A Feasibility Study is a formal project document that shows results of the analysis, research and evaluation of a proposed project and determines if this project is technically feasible, cost-effective and profitable. The primary goal of feasibility study is to assess and prove the economic and technical viability of the business idea.
A project feasibility study allows exploring and analysing business opportunities and making a strategic decision on the necessity to initiate the project. For each project passing through the Initiation Phase, a feasibility study should be developed in order for investors to ensure that their project is technically feasible, cost-effective and profitable.
A thorough feasibility study can give you the right answer before you spend money, time and resources on an idea that is not viable. It must therefore be conducted with an objective, unbiased approach to provide information upon which decisions can be based.
Reasons to Do a Study
- Gives focus to the project
- Narrows the business alternatives
- Identifies new opportunities
- Identifies reasons not to proceed
- Provides valuable information for “go/no go” decision
- Increases probability of business success by identifying weaknesses early
- Provides documentation that the idea was thoroughly investigated