Feasibility Study

A feasibility study is an evaluation and analysis of the potential of a proposed idea, project, or business venture. A feasibility study examines a variety of factors, from the availability of resources to the potential legal ramifications of the proposed project, to help the decision maker decide whether or not to pursue the venture.

A feasibility study serves to provide an objective evaluation of the proposed project by offering an overview of its most important aspects, from cost and technological requirements to regulatory and legal considerations. The undertaking of a feasibility study should involve detailed research and involve various experts in the field, such as engineers, financial consultants, and lawyers, to ensure accurate results.  

The main outputs of a feasibility study typically include evaluations of the project objectives and their feasibility in terms of resources, cost, time, and potential risks. Depending on the nature and scope of the proposed project, additional aspects may be included in the evaluation, such as the availability of workers, the return on investment expected, or the impact on the local community.

The feasibility study provides decision-makers with the insights and data needed to make a well-informed choice about the future of the proposed project. If the feasibility study reveals that the project is not feasible due to any of the examined factors, the decision-makers can choose to re-evaluate the project and make changes to make it more feasible.

For example, a company that is considering opening a new restaurant in a bustling city neighborhood must undertake a feasibility study to decide if it will be feasible. This feasibility study will include analysis of factors such as the local restaurant market, the availability of financing, the cost of real estate in the area, and the impact on the community.

If the results of the study reveal that the restaurant would have difficulty to break even in the current restaurant market, or if the availability of financing is limited, then the company can choose to reconsider the project or make changes to make it more feasible. Alternatively, the results may be positive, in which case the company can move forward knowing that the proposed idea for the restaurant is likely to be successful.