A business feasibility study is a process of identifying opportunities and problems, setting objectives, defining successful outcomes, delineating situations and calculating costs and benefits associated with different alternatives for solving a problem.
It assesses actual business or project viability based on cost-benefit analysis and helps in the decision making the process. Before making a formal business plan, a business feasibility study is conducted during the contemplation phase of the business development stage.
It takes all factors of business into account such as technical, operational, legal and economic. Investors conduct business feasibility study to identify the pros and cons of a business before investing in time and money into it.
Hotel Feasibility Study Template:
Hotel business feasibility study is conducted to investigate if the hotel business model is sustainable and profitable. Factors like location, market, costs and benefits are investigated in this regard. This study will help in decision making of the new or re-modeled hotel and attract investors based on return on investment projections.
Below are the key points of a template plan and approach to conducting a hotel business feasibility study to check the viability of a hotel project based on market and financial analysis.
Location examination: To answer the questions about site attractiveness, advantages, associated risks, cost and availability of transport and human resources.
Total Costs Calculation: It studies all development and architectural costs such as licenses, tax, materials, Human resource utility bills and insurance.
Market analysis such as local hotels demands and supply investigation, room rates and occupancy levels.
- Projections of hotel revenue
- ROI projection of hotel business
Restaurant Feasibility Study Template:
A restaurant feasibility study is conducted to investigate the viability of a restaurant business based on different factors like location, market and costs. It helps investors to see the ROI of the restaurant business to invest their money. Following simple points can be followed to make a comprehensive feasibility study,
- Evaluate potential locations for a restaurant
- Research restaurant business industry
- Review the market competition
- Make a mock projection of your costs
- Evaluate ROI projections to attract investors.
Economic Feasibility Example:
It’s a cost-benefit analysis used for assessment of business whether it is viable to implement. SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) is conducted to assess the success of the project. An economic feasibility study is a set of the following analysis,
- Market Analysis (Market research and market behavior analysis)
- Economic Analysis (Macroeconomic analysis, microeconomic analysis, marginal calculus and linear programming)
Technical Analysis (Graphical analysis of price and turnover of raw material, currency and security)
- Strategic Analysis (Strategic Plan)
Financial Feasibility Analysis Template:
It focuses on the financial aspects of the business such as assessing the economic viability of the business by evaluating below factors,
- Startup costs
- Capital Funding sources
- Cash flow projections and Profit Plan
- Return on Capital Investment
- Paying back investors
Feasibility Study in Entrepreneurship:
A feasibility study is vital phase of any entrepreneurial project. Startups require investments and investors needs to have an insight into a business model success based on its feasibility study. Every entrepreneur conducts an extensive study before making a business model and does a self-analysis to analyze how attractive his business plan is for investors, based on cost-benefit analysis, payback and return on investment projections.
Construction Feasibility Study Template:
This feasibility study is conducted to assess the viability of any construction project by considering some factors such as,
- Planning permissions
- Environmental Impact Assessment (EIA)
- Legal or Statutory Approvals
- Potential of a renovation of an existing facility or building a new facility
- Site Information Assessment
Site appraisals such as assessment of any contamination uses of adjoining land, easements, restrictive covenants, availability of services and so on.
Feasibility Study in Software Engineering:
Feasibility study in software engineering does not target solve the problem, but it is used to assess whether a problem is worth solving. It studies the following areas of software development project,
- Operational Feasibility – It studies the usability scope of software to be developed whether it is high or low.
- Technical Feasibility– It assesses the possibility of developing the required software with available technology in terms of programming languages and hardware resources.
- Economic Feasibility – It evaluates the profit of software developed based on costs and benefits analysis.