The main and most important goal of the feasibility study, it is a research study to find out whether the proposed project is feasible with a high probability of success. It is also looking forward to laying the foundations necessary to support the project as many ambitious projects fail in this study and this prevents anyone from wasting time and resources on desperate projects. Which looks great in ideas so in this article we will talk about the main and most important goal of the feasibility study
The main and most important goal of the feasibility study
Feasibility studies address business perceptions over a somewhat longer period of time rather than taking a short-term view of things.
It covers the financial aspect as well as the technical, legal, and economic perspectives of the business.
Feasibility tries to answer questions about when, how, and where the business will operate and are generally executed long before the project is chosen or implemented.
Feasibility studies are designed to provide information to their users on whether the proposed project can continue, the opportunities, or even the continuation of an existing business, strengths, weaknesses, and threats present in the environment based on a specific set of assumptions.
Feasibility studies make decision-making easy because they provide well-thought-out agreements and calculated information about a specific business that has to progress.
Feasibility also highlights whether and how the project will succeed.
If the readers decide to go on to the project, this study becomes a tool for setting goals, objectives and developing an action plan.
Feasibility if done correctly from a business perspective.
It is a good business practice to review this document at intervals and keep this document updated as business conditions continue to change.
In such circumstances, this document becomes very useful as it allows companies to know where the deviations are occurring and what causes and causes of them.
This evaluation is very vital for companies to pre-plan and modify their sites.
How feasibility works
A feasibility study will first define an initial business, product or service.
It usually contains three main parts:
The technical study
In the market segment, market study, the current target market is tested, and the feasibility of the product in this market will be determined.
The study will survey the prices and costs and then the prices for the proposed product and service.
Then comes the technical part of the feasibility study where you measure and calculate how much money you will need for your business, the amount of capital to set up the business, and the amount of capital to work for the first three or six months.
Then how much are the annual operating and direct costs (COGS).
In the financial study, quite simply, costs and profits are calculated, and then businesses can be classified as feasible, useless, or high risk.
Other analyzes such as sensitivity analysis can be done to test the business under changing conditions, and its flexibility under changing factors.
This will give you a picture of how safe or not the business is.