A feasibility study company takes an in-depth look into a potential business venture or project, analyzing its practicality and sustainability. The purpose of this kind of analysis is to determine whether the proposed undertaking will be profitable and manageable or not.
Types of Feasibility Studies (and Best Practices associated with them)
Feasibility studies can help businesses determine their course of action before committing resources to a project. There are four main types of feasibility studies
Economic Feasibility:
An economic feasibility study evaluates the economic viability of a project and whether there is a financial need for its completion. This type of study examines factors such as market demand, cost-benefits, competitive analysis, break-even analysis, and return on investment (ROI).
Best Practices for Economic Feasibility Study
- Gather data from potential customers, industry experts, and other stakeholders to gain insight. This can be done through focus groups, surveys, interviews, etc.
- Analyze the market demand for the product or service being proposed. Some of the ways to do a market demand analysis include researching current market trends, customer preferences, and analyzing the competition through a SWOT analysis.
- Calculate ROI to determine if the project is economically feasible. To do this, compare the cost of running the project to the expected profits it will generate.
- Conduct a financial analysis to assess current and future capital needs by forecasting cash flows and conducting a break-even analysis.
Legal Feasibility:
A legal feasibility study examines the relevant laws, regulations, and policies that could affect a project. This type of analysis considers whether or not the proposed project complies with all applicable laws and regulations. For example, if you want to open a business in Dubai, you must look for a feasibility study company familiar with the laws and regulations of the local jurisdiction in the emirate.
Best Practices for Legal Feasibility Study
- Gather all the relevant laws, regulations, and policies that could affect the project.
- Analyze each law to determine if it would impact the proposed project.
- Research any potential legal liabilities or risks associated with the project.
- Assess whether there are any legal requirements for obtaining permits or licenses to operate the project.
Operational Feasibility:
An operational feasibility study examines whether or not the project can be successfully implemented. It looks at the resources and processes required to complete the project, such as personnel, equipment, materials, and facilities.
Best Practices for Operational Feasibility Study
- Evaluate the personnel, equipment, materials, and other resources needed to complete the project.
- Assess whether the proposed processes and procedures are feasible with the available resources.
- Identify any potential issues that could arise during the project implementation.
Schedule Feasibility:
A schedule feasibility study evaluates the timeline for completing a project. It examines the time, tasks, and dependencies involved to determine if the project can be completed within an acceptable timeframe.
Best Practices for Schedule Feasibility Study
- Determine the timeline for completing the project and identify any potential delays.
- Analyze the tasks involved in each step of the project to identify any that can be completed concurrently.
- Create a Gantt chart or other visual representation of the project timeline.
- Identify any dependencies between tasks and create a plan to mitigate any potential delays.
- Monitor the progress of the project and make adjustments as needed.
Technical Feasibility:
A technical feasibility study assesses the technical requirements to complete a project. It looks at the skills, knowledge, and technology necessary to execute the proposed project.
Best Practices for Technical Feasibility Study
- Evaluate the existing technology and resources required to complete the project.
- Analyze whether the proposed project can be completed with available technology.
- Identify any potential technical issues or risks associated with the project.
- Assess the skills, knowledge, and expertise of personnel needed to complete the project.
- Develop a technology roadmap outlining the steps needed to implement the project.
- Create a contingency plan for addressing any potential technical issues that may arise during the project implementation.
A good feasibility study company will take into account all of the above elements when conducting a feasibility study. They will also analyze the risks involved and create a plan to mitigate them. By taking these steps, you can ensure that your project or venture has the highest chance of success.