Conducting a feasibility study for a new business or when launching a new idea is crucial to its success. Likewise, when executing a new project whose success or failure has a material effect on your organization. You are driving change, and solving problems, yet failure is intimidating.
Creating a feasibility study for a new business is crucial. It is like conducting a SWOT analysis to help you make informed decisions. In this article, we shall walk you through everything you need to know about a feasibility study and how to use it to your advantage.
This article also shows insight into the advantages of using a feasibility study template, and how a feasibility analysis in entrepreneurship can help you build a successful business venture.
What Is a Feasibility Study for a New Business?
From 21,000 in 2022 to over 30,000 in 2023 and almost double that in the first quarter of 2024, the number of businesses in the UAE continues to grow. As a new business owner, it is essential to have a roadmap or guide to help you make informed decisions before settling in this overcrowded market.
A feasibility study is like this roadmap or guide.
Considering a couple of variables, it helps you to assess the success or otherwise of your new business. The UAE market is wide enough to enter, invest time, money, and energy without having a feasibility study as a navigator to check all important factors that could hinder its growth and sustainability.
Market demand, costs, competitors, risks, threats, potential challenges, and opportunities are some of the factors that a feasibility study will help you check. It will answer key questions like;
– Will there be enough customers to offer my service to?
– Is the operating cost worth the investment when compared to the final take home?
– What are the major risks I will face?
By projecting answers to these questions and more, you and your team will know if your project is likely to succeed or not. When a more comprehensive feasibility study template is used, it will also reveal key areas that need adjustments before moving forward.
Why Every Entrepreneur Needs a Feasibility Study?
There are lots of benefits attached to conducting a Feasibility analysis in entrepreneurship. Aside from helping to confirm the viability of a business, it also helps to uncover potential challenges, and find ways to mitigate them.
Here are a couple of other reasons you might need a comprehensive feasibility study.
– to provide a detailed analysis of your business concept.
– help secure funding by providing how realistic the growth and sustainability of a business can be
– Highlighting strengths, weaknesses, opportunities, and threats of your idea
– Help prevent future losses
Components of a Feasibility Study Report
Having understood why a feasibility analysis is important, it is also important to learn what afeasibility study report should include.
Here is what a typical feasibility analysis includes;
Ø Market Analysis
Also, market feasibility study. This is an evaluation of how you expect the project deliverables to perform in the market. How many units do you want to sell? Who do you want to sell them to? What period will they buy it the most? Who sells the same product? It also contains a market competition breakdown and a sales projection.
Ø Financial Projections
This section contains a set of financial statements that estimate cost, forecast revenue, and project how profitable the business is. It shows investors how you want to spend their money. And in the case of loans, how do you plan to pay it back?
Ø Legal Requirements
Legal requirements examine whether a project is not against the business rules and regulations of the UAE. It also checks that other legal and ethical standards are in place. It also helps to avoid legal issues before, during, and throughout the project lifecycle.
Ø Technical Feasibility
This ascertains if the new business has the available resources to function effectively. These resources majorly include material and technological. It also shows if the project can meet the technical standard for a digital project.
Ø Organizational Feasibility
Organizational feasibility evaluates the management prowess needed to function optimally. Generally, it revolves around staffing, human management, human resources, etc.
An executive summary, risk assessment, and operational plan are other components needed in a feasibility study report.

Steps for Conducting a Feasibility Analysis
Below are the steps involved in carrying out afeasibility analysis.
1. Conduct market research
2. Create your financial projections
3. Evaluate your operational need; personnel, technology, material, etc
4. Carry out a legal and compliance check
5. Combine all into a feasibility study report
Benefits of Using a Feasibility Study Template
Using a feasibility study template makes the process of writing a feasibility study report easier. It saves time and ensures all aspects are covered, leaving no chance for mistakes that could have been avoided.
Other benefits include;
– Consistent formatting makes it easy to be reviewed by stakeholders
– It reduces the chances of omitting critical details
– It serves as the perfect itinerary
Frequently Asked Questions
How long does it take to complete a feasibility study?
This varies depending on the technicality of the project.
Do I need professional help to conduct a feasibility study?
Yes. It is advisable to hire a consultant who can provide you will provide a detailed analysis and make everything clear whilst breaking down terminologies.
Conclusion
Not having a proper Feasibility Study for a new business can render your effort, money, time, and resources useless. There are a couple of companies that have failed due to not having a feasibility study in place.
Underestimating costs, ignoring market competition, and skipping market research are common mistakes to avoid when conducting a feasibility study report.