Q:

What is the purpose of a feasibility study?

A:

The purpose of a feasibility study is to analyze a business proposal to determine if the project is viable and if it should be followed through with. Determining if a business is feasible prior to establishing it prevents an investor from wasting money and time on a failed business venture.

Some concerns that are addressed through a feasibility study include:

  • Will the business generate adequate cash flow?
  • Will the business be able to encounter and withstand risks?
  • Will the business meet the goals intended by the founders?

A feasibility study is conducted in the idea stage of planning a business. It is not to be confused with a business plan. A business plan is only created after a feasibility study is conducted and a decision is made to move forward with the business.

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    What is the way to conduct a feasibility study?

    A:

    A feasibility study is conducted by identifying potential problems for a business that could cause it to be unsuccessful. This is accomplished by examining the three main areas affecting business success: finance, marketing and organization.

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    What is the technical study of feasibility?

    A:

    A technical study of feasibility is an assessment of the logistical aspects of a business operation. It includes segments on necessary materials, labor and technology, and the means of shipping or transporting goods, according to About.com. Although not part of the technical portion of the study, a financial feasibility report is typically included, and it is supported by the details of the technical study.

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    What is a feasibility study for information system projects?

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