What is a feasibility study?
A feasibility study addresses possible alternatives when the solution is unknown. The study may show that the project is not economically justifiable – or that it has so many environmental impacts that it is not viable. Early determination of such a finding will avoid unnecessary expenditure of funds on preliminary engineering and related costs. A feasibility study may include studying potential transportation corridors and/or routes within a corridor.
Feasibility studies are preliminary investigations into the potential benefits associated with undertaking a specific activity or project. The main purpose of the feasibility study is to consider all factors associated with the project, and determine if the investment of time and other resources will yield a desirable result. While considered a preliminary study, it is not unusual for a feasibility study to be highly detailed. When a business is considering a new operation or the launch of a new product, the feasibility study is a logical tool to employ before any resources are invested in the new project. One of the most important aspects of the study is to make sure that the total investment needed to successfully bring the project to completion is considered. Often, this will include addressing components such as cash reserves, labor, construction, production facilities, outsourcing, and the cost of raw materials. Only when the feasibility study has addressed the total cost of compl
Don Hofstrand, Co-Director, Ag Marketing Resource Center, (641) 423-0844, dhof@iastate.edu, Mary Holz-Clause, Co-Director, Ag Marketing Resource Center, mclause@iastate.edu As the name implies, a feasibility study is an analysis of the viability of an idea. The feasibility study focuses on helping answer the essential question of “should we proceed with the proposed project idea?” All activities of the study are directed toward helping answer this question. Feasibility studies can be used in many ways but primarily focus on proposed business ventures. Farmers and others with a business idea should conduct a feasibility study to determine the viability of their idea before proceeding with the development of the business. Determining early-on that a business idea will not work saves time, money and heartache later. A feasible business venture is one where the business will generate adequate cash-flow and profits, withstand the risks it will encounter, remain viable in the long-term and m
