Probably, many of us will repeatedly come up with the most diverse innovative business ideas about an existing business that we can improve or a new idea that starts from scratch. For the first case, if we have to know the current situation of the company, we can carry out studies such as the SWOT analysis. Either way, we will have to know the possibilities that our idea has of succeeding, and for this we can do a feasibility study. In this article we will explain what steps you have to take into account to carry out a feasibility study.
Steps to follow:
1. We can define a feasibility study as that analysis and evaluation of information from various fields, which will allow us to know if a new company or idea in a business can be economically and commercially profitable. Depending on the concept on which the study is carried out, the content will vary substantially, but there will always be essential pillars on which we will have to base our search and analysis of information on the feasibility study.
2. The first pillar is the economic-financial viability of the project. That is, if the idea can bring real benefits, which can offset the costs not only operational, but also start-up, since if it is a large infrastructure but then the benefits are scarce, it would not be worth it. Some points to keep in mind are:
- Analysis of the origin of the funds that we will use to start the project.
- Determine where all those funds will be invested individually.
- Preparation of a prospecting of income and expenses of the activity in future years, at least 3 or 5 years.
- Estimate what would be the return on all the capital invested, also in 3 to 5 years.
- Know what is the dead end or minimum sales that we would have to have to overcome costs and begin to have benefits.
3. With the analysis of the operational viability, we will determine if the personnel that the company owns or will possess will be able to adequately assume its obligations. Here we will analyze:
- That the training and education of employees is sufficient for the needs of the project.
- The workload of the employees will be enough so that they can carry out their tasks without problem, being able to combine work and family life.
- We have the appropriate infrastructure to carry out the activity we intend.
- We comply with the requirements and legal procedures imposed by public entities.
4. Another important point is the viability of the market, an essential area in which we will determine if our idea can really develop in the market to which we intend to focus it. We will take into account:
- If there really is a potential number of customers and demand which can cover the minimum costs of the project.
- That there is a need in the market to achieve what we intend to offer, thus satisfying the need of customers.
- How much market share we can obtain and what would therefore be the potential amount of sales, data that would collaborate with the economic analysis.
- Determine which area and sector of the market we will focus our activity on.
5. Finally, we will analyze the conceptual viability of the business idea. Here we will critically and realistically discuss the real possibilities that it can actually work. For it:
- We can help ourselves with the SWOT analysis, since it takes items very similar to those that we have to analyze in this section, such as the opportunities that we can take advantage of or the threats that we can find in the market around us.
- We will determine that the time, in the short and long term, in which the operations will be carried out are sufficient and we will not extend ourselves more than necessary.
We will analyze the set of the three previous sections and the idea in particular, to carry out a critical analysis and reach a conclusion about it.