FEASIBILITY ANALYSIS AND

DECISION BUSINESS MODELA BRIEFING H20 THE SOURCE OF LIFE

CHAPTER 4

INTRODUCTIONAn Entrepreneur Cantillion (Cira 1700), descripted an entrepreneur as rational decision maker who assumes the risk and provide management for the firm. The inherit risk in many occasions stops ideas to see the light, the true fine line that contributes to a successful business plan is its feasibility analysis

Idea assessment Is the process of examining a need in the market , developing a solution for that need , and determine the ability to turn the idea into a business hence the need for feasibility study

Feasibility Analysis Is the process of determining whether entrepreneur's idea is viable foundation for creating a successful business and what business model fits it best

Business Model Is plan for the successful operation of a business , keeping in mind the resources and the intended customer and products or services and best model to apply such.

IDEA ASSESSMENT AND BUSINESS PLAN STEPS

Business idea

Conducting idea assessment

Conducting feasibility analysis (as coming steps stated)

Developing the business model

Crafting the business plan , business model canvas

Test the value proposition (of product service )

Creating the strategic plan (for the full model )

Refining the organogram ( tasks and duties)

Launching the business Soft opening Full operation

ELEMENTS OF FEASIBILITY ANALYSIS

Feasibility Analysis consists of four interrelated elements:

1. Industry and market feasibility analysis (the industry details and its market concentration )

2. Product or service feasibility analysis ( the product or service and its specs and details )

3. Financial feasibility analysis (the budget and cash flow )

FEASIBILITY ANALYSIS STEPBASIC STEPS TO CONSIDER ARE

1. Project Description – Identify the project name and purpose. Include details including stakeholders, and end result expected.

2. Goals – List long and short-term goals and what processes will be needed to achieve those goals.

3. Timeline – What will be the estimated time until project completion?

4. Costs and Budgeting – Include all costs incurred for the project including the cost of the feasibility study itself.

5. Purpose – What purpose does the project have and whom will it benefit?

6. Market Analysis – If applicable, will the market or market environment benefit from the project. If so, list why.

FEASIBILITY ANALYSIS STEP

7. Resources – Identify all the resources both IT, technical, inventory, and human that will be needed to complete the project.

8. Project Process – How will the project flow? Include flow charts showing project stages.

9. Management and Teams – Who will manage and who will work on scheduled tasks? Will project management outsourcing be needed?

10. Observations– Statements that do or don’t support the project should be included here. If for a client, does the client have the finances to complete the project or are there alternatives? If for a project or process, will it work and will it be beneficial

FINANCIAL ANALYSIS

IS THERE ENOUGH MARGIN???

• Capital requirements (needs capital estimate to start the business)

• Estimated earnings (forecast earnings potential )

• Time out of cash (running out of cash before the break even)

• Return on investment (estimated earnings vs. the capital requirements)

BUSINESS MODEL CANVAS

FEASIBILITY ANALYSIS OUTCOME

IS THE PROJECT FEASIBLE?

As soon as completing feasibility analysis a determination to proceed with the project or not. A good feasibility study should include:

1. Project Problems – Does the study include risk or problematic areas that need to be addressed and are they clearly identified?

2. The Outcome – Ever study should identify the process, product, client request, and goal and how they will affect the outcome; positively or negatively. Will outcomes be beneficial or deterrent?

A. Alternatives – Are possible alternatives available or suggested and researched?

B. Assessment – The assessment part of your feasibility study should include risk management and controls, solutions, if the project is feasible, and how the project should be implemented.

CONCLUSION

• Projects to be considered, especially if they are to undertake many resources including real money , real time, and real effort then:

• A feasibility study is essential prior to project initiation, project scope, and initiation.

• If a project appears overwhelming or requires much detail and analysis to get to break even to begin the project, consider completing a feasibility study prior to the project.

• There are no guarantees for success it is only dependent on entrepreneurs vision and capability to apply the plan of the project and lead it to its aim and success