A feasibility study is a systematic study to understand whether or not a specific project, venture, or approach is feasible. The ultimate outcome of any feasibility report is a go / no go decision. You decide to move forward or you don’t.
Why Conduct a Feasibility Study?
The most common reason is to limit one’s losses. For example, suppose a county redevelopment authority is considering a new industrial park. Legal, design, construction, management, staffing and marketing expenditures could easily cost tens of millions of dollars. Several years of costs would be sunk into the project before there was any possibility of recouping any expenses through operations. A feasibility study should be a high priority long before substantial capital and resources are invested. If the feasibility study indicates a very low probability of success, it would be far less expensive to invest in the feasibility study and not develop the park, than it would be to go forward without the study and then see the park fail.
A thorough feasibility study can help decision makers better understand which aspects of the project are critical to success, and which ones aren’t. If the feasibility study is negative, the findings may still uncover previously unknown market opportunities and can thus help set the stage for another successful project. If the feasibility study is positive, the findings should provide useful insights and benchmarks for the original project as it moves forward.
Typical Feasibility Questions
Here are a few examples of questions we address in a typical feasibility study:
What data is available internally and externally?
What is the quality and reliability of this data? Is it current? Is it readily available?
Has anyone attempted anything like this before?
If so, what problems did they encounter? Did they ultimately succeed? If not, what can be learned from their failure?
What are the critical decision factors?
What factors will enter into the final decision as to whether the project, venture or approach is feasible and should move forward? Typical factors involve financing, staff resources, material resources, market supply and demand, time and space constraints, etc.
Are there any benchmarks or hurdles that need to be surpassed?
What financial, resource, membership, or other hurdles must be reached for a successful solution? Are there unavoidable market risks or environmental risks? How can they be mitigated?
Different feasibility study companies have different strengths. At Ground Floor Partners our expertise is market feasibility, not engineering feasibility. We research and analyze market factors such as demographics, supply and demand, market capacity, regulations, cultural issues, etc. Here are some areas we work in:
- special needs/ disabled housing
- senior housing (assisted living, nursing homes, memory care)
- industrial parks
- community centers
- economic and community development
- tourism initiatives
We have alliance partners in construction, architecture, strategic planning, marketing, technology and other areas whom we can bring on to complete any size project.
Wouldn’t it be nice to learn from other people’s mistakes, so you can avoid repeating them? Here is a brief list of the most common mistakes when performing feasibility studies.
Contact Us now to see if Ground Floor Partners is a good fit for your organization.