Importance of Project Feasibility
When considering a new business, it is important to conduct a feasibility analysis. This is an assessment of the capital required, staff and facility needs, and most importantly if it will be profitable. The customer will see pay back and the return-on-investment (ROI) of the project.
Some business people may consider hiring a consultant to determine if the project is feasible and pay for their expertise. This is an additional cost for a start-up company or new business concept for a current business that they might not want to spend, yet this is a critical initial step to take to assure you are investing time on an idea that will ultimately benefit you financially.
Some equipment and technology provider companies provide financial feasibility assistance on the front side of buying their equipment. Do your technology partners do this?
At Insta-Pro, we provide feasibility studies free of charge. In order to arrive at a quality analysis of the business opportunity, we will ask you a series of questions to fill into the spreadsheet program we developed. Some of the information we request includes:
- Products or formula to process
- Costs of ingredients
- Price of goods to sell
- Electrical voltage and cycle
- Volume required on monthly and annual basis
- Intended hours of operation per day
- Intended days of operation per week
- How much space is available
- Staffing costs and staffing strategy
As a company, we are committed to providing honest and straight forward answers. The outcome of the feasibility study will tell you whether you should move forward with the project, change some details to improve it, or come up with a different solution.
Note: The feasibility should not replace the need for a complete business and financial plan with your accounting and financial team as you progress your project to the next stage for final approvals and gaining funding. However, the feasibility will assist in these steps and make it more efficient.
