If you’re thinking about starting or expanding a business, it may be too early to develop a complete business plan. At this early stage, you should start with a feasibility study to see if your idea for a B2B venture is worth pursuing in the first place, before embarking on developing the full business plan.
Objective Feasibility Study of Your Business Idea
A feasibility study provides a relatively high-level evaluation of a business concept. It determines if your idea for starting or expanding a business is viable and worth pursuing. Think of the feasibility study as an initial ‘sanity check’ of your business concept.
We can help you evaluate your business idea with a thorough feasibility study that identifies the strengths of your concept and also the areas where your business model may need to be revised.
The feasibility study might show that your idea is not viable and that you need to go back to the drawing board. One possible conclusion could be that it is best to abandon the idea altogether because, frankly, it’s just a ‘bad idea’.
If the business idea has little chance of becoming successful, the feasibility study has saved you the time, money, and aggravation of developing a complete business plan.
Often, entrepreneurs are so enamored with their business idea that they are unable to step back and evaluate the viability of their concept objectively.
We can conduct an objective and independent feasibility analysis of your concept for a B2B venture. If it looks like the greatest thing since sliced bread, we’ll tell you. If it’s not, we’ll tell you as well and we’ll provide recommendations for how to fix the concept, if possible.
Elements of a Feasibility Analysis
To determine the viability, the analysis covers many key facets of your business venture, such as:
- Business goals and objectives – What are your personal reasons and goals for starting the business? Do you have the drive and commitment to make the venture successful?
- Customer problem – What is the customer problem you are trying to solve?
- Market demand – This involves an initial evaluation of market potential, prospective buyers, target markets, market size, and market growth to determine if there’s a profitable market.
- Products and services – What do you plan on selling to your target market(s)?
- Substitutes – What other choices do customers have?
- Competition – Who are your existing and potential future competitors and their position in the marketplace?
- Differentiation – How will your business stand out from the competition in a dynamic, competitive landscape? What is unique about your business?
- Pricing – How are you going to price your products and services so that your startup can make a profit?
- Manufacturing and delivery – How are you going to produce and deliver your solution? What equipment and tools do you need?
- Sales & Marketing – How will you create awareness and attract customers? What will your sales process look like?
- Trends – What trends can be identified, good and bad, and how will these impact the business?
- Risks – What can go wrong and what would be the consequences for the startup?
- Financial – What are the startup and operational costs for the business venture? How will cost increase as the business grows? When will the business be profitable? The key question here is: “Will the organization be able to make money in a sustainable way?”
- Organization – Review of the internal organization, skills and experience of the management team, legal structure of the firm and human resources. Employee headcount and employee skills and training required for the business start-up and for the initial growth phase.
Feasibility Study Report
Upon completion of the feasibility study, you’ll receive an analysis report highlighting strengths, weaknesses, and our recommendations.
Also, the feasibility report will include an opinion about whether the business concept is worth pursuing and if it makes sense to go ahead with formal business planning.
If the business concept does appear to be viable, the knowledge gained from the feasibility study is an excellent starting point for full-fledged business planning.
No Guarantee of Success
It’s important to keep in mind that the feasibility study is a relatively high-level analysis of the viability of a business concept. There is no guarantee that the conclusion of the feasibility analysis, whether it’s favorable or unfavorable, is an accurate predictor of the venture’s future. Just like a sound business plan does not guarantee success, but it’s a good start.
Even a brilliant business idea can still fail due to poor management, underfunding, some unforeseen events in the marketplace, and of course just plain bad luck. On the same token, a not-so-great idea that’s pursued anyway can become a success in the hands of a strong management team.
Nevertheless, a feasibility study is a convenient and affordable way to take an honest look at the viability of your business concept, especially if there’s a lot at stake.
To learn more about conducting a feasibility study, or to schedule a free, no-obligation conversation about your business idea, please contact us.