How to Outline a Feasibility Study

by Victoria Duff Google

New ideas are the first step in the creation of new products, better services, new businesses and new divisions of existing businesses. Not all new ideas can be put into action, however. Some might not be possible given the current technology. Others would be too expensive to implement relative to potential profits. There are many values and problems in new ideas, and the way to discover them is to perform a feasibility study.

Why Outline Your Feasibility Study?

A detailed outline provides a road map so you stick to the goal of fully examining the success potential of your idea, without getting sidetracked by findings along the way. Also, if your research produces surprises, you can amend your outline to reflect a new direction or additional product you had not considered previously.

Idea Detail Section

Start your outline with a full description of your idea or project. Take, for example, the idea of selling ice to Eskimos. Indicate the various ice products such as ice cubes, block ice, crushed ice, colored ice and alternatives such as selling ice-making machines. Details of your idea or project, and alternative ideas, will vary in their feasibility as you continue your study. The purpose of a feasibility study is to identify whether your idea is feasible and in what form, but it also illuminates problems that can be fixed. You might find colored ice and machines that make colored ice are potentially attractive products for use in the average Eskimo home igloo.

Intended Market Section

This section involves producing a full description of your intended market, including industry size, leading companies, trends, niche market potential, sales potential, consumer demographics and buying habits. It should result in being able to pinpoint the needs of different age groups, their locations and how to reach them. It should also give you an idea of how your niche product, colored ice, is likely to fare in each demographic segment.

Technology Requirements Section

There might be a market for your colored ice, but machines to produce colored ice may not yet be in existence. This means your idea is either not feasible given current technology, or it opens the possibility of creating a new product. List all the technologies involved in bringing your idea to reality, and their availability and costs.

Organizational Factors Section

The next section examines how your existing organization can handle the successful implementation of your idea. For example, you might already sell ice to people in Texas, but if you want to expand to selling ice to Eskimos, your managers, facilities and fulfillment operations will be split over a wide geographical area, and your management will have to be attuned to an entirely different type of customer need. Setting up a northern subsidiary might be the answer.

Financial Analysis Section

Analyzing the costs of bringing your idea to reality and whether it can be profitable is the most important part of your feasibility study. Include a full profit and loss projection in this section. The financials might prove your idea is a bad one, but they might also show where a few changes in technology and organization can result in profits.

Conclusions and Recommendations

One feasibility study can lead to another that focuses on a detail revealed. That is because your study has accomplished its goal -- identifying whether your idea is feasible, why or why not, and how it might be amended to create a feasible idea. A conclusions and recommendations section is the place to evaluate the original idea and suggest the next step in implementing it, or how it might be altered to create a more feasible idea.

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