similarity between feasibility study and business plan

10 Feasibility study and business plan differences you should know

by Naiyer Jawaid | Nov 8, 2021 | Development , Real Estate | 5 comments

Feasibility study and business plan differences are subtle. In this post we will discuss 10 differences will help you to evaluate and differentiate between a feasibility study and a business plan.

Do you know what is a feasibility report? Do you know what is a business plan? Can you easily differentiate between a feasibility report and a business plan?

It’s easy! Just read out through the article and it will all be easy.

Let’s start by learning about a feasibility report:

A feasibility study is a formal document that assist in the identification and investigation of a proposed project. We can identify the project's weaknesses and strengths with the support of a feasibility study report, which saves us time and energy. We can determine whether the suggested idea will be lucrative and practicable in the future.

Before investing in a project, it is critical to determine if the project will be beneficial in the long run. The organization also needs to know how much the project will cost. Overall, a feasibility analysis indicates whether the firm should invest or continue with the project.

You should also like to read When to do feasibility study?

Now let us learn about business plan:

A business plan is a formal document that contains the goals/ objective of the business, the time in which the goal will be completed and the strategies that can be adopted to reach the specific goal.

A business plan is a necessary document for every new firm to have in place before it can begin operations. Writing a credible business plan is typically a requirement for banks and venture capital companies before contemplating granting funding to new enterprises.

It is not a smart idea to operate without a business strategy. In fact, very few businesses can survive for long without one. There are many more advantages to developing and keeping to a strong business plan, such as the ability to think through ideas without investing too much money and, eventually, losing money. Business plans are used by start-ups to get off the ground and attract outside investors.

A feasibility study is used to assess if a business or a concept is viable. After the business opportunity has been identified, the business strategy is produced. “A feasibility study is carried out with the goal of determining the workability and profitability of a company venture. A feasibility study is conducted before any money is committed in a new business endeavour to see whether it is worth the time, effort, and resources.

Similarities between a Feasibility study and a business plan

It's essential to analyse the similarities between a feasibility study and a business plan because they're both implemented altogether in same ways to help you build a lucrative company. The following are some of the similarities between the two documents:

Time: Both the reports are completed before the business begins and can be repeated afterwards to decide the next stages for new concepts.

Input: Both Feasibility report and the Business plan include input from a variety of people or departments with a variety of talents.

Format: Both report formats incorporate other documents that are gathered in order to create the report.

Components: Examining the target market, market circumstances, and financial expenses are some of the topics examined.

Use: Both may be displayed to potential investors and can assist the organization's management in making choices.

Organizations uses a business plan and a feasibility study as analytical and decision-making tools.

Although the three tools can be used in conjunction with one another in decision-making processes, they each have their own strengths and weaknesses, and they appear to target and address separate processes.

You might also like to read How to write a feasibility study report?

Now let us evaluate the difference between feasibility report and a business report-

• A feasibility study is conducted to determine the viability and profitability of a business endeavour. A feasibility study is conducted before any money is committed in a new business endeavour to see whether it is worth the time, effort, and resources.

A business plan, on the other hand, is created only when it has been determined that a business opportunity exists and that the endeavour is about to begin.

• A feasibility report is the first step and after that a business plan is made to be implemented, without feasibility report a business plan cannot be made.
• A feasibility study contains computations, research, and projected financial forecasts for a company possibility. A business plan, on the other hand, is mostly comprised of tactics and strategies to be applied to establish and expand the company.
• A feasibility study is concerned with the viability of a business concept, but a business plan is concerned with the development and sustainability of a company.
• A feasibility report informs the entrepreneur about the profit potential of a company concept or opportunity, whereas a business plan assists the entrepreneur in raising the necessary start-up cash from investors.
• Key components of a feasibility study and a business plan
• A business plan does not include the description of the sales methods used, such as distribution agreements, strategic alliances, and the amount of involvement with partners, as well as the payment terms, warranties, and other customer support.

But a feasibility report includes all the sales methods, strategies, alliances to payment and customer support.

•  Feasibility report contains:
• Assists in cost estimation, describe the production site, required inputs, and sourcing region.
• Physical description of the factory, including machine, capacity, warehouse, and supply chain, is necessary.
• Indicate if the area used for production is rented or owned. This will have an impact on the financial forecast.
• Information regarding the manufacturer's capacity, order details, price, and so on, if manufacturing is outsourced. To aid in cost estimation, describe the production site, needed inputs, and sourcing location.
• A physical description of the factory, including machine, capacity, warehouse, and supply chain, is necessary.

But a business plan does not contain anything related to production and operations, but a business plan contains all the information related to management.

• A poorly written business plan – poor projections, strategies, analysis, business model, and environmental factors, among other things – can be easily adjusted during business operations, but this cannot be said of a feasibility study because an incorrect conclusion in a feasibility study can be costly — it could mean launching a venture with little chance of survival or approving a proposal that wastes the company's human and financial resources.
•  A business plan presume that a company will prosper and lays out the procedures needed to get there. Those in charge of conducting a feasibility study should not have any predetermined notions regarding the likelihood of success. They must maintain as much objectivity as possible. They do research and allow the facts to lead to the study's conclusion. If the study concludes that the idea is viable, some of the findings, such as market size predictions, may be incorporated in the company's business plan.

You should also read What is land development feasibility study?

These 10 differences will help you to evaluate and differentiate between a feasibility study and a business plan.

Feasibility study may appear to be like the business plan in many respects. "A feasibility study may easily be transformed to a business plan” but it is crucial to remember that the feasibility study is completed prior to the endeavor. The business plan should be thought of in terms of growth and sustainability, whereas the feasibility study should be thought of in terms of concept viability.

This is all you need to know and understand about feasibility study and business plan.

Get ready to apply your knowledge in the real words with lots of success.

You might also like to explore below external contents on  feasibility study :

• What Is a Feasibility Study? – Types & Benefits
• Best 8 Property Management Software
• FEASIBILITY STUDIES & BUSINESS PLANS

Hope you enjoyed this post on  feasibility study , let me know what you think in the comment section below.

Are you someone involved with real estate feasibility?

We are excited to launch the next generation of real estate feasibility software to help you manage your development projects with ease.

Register now for a free trail license!

This is a very good piece of writing. When you have a concept for a company but want to be sure it’s a good idea, you do a feasibility study.

It was very helpful. Thank you so much!

Appropriately timed! A company’s future operations are laid out in great detail in the company’s business plan. Once you’ve done your feasibility study, you’ll know whether or not the proposal has merit. The next step is to lay out your goals, whether financial and otherwise, as well as the strategies you want to use to attain them and the organisational structure you envision.

Prior to the company opening, both are undertaken, and may be repeated again in the future to identify the next steps on new ideas that may arise.

Great Content.

Submit a Comment Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

This site uses Akismet to reduce spam. Learn how your comment data is processed .

Follow Us On

Latest Posts

Looking for Feasibility Study Samples?

60+ real-life feasibility study samples for FREE!

Get your ultimate guide to feasibility study for FREE!

TheInfoPeak

Dedicated to Business & Technology

Feasibility Study vs Business Plan Similarities And Differences

Feasibility Study vs Business Plan

Setting up a business enterprise can present a lot of challenges for the entrepreneur. The preliminary stage which involves a lot of brainstorming often gets down to preparing two important documents: the feasibility study and the business plan, both of which are quite indispensable if you’re considering starting a business, and doing it properly.

The possibility of success in a venture predicates upon the proper delivery of these documents, which should be written after conducting careful research and critical analysis, and conveyed in formats that others can understand, because you might want to seek for funds or investors, or even solicit for a loan, and so won’t be the only person reading them.

It, therefore, becomes needful for any entrepreneur to be able to distinguish between a feasibility study and a business plan, to know how to go about creating them.

What is a feasibility study?

As the name implies, a feasibility study is an analysis of the viability of an idea. Feasibility studies help answer the essential question, “Should we proceed with the proposed idea?” The objective study may be completed in conjunction with a SWOT planning process, which looks at the strengths, weaknesses, opportunities, and threats that may be present externally (the environment) or internally (resources).

Feasibility studies help determine: a) does the company possess the required resources or technologies, and b) does the proposal offer a reasonable return vs. risk from the investment.

So a feasibility study lets you know whether the idea you have for a business is worth the time, effort, and money you are willing to invest in it. It’s just like asking yourself, “Is it advisable that I go into this business?”.

While you might be able to conduct this study yourself, it would be more productive and prudent to get the contributions of different professionals such as accountants, entrepreneurs who have opened successful businesses, and realtors who can advise you on the worth of the location and pricing (values you would need in costing and price estimation), comparing similar businesses in the location where you wish to set up your enterprise.

What is a Business Plan?

A business plan “is a written document describing the nature of the business, the sales and marketing strategy, and the financial background, and containing a projected profit and loss statement”.

A business plan is also a road map that provides directions so a business can plan its future and helps it avoid bumps in the road. The time you spend making your business plan thorough and accurate and keeping it up-to-date is an investment that pays big dividends in the long term.

The business plan comes after you have conducted a proper feasibility study and ascertained that your idea is worth going “all out for”. So creating a business plan is like saying, “Yes I’m convinced about the profitability of this idea. This is how I intend to make it profitable”.

Every business is established for the sole purpose of making a profit. If profiting is not the goal, then it is no business, but rather a non-profit organization. Hence details of how a business will operate and make a profit are contained in the business plan.

This is where you’re going to spell out your financial and other objectives, the methods you plan to use to achieve them, and your proposed organizational structure.

Now, let’s look at what makes a feasibility study and a business plan appear similar.

Similarities between feasibility study and business plan

Comparing the similarities between a feasibility study and a business plan is important because both are used in different ways to help you create a profitable business. Similarities between the two documents include:

Timing : Both are done in the beginning before the work opens, and can be done again later to define the next steps for future ideas.

Inputs : They both involve input from multiple individuals or departments with different skills.

Format : Both contain other documents that are grouped to create the report.

Components : Some of the issues analyzed are similar, including examining the target market, market conditions, and financial costs.

Use : Both help the management of the organization in making decisions, and they can also be shown to potential investors.

By now you should have a considerable understanding of how a feasibility study differs from a business plan. But to expound your knowledge it would do to know what the varying components are.

Purpose : While a feasibility study determines the viability of a business idea, a business plan comes after the decision has been made to go ahead with the business.

Methodology : In essence, a feasibility study is based significantly on research, while a business plan makes projections into the future.

Risks : A feasibility study ascertains the risks associated with the idea, whereas a business plan explains how these risks will be dealt with to ensure that the business makes the desired profit.

Cost : A feasibility study can require hiring professionals with expertise who will conduct thorough studies, whereas a business plan may be written by employees of the business, as part of their jobs.

How do you conduct a Feasibility Study?

If you’re doing the feasibility study yourself, conduct a complete competitive analysis considering the following outlines:

Product demand: Is there a need or want for your product or service? Is the need already being met, or is there room for another product?

Market conditions : Who would buy your product and where are they? Can you serve their location? Is the market saturated, or is there room/need for more products?

Pricing : What do current users pay for similar products? What do you need to charge so that you will be profitable, and will consumers pay your price?

Risks : What are the risks associated with your idea?

Probability of Success : Can you reasonably overcome the risks to become profitable?

• Shea Butter Production In Nigeria 2021 Business Plan

Writing a Business Plan?

Writing a business plan may seem daunting, but if you take it step-by-step, it will come to fruition. The Small Business Administration advises that business plans should include the following:

Executive Summary : Include your mission statement, products and or services, some brief information about your leadership team and key employees, as well as the location of your business. To attract investors, add current financial information and projections for growth.

Company description : Detail the problems your business solves; its target market; its competitive advantages, compared with the competition, and anything else that makes your company superior to others: i.e., product awards or recognition, big increases in sales, and so on.

Market analysis : Perform competitive research of what other businesses are doing; their strengths and weaknesses, and how and why your business will be competitive and successful in the market.

Organization or management : State the legal status of your business, such as a corporation or partnership, and include an organizational chart showing management levels, departments, and so on.

Service or product line : State what you will sell or provide and describe the benefits of each. Explain any research done, and any patents filed, and so on.

Marketing and sales : Explain in detail your marketing strategy and how sales will be made.

Funding request : If you are going to be requesting do fund, detail the amount of funding you’ll need for the next five years – specifically, what you’ll do with the funds, and the terms you’re asking for.

Financial projections : This is the business’s financial outlook for the next five years. Include current financial statements, if the business is in operation.

Appendix : This includes supporting documents or requested materials, such as resumes, product photos, letters of reference, patents, licenses, and so on.

In conclusion, it should be obvious by now that a feasibility study and a business plan cannot substitute for each other, and both exist as essential planning documents for successful businesses. If you have the intention of preparing any or both of these documents, it is advisable to seek the aid of a professional writer wherever you might encounter difficulties.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

Copyright © 2024 TheInfoPeak

Design by ThemesDNA.com

Business Plan Vs. Feasibility Study

• Small Business
• Business Planning & Strategy
• Business Plans
• ')" data-event="social share" data-info="Pinterest" aria-label="Share on Pinterest">
• ')" data-event="social share" data-info="Reddit" aria-label="Share on Reddit">
• ')" data-event="social share" data-info="Flipboard" aria-label="Share on Flipboard">

How to Write a Business Plan for Starting a Medical Spa Practice

What are the key elements of a business plan, what are the components of a global business plan.

• How to Write a Business Plan for a Food Truck Business
• What Is a Dehydrated Business Plan?

If you're considering starting a business, you'll need both a feasibility study and a business plan. Both documents should be written after conducting thorough research and critical thinking, and conveyed in formats that others can understand. That way, you can show both to people whose opinions you value as well as to those you hope will invest in your idea. Before you begin, it's important to define and distinguish between a feasibility study and a business plan.

Defining Both Terms

A feasibility study is done before starting a business, when you have the idea for the business but you want to make sure it's feasible, or advisable. Put another way, is it worth your time, effort and money to create this business? Several different professionals may contribute to the study, such as an accountant, entrepreneurs who have opened successful businesses, and Realtors who advise on the worth of the location and pricing, comparing similar businesses in the area.

A business plan details how the business will operate. It assumes your feasibility study has been completed and it was determined the idea is viable. Now you're going to spell out your financial and other objectives, the methods you plan to use to achieve them, and your proposed organizational structure.

Consider the Similarities

Comparing the similarities between feasibility study and business plan is important because both are used in different ways to help you create a profitable business. Similarities between the two documents include:

• Timing : Both are initially done before the business opens, and can be conducted again later to determine the next steps on future ideas.
• Input : Both include input from several individuals or departments that have different skills. 
• Format : Both include other documents that are pulled together in order to compose the report.
• Components : Some of the issues analyzed are similar, including examining the target market, market conditions and financial costs.
• Usage : Both help the organization's management make decisions, and can also be shown to potential investors.

Understand the Differences

It's equally important to understand the difference between feasibility study and business plan . They are not the same, and one cannot substitute for the other. Differences include:

• Purpose : Feasibility studies determine whether to go ahead with the business or with another idea, whereas business plans are designed after the decision to go ahead has already been made.
• Methodology : Essentially, feasibility studies are research projects, whereas business plans are projections for the future.
• Risks : Feasibility studies determine the risks associated with the idea, whereas business plans explain how management will deal with the risks so that it will make a profit.
• Cost : Feasibility studies can require hiring outside professionals with expertise who will conduct thorough studies, whereas business plans are written by employees of the business, as part of their jobs.

Conducting a Feasibility Study

If you're doing the feasibility study yourself, conduct a complete competitive analysis considering the following:

• Product demand:  Is there a need or want for your product or service? Is the need already being met, or is there room for another product?
• Market conditions :  Who would buy your product and where are they?  Can you serve their location? Is the market saturated, or is there room/need for more products?
• Pricing:  What do current users pay for similar products? What do you need to charge so that you will be profitable, and will consumers pay your price?
• Risks : What are the risks associated with your idea?
• Probability of Success : Can you reasonably overcome the risks to become profitable?

Writing a Business Plan

Writing a business plan may seem daunting, but if you take it step-by-step, it will come to fruition. The Small Business Administration advises that business plans should include the following:

• Executive Summary : Include your mission statement, products and or services, some brief information about your leadership team and key employees, as well as the location of your business. To attract investors, add current financial information and projections for growth.
• Company description : Detail the problems your business solves; its target market; its competitive advantages, compared with the competition, and anything else that makes your company superior to others: i.e.,  product awards or recognition, big increases in sales, and so on.
• Market analysis : Perform competitive research of what other businesses are doing; their strengths and weaknesses, and how and why your business will be competitive and successful in the market.
• Organization or management: State the  legal status of your business, such as a corporation or partnership, and include an organizational chart showing management levels, departments, and so on.
• Service or product line : State what you will sell or provide and describe the benefits of each. Explain any research done, and any patents filed, and so on. 
• Marketing and sales : Explain in detail your marketing strategy and how sales will be made.
• Funding request : If necessary, detail the amount of funding you’ll need for the next five years - specifically,  what you’ll do with the funds, and the terms you’re asking for.
• Financial projections : This is the business’s financial outlook for the next five years. Include current financial statements, if the business is in operation.
• Appendix : This includes supporting documents or requested materials, such as resumes, product photos, letters of reference, patents, licenses and so on.
• MBN: Market Business News: What is a Feasibility Study? Definition and Examples
• Cleverism: How to Conduct a Feasibility Study the Right Way
• Entrepreneur: 7 Steps to a Perfectly Written Business Plan
• SBA: Write Your Business Plan

Barbara Bean-Mellinger is a freelance writer who lives in the Washington, D.C. area. She has written on business topics for bizfluent.com, afkinsider.com, Harbor Style Magazine, the Charlotte Sun and more. Barbara holds a B.S. from the University of Pittsburgh and has won numerous awards in B2B and B2C marketing.

Related Articles

How to write a comprehensive business plan, how to design an effective business plan, what is the role of a business plan in getting venture capital funding, how to outline a feasibility study, what factors make the difference between a good business plan & an excellent one, 6 types of business plans, examples of business feasibility reports, how to create a business plan as an entrepreneur, how to write a business description, most popular.

• 1 How to Write a Comprehensive Business Plan
• 2 How to Design an Effective Business Plan
• 3 What Is the Role of a Business Plan in Getting Venture Capital Funding?
• 4 How to Outline a Feasibility Study

Business Plan Vs. Feasibilty Study

by Brian Hill

Published on 1 Jan 2021

Business plans and feasibility studies are analysis and decision-making tools used by companies. Feasibility studies are used to determine whether a proposed action has a high enough probability of success that it should be undertaken. Business plans are blueprints for implementing actions that have already been deemed feasible by the company's management.

Many Decisions vs. One

Business plans map out the direction a company intends to take to reach its revenue and profit objectives in the future. They are a compilation of numerous decisions made by the management team about how the company should be run. Feasibility studies are designed to provide guidance for one decision. Feasibility studies are often done to decide whether to start the business or not -- whether the likelihood of success is high enough to make the financial risk worthwhile. They can also be used to make decisions about whether to launch a new product in an existing company, or enter a new market -- any activity where there is a question about whether the company should take the action or not. Feasibility studies are sometimes termed cost/benefit analyses because the projected costs of the project are compared to the expected benefits to yield a conclusion.

Although the content and emphasis of business plans vary by company and industry, all plans have many elements in common. They describe the products or services the company intends to sell, why customers need these products or services, the target customers, how the company intends to reach them through its marketing strategy, the background and capabilities of the management team, and risk factors the company may face. They also contain information on projected revenue and profit. Plans contain these specific elements because many times they will be read by investors or other people outside the company, and these individuals want to see very specific information in a plan. Feasibility studies may have some or many of the same elements of a business plan, including a description of the human resources required and financial projections, but all the information leads to a conclusion or recommendation.

Differences

A business plan assumes a business is going to succeed and presents the steps necessary to achieve success. Those in charge of conducting a feasibility study should not have a preconceived view about whether success will be attained. They must be as objective as possible. They conduct research and let the facts lead to the ultimate opinion given in the study. If the study's conclusion is that the project is viable, some of the research done may be included in the company's business plan, such as projections of the size of the market.

Both business plans and feasibility studies attempt to predict future outcomes using assumptions about what is likely to happen in the business environment -- the economy and the company's competition. But this environment is always changing and the assumptions a company uses in its projections of revenue or profit may prove to be incorrect. Companies find that some of the strategies in their plan do not work to the degree the business owner expected, and have to be adjusted. In the case of a feasibility study, an incorrect conclusion can be especially costly -- it could mean launching a venture that has very little chance of surviving or approving a project that wastes the company's human and financial resources.

Feasibility study: definition, benefits and differences with a Business Plan

• Last updated on 09 January, 2024

Welcome to our series of articles on feasibility studies.

• What is a Feasibility study?
• What is a bankable feasibility study?
• How to do a feasibility study?
• Feasibility study consultants: expertise needed
• Cost of a feasibility study
• Car Park Feasibility Study: Key considerations
• Hotel Feasibility Study: Methodology
• Feasibility study of solar PV projects: Key components
• Feasibility study of real estate developments
• Feasibility study of marina projects

In this post, we will touch on all the basic concepts behind a feasibility study. definition, benefits of doing it, main parts, differences with a business plan, etc. Aninver Development Partners is a consulting firm specializing in Feasibility studies for projects such as hotels, infrastructure, energy, technology, etc. We assist clients globally. 

Definition of Feasibility study

A feasibility study is a comprehensive and systematic analysis and evaluation of a proposed project, business venture, or initiative to determine its practicality, viability, and potential for success. It involves a thorough examination of various factors, such as financial, technical, operational, legal, environmental, and market-related aspects, to assess whether the project is feasible and worth pursuing. 

The primary goal of a feasibility study is to provide stakeholders with essential information and insights to make informed decisions about whether to proceed with the project, abandon it, or make necessary adjustments to enhance its chances of success.

Differences between a feasibility study and a business plan

Feasibility studies and business plans are both important tools in the development and evaluation of a business or project, but they serve different purposes and are created at different stages of the process. Here are the key differences between a feasibility study and a business plan:

Differences in Purpose

• Feasibility Study : Feasibility studies are conducted in the early stages of project development or business planning. Their primary purpose is to determine whether a proposed project or business idea is viable and should be pursued. Feasibility studies focus on assessing the potential risks, challenges, and opportunities associated with the project.
• Business Plan : Business plans are created after the feasibility study, once it has been established that the project is viable. The purpose of a business plan is to outline in detail how the business will be structured, operated, and grown. It serves as a roadmap for the future of the business and is often used to secure financing.

Differences in Content

• Feasibility Study : A feasibility study includes an analysis of the project's overall concept, market research, technical requirements, financial projections, potential risks, and recommendations. It provides a high-level overview of the project's feasibility.
• Business Plan : A business plan is a detailed document that outlines the company's mission, vision, goals, organizational structure, market strategy, marketing and sales plans, financial forecasts, and operational details. It delves into the specifics of how the business will operate.

Differences in Timing

• Feasibility Study : Feasibility studies are conducted at the outset of a project or business idea to assess its potential feasibility. They help stakeholders decide whether to move forward with the project.
• Business Plan : Business plans are typically created after the feasibility study, once it has been determined that the project is feasible and worth pursuing. They provide a roadmap for the actual operation and growth of the business.

Differences in Audience

• Feasibility Study : The primary audience for a feasibility study includes project stakeholders, investors, and decision-makers who need to determine whether the project should proceed.
• Business Plan : Business plans are used to communicate the business's vision and strategy to a wider audience, including potential investors, lenders, partners, and employees.

In summary, a feasibility study is a preliminary assessment of the potential success of a project, while a business plan is a detailed document that outlines how a business will be run. The feasibility study helps determine whether a business plan should be developed, while the business plan provides a comprehensive strategy for the ongoing operation and growth of the business.

Feasibility study vs Pre-feasibility study

Let's explore now the key differences between a prefeasibility study and a feasibility study:

Purpose and Scope : A prefeasibility study and a feasibility study both play critical roles in project evaluation, but they serve distinct purposes. A prefeasibility study is typically the initial phase in the assessment process. Its primary purpose is to provide a preliminary evaluation of a project's potential viability. It helps stakeholders decide whether it's worth investing further resources into a detailed feasibility study. In contrast, a feasibility study goes into much greater depth and detail, assessing the project's practicality from technical, financial, operational, and market perspectives. It aims to provide a comprehensive understanding of whether the project is feasible and worth pursuing.

Level of Detail : One of the key distinctions between the two studies is the level of detail they encompass. A prefeasibility study offers a broad overview of the project, examining high-level factors like market demand, technical requirements, and rough cost estimates. It provides enough information to make an initial go/no-go decision. In contrast, a feasibility study drills down into finer details, providing precise financial projections, risk assessments, engineering specifics, and a comprehensive business plan. It seeks to leave no stone unturned in assessing the project's practicality.

Resource and Cost Implications : A prefeasibility study is generally less resource-intensive and cheaper to conduct compared to a full feasibility study. It acts as a cost-effective filter to eliminate unviable projects early in the evaluation process. Once a project passes the prefeasibility stage and proceeds to a feasibility study, it implies a commitment of more resources, time, and finances due to the comprehensive nature of the study. A prefeasibility study helps in efficient resource allocation by focusing only on the most promising projects, while a feasibility study is a more intensive process suitable for projects that have demonstrated a higher likelihood of success during the prefeasibility assessment.

Benefits of doing a Feasibility study

Conducting a feasibility study offers numerous benefits, making it an essential step in the decision-making process for any project, business venture, or initiative. Here are the key advantages of performing a feasibility study:

• Risk Assessment : Feasibility studies help identify potential risks and challenges associated with a project. By thoroughly examining technical, financial, operational, and market-related aspects, stakeholders can pinpoint areas of concern and develop strategies to mitigate or manage these risks effectively.
• Decision-Making : Feasibility studies provide critical information to decision-makers, helping them make informed choices about whether to proceed with a project. These studies offer a basis for go/no-go decisions, preventing resources from being wasted on unviable endeavors.
• Resource Allocation : By assessing the feasibility of a project, stakeholders can allocate resources more efficiently. They can avoid overinvesting in projects with limited potential and allocate resources to those with a higher likelihood of success.
• Financial Planning : Feasibility studies include detailed financial projections and cost estimates. This financial information is invaluable for securing funding from investors, lenders, or other sources. It helps in creating a solid business case.
• Market Insight : Market feasibility studies provide insights into customer demand, market trends, and competitive dynamics. This information is crucial for designing products or services that meet market needs and for formulating effective marketing strategies.
• Optimized Design : Technical feasibility studies ensure that a project's technical requirements and design are viable. They help in avoiding costly design flaws and ensuring that the project can be implemented as planned.
• Legal and Regulatory Compliance : Feasibility studies can identify potential legal and regulatory challenges. This allows for the development of strategies to navigate and comply with relevant laws and regulations, reducing the risk of legal complications later on.
• Enhanced Project Viability : Feasibility studies may lead to adjustments and improvements in the project plan, making it more viable and likely to succeed. This iterative process ensures that potential issues are addressed proactively.
• Investor and Stakeholder Confidence : When potential investors and stakeholders see that a comprehensive feasibility study has been conducted, they are more likely to have confidence in the project. This can make it easier to secure funding and support.
• Long-Term Planning : Feasibility studies not only assess the viability of a project in the short term but also help in long-term planning. They provide insights into the sustainability and growth potential of a business or initiative.

In summary, conducting a feasibility study is a valuable step in the project development process. It provides a structured approach to assess the viability of a project, manage risks, make informed decisions, secure financing, and set the stage for a successful venture. The benefits of a feasibility study extend beyond initial decision-making and contribute to the overall success and sustainability of a project or business.

Components of a Feasibility study

A feasibility study typically consists of several key components that provide a comprehensive evaluation of a project, business venture, or initiative. These components help stakeholders make informed decisions about the feasibility and viability of the proposed endeavor. The main components of a feasibility study include:

Executive Summary

The executive summary provides a concise overview of the entire feasibility study. It includes a brief description of the project, its objectives, and the key findings and recommendations. It serves as a quick reference for decision-makers.

Project Description

This section outlines the project's goals, objectives, and scope. It defines the problem the project aims to solve or the opportunity it seeks to capture. It also specifies the project's location and the stakeholders involved.

Market Analysis

Market analysis assesses the demand for the product or service within the target market. It includes information on target customers, market size, growth potential, competition, and market trends. This component helps determine whether there is a viable market for the project.

Technical Feasibility

Technical feasibility examines the project's technical requirements. It assesses whether the necessary technology, equipment, and resources are available or can be developed. It also identifies any technical challenges that may need to be addressed.

Operational Feasibility

Operational feasibility evaluates how the project will be implemented and operated. It includes details about project timelines, workflow, personnel requirements, and operational processes. This section helps in understanding how the project will function on a day-to-day basis.

Financial Feasibility

Financial feasibility is a critical component that includes detailed financial projections and analysis. It covers aspects such as startup costs, revenue forecasts, expense estimates, cash flow analysis, and return on investment calculations. It assesses the project's financial viability and potential profitability.

Legal and Regulatory Analysis

This section examines the legal and regulatory requirements that may impact the project. It identifies permits, licenses, or compliance issues that need to be addressed. Understanding and addressing legal and regulatory aspects are essential to avoid potential obstacles.

Risk Assessment

The risk assessment component identifies potential risks and challenges associated with the project. It evaluates the probability and impact of these risks and suggests risk mitigation strategies. Risks can be financial, technical, operational, market-related, or related to external factors.

Recommendations and Conclusion

In this section, the feasibility study summarizes the findings and presents clear recommendations based on the assessment. It often includes a conclusion that states whether the project is feasible and worth pursuing or whether it should be abandoned or modified.

The appendices contain additional supporting documentation and data, such as detailed financial spreadsheets, market research reports, technical specifications, and any other relevant information. These provide a more in-depth reference for stakeholders.

The main components of a feasibility study collectively provide a thorough assessment of a project's viability from multiple angles, ensuring that decision-makers have a comprehensive understanding of the project's potential, risks, and benefits.

Examples of Feasibility studies

Let's look now into some examples of feasibility studies for different types of projects and initiatives:

• Real Estate Development

A real estate developer is considering constructing a residential apartment complex in a growing urban area. A feasibility study would assess factors like market demand, location, zoning regulations, construction costs, potential revenue from rentals, and the financial viability of the project.

• Manufacturing Plant Expansion

A manufacturing company is considering expanding its operations by building a new production facility. The feasibility study would evaluate factors such as available land, infrastructure, equipment requirements, workforce, environmental impact, and the financial feasibility of the expansion.

• Small Business Startup

An entrepreneur is exploring the feasibility of starting a small restaurant in a specific location. The feasibility study would examine the local market, including competitors, target customer demographics, startup costs, regulatory requirements, and financial projections for the first few years of operation.

• Renewable Energy Project

A renewable energy company is considering the construction of a solar power plant. The feasibility study would assess the site's solar exposure, grid connection feasibility, equipment costs, revenue from energy sales, environmental impact, and the return on investment over the project's lifespan.

• Healthcare Facility Expansion

A hospital is contemplating an expansion to meet growing patient demands. The feasibility study would include an assessment of the required medical equipment, staffing needs, regulatory compliance, funding sources, and the anticipated patient load.

• Tourism Development

A tourist destination is considering the construction of a new hotel and recreational facilities. The feasibility study would evaluate the area's appeal to tourists, competition with existing businesses, construction costs, expected occupancy rates, and potential revenue from tourism.

• Nonprofit Program Expansion

A nonprofit organization is looking to expand its community outreach programs. The feasibility study would assess the need for the programs, funding sources, volunteer availability, operational costs, and the impact of the expansion on the organization's mission and goals.

• E-commerce Startup

An entrepreneur plans to launch an e-commerce website. The feasibility study would examine market demand, website development costs, marketing strategies, competitive analysis, and projected sales revenue and profitability.

These examples illustrate how feasibility studies are conducted in various fields and industries to evaluate the potential success and viability of a wide range of projects and initiatives. The specific components and focus areas of a feasibility study will vary depending on the nature of the project and the questions it seeks to address.

7 steps to conduct a Feasibility study

Now, let's think we are going to write a feasibility study. Let's check what steps we need to take to develop the final report.

• Conduct a Preliminary Analysis

Begin by conducting an initial evaluation of the project's objectives and scope. This step involves defining the problem the project intends to address or the opportunity it aims to seize. Ensure that the project's goals are clear and well-defined.

• Analyze Technical Specifications

Examine the technical aspects of the project in detail. Evaluate the availability of required technology, equipment, and resources. Verify that the project's technical requirements can be met effectively.

• Conduct a Commercial Analysis

Perform a comprehensive analysis of the project's commercial aspects. This step involves assessing the market's demand for the product or service, analyzing market size, competition, customer needs, and market trends. Determine if there is a feasible market for the project.

• Prepare a Projected Income Statement

Create a detailed projected income statement for the project. This includes estimating startup costs, revenue forecasts, expense projections, and cash flow analysis. Calculate the return on investment (ROI) to determine the project's financial viability, the Internal Rate of Return (IRR) of the investment and the Net Present Value (NPV) of future cash flows.

• Prepare a Day-Zero Balance Sheet

Develop a balance sheet that represents the project's financial position at the outset (day zero). This financial snapshot should account for all assets, liabilities, and equity to provide a clear overview of the project's financial situation before it begins.

• Analyze Different Alternatives for Feasibility

Explore various alternatives and scenarios for the project's feasibility. Assess different approaches, technologies, or business models to identify the most viable option. Consider the potential impact of these alternatives on the project's success. Make sensibilities to potentila risks.

• Make a Go/No-Go Decision

Based on the findings and analysis conducted throughout the feasibility study, make a well-informed decision on whether to proceed with the project (a "Go" decision) or abandon it (a "No-Go" decision). Ensure that the decision aligns with the project's goals and aligns with the information presented in the study.

These steps provide a structured approach to conducting a feasibility study, ensuring that all relevant aspects of the project are thoroughly assessed and considered before making a decision on its viability.

In conclusion, a feasibility study is an indispensable tool for any project, business venture, or initiative. It serves as the critical bridge between a concept and a well-informed decision. By following a systematic process that includes a preliminary analysis, technical assessment, commercial evaluation, financial projections, and a careful consideration of alternatives, stakeholders can gain a comprehensive understanding of a project's viability.

The feasibility study's ability to assess market demand, technical feasibility, operational requirements, financial viability, and potential risks empowers decision-makers to make informed choices. Whether it's a real estate development, a new product launch, a manufacturing expansion, an IT system upgrade, or any other endeavor, a feasibility study helps in risk management, efficient resource allocation, and, ultimately, the successful realization of the project's goals.

It's important to remember that a well-conducted feasibility study not only serves the purpose of greenlighting a project but also provides a foundation for its long-term success. It gives stakeholders the confidence that the project is based on sound analysis and planning. In a world of complex challenges and opportunities, the feasibility study is a guiding compass for those seeking to turn innovative ideas into reality.

Make sure you hire the right consultants to deliver your feasibility study or business plan. Our firm, Aninver Development Partners, specializes in designing bankable feasibility studies  to make sure projects continue to their following phase. 

Send us a message on our contact page and we can discuss how we can help you. 

Some of our experience conducting feasibility studies can be seen below:

• Feasibility Study for a new marina in the island of San Andrés through PPP
• Pre-feasibility study for construction of silo storages in Northern Ghana through PPP
• Feasibility study of a real estate WAQF project in Cotonou (Benin)
• Feasibility study and analysis of strategic alternatives of a touristic development in Natal
• Feasibility study for creation of an Investment and Export Promotion Agency of Health services in Tunisia
• Feasibility Study for car parks in Bishkek though PPP
• Feasibility study of markets in Benin and Togo under PPP scheme
• Feasibility Study for the establishment of a Large-Scale Cashew Processing Plant in Zambia
• Public Private Partnership (PPPs) study in the Housing Sector
• Review of Business Case for Manila Central Subway
• First Mover PPP Prefeasibility Study
• Review of the feasibility study of the PPP project Complejo El Brillante, in Cordoba (Spain)
• Review of pre-feasibility study of a Health PPP project

Alvaro de la Maza is one the founding partners of Aninver Development Partners. Alvaro is a Civil Engineer, MS on Infrastructure Management and MBA by IESE Business School.Alvaro has extensive experience in Infrastructure and Public Private Partnerships. Alvaro has worked and led multiple consulting projects for clients such as the World Bank, the African Development Bank and other donors.Alvaro enjoys creating digital products and he has led the development of market intelligence platforms in d...

Most popular articles

 Related insights

Join our newsletter.

Feasibility study and business plan: Feasibility Study vs: Business Plan: Understanding the Difference

1. what are feasibility studies and business plans and why are they important, 2. what is it, what are its components, and how to conduct one, 3. what is it, what are its components, and how to write one, 4. what are the similarities and differences between them, 5. what are the scenarios and situations where you need one or both of them, 6. how to apply them to different types of businesses and projects, 7. how to make your feasibility study and business plan effective and successful, 8. what are the key takeaways and recommendations from your blog.

Before launching a new venture or expanding an existing one, entrepreneurs need to assess the viability and profitability of their ideas. This is where feasibility studies and business plans come in handy. These are two different but complementary tools that can help entrepreneurs make informed decisions and secure funding for their projects. However, many people confuse the two or use them interchangeably, which can lead to misunderstandings and missed opportunities. In this article, we will explore the differences and similarities between feasibility studies and business plans, and how to use them effectively.

- A feasibility study is a preliminary analysis that evaluates the potential and practicality of a business idea. It answers the question: Is this idea worth pursuing ?

- A business plan is a detailed document that describes the goals, strategies, and operations of a business. It answers the question: How will this idea be executed and succeed?

Some of the main differences between feasibility studies and business plans are:

1. Purpose : A feasibility study is used to test the viability of an idea before investing too much time and money into it. It can help entrepreneurs identify the strengths, weaknesses, opportunities, and threats of their idea, as well as the market demand, customer preferences, competition, costs, risks, and legal issues. A feasibility study can also provide a go/no-go decision or a recommendation for further research. A business plan , on the other hand, is used to communicate the vision and direction of a business to potential investors, partners, employees, and customers. It can help entrepreneurs secure funding , attract talent, establish partnerships, and monitor progress. A business plan can also serve as a roadmap for implementing and managing the business.

2. Format : A feasibility study is usually a concise and focused report that summarizes the findings and conclusions of the analysis. It can range from a few pages to a few dozen pages, depending on the complexity and scope of the idea. A business plan is typically a comprehensive and structured document that covers various aspects of the business, such as the executive summary, the company description, the market analysis, the product or service description, the marketing and sales plan, the financial plan, and the appendix. It can range from 10 to 100 pages, depending on the size and stage of the business.

3. Timing : A feasibility study is usually conducted before a business plan, as it can help entrepreneurs determine whether their idea is worth pursuing or not. A feasibility study can save entrepreneurs from wasting time and money on an unfeasible or unprofitable idea. A business plan is usually developed after a feasibility study, as it can help entrepreneurs refine and elaborate on their idea. A business plan can also be updated and revised as the business grows and changes.

An example of a feasibility study is a market research that evaluates the demand and preferences of potential customers for a new product or service . An example of a business plan is a pitch deck that showcases the value proposition, the competitive advantage, and the financial projections of a new venture.

What are feasibility studies and business plans and why are they important - Feasibility study and business plan: Feasibility Study vs: Business Plan: Understanding the Difference

A feasibility study is a crucial step in the process of launching a new venture or project. It is an analysis that evaluates the viability of an idea, product, service, or solution before investing time, money, and resources into it. A feasibility study helps to answer questions such as:

- Is there a market demand for the proposed offering?

- What are the technical, operational, legal, and financial requirements and risks involved?

- How much will it cost to develop, produce, and deliver the offering?

- How much revenue and profit can be expected from the offering?

- What are the strengths, weaknesses, opportunities, and threats (SWOT) of the offering and the business environment?

- What are the alternatives and competitors in the market?

A feasibility study typically consists of the following components:

1. Executive summary : This is a brief overview of the main findings and recommendations of the feasibility study. It should highlight the objectives, scope, methodology, results, and conclusions of the analysis.

2. Market analysis : This is a detailed examination of the current and potential market for the proposed offering. It should include information such as market size, segmentation, trends, growth, demand, customer preferences, buying behavior, and competitive landscape.

3. Technical analysis : This is a thorough assessment of the technical aspects of the proposed offering. It should cover topics such as product or service design , specifications, features, functionality, quality, performance, reliability, safety, and compliance.

4. Operational analysis : This is a comprehensive evaluation of the operational requirements and capabilities of the proposed offering. It should address issues such as production or service delivery processes , equipment, materials, labor, facilities, logistics, distribution, inventory, maintenance, and quality control.

5. Financial analysis : This is a rigorous estimation of the financial implications and outcomes of the proposed offering. It should include elements such as cost-benefit analysis , break-even analysis, cash flow analysis , income statement, balance sheet, return on investment, and sensitivity analysis.

6. Risk analysis : This is a systematic identification and mitigation of the potential risks and uncertainties associated with the proposed offering. It should consider factors such as technical, operational, market, financial, legal, regulatory, environmental, social, and ethical risks.

7. Recommendation and conclusion : This is a clear and concise statement of the overall feasibility and desirability of the proposed offering. It should summarize the main findings and arguments of the feasibility study and provide a recommendation on whether to proceed, modify, or abandon the idea.

To conduct a feasibility study , one should follow these steps:

- Define the objectives and scope of the study

- Gather relevant data and information from primary and secondary sources

- analyze the data and information using appropriate methods and tools

- Evaluate the results and compare them with the predefined criteria and benchmarks

- draw conclusions and make recommendations based on the evidence and logic

For example, suppose a company wants to launch a new online platform that connects freelance writers with clients who need content creation services . A feasibility study would help the company to determine the following:

- The size and characteristics of the target market and the potential demand for the platform

- The technical features and functionality of the platform and the development costs and time involved

- The operational processes and resources required to run and maintain the platform and the service quality and customer satisfaction levels expected

- The financial projections and outcomes of the platform and the revenue streams and cost structures involved

- The risks and challenges that the platform might face and the strategies and contingency plans to overcome them

- The recommendation and conclusion on whether the platform is feasible and profitable and the next steps to take

What is it, what are its components, and how to conduct one - Feasibility study and business plan: Feasibility Study vs: Business Plan: Understanding the Difference

A feasibility study and a business plan are two different but related documents that entrepreneurs and business owners need to prepare before launching a new venture. While a feasibility study evaluates the viability of a business idea, a business plan outlines the strategy and goals of the business . In this article, we will compare and contrast these two documents and explain how to create them.

## How to create a business plan

A business plan is a comprehensive document that describes the vision, mission, objectives, strategies, and financial projections of a business . It serves as a roadmap for the business and a communication tool for potential investors, partners, and stakeholders. A business plan should answer the following questions :

- What is the purpose and value proposition of the business?

- Who are the target customers and what are their needs and preferences?

- What are the products or services that the business will offer and how will they differ from the competitors?

- How will the business reach and attract the customers and what are the marketing and sales strategies ?

- What are the resources and capabilities that the business will need and how will they be acquired and managed?

- What are the risks and challenges that the business will face and how will they be mitigated and overcome?

- What are the financial assumptions and projections that the business will make and how will they be measured and evaluated?

A business plan typically consists of the following components:

1. Executive summary : A brief overview of the business plan that summarizes the main points and highlights the key aspects of the business . It should capture the attention and interest of the readers and entice them to read the rest of the document.

2. Company description : A detailed description of the business that covers its history, vision, mission, values, goals, and structure. It should also include information about the founders, team members, and advisors of the business.

3. Market analysis : A thorough analysis of the industry, market, and competition that the business will operate in. It should identify the size, growth, trends, opportunities, and threats of the market and the strengths, weaknesses, opportunities, and threats of the business. It should also define the target market segment and the customer profile and behavior.

4. Product or service description : A clear and concise description of the products or services that the business will offer and how they will meet the needs and solve the problems of the customers . It should also explain the unique selling proposition and competitive advantage of the products or services and how they will be developed, delivered, and supported.

5. Marketing and sales plan : A strategic plan that outlines the marketing and sales objectives, strategies, and tactics of the business. It should specify the marketing mix elements such as product , price, place, and promotion and how they will be implemented and coordinated. It should also describe the sales process and cycle and how the business will generate leads , convert prospects, and retain customers.

6. Operational plan : A practical plan that describes the operational aspects of the business such as the location, facilities, equipment, technology, inventory, supply chain, quality control, legal and regulatory compliance , and human resources. It should also detail the roles and responsibilities of the staff and the organizational chart and culture of the business.

7. Financial plan : A realistic plan that projects the financial performance and position of the business for the next three to five years. It should include the income statement, balance sheet, cash flow statement , break-even analysis, and financial ratios. It should also state the sources and uses of funds and the assumptions and scenarios that underlie the projections.

8. Appendix : An optional section that contains any additional or supporting information that may be relevant or useful for the readers of the business plan. It may include resumes, testimonials, references, patents, licenses, contracts, charts, graphs, tables, or other documents.

To write a business plan , one should follow these steps:

- Conduct a thorough research on the industry, market, and competition and gather relevant and reliable data and information.

- Define the purpose and scope of the business plan and identify the target audience and their expectations and needs.

- Outline the structure and content of the business plan and organize the information into logical and coherent sections and subsections.

- Write the first draft of the business plan using clear , concise, and persuasive language and tone. Use bullet points, headings, subheadings, and numbers to make the document easy to read and understand. Use examples, anecdotes, and stories to illustrate the concepts and ideas.

- Review and revise the draft of the business plan and check for accuracy , consistency, completeness, and clarity. Eliminate any errors, gaps, or redundancies and improve the flow and transitions of the document. Seek feedback from others and incorporate their suggestions and comments.

- Format and design the final version of the business plan and make it visually appealing and professional. Use fonts, colors, images, and graphics to enhance the presentation and impact of the document. Add a cover page, table of contents, and page numbers to make the document easy to navigate and reference.

A business plan is a dynamic and flexible document that should be updated and revised regularly as the business evolves and grows . It should reflect the current situation and goals of the business and incorporate the feedback and learning from the market and customers. A business plan is a valuable tool for the success and sustainability of any business.

What is it, what are its components, and how to write one - Feasibility study and business plan: Feasibility Study vs: Business Plan: Understanding the Difference

Before launching a new venture or expanding an existing one, entrepreneurs need to assess the viability and profitability of their ideas. Two common tools that can help them with this task are feasibility studies and business plans. Although they are often used interchangeably, they have different purposes, scopes, and contents. In this section, we will explore the similarities and differences between these two documents and how they can complement each other.

- Similarities : Both feasibility studies and business plans are based on research and analysis of the market, the industry, the competitors, and the customers. They both aim to provide evidence and rationale for the proposed venture or project. They both use quantitative and qualitative data to support their claims and projections. They both require clear and concise writing and presentation skills to communicate the findings and recommendations to the stakeholders .

- Differences : The main difference between feasibility studies and business plans is the level of detail and the intended audience . A feasibility study is a preliminary document that evaluates the technical , economic , legal , and social aspects of a potential venture or project. It answers the question: Is this idea feasible? A feasibility study is usually conducted for internal use, such as for the management team or the board of directors. A business plan is a comprehensive document that describes the vision , mission , goals , strategies , and action plans of a venture or project. It answers the question: How will this idea succeed? A business plan is usually prepared for external use, such as for investors, lenders, or partners.

- Examples : To illustrate the differences between feasibility studies and business plans, let us consider two hypothetical scenarios. Suppose you want to open a new coffee shop in your neighborhood. A feasibility study would help you determine the demand , the supply , the costs , and the risks of this idea. You would need to research the market size , the customer preferences , the competitor analysis , the location analysis , the legal requirements , and the financial projections . A business plan would help you define the value proposition , the target market , the marketing mix , the operational plan , the organizational structure , and the financial plan of your coffee shop. You would need to outline the vision statement , the mission statement , the objectives , the strategies , the tactics , and the milestones of your business. Suppose you want to develop a new mobile app that connects users with local service providers. A feasibility study would help you assess the technical , the market , the legal , and the social feasibility of this idea. You would need to research the user needs , the existing solutions , the technology requirements , the data protection , and the social impact of your app. A business plan would help you present the business model , the competitive advantage , the revenue streams , the distribution channels , the customer segments , and the cost structure of your app. You would need to describe the problem , the solution , the unique value proposition , the customer relationships , the key resources , and the key activities of your business.

Both feasibility study and business plan are important tools for entrepreneurs and investors who want to evaluate the potential of a new venture or project. However, they serve different purposes and should be used in different situations. Depending on the nature, scope, and stage of your idea, you may need one or both of them to make informed decisions and secure funding. Here are some scenarios and situations where you need a feasibility study, a business plan, or both:

- You need a feasibility study when you have a new idea or opportunity that you want to explore further. A feasibility study is a preliminary analysis that helps you assess the viability and profitability of your idea before investing too much time and money into it. It helps you identify the market demand, the technical requirements, the operational challenges, the legal and regulatory issues , the financial projections, and the risks and opportunities involved in pursuing your idea. A feasibility study can help you answer questions such as: Is there a need or gap in the market that your idea can fill? Can you deliver your product or service in a cost-effective and efficient way? What are the potential revenues and expenses of your idea? What are the strengths and weaknesses of your idea compared to the existing alternatives? What are the external factors that can affect your idea positively or negatively? A feasibility study can help you determine whether your idea is worth pursuing further or not. For example, if you want to start a new online platform that connects freelance writers and editors, you may conduct a feasibility study to see if there is enough demand for such a service, how you can differentiate yourself from the existing competitors, what are the technical and operational requirements to run the platform, how much it will cost to develop and maintain the platform, and what are the potential revenues and risks involved.

- You need a business plan when you have a feasible idea that you want to execute and communicate. A business plan is a detailed document that describes your business idea, your goals and objectives, your strategies and actions, your resources and capabilities, and your expected outcomes and results. It helps you plan and organize your business activities, track and measure your progress and performance, and communicate and persuade your stakeholders and potential investors. A business plan can help you answer questions such as: What is your mission and vision for your business? Who are your target customers and what are their needs and preferences? How will you reach and serve your customers and what value proposition will you offer them? Who are your competitors and how will you gain a competitive advantage over them? What are your short-term and long-term goals and how will you achieve them? What are the key activities, resources, and partners that you need to run your business? How will you generate revenues and control costs? How will you manage and mitigate the risks and uncertainties in your business environment? A business plan can help you turn your idea into a reality and convince others to support your business. For example, if you have a feasible idea for a new online platform that connects freelance writers and editors, you may create a business plan to outline your business model, your marketing and sales strategies, your financial projections, and your funding requirements.

- You need both a feasibility study and a business plan when you have a complex or large-scale idea that requires a thorough evaluation and a comprehensive plan. Sometimes, your idea may be too complex or large-scale to be assessed by a feasibility study alone or executed by a business plan alone. You may need both a feasibility study and a business plan to cover all the aspects and stages of your idea. A feasibility study can help you explore and validate your idea, while a business plan can help you implement and communicate your idea. You may use the feasibility study as a basis for your business plan, or you may conduct them simultaneously or iteratively. For example, if you want to start a new biotechnology company that develops and commercializes innovative drugs, you may need both a feasibility study and a business plan to evaluate the scientific and commercial potential of your drugs, to plan and manage the research and development process, to secure the intellectual property rights and regulatory approvals, to establish the manufacturing and distribution channels, to market and sell your drugs to the customers and payers, and to raise funds from the investors and partners.

Feasibility studies and business plans are both essential tools for entrepreneurs , investors, and managers who want to evaluate the potential and viability of a new venture or project. However, they are not interchangeable and serve different purposes. A feasibility study is a preliminary analysis that assesses whether a project is technically, financially, and legally feasible, as well as socially and environmentally desirable. A business plan is a comprehensive document that outlines the goals , strategies, and operational details of a venture, as well as its market analysis, financial projections, and risk assessment.

To illustrate how feasibility studies and business plans can be applied to different types of businesses and projects, let us consider the following examples:

1. A restaurant: A feasibility study for a restaurant would examine the demand and supply of the target market, the location and accessibility of the site, the availability and cost of raw materials and equipment, the legal and regulatory requirements , the competition and differentiation, and the social and environmental impact . A business plan for a restaurant would specify the vision and mission, the target customers and value proposition, the menu and pricing, the marketing and promotion, the staffing and management, the financial plan and budget, and the contingency plan and exit strategy .

2. A software product: A feasibility study for a software product would evaluate the technical feasibility of the product idea, the market opportunity and customer needs, the competitive landscape and unique selling proposition, the legal and ethical implications , and the social and environmental benefits . A business plan for a software product would describe the product features and benefits , the customer segments and personas , the go-to-market strategy and channels, the revenue model and pricing , the development and testing process, the team and organization, the financial plan and milestones, and the risk analysis and mitigation .

3. A solar farm: A feasibility study for a solar farm would assess the suitability and availability of the land, the solar radiation and climate conditions, the grid connection and power purchase agreement, the capital and operating costs, the legal and regulatory framework , and the social and environmental impact. A business plan for a solar farm would define the objectives and scope, the market and customer analysis, the technical and operational plan, the marketing and sales plan, the financial plan and cash flow , the organizational and governance structure, and the risk management and sustainability plan.

How to apply them to different types of businesses and projects - Feasibility study and business plan: Feasibility Study vs: Business Plan: Understanding the Difference

A feasibility study and a business plan are both essential tools for entrepreneurs who want to turn their ideas into reality . However, they serve different purposes and should not be confused with each other. A feasibility study is a preliminary analysis that evaluates the viability of a business idea, while a business plan is a comprehensive document that outlines the goals, strategies, and actions of a business. To make your feasibility study and business plan effective and successful, you should follow these tips and best practices :

- conduct a thorough market research . Before you start writing your feasibility study or business plan, you need to understand the market potential, customer needs, competitor strengths, and industry trends of your business idea. You can use various methods such as surveys, interviews, focus groups, online research, and observation to gather relevant data and insights. This will help you validate your assumptions, identify your target market , and assess the demand and profitability of your product or service.

- Define your value proposition and competitive advantage . A value proposition is a clear statement that explains how your product or service solves a customer problem, meets a need, or provides a benefit. A competitive advantage is a unique feature or benefit that sets your business apart from others in the market. You should articulate your value proposition and competitive advantage in your feasibility study and business plan, and demonstrate how they align with your market research and customer feedback . For example, if you are planning to open a vegan bakery, your value proposition could be "We offer delicious and healthy vegan baked goods that cater to the growing demand for plant-based food", and your competitive advantage could be "We use organic and locally sourced ingredients , and we have a loyal customer base from our online presence".

- set realistic and measurable goals and objectives. Your feasibility study and business plan should include specific, attainable, and quantifiable goals and objectives that reflect your vision and mission. goals are the long-term outcomes that you want to achieve, such as increasing sales, expanding market share , or improving customer satisfaction . Objectives are the short-term steps that you need to take to reach your goals, such as launching a new product, hiring more staff, or securing funding. You should also define the key performance indicators (KPIs) that will help you track and measure your progress and success . For example, if your goal is to increase sales, your objective could be "To sell 10,000 units of our new product in the first year", and your KPI could be "The number of units sold per month".

- Develop a realistic and detailed financial plan. A financial plan is a crucial component of your feasibility study and business plan, as it shows the expected costs and revenues of your business , and the projected cash flow and profitability . You should prepare a realistic and detailed financial plan that covers the following aspects: startup costs, operating costs, sales forecast, income statement, balance sheet, and break-even analysis. You should also include a sensitivity analysis that shows how your financial performance would change under different scenarios, such as changes in market conditions, customer demand, or pricing strategy. This will help you assess the financial feasibility and sustainability of your business, and identify the potential risks and opportunities.

- Seek feedback and revise accordingly. Before you finalize your feasibility study and business plan, you should seek feedback from various sources, such as potential customers, partners, investors, mentors, or experts. You should ask for honest and constructive feedback that can help you improve the quality and clarity of your documents, and address any gaps or weaknesses. You should also be open to revise your feasibility study and business plan based on the feedback, and update them regularly as your business evolves and grows. This will help you ensure that your feasibility study and business plan are accurate, relevant, and effective.

After comparing and contrasting the feasibility study and the business plan, we can draw some important conclusions and recommendations for entrepreneurs and investors. These are:

- A feasibility study is a preliminary analysis that evaluates the viability of a business idea or project before committing to a full-scale plan. It helps to identify the strengths, weaknesses, opportunities, and threats (SWOT) of the proposed venture, as well as the market demand, competition, costs, risks, and potential returns.

- A business plan is a comprehensive document that outlines the goals, strategies, and actions of a business, as well as the financial projections, marketing plan, and operational plan. It serves as a roadmap for the execution and management of the business, as well as a communication tool for attracting funding, partners, and customers.

- Both the feasibility study and the business plan are essential for the success of a business, but they serve different purposes and audiences. A feasibility study is more exploratory and tentative, while a business plan is more definitive and persuasive. A feasibility study is mainly for the benefit of the entrepreneur, while a business plan is mainly for the benefit of the investors and other stakeholders.

- Therefore, our recommendations are:

1. Conduct a feasibility study before writing a business plan, to ensure that your business idea or project is worth pursuing and has a reasonable chance of success.

2. Use the findings and recommendations of the feasibility study as the basis for developing your business plan , to ensure that your business plan is realistic, consistent, and aligned with your goals and vision.

3. Tailor your business plan to the specific needs and expectations of your target audience, to ensure that your business plan is clear, concise, and convincing.

For example, if you are planning to start a coffee shop, you should first conduct a feasibility study to assess the demand, competition, location, costs, and risks of your business idea. Based on the results, you can decide whether to proceed with the business plan or not. If you decide to proceed, you should use the feasibility study as a guide to develop your business plan, which should include your mission, vision, objectives, value proposition, market analysis, marketing strategy, operational plan, financial plan, and risk management plan . Depending on who you are presenting your business plan to, you should emphasize different aspects of your business, such as the market opportunity, the competitive advantage, the financial projections, or the social impact.

By following these steps, you can increase the chances of launching and running a successful business. We hope that this blog has helped you understand the difference between a feasibility study and a business plan, and how to use them effectively for your business venture. Thank you for reading and stay tuned for more insights and tips on entrepreneurship and business development.

Start your own company with us

FasterCapital works with you on studying the market, planning and strategizing, and finding the right investors

Read Other Blogs

Nursery supply chain management (NSCM) is the process of planning, coordinating, and executing the...

Underwriting is a process of evaluating the risk and value of a business, product, or service, and...

1. Understanding SWOT Analysis: - Definition : SWOT stands for...

In the realm of healthcare, the endurance and efficiency of inpatient services are pivotal. This...

Video marketing is not a new phenomenon, but it has become more crucial than ever for small...

Mobile automation has become an indispensable part of modern business strategies, especially in the...

Entrepreneurship often conjures images of dynamic individuals forging paths through the business...

In the realm of mobile marketing, automation emerges as a pivotal force, propelling campaigns into...

In the competitive landscape of startup financing, the decision to refinance is not merely a...

• Start Your Business
• Grow Your Business
• Business Ideas
• Business Plan Writing

The Difference Between A Feasibility Study And A Business Plan

Should you prepare a feasibility study report or a business plan? This is a question that is always asked by thousands of people daily. They want to prepare either of the two but classify both as the same without understanding the clear distinction between a feasibility study report and a business plan.

Feasibility study reports and business plans have different goals, although similar. One is more in-depth than the other, and the reasons for preparing each is partly different from the other.

While a feasibility study report and a business plan are both analysis and decision making tools, it is highly important to know the difference between a feasibility study report and a business plan at all times, as I have detailed below:

See Also:   The Difference Between A Business Plan And A Business Proposal

Reasons For A Feasibility Study Report

A feasibility study report is a document that is prepared after a feasibility study has been carried out. It contains in-depth analysis, projections, cost estimates, production requirements, production processes, and is the ultimate tool to determine whether a business should be started or not.

Since the feasibility study that’s first carried out is a comprehensive market research, its results will show the market size, their demographics, genders, age brackets, number of businesses operating in the industry, and much more.

These results are then put together in the report along with their cost projections, and will ultimately show whether the business is worth following through or not.

Feasibility Study Report Structure

A sample feasibility study report structure could look like the list below:

• Introduction
• Product or Service
• Market Environment
• Competition
• Business Model
• Market and Sales Strategy
• Production Operations Requirements
• Management and Personnel Requirements
• Regulations and Environmental Issues
• Critical Risk Factors
• Financial Projections

See Also:   How To Write A Feasibility Study Report In Nigeria Or Africa: The Complete Guide

Reasons For A Business Plan

A business plan is a strategy and tactical document that is prepared after a successful feasibility study has been carried out. It is written based on the results of a feasibility study, and focuses instead on how the business can achieve a successful market penetration and growth.

A business plan also contains financial projections, cash flow statements, balance sheets, profit and loss statements, break even analysis, and much more. It shows how profitable or not the business will be after acting on the results gotten from the feasibility study, and what it can do to either grow its revenues or change its focus to another industry.

Business Plan Structure

A sample business plan structure could look like the list below:

• Executive Summary
• Business Description
• Service or Product Line
• Market Analysis & Strategies
• Organization & Management
• Funding Request

See Also:   How To Write A Business Plan: The Complete Guide

What Then Do You Need?

If you know nothing about the business you intend to start, the first step is to prepare a feasibility study report after an extensive market research has been carried out. After which, you can go on to prepare a business plan, so you can show the growth, sustainability, and profit potential of the business you’ve set out to run.

See Also:   How to Choose A Business Plan Consultant

What are your thoughts on the difference between a feasibility study report and a business plan? Let me know by leaving a comment below.

Latest articles

How To Increase Your Profits With TradingView

How To Start A Lucrative Export of Limestone From Nigeria and Africa To International Buyers: The Complete Guide

How To Start A Lucrative Export of Calcium Carbonate From Nigeria and Africa To International Buyers: The Complete Guide

How To Start A Lucrative Calcium Carbonate Production and Supply Business In Nigeria and Africa: The Complete Guide

Related articles

How To Start A Lucrative Solar Energy Installation Business In Nigeria and Africa: The Complete Guide

How to start a lucrative ketchup production business in nigeria and africa: the complete guide, how to start a lucrative salt production business in nigeria and africa: the complete guide, 20 comments.

Until now,I always think that business plan and feasibility study report are the same. Thank you a million times for pointing out the difference to me. An eye opener I may say.Thanks once again.

Imeh Enuah.

I’m glad you found the article valuable, Imeh.

Do have a great time!

Thank you brother ❤️👍

Thanks for the effort but still not crystal clear to me…

Thank you for the comment, Victor.

Indeed they’re similar. But the simplest way to understand it is that “a feasibility study is first carried out and documented in a report before a business plan is written to show how you can execute your plans to take the market”.

Stan, even though we don’t go writing you for those your valuable articles, which are changing a lot of lives for good, mullions of people are there silently waiting to read your article everyday. Thanks for impacting knowledge and sharing those priceless write-ups.

Thank you for the kind words and for being a reader, Elvis.

Stan, this has cleared my inquisition on the differentiating factor between the two.

I’m glad you found the article valuable, Daniel.

Thank you for the comment.

Thanks a lot for the article. My position as a Consulting Executive in my previous employment taught me that in industry every feasibility studies is accompanied by a business plan all in one report.

Business plans usually standalone for only existing businesses which usually requires such things as a new marketing or market research, cashflow analysis and asset reappraisal.

Thank you for the contribution, Jeremiah.

Indeed a detailed feasibility report is an in-depth business plan.

What is the difference between a marketing plan and bussines plan

We’d still post an article about that.

Do look out for it on the blog.

Thank you for asking.

Very insightful to say the least. Well done sir!

Thank you for the kind words, Tobechi.

Indeed you are doing a great job.i feel so blessed and fortunate to have such unquontifiable opportunity of learning daily,God bless you, thanks.

Thank you for the kind words, Gideon.

Hello, I wanto prepare a feasibility study report for a potential investor I have a meeting with in another 2 weeks. How do I reach you and where do we start from?

Stan, this is lovely I think I have a better conclusion n knowledge. God bless you.

Thank you for reading, Obi.

Comments are closed.

Popular articles

The Difference Between A Business Idea And A Business Opportunity

63+ Lucrative Small-Scale Business Ideas You Can Start In Nigeria Or Africa

How To Start A Lucrative Clearing and Forwarding Business In Nigeria and Africa: The Complete Guide

Recent Articles

Subscribe to get the latest news, offers and special announcements.

© Copyright 2023 - Startup Tips Daily Media

• Business & Commerce

What is the difference between feasibility study and business plan?

• No comments
• 7 minute read

What is the difference between heath and heather?

Share article, table of contents hide, what is a feasibility study, what is a business plan, the key differences between a feasibility study and a business, when to use a feasibility study vs. a business plan, how to create a feasibility study, how to create a business plan, what are the types of feasibility studies, what are the types of business plans.

A feasibility study is an analysis of whether a business idea is practical and viable , while a business plan outlines the strategy and operations of a business in detail. Essentially, a feasibility study is a precursor to a business plan, helping to determine whether the business idea is worth pursuing before investing time and resources into developing a full plan.

(Photo by Firmbee.com on Unsplash )

A feasibility study is an analysis of the viability of an idea, proposal, or concept. It assesses the likelihood that a project will be successful in meeting its objectives and goals, and whether it is worth pursuing.

A feasibility study is not the same as a business plan. A business plan is a document that outlines the financial and operational goals of a business. It includes information on the company’s products or services, marketing strategy, and target market.

A feasibility study looks at all aspects of a proposed project, including technical feasibility, financial feasibility, and operational feasibility. It is used to determine whether a project is worth pursuing and to identify any potential risks or limitations.

Technical feasibility looks at whether a proposed project can be completed with the available resources. This includes evaluating the technical requirements, such as hardware and software requirements, and assessing whether these can be met. Financial feasibility looks at whether a proposed project is financially viable. This includes assessing the costs and benefits of the project, as well as any potential sources of funding. Operational feasibility looks at whether a proposed project can be completed successfully within the given constraints. This includes evaluating the resources required for the project and assessing whether they are available.

The goal of a feasibility study is to identify any potential problems with a proposed project so that they can be addressed before moving forward. By doing this, it increases the chances of success for the project overall.

(Photo by Jason Goodman on Unsplash )

A business plan is a comprehensive document that outlines the strategy, operations, and financial projections for a business. It typically includes information on the company’s products or services, target market, competition, marketing and sales strategies, management team, and financial projections.

A well-written business plan is an important tool for entrepreneurs and business owners, as it provides a roadmap for the future of the business and helps to secure funding from investors or lenders. It allows the business owner to clearly articulate their vision and goals, and to identify potential challenges and opportunities.

The key components of a business plan typically include an executive summary , company description, market analysis, marketing and sales strategy, management and organization, product or service line, financial projections, and funding request.

The executive summary provides an overview of the business plan, highlighting the key points and objectives. The company description provides background information on the business, including its history , mission, and goals. The market analysis outlines the target market, competition, and industry trends. The marketing and sales strategy describes how the business will reach and engage customers. The management and organization section details the management team and organizational structure of the business. The product or service line outlines the products or services the business will offer. The financial projections include income statements, balance sheets, and cash flow statements. Finally, the funding request outlines the amount of funding needed and how it will be used.

Overall, a business plan is a critical document for any business, providing a roadmap for success and a way to attract funding and support from investors and lenders.

Purpose: A feasibility study is conducted to determine whether a business idea is practical and viable, while a business plan is developed to outline the strategy, operations, and financial projections for a business.

Scope : A feasibility study is a preliminary analysis that focuses on the market, technical, and financial feasibility of a business idea, while a business plan is a comprehensive document that covers all aspects of a business, including its products or services, target market, competition, marketing and sales strategies, management team, and financial projections.

Timing : A feasibility study is typically conducted before developing a business plan to determine whether the business idea is worth pursuing, while a business plan is developed once the decision to proceed with the business has been made.

Audience : A feasibility study is primarily used to inform the entrepreneur or management team about the viability of the business idea, while a business plan is used to secure funding from investors or lenders.

Level of detail : A feasibility study provides a high-level analysis of the business idea, while a business plan provides a detailed roadmap for the future of the business, including its marketing and sales strategies, management team, and financial projections.

A feasibility study is typically used when starting a new business or venture, and its purpose is to determine if the proposed business idea is viable. A feasibility study will assess the market potential, technical feasibility, and financial viability of the proposed business. It is important to note that a feasibility study is not the same as a business plan; rather, it is one tool that can be used in developing a business plan.

In contrast, a business plan is typically used once a business has already been established. Its purpose is to outline the company’s strategy for achieving its goals and objectives. Unlike a feasibility study, which assesses the viability of a proposed idea, a business plan focuses on an existing businesses’ ability to execute its strategy and achieve its goals.

A feasibility study is an analysis of whether a proposed project is likely to be successful. A business plan is a more detailed document that outlines the specifics of the business, such as its products or services, marketing strategy, and financial projections.

Creating a feasibility study typically requires four main steps:

• Define the problem or opportunity. This step includes understanding the needs of the potential customer or client.
• Research and gather data. This step includes secondary research, such as market analysis and industry trends, as well as primary research, such as customer surveys or interviews.
• Analyze the data and make recommendations. This step includes determining whether the problem or opportunity can be solved and whether the proposed project is likely to be successful.
• Prepare a written report . This step includes documenting the findings of the feasibility study in a clear and concise manner.

Creating a business plan can seem like a daunting task, but it doesn’t have to be. You can start by doing some research and then outlining your goals and objectives. Once you have a good understanding of what you want to achieve, you can start putting together a more detailed plan.

There are a few key things that should be included in any business plan:

• An executive summary. This is a brief overview of your business and what you hope to accomplish.
• A description of your product or service. What are you offering and why do your customers need it?
• A marketing plan. How will you reach your target market and what strategies will you use to promote your product or service?
• A financial plan. What are your revenue and expense projections? How much money do you need to get started or to keep your business running?
• An operational plan. What are the day-to-day details of running your business? Who will handle what tasks?
• A risk management plan. What could go wrong and how will you handle it if it does?

Market Feasibility

A market feasibility study assesses the potential for a product or service to be successful in a given market. It takes into account multiple factors such as the size of the target market, growth trends, competitor analysis, and customer needs and buying habits. This type of feasibility study is important for businesses to understand whether there is a demand for their product or service in the marketplace.

Technical Feasibility

A technical feasibility study assesses the ability of a business to successfully develop and implement a proposed solution. This includes assessing the technical risks involved, as well as ensuring that the necessary resources (e.g., personnel, equipment) are available. A technical feasibility study is important to determine whether a proposed solution is achievable and will meet the needs of the business.

Financial Feasibility

A financial feasibility study assesses the potential financial impact of a proposed solution. This includes an assessment of the costs and benefits of implementing the solution, as well as any potential risks and uncertainties associated with it. A financial feasibility study is important to determine whether a proposed solution is financially viable and will have a positive impact on the business’s bottom line.

Managerial Feasibility

A managerial feasibility study assesses the ability of management to successfully develop and implement a proposed solution. This includes an assessment of management’s experience, skills,

There are three types of business plans :

Internal business plan

An internal business plan is a document that outlines the company’s strategy for achieving its objectives. It is typically created by the company’s management team and is not shared with outsiders.

External business plan

An external business plan is a document that is shared with outsiders, such as investors, potential partners, and customers. Its purpose is to persuasively communicate the company’s strategy and how it will achieve its objectives.

Hybrid business plan

A hybrid business plan combines elements of both an internal and an external business plan. It typically includes a high-level overview of the company’s strategy that can be shared with outsiders, as well as more detailed information on operational matters that is meant for internal use only.

Featured Image By – Photo by Daria Nepriakhina 🇺🇦 on Unsplash

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

You May Also Like

What is the difference between LLC and inc?

• June 2, 2023

What is the difference between a charity and a nonprofit

• October 20, 2022

What is the difference between tangible property and intangible property?

• July 7, 2023

Sewer vs. Drain: Understanding the Key Differences

• Difference Digest
• April 29, 2024

Torque Converter vs Fluid Coupling: Key Differences

• March 21, 2024

Conscious vs. Unconscious: Key Distinctions

• March 16, 2024

Debt Consolidation vs. Debt Relief: Key Differences

• What is the difference between a feasibility study and a business plan?

Navigating the dynamic business world requires a high degree of strategic acumen and meticulous preparation, especially for senior management roles. In this article, we'll delve into two paramount tools that can significantly assist in this journey: business plans and feasibility studies.

Both tools are used extensively by seasoned professionals such as senior finance managers, real estate development managers, asset managers, and procurement managers. Yet, the relationship and differentiation between business plans and feasibility studies often confuse. Through this article, we'll demystify these concepts and reveal how business plan and feasibility study consultants can be crucial in bolstering your strategic decision-making.

Unravelling the relationship

Business plans and feasibility studies are interconnected yet serve different purposes. A business plan outlines your organisation's direction, detailing the approach to achieving set goals, while a feasibility study analyses the viability of a specific business venture before it's initiated.

Consider a corporation contemplating a shift to solar power. They begin with a feasibility study, engaging a consultant to evaluate factors like sunlight availability, installation costs, regulatory environment, and potential impact on their market position. If this study finds that the location isn't sunny enough, costs are too high, or infrastructure is unsuitable, the idea is scrapped, saving the corporation from a costly mistake.

However, if the feasibility study deems the transition viable, the corporation proceeds to the business plan stage. They hire a business plan consultant to outline a detailed strategy, covering aspects such as budgeting, sourcing, installation timelines, risk mitigation, and communication plans.

Dissecting the differences

While both a business plan and a feasibility study are crucial, they're not interchangeable. A feasibility study asks, "Should we do this?" while a business plan asks, "How will we do this?"

To explain better, let's consider a scenario involving a restaurant. If a restaurateur is considering opening a new branch in a different city, they would first conduct a feasibility study. They'd assess the local market demand, competition, demographics, potential locations, costs, and projected revenue. If the study finds that the new branch wouldn't be profitable or sustainable, they would shelve the idea. However, if the feasibility study reveals that the new branch is likely to be successful, they'd proceed to create a business plan. This would detail how they intend to launch and run the new branch, such as the restaurant's concept, target customers, marketing strategies, menu, pricing, staffing, and financial projections.

In essence, the feasibility study is about whether they should open the restaurant, and the business plan is about how they will open and operate it, illustrating the key difference between the two tools.

The rationale behind business plans and feasibility studies

Why should your organisation invest time and resources in these tools? Essentially, they provide clarity and confidence in decision-making. A feasibility study examines the practicability of your idea. It determines if the proposed project is worth the risk and investment. It's akin to a 'litmus test', helping you avoid costly missteps.

On the other hand, a business plan provides a detailed roadmap for your business. It lays out your business's objectives and strategies, management and operational structure, and financial projections. It facilitates internal understanding and commitment and helps attract external investors when well-executed.

The role of consultants

Given the complexity and the high stakes involved, many organisations engage business plan consultants and feasibility study consultants. These experts bring an external perspective, help avoid internal biases, and contribute specialist knowledge and methodologies.

Feasibility study consultants conduct comprehensive market research, cost analyses, and risk assessments. They help determine if your proposed project is both profitable and achievable. On the other hand, business plan consultants assist in crafting compelling business plans that communicate your vision effectively. They analyse your business's strengths, weaknesses, opportunities, and threats (SWOT) and devise strategies that align with your objectives and capabilities.

Final thoughts

For senior management, these tools offer invaluable assistance. A robust feasibility study allows managers to make informed go/no-go decisions. It facilitates risk management and helps align the team around a shared understanding of the project's potential. Business plans, meanwhile, provide a clear vision and direction for the organisation. They assist managers in tracking progress, managing changes, and communicating with stakeholders. They're essential for steering the corporate ship in an often turbulent business sea.

In conclusion, business plans and feasibility studies, assisted by professional consultants, play an instrumental role in shaping and executing your business strategy. They underpin decision-making, mitigate risks, and maximise potential returns. Whether you're evaluating a new project or charting your organisation's path, consider investing in a well-crafted feasibility study and a comprehensive business plan - the rewards can be immense.

Related Services: Feasibility Study , Business Plan , Strategic Advisory

What is the role of a business valuation in estate planning?

Navigating the dynamic business world requires a high degree of strategic acumen and meticulous preparation, especially for senior management roles. In this article, we'll delve into two paramount tools that...

Recommended for you

Do neo-banks pose a threat to mainstream banking network in gcc, approximately 12,600 residential units in qatar are in the pipeline for q4 2022.

The Advantages of Working with Remote Teams

Your folder is empty

Transaction Enquiry

Recover password.

• Client Success Stories

The difference between a feasibility study & a business plan

How much wood would a woodchuck chuck if a woodchuck could chuck wood? How much would the wood cost and how dependable is supply? Does the wood have a “best by” date? How long would it take to do the chucking? And what about woodchuck retention, it is a tough market out there.

If there are wood chucking businesses (and we do have a client that clears and hauls felled trees and wood debris), they might want to consider a feasibility study and business plan before diving into an expansion or other major project. Feasibility studies and business plans are commonly needed (or required) for analysis and decision purposes such as the launch of a new business line, product or service line expansions, geographic expansion, or attracting capital. Likewise, target readers range from boards of directors for project approval purposes, management for internal planning, lenders or potential investors, grant or other assistance programs, and a number of others. 

But what are the differences between a feasibility study and a business plan, and how do the two relate? A business feasibility study is a detailed analysis of the viability of an idea or concept for a business venture. Once feasibility has been determined, a business plan documents the operational and financial objectives of the venture and the detailed plans to achieve them. In short, a business feasibility study can be looked at as “Can we?” while the business plan is “How to.” 

It is common for the “can we?” and “how to” assessments of a project to be combined into one document, but many key aspects of feasibility should be determined before diving too deep into the “how to” of a venture.

Some years ago we did a feasibility study for a large California dairy operation seeking to grow returns by introducing value-added products rather than strictly selling bulk fluid milk. The idea? Homogenize and pasteurize their own milk (some in flavors), put it in glass bottles, and deliver it to people’s doorsteps. 

After I got over my shock, we set about exploring key aspects of feasibility: Is there demand for it, and at what price points? What would it take for the company to successfully make and bottle the products? How would it be marketed? Can bottles be returned and sanitized sufficiently for safe re-use?

As you might imagine, there was not much industry data to lean on; Nielsen and IRI have no market data for home delivered milk, there are no trade associations for the home milk delivery business, and not a lot of equipment and bottle suppliers focus on that niche of the otherwise huge dairy industry.

It was a challenge. We designed a market survey and partnered with the marketing program of a local community college to take consumer surveys at farmers’ markets and other events to determine potential market interest and price points. We contacted some of the few similar operations we could find in the United States. We looked into the availability of bottles approved for both milk and multiple re-use. 

Ultimately, we found the project feasible, and with this assurance developed a business plan to lay out the “how to-s.” In the years since, the company has been a great success with stunning growth.

Tempting as it may be to dive straight into the “how to,” unless you have other supportable reasons to believe a project is feasible from such key aspects as demand, production, distribution, marketing, capital, and a thorough risk assessment, it is best to spend some time determining “Can we?”

I tell our business feasibility study clients that one result they should be prepared for is “not feasible.” It happens, but it’s still a lot less trouble and risky than jumping in without due diligence. Morrison has conducted feasibility studies and business plans for nearly 20 years for a wide variety of needs and intended readers. We’re always happy to bounce around ideas and help explore what might – or might not – work for a business’s needs.

Brent Morrison is the Founding Principal at Morrison. To get in touch with Brent, please find contact information for Morrison here .

We’ve worked with a wide variety of clients on a broad range of projects and are happy to discuss solutions that can best fit your needs.

Difference Between a Feasibility Study and a Business Plan

The main difference between a feasibility study and a business plan is that a feasibility study is conducted to assess the viability of a proposed project or venture before significant resources are invested, focusing on analyzing various aspects such as economic, legal, technical, and scheduling considerations. In contrast, a business plan is a comprehensive document that outlines a company’s strategy, goals, market analysis, financial projections, and operational plans, used primarily for executing and managing the business, as well as for attracting investors and lenders.

Table of Contents

What is a Feasibility Study and What is a Business Plan

Feasibility Study refers to an analysis and evaluation of a proposed project to determine if it is technically feasible, economically viable, and legally permissible. It is usually conducted before significant investments are made to understand the likelihood of the project’s success. The feasibility study considers various factors, including market research, technical requirements, legal constraints, financial modeling, and risk assessment. The purpose of this study is to ascertain the strengths and weaknesses of a proposed venture, opportunities and threats present in the environment, the resources required, and ultimately the prospects for success.

Business Pl a n, on the other hand, is a detailed plan of how a business will operate and achieve its goals. It serves as a roadmap for the business, detailing the strategy, target market, competition, marketing and sales strategies, organizational structure, and financial projections. A business plan is essential for both new and established businesses. It helps in securing funding from investors or banks, guiding the management team in making strategic decisions, and monitoring the progress of the business. Business plans are dynamic documents that should be updated regularly as the business grows and market conditions change.

Key Differences Between a Feasibility Study and a Business Plan

• Purpose and Focus : A feasibility study is conducted to evaluate the viability of a project before significant resources are committed, whereas a business plan is used for the execution and ongoing management of a business.
• Scope of Analysis : Feasibility studies typically have a narrower focus, examining specific aspects like economic viability and technical requirements, while business plans provide a comprehensive overview of the entire business operation.
• Timing : A feasibility study is often conducted before a business plan, helping to decide whether or not to proceed with the business idea.
• Audience : Feasibility studies are usually intended for internal decision-making, while business plans are often created with external stakeholders, such as investors and lenders, in mind.
• Content : A feasibility study includes detailed analysis on viability aspects, whereas a business plan includes broader information like marketing strategies, organizational structure, and financial forecasts.
• Use in Decision Making : Feasibility studies are used to make go/no-go decisions on a project, while business plans are used to guide the operational, financial, and marketing decisions of a business.

Key Similarities Between a Feasibility Study and a Business Plan

• Planning Tools : Both are essential planning tools used in the decision-making process of starting or managing a business or project .
• Research-Based : Both require extensive research and analysis of the market, competition, and internal capabilities.
• Risk Assessment : Both involve assessing risks and identifying potential challenges and opportunities.
• Financial Considerations : Both include financial analysis, although the focus and depth may vary.
• Goal Orientation : Both are oriented towards achieving specific goals – whether it’s determining the viability of a project or outlining the strategy for a business.
• Dynamic Documents : Both should be considered dynamic documents that can be revised and updated as new information becomes available or circumstances change.

About The Author

Hidayat Rizvi

Related posts.

Farmer vs Businessman: A Detailed Comparative Analysis of Two Vital Roles

Salesman vs Businessman: Comprehensive Analysis for Aspiring Professionals

Difference Between Business Improvement and Business Process Reengineering

Difference Between Indian and American Business Culture

Leave a comment cancel reply.

Your email address will not be published. Required fields are marked *

Important Links

• Privacy Policy
• Terms and Conditions

Social Networks

• hidayat.rizvi.1
• @HidayatRizvi
• hidayat_rizvi_2000
• hidayat-rizvi-b0788b10

HidayatRizvi.com © 2024. All Rights Reserved

Get a free consultation, enter your contact details and i will get in touch, send a message. i will respond quickly.

• Accountancy
• Business Studies
• Commercial Law
• Organisational Behaviour
• Human Resource Management
• Entrepreneurship

Difference between Feasibility Study and Business Plan

• Difference between Business Plan and Business Proposal
• Difference Between Business Intelligence and Machine Learning
• Difference between Business Continuity Plan and Disaster Recovery Plan
• Difference between Planning and Forecasting
• Difference Between Data Science and Business Intelligence
• Difference between Business Intelligence and Data Mining
• Difference Between Data Science and Business Analytics
• Difference between Marketing Strategy and Marketing Plan
• Difference Between Business Intelligence and Data analytics
• Difference Between Entrepreneur and Businessman
• Difference between Project Report and Business Report
• Difference between Project Report and Feasibility Report
• Difference between Project Management and Business Management
• Difference between SDLC and STLC
• Difference between MRP and MRP II
• Difference between ERP and SCM
• Difference between BRD and SRS
• Differences between ERP and SAP
• Difference between Business Intelligence and Predictive Analytics

Feasibility Study and Business Plan are essential tools in the business development process. They serve different purposes and are conducted at different stages. A feasibility study helps determine the viability of a business idea; whereas, a business plan provides a detailed roadmap for executing that idea and achieving business goals.

What is a Feasibility Study?

A feasibility study is a comprehensive assessment conducted at the early stages of a business idea or project to evaluate its potential viability and identify potential risks and challenges. The primary purpose of a feasibility study is to determine whether the proposed business venture is feasible and worth pursuing further.

Features of the Feasibility Study are:

• Market Analysis: Feasibility Study evaluates the target market , including its size, growth potential, demographics, and competition. This involves researching customer needs, preferences, and behavior to assess demand for the proposed product or service .
• Technical Feasibility: A feasibility study assesses the technical requirements and capabilities needed to develop and deliver the product or service. This may involve evaluating technology, equipment, facilities, and expertise required for production or implementation.
• Financial Feasibility: A feasibility study conducts financial analysis to estimate the costs involved in starting and operating the business, as well as potential revenue and profitability. This includes preparing financial projections, such as income statements , cash flow statements , and Return on Investment (ROI) calculations.

What is a Business Plan?

A business plan is a comprehensive document that outlines the goals, strategies, operations, and financial projections of a business. It serves as a roadmap for the organization’s future direction and provides a detailed blueprint for how the business will be structured, managed, and operated.

Features of a Business Plan are:

• Executive Summary: A business plan gives a brief overview of the business concept, objectives, products or services offered, target market, competitive advantage, and financial projections.
• Company Description: It gives detailed information about the business, including its history, mission statement, vision, values, legal structure, location, and ownership.
• Market Analysis: A business plan is formed after analyzing the target market, including its size, growth potential, demographics, buying behavior , market trends, and competition. This section also outlines the business’s market positioning and competitive strategy.

Feasibility Study and Business Plan – FAQs

When should a feasibility study be conducted.

A feasibility study is typically conducted at the early stages of developing a business idea or project, before significant resources are invested. It helps entrepreneurs and stakeholders make informed decisions about whether to proceed with the venture.

Who conducts a feasibility study?

Feasibility Studies are often conducted by entrepreneurs, business owners, project managers, consultants, or other professionals with expertise in the relevant industry or field. They may also involve collaboration with specialists such as market researchers, engineers, financial analysts, and legal advisors.

When should a business plan be developed?

A business plan is typically developed after a feasibility study has been conducted and the decision to move forward with the business venture has been made. It provides a detailed blueprint for executing the business idea and achieving its objectives.

Who uses a business plan?

Business plans are used by entrepreneurs, startups, existing businesses, investors, lenders, partners, employees, and other stakeholders interested in understanding the organization’s goals, strategies, operations, and financial prospects.

What are the benefits of conducting a feasibility study?

Benefits of conducting a feasibility study include minimizing risks, identifying potential challenges and opportunities, validating assumptions, attracting investors or lenders, guiding decision-making , and increasing the likelihood of success for the proposed business venture.

Please Login to comment...

Similar reads.

• Commerce - Difference Between

Improve your Coding Skills with Practice

What kind of Experience do you want to share?

Difference between Feasibility Study and Business Plan

Entrepreneurs face many challenges when creating a new venture.  Although the business plan is one of the most well-known documents, the feasibility study may be just as important.  Before the entrepreneur can seek funding, he or she must demonstrate that the idea is truly a good one.

Rochester.edu explained that a feasibility study, “can be defined as a controlled process for identifying problems and opportunities, determining objectives, describing situations, defining successful outcomes, and assessing the range of costs and benefits associated with several alternatives for solving a problem.”

In order to create a feasibility study, entrepreneurs need to define dimensions of business viability including:  market viability, technical viability, business model viability, management model viability, economic and financial model viability, and exit strategy viability.

A good outline for a feasibility study includes:

• Introduction
• Product or Service
• Market Environment
• Competition
• Business Model
• Market and Sales Strategy
• Production Operations Requirements
• Management and Personnel Requirements
• Regulations and Environmental Issues
• Critical Risk Factors
• Financial Predictions Including:  Balance Sheet, Income Statement, Cash Flow Statement, Break Even Analysis, and Capital Requirements

A feasibility study is not the same thing as a business plan.  The feasibility study would be completed prior to the business plan.  The feasibility study helps determine whether an idea or business is a viable option.  The business plan is developed after the business opportunity is created.  StrategicBusinessTeam.com explained, “A feasibility study is carried out with the aim of finding out the workability and profitability of a business venture. Before anything is invested in a new business venture, a feasibility study is carried out to know if the business venture is worth the time, effort and resources. A feasibility study is filled with calculations, analysis and estimated projections while a business plan is made up of mostly tactics and strategies to be implemented in other to grow the business.”

While it may seem the feasibility study is similar in many ways to the business plan, it is important to keep in mind that the feasibility study is developed prior to the venture.  StrategicBusinessStream pointed out that “a feasibility study can readily be converted to a business plan.”  It’s important to think of the business plan in terms of growth and sustainability and the feasibility study in terms of idea viability.

Related Articles:

• Top 30 Links for the Successful Entrepreneur
• Top 10 Companies Code of Ethics and Conduct
• Top 10 Company Mission Statements
• How to Conduct a Feasibility Study
• How to Create a Business Plan
• Business Plan Outline
• Feasibility Plan Outline
• Writing a Winning Business Plan

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Difference Between Feasibility Study, Business Plan, And Business Proposal

Here is the difference between a feasibility study report and a business plan ? Can a feasibility study report be converted to a business plan? Find out.

DIFFERENCE BETWEEN FEASIBILITY STUDY AND BUSINESS PLAN SAMPLE

In the course of the article, we will be highlighting the major differences between business plan, business proposal and feasibility study .

RELATIONSHIP BETWEEN FEASIBILITY STUDY AND BUSINESS PLAN AND PROPOSAL

A business plan, business proposal and a feasibility study are all analysis and tools utilised for decision making by organizations.

In as much as the 3 tools can be utilised alongside one another in decision making processes, they have their differences and they seem to target and tackle different processes.

DEFINITIONS

WHAT IS A BUSINESS PLAN?

A business plan can be considered to be that document that highlights a concise description of how a business is established. The business plan is usually a 5-year plan of a particular business and it shows the company structure, market finding and analysis, products and services, marketing strategy and financial projections.

WHAT IS A BUSINESS PROPOSAL?

A business proposal can be considered to be a sales document that is drafted to highlight how a particular project will be carried out, estimate the value of the project to the client and then seeks the client’s involvement in the business. The business proposal is usually document that an organization submits to another organization to effect a business arrangement.

WHAT IS A FEASIBILITY STUDY

A feasibility study is considered to be that document that is drafted with the purpose of finding out how workable and profitable a business venture will be. Before any action is taken in a business, it is the feasibility study that will determine if the business will be worth the time, resources and efforts.

COMPARING BUSINESS PLAN VS FEASIBILITY STUDY

The differences between a business plan, business proposal and feasibility study can be categorised into 2

• The reason or purpose of the write-up
• The structure or element of the write-up

DIFFERENCES IN TERMS OF REASONS OR PURPOSE

REASONS FOR A BUSINESS PLAN

A reason why a business plan is written out in a business is to to document the vision of the business and the steps that will be taken to accomplish the vision. A typical business plan will contain the financial projections of the cost of the business and also give an estimation of the revenues that the business will generated.

The purpose of the business plan is to provide a concise explanation of the business to be utilised by the potential investors, employees, suppliers, attorneys, accountants and any other set of people that will need a quick and comprehensive knowledge of what the organization does and its ability to achieve success

REASON FOR A BUSINESS PROPOSAL

A business proposal, most of the times, is an unsolicited business ideas that is presented to another business entity or they may be a response to requests made by a potential client to your company. The scope of a business proposal is quite limited to a particular project. In fact, we can say the major reason for a business proposal is to request for a business opportunity.

REASON FOR A FEASIBILITY STUDY

Feasibility is most of the times carried out with the purpose of finding out the profitability and workability of a business idea. Unlike a business plan, a feasibility study is always filled with calculations and estimated projections for a project.

DIFFERENCES IN TERMS OF STRUCTURE

STRUCTURE OF A BUSINESS PLAN

A business plan comprises of 3 major elements:

• A detailed description of the business model
• The marketing model
• And the financial projection

Other information sections of the business plan will include the executive summary, description of the business, competitive analysis, marketing model, operations plan, financial information and projections. These are the structures of a typical business plan

STRUCTURE OF A BUSINESS PROPOSAL

A business proposal that is written as a response to an RFP must follow the format that is requested in the RFP. The structure of the business proposal will involve a description of the services your company renders that are relevant to the goals that are specified in the RFP.

Your business proposal will also comprise of the answers to the specific questions that are asked in the RFP and a quote on the information about the materials, labour, tools, delivery and other costs that will be incurred in the course of the project.

STRUCTURE OF A FEASIBILITY STUDY

The activities for creating the feasibility study for a business venture are general in nature and are quite applicable to all kinds of businesses or projects irrespective of the technicalities involved in the running of the project.

The basic structures of a feasibility study will be:

• The scope of the project, which will be used to describe the problems of the business and the opportunities
• The current analysis is used to understand the current methodologies that will be utilised in the implementation of the project.
• The requirements of the projects. These depend on the object of the project’s attention
• The approach can be considered to be the prescribed solution to satisfy the requirement. On the approach, various alternatives can be considered and detailed explanations on why the solution is preferred to other solutions highlighted.
• Evaluation will examine the cost efficiency of the approach that is selected. This starts with the analysis of the estimated cost of the entire project.
• Review is then done to assemble all the elements into the feasibility study. The review has two different purposes.
• To initiate a project decision, which will be either to approve or reject the project or better still, ask that the project be revised before a final decision is made
• To ensure that the feasibility study is thorough and accurate.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Business plan vs Feasibility study

Introduction.

Two essential tools that pave the way for success are the business plan and the feasibility study . 

In this comprehensive guide, we will have some knowledge on each, revealing their unique roles and shedding light on their significance. 

We'll see business plan and feasibility study similarities in strategic planning, and other points. 

We'll also discuss  10 difference between business plan and feasibility study in components, significance, and other points.

Understanding the Basics

Defining business plans and feasibility studies.

Let's know the fundamental definitions and purposes of both business plans and feasibility studies.

Business Plan

A business plan serves as a strategic document that outlines the mission, vision, and objectives of a company. 

It encompasses details about the products or services offered, target audience, marketing strategies, and financial projections. 

Business Plan acts as a roadmap, guiding entrepreneurs in achieving their business goals.

Business Feasibility Study

On the other hand, a feasibility study is a detailed analysis conducted to evaluate the practicality and viability of a proposed project. 

It dives into market research, financial assessments, and risk analysis, providing insights into whether a particular venture is worth pursuing.

Designing a Business Plan

Key components for a strategic blueprint.

A closer look at the essential elements that constitute a well-designed business plan, providing a roadmap for long-term success.

Executive Summary: 

A concise overview of the business, highlighting its key aspects and objectives.

Business Description:  

Detailed information about the nature of the business, its mission, and its vision.

Market Analysis: 

In-depth research on the target market, competitors, and industry trends.

Organization and Management Structure:  

Insights into the organizational structure and key personnel.

Products or Services:  

A comprehensive description of what the business offers.

Marketing and Sales Strategy:  

Plans for promoting and selling products or services.

Financial Projections:  

Detailed forecasts of revenue, expenses, and profits.

Navigating Business Feasibility Study

Evaluating viability and risks.

Understanding the basics of business feasibility studies, focusing on assessing the viability of business ideas and mitigating potential risks.

Market Feasibility : 

Analyzing the market to determine the demand for the product or service.

Technical Feasibility : 

Assessing the technological requirements and capabilities.

Financial Feasibility : 

Evaluating the financial aspects, including investment and return on investment.

Operational Feasibility : 

Examining how well the business can function in its intended environment.

Legal Feasibility : 

Ensuring compliance with legal requirements and regulations.

Business Plan vs Feasibility Study

Contrasting objectives and applications, what are the difference between business plan and feasibility study.

Business plan feasibility study differences is revealed by A side-by-side comparison, highlighting the distinctive objectives and applications of business plans and feasibility studies.

Objective : 

Business plans focus on outlining the strategic direction of the company and attracting investors, while feasibility studies aim to assess the practicality of a project before significant resources are invested.

Application : 

Business plans are instrumental in securing funding, guiding day-to-day operations, and fostering growth. 

Feasibility studies, however, help decision-makers determine if a project is feasible before committing resources.

10 difference between business plan and feasibility study

In strategic planning, enterprises frequently navigate the complexities of both business plans and feasibility studies. 

While these two instruments may seem similar, there's fundamental distinctions that influence decision-making. 

There are 10 difference between business plan and feasibility study:

2. timeliness of use, 3. scope of analysis, 4. flexibility, 5. financial emphasis, 6. decision-making stage, 7. detail level, 8. risk assessment, 9. audience orientation, 10. timeline considerations.

A business plan primarily acts as a roadmap, delineating the company's goals, strategies, and the means to achieve them. 

It serves as a visionary document encapsulating the company's long-term objectives.

Feasibility Study

In contrast, a feasibility study zeroes in on evaluating the practicality of a specific project. 

It dives into the viability of the project and its potential for success.

Business plans find utility before the commencement of a project or to secure funding for a startup, setting the stage for the entire business journey.

Feasibility studies come into play before the implementation phase of a project, offering insights into whether a project should progress or be halted.

Encompassing marketing strategies, financial projections, operational plans, and more, business plans cover a broad spectrum, providing a holistic view of the entire business.

Conversely, feasibility studies focus on specific aspects like market analysis, financial feasibility, and technical requirements, offering a more targeted and detailed examination.

Business plans showcase a degree of flexibility, allowing companies to adapt their strategies as the market evolves. 

They are dynamic documents that can be periodically revised.

Feasibility studies exhibit less flexibility. 

Changes are challenging once the study is complete, as it forms the foundation for project initiation.

It delves into the viability of the project and its potential for success.

While financial aspects are integral to a business plan, they are not the sole focus. 

Business plans explore a wide array of elements beyond finances.

Finances take center stage in feasibility studies, critically analyzing the economic viability and financial feasibility of a project.

Business plans guide decision-making at various stages of the company's life, from inception to growth phases.

Feasibility studies specifically influence the decision of whether to proceed with a project or abandon it based on practicality.

Providing a detailed yet generalized overview of the business, focusing on strategies and goals rather than granular details.

Feasibility studies are meticulous in detail, offering an in-depth analysis of specific project components, leaving no stone unturned.

While business plans acknowledge risks, they may not delve deeply into risk assessment and mitigation strategies.

Feasibility studies rigorously assess risks associated with the project and outline strategies to mitigate these risks effectively.

Tailored for external stakeholders, such as investors, lenders, or partners, business plans address a wider audience.

Feasibility studies primarily target internal decision-makers, offering insights crucial for project initiation.

Business plans may or may not have a fixed timeline, depending on the nature of the business.

Feasibility studies typically have a predefined timeline, ensuring a thorough examination within a specified period.

In conclusion, understanding these 10  difference between business plan and feasibility study  is pivotal for strategic decision-making. 

While a business plan navigates the entire business landscape, a feasibility study drills down into the specifics of a project's viability. 

The Power of Numbers

Financial projections and analysis.

Exploring the numerical aspect, emphasizing the importance of robust financial projections and in-depth analysis in both documents. 

Financial projections significance in Business plan feasibility study differences are clear.

Financial Projections in Business Plan

Financial projections in a business plan provide a snapshot of anticipated revenue, expenses, and profits over a specific period. 

This section demonstrates the financial viability of the business and helps secure funding.

Financial Analysis in Feasibility Study

In a feasibility study, financial analysis goes deeper, scrutinizing potential risks and returns. 

It involves a detailed examination of investment costs, operational expenses, and revenue forecasts. 

This rigorous financial analysis ensures that decision-makers make informed choices.

Real-world Applications

Case studies illustrating success stories.

Examining real-world examples that showcase how effective business plans and feasibility studies contribute to business triumphs.

Apple Inc. : 

A business plan crafted by Steve Jobs outlined Apple's vision and product strategy, paving the way for its global success.

Tesla Inc. : 

Elon Musk's ambitious business plan and feasibility studies for electric vehicles revolutionized the automotive industry.

Strategic Evolution Over Time

The adaptive nature of business plans.

Unveiling the evolutionary aspect of business plans, showcasing how these strategic documents adapt to changing business landscapes.

Agile Business Plan : 

Introduction to the concept of agile business plan, emphasizing flexibility in strategic frameworks.

Market Trends : 

A section dedicated to the continuous monitoring of market trends, allowing businesses to adjust strategies accordingly.

Competitor Analysis :

 Regular assessments of competitors' strengths and weaknesses, providing insights for strategic refinement.

SWOT Analysis Updates : 

Periodic updates to the Strengths, Weaknesses, Opportunities, and Threats analysis, ensuring relevancy and effectiveness.

The Ongoing Role of Feasibility Studies

Post-implementation evaluation.

Highlighting the often overlooked role of feasibility studies post-implementation, examining how these studies continue to guide decision-makers.

Continuous Monitoring : 

The importance of continuous monitoring and evaluation after project implementation and Evaluating actual performance against performance metrics outlined in the feasibility study.

Risk Mitigation Strategies : 

Implementing and adjusting risk mitigation strategies based on real-world outcomes.

Adaptability Measures : 

Incorporating adaptability measures for unforeseen challenges.

Call Us Now 

Special offers for limited time on:

Feasibility Studies and Business Plans

Contact Us for More Information

For any inquiries or additional details, our team is here to assist you.

Email: [email protected] Phone: +2 010 90 140 820

Join the Start-up Revolution!

Embrace strategic development and witness your start-up reach new heights of success.

Addressing frequently asked questions to provide clarity on key aspects of business plans and feasibility studies.

Why is a business plan essential?

A business plan acts as a roadmap, guiding entrepreneurs and attracting investors by showcasing the company's vision and potential.

What distinguishes a feasibility study from a business plan?

While a business plan focuses on strategic direction, a feasibility study assesses the viability of a proposed project before substantial resources are committed. 

This indicates one of the main Business plan and feasibility study differences.

How often should a business plan be updated?

A business plan should be regularly reviewed and updated, especially when significant changes occur in the business environment.

Can a feasibility study guarantee project success?

While a feasibility study minimizes risks, success depends on dynamic factors. 

It provides insights for informed decision-making.

Are business plans only for startups?

No, established businesses also benefit from business plans, helping guide growth strategies and secure funding.

​ What happens if a feasibility study indicates high risks?

If significant risks are identified, decision-makers can modify the project, seek additional insights, or choose not to proceed.

Share this post

• Business Improvement Tips
• Success Stories

Start networking and exchanging professional insights

Register now or log in to join your professional community.

• Next Question:
• What are the most crucial assumptions feasibility studies we should consider?

• Ahmed Ibrahim Mohamed Khalil Kashif
• 25-June-2013

What's the difference between a feasibility study and a business plan?

A feasibility study is designed to discover if a business or project is “feasible” or not. Before anything is invested in a new business venture, a feasibility study is carried out to know if the business venture is worth the time, effort and resources.On the other hand, a business plan is developed only after it has been established by the feasibility report that the business is worth investing. This simply means that a business plan is prepared after a feasibility study has been conducted.

A feasibility study report is filled with calculations, analysis and estimated projections of a business opportunity and its viability for investment. While a business plan provides tactics and strategies to be implemented in other to start, run and grow the business successfully.

A feasibility study , or business opportunity analysis, is a planning tool similar to a business plan. The feasibility study is done to flesh out the possibilities in an initial business idea.

The business plan then fully describes the business and its financial projections.

Differences in feasibility study & business plan as below:

1.  A feasibility study is carried out with the aim of finding out the workability and profitability of a business venture. Before anything is invested in a new business venture, a feasibility study is carried out to know if the business venture is worth the time, effort and resources.

On the other hand, a business plan is developed only after it has been established that a business opportunity exist and the venture is about to commence. This simply means that a business plan is prepared after a feasibility study has been conducted.

2.  A feasibility report is filled with calculations, analysis and estimated projections of a business opportunity. While a business plan is made up of mostly tactics and strategies to be implemented in other to start and grow the business.

3.  A feasibility study is all about business idea viability while a business plan deals with business growth plan and sustainability.

4.  A feasibility study report reveals the profit potential of a business idea or opportunity to the entrepreneur, while a business plan helps the entrepreneur raise the needed startup  capital from investors.

business plan use after feasibility study and path for ur work

feasibility study use to know are our data to start business it is enough and good or need enhance and change

In addition to the answers, I would like to simplify it in this way:

1. Feasibility focuses more on financial, revenues and returns that the project will generate

2. Business plan is about describing steps, strategies and other related activities  involved in setting up the business !

A feasibility study is not the same thing as a business plan . A feasibility study , or business approach analysis, is a planning tool similar to a business plan . Hence, the feasibility study helps determine whether an idea or business is a viable option, a feasibility study is carried out to know if the business venture is worth the time, effort and resources. A feasibility study is filled with calculations, analysis and estimated projections while a business plan is made up of mostly tactics and strategies to be implemented in other to grow the business.

Thus, the business plan is developed after the business opportunity is created. None the less the feasibility study would be completed prior to the business plan or any business venture. Thereafter, the business plan then fully describes the business and its financial projections.

I agree with Mr.Vinod's answer.

Feasibility Study focus on all information to empower " investor " to decide to go to the Project or not based on the profitability of the project. The business plan is an extension of the feasibility study with details how the operation will be managed and financed. The business plan is simply a plan of how we will run our business after the investor already decided to go to the business operation of the project.

Popular Searches

More questions like this.

Do you need help in adding the right keywords to your CV? Let our CV writing experts help you.

Cancel Report Answer