patient load.

• Tourism Development

A tourist destination is considering the construction of a new hotel and recreational facilities. The feasibility study would evaluate the area's appeal to tourists, competition with existing businesses, construction costs, expected occupancy rates, and potential revenue from tourism.

• Nonprofit Program Expansion

A nonprofit organization is looking to expand its community outreach programs. The feasibility study would assess the need for the programs, funding sources, volunteer availability, operational costs, and the impact of the expansion on the organization's mission and goals.

• E-commerce Startup

An entrepreneur plans to launch an e-commerce website. The feasibility study would examine market demand, website development costs, marketing strategies, competitive analysis, and projected sales revenue and profitability.

These examples illustrate how feasibility studies are conducted in various fields and industries to evaluate the potential success and viability of a wide range of projects and initiatives. The specific components and focus areas of a feasibility study will vary depending on the nature of the project and the questions it seeks to address.

7 steps to conduct a Feasibility study

Now, let's think we are going to write a feasibility study. Let's check what steps we need to take to develop the final report.

• Conduct a Preliminary Analysis

Begin by conducting an initial evaluation of the project's objectives and scope. This step involves defining the problem the project intends to address or the opportunity it aims to seize. Ensure that the project's goals are clear and well-defined.

• Analyze Technical Specifications

Examine the technical aspects of the project in detail. Evaluate the availability of required technology, equipment, and resources. Verify that the project's technical requirements can be met effectively.

• Conduct a Commercial Analysis

Perform a comprehensive analysis of the project's commercial aspects. This step involves assessing the market's demand for the product or service, analyzing market size, competition, customer needs, and market trends. Determine if there is a feasible market for the project.

• Prepare a Projected Income Statement

Create a detailed projected income statement for the project. This includes estimating startup costs, revenue forecasts, expense projections, and cash flow analysis. Calculate the return on investment (ROI) to determine the project's financial viability, the Internal Rate of Return (IRR) of the investment and the Net Present Value (NPV) of future cash flows.

• Prepare a Day-Zero Balance Sheet

Develop a balance sheet that represents the project's financial position at the outset (day zero). This financial snapshot should account for all assets, liabilities, and equity to provide a clear overview of the project's financial situation before it begins.

• Analyze Different Alternatives for Feasibility

Explore various alternatives and scenarios for the project's feasibility. Assess different approaches, technologies, or business models to identify the most viable option. Consider the potential impact of these alternatives on the project's success. Make sensibilities to potentila risks.

• Make a Go/No-Go Decision

Based on the findings and analysis conducted throughout the feasibility study, make a well-informed decision on whether to proceed with the project (a "Go" decision) or abandon it (a "No-Go" decision). Ensure that the decision aligns with the project's goals and aligns with the information presented in the study.

These steps provide a structured approach to conducting a feasibility study, ensuring that all relevant aspects of the project are thoroughly assessed and considered before making a decision on its viability.

In conclusion, a feasibility study is an indispensable tool for any project, business venture, or initiative. It serves as the critical bridge between a concept and a well-informed decision. By following a systematic process that includes a preliminary analysis, technical assessment, commercial evaluation, financial projections, and a careful consideration of alternatives, stakeholders can gain a comprehensive understanding of a project's viability.

The feasibility study's ability to assess market demand, technical feasibility, operational requirements, financial viability, and potential risks empowers decision-makers to make informed choices. Whether it's a real estate development, a new product launch, a manufacturing expansion, an IT system upgrade, or any other endeavor, a feasibility study helps in risk management, efficient resource allocation, and, ultimately, the successful realization of the project's goals.

It's important to remember that a well-conducted feasibility study not only serves the purpose of greenlighting a project but also provides a foundation for its long-term success. It gives stakeholders the confidence that the project is based on sound analysis and planning. In a world of complex challenges and opportunities, the feasibility study is a guiding compass for those seeking to turn innovative ideas into reality.

Make sure you hire the right consultants to deliver your feasibility study or business plan. Our firm, Aninver Development Partners, specializes in designing bankable feasibility studies  to make sure projects continue to their following phase. 

Send us a message on our contact page and we can discuss how we can help you. 

Some of our experience conducting feasibility studies can be seen below:

• Feasibility Study for a new marina in the island of San Andrés through PPP
• Pre-feasibility study for construction of silo storages in Northern Ghana through PPP
• Feasibility study of a real estate WAQF project in Cotonou (Benin)
• Feasibility study and analysis of strategic alternatives of a touristic development in Natal
• Feasibility study for creation of an Investment and Export Promotion Agency of Health services in Tunisia
• Feasibility Study for car parks in Bishkek though PPP
• Feasibility study of markets in Benin and Togo under PPP scheme
• Feasibility Study for the establishment of a Large-Scale Cashew Processing Plant in Zambia
• Public Private Partnership (PPPs) study in the Housing Sector
• Review of Business Case for Manila Central Subway
• First Mover PPP Prefeasibility Study
• Review of the feasibility study of the PPP project Complejo El Brillante, in Cordoba (Spain)
• Review of pre-feasibility study of a Health PPP project

Alvaro de la Maza is one the founding partners of Aninver Development Partners. Alvaro is a Civil Engineer, MS on Infrastructure Management and MBA by IESE Business School.Alvaro has extensive experience in Infrastructure and Public Private Partnerships. Alvaro has worked and led multiple consulting projects for clients such as the World Bank, the African Development Bank and other donors.Alvaro enjoys creating digital products and he has led the development of market intelligence platforms in d...

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What is the difference between feasibility study and business plan?

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What is the difference between heath and heather?

Share article, table of contents hide, what is a feasibility study, what is a business plan, the key differences between a feasibility study and a business, when to use a feasibility study vs. a business plan, how to create a feasibility study, how to create a business plan, what are the types of feasibility studies, what are the types of business plans.

A feasibility study is an analysis of whether a business idea is practical and viable , while a business plan outlines the strategy and operations of a business in detail. Essentially, a feasibility study is a precursor to a business plan, helping to determine whether the business idea is worth pursuing before investing time and resources into developing a full plan.

(Photo by Firmbee.com on Unsplash )

A feasibility study is an analysis of the viability of an idea, proposal, or concept. It assesses the likelihood that a project will be successful in meeting its objectives and goals, and whether it is worth pursuing.

A feasibility study is not the same as a business plan. A business plan is a document that outlines the financial and operational goals of a business. It includes information on the company’s products or services, marketing strategy, and target market.

A feasibility study looks at all aspects of a proposed project, including technical feasibility, financial feasibility, and operational feasibility. It is used to determine whether a project is worth pursuing and to identify any potential risks or limitations.

Technical feasibility looks at whether a proposed project can be completed with the available resources. This includes evaluating the technical requirements, such as hardware and software requirements, and assessing whether these can be met. Financial feasibility looks at whether a proposed project is financially viable. This includes assessing the costs and benefits of the project, as well as any potential sources of funding. Operational feasibility looks at whether a proposed project can be completed successfully within the given constraints. This includes evaluating the resources required for the project and assessing whether they are available.

The goal of a feasibility study is to identify any potential problems with a proposed project so that they can be addressed before moving forward. By doing this, it increases the chances of success for the project overall.

(Photo by Jason Goodman on Unsplash )

A business plan is a comprehensive document that outlines the strategy, operations, and financial projections for a business. It typically includes information on the company’s products or services, target market, competition, marketing and sales strategies, management team, and financial projections.

A well-written business plan is an important tool for entrepreneurs and business owners, as it provides a roadmap for the future of the business and helps to secure funding from investors or lenders. It allows the business owner to clearly articulate their vision and goals, and to identify potential challenges and opportunities.

The key components of a business plan typically include an executive summary , company description, market analysis, marketing and sales strategy, management and organization, product or service line, financial projections, and funding request.

The executive summary provides an overview of the business plan, highlighting the key points and objectives. The company description provides background information on the business, including its history , mission, and goals. The market analysis outlines the target market, competition, and industry trends. The marketing and sales strategy describes how the business will reach and engage customers. The management and organization section details the management team and organizational structure of the business. The product or service line outlines the products or services the business will offer. The financial projections include income statements, balance sheets, and cash flow statements. Finally, the funding request outlines the amount of funding needed and how it will be used.

Overall, a business plan is a critical document for any business, providing a roadmap for success and a way to attract funding and support from investors and lenders.

Purpose: A feasibility study is conducted to determine whether a business idea is practical and viable, while a business plan is developed to outline the strategy, operations, and financial projections for a business.

Scope : A feasibility study is a preliminary analysis that focuses on the market, technical, and financial feasibility of a business idea, while a business plan is a comprehensive document that covers all aspects of a business, including its products or services, target market, competition, marketing and sales strategies, management team, and financial projections.

Timing : A feasibility study is typically conducted before developing a business plan to determine whether the business idea is worth pursuing, while a business plan is developed once the decision to proceed with the business has been made.

Audience : A feasibility study is primarily used to inform the entrepreneur or management team about the viability of the business idea, while a business plan is used to secure funding from investors or lenders.

Level of detail : A feasibility study provides a high-level analysis of the business idea, while a business plan provides a detailed roadmap for the future of the business, including its marketing and sales strategies, management team, and financial projections.

A feasibility study is typically used when starting a new business or venture, and its purpose is to determine if the proposed business idea is viable. A feasibility study will assess the market potential, technical feasibility, and financial viability of the proposed business. It is important to note that a feasibility study is not the same as a business plan; rather, it is one tool that can be used in developing a business plan.

In contrast, a business plan is typically used once a business has already been established. Its purpose is to outline the company’s strategy for achieving its goals and objectives. Unlike a feasibility study, which assesses the viability of a proposed idea, a business plan focuses on an existing businesses’ ability to execute its strategy and achieve its goals.

A feasibility study is an analysis of whether a proposed project is likely to be successful. A business plan is a more detailed document that outlines the specifics of the business, such as its products or services, marketing strategy, and financial projections.

Creating a feasibility study typically requires four main steps:

• Define the problem or opportunity. This step includes understanding the needs of the potential customer or client.
• Research and gather data. This step includes secondary research, such as market analysis and industry trends, as well as primary research, such as customer surveys or interviews.
• Analyze the data and make recommendations. This step includes determining whether the problem or opportunity can be solved and whether the proposed project is likely to be successful.
• Prepare a written report . This step includes documenting the findings of the feasibility study in a clear and concise manner.

Creating a business plan can seem like a daunting task, but it doesn’t have to be. You can start by doing some research and then outlining your goals and objectives. Once you have a good understanding of what you want to achieve, you can start putting together a more detailed plan.

There are a few key things that should be included in any business plan:

• An executive summary. This is a brief overview of your business and what you hope to accomplish.
• A description of your product or service. What are you offering and why do your customers need it?
• A marketing plan. How will you reach your target market and what strategies will you use to promote your product or service?
• A financial plan. What are your revenue and expense projections? How much money do you need to get started or to keep your business running?
• An operational plan. What are the day-to-day details of running your business? Who will handle what tasks?
• A risk management plan. What could go wrong and how will you handle it if it does?

Market Feasibility

A market feasibility study assesses the potential for a product or service to be successful in a given market. It takes into account multiple factors such as the size of the target market, growth trends, competitor analysis, and customer needs and buying habits. This type of feasibility study is important for businesses to understand whether there is a demand for their product or service in the marketplace.

Technical Feasibility

A technical feasibility study assesses the ability of a business to successfully develop and implement a proposed solution. This includes assessing the technical risks involved, as well as ensuring that the necessary resources (e.g., personnel, equipment) are available. A technical feasibility study is important to determine whether a proposed solution is achievable and will meet the needs of the business.

Financial Feasibility

A financial feasibility study assesses the potential financial impact of a proposed solution. This includes an assessment of the costs and benefits of implementing the solution, as well as any potential risks and uncertainties associated with it. A financial feasibility study is important to determine whether a proposed solution is financially viable and will have a positive impact on the business’s bottom line.

Managerial Feasibility

A managerial feasibility study assesses the ability of management to successfully develop and implement a proposed solution. This includes an assessment of management’s experience, skills,

There are three types of business plans :

Internal business plan

An internal business plan is a document that outlines the company’s strategy for achieving its objectives. It is typically created by the company’s management team and is not shared with outsiders.

External business plan

An external business plan is a document that is shared with outsiders, such as investors, potential partners, and customers. Its purpose is to persuasively communicate the company’s strategy and how it will achieve its objectives.

Hybrid business plan

A hybrid business plan combines elements of both an internal and an external business plan. It typically includes a high-level overview of the company’s strategy that can be shared with outsiders, as well as more detailed information on operational matters that is meant for internal use only.

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