Feasibility and Funding

Check your Feasibility
Feasibility is about investigating whether the business venture could be profitable or not. Naturally if the business is not feasible, in that it cannot make a profit, then it should not be started. Feasibility exercised to determine whether to start your business or not is critical. It involves you taking the time to do the calculations and talking to and working with your adviser to determine whether the business has a good chance of succeeding.
"Make sure your decisions are based on solid grounds - not on other people's opinions ..."

For a business to be feasible it must make a profit and allow you as a business owner to create an asset that has a value for the future. Along the way you need to be able to enjoy what you are doing so work satisfaction and independence is an important part of the mix.

Keep in mind that life is not all about business and making money. Growing your wealth as a result of a good business is obviously one of the big goals in life. However, health, family and relaxation and other things are just as important. When putting together a feasibility study, take into account business and non-business issues and weigh them all up.

Questions to Ask
Some questions to ask include:

  • Will the proposed business work?
  • Will the proposed business make a profit?
  • Will the proposed products and services offered be in demand?
  • Will your customers be prepared to pay the prices you are seeking?
  • Will the business be able to sustain its operation in the light of other competitors?
  • Will the business give you satisfaction, as well as profit?
  • Will the business affect your relationship with family and friends?
  • Will the business affect your health?
  • Will the business give you the satisfaction of being your own boss?

To answer these questions you will need to do research and dig out the hard facts. Base all your conclusions on hard facts. That is, make sure your decisions are based on solid ground rather than on opinions or views that you or others may have.

You have to set aside all emotion and work on the solid evidence of facts provided by advisers as well as successful business associates. When you are working at feasibility remember that detail is not critical for this stage. That can be looked at later when the planning process proper is undertaken.

No Feasibility can Translate to Failure
One of the main reasons for failure is where the entrepreneur (who has come up with the idea) has taken the idea to production and marketing without researching the feasibility of his/her concept.

The fact that you simply love the idea or product won't guarantee that it is going to be a roaring success.

A smart businessperson will know the importance of doing the initial research before investing time and money. A smart entrepreneur will not move ahead and develop a full-scale business, based on an idea that has not been fully investigated.

This whole process of gathering information is known as a feasibility study. It can be simple or complex, it can involve formal help such as a professional or consultant, or the person with the idea can do it himself/herself.