How to Write Feasibility Studies

By Indeed Editorial Team

April 1, 2021

Whether you are preparing to start your own business or you want to implement a new
project to improve your business, there are a few professional strategies you can use to
ensure success, one of which includes conducting a feasibility study. By reviewing the
necessary components and preparation required to write a feasibility study, you can
create one that contributes to a successful business venture.

In this article, we define feasibility studies, review why they are important, outline some
key components included in a feasibility study and provide you with the steps you need
to learn how to write your own.

Related: How to Write a Case Study Step by Step (with Examples)

What is a feasibility study?

A feasibility study is a report that aims to determine the practicality, strengths and
weaknesses of a proposed project, existing system or corporation as a whole. Further,
feasibility studies also help professionals do the following:

 Plan a course of events to complete the project

 Identify the challenges that could arise
 List potential solutions that would come about as a result of the project

Two distinct components summarize all of these factors: Desired values to achieve and
the cost required to carry out the venture.

Related: Product Cost: A Definitive Guide (With Examples)

Why is a feasibility study important?

Feasibility studies are important because they encourage professionals to consider all
of the factors that go into a project or business start-up. These include areas such as
background, project summary, description of operations, market research and legal and
financial documents.

Furthermore, a well-written feasibility study can help project leaders gain the approval
they need to complete the project. By analyzing each of these areas and preparing a
plan of action, professionals can have the best chance of creating a successful project
that benefits the corporation or broader society.

Related: 5 Phases of the Project Management Life Cycle

Key components of a feasibility study

A feasibility study gathers essential company information and encourages investors,
company officials or other company employees to support a project. Here are some key
components of a feasibility study to consider including in your own:

 Title page
 Table of contents
 Executive summary
 Market feasibility
 Technical feasibility
 Financial feasibility
 Organizational feasibility
 Conclusion
 Appendix and reference pages

Title page

The title page is the first part of the feasibility study that your reader sees. You should
use a clear title that provides some insights into your project. A good example is
"Feasibility Study for Cultivating Unified Goals Across Departments."

Your title page should also include the names of the project leader and project members
along with their job titles. You might consider including the date the project is set to start
and estimated date for completion to provide more context about your time frame to the
reader.

Table of contents

The table of contents aims to provide the reader with easy access to any section within
the report. Complete your table of contents after you finish the report to make sure the
page numbers coincide with the section titles. Usually, your word processor has a table
of contents feature that makes creating this component quick and efficient.

Executive summary

The executive summary should be the first major component of your feasibility study. In
this section, you should include an introduction to the project, its purpose, desired
solutions and an overview of the sources you used to support the legitimacy of the
report.

Market feasibility

The market feasibility portion of your report provides the reader with insightful
information about company statistics, market research and the future outlook for the
company. Start by summarizing your company's industry. Discuss its history, current
practices and trends along with future projections for the industry as a whole.

Then you can start narrowing your focus to discuss how your company fits within this
industry. List your top competitors, your primary sources of revenue, sales figures and
potential niche areas you could pursue to expand your customer base.
The market feasibility section helps your reader gain more of an understanding of your
company, what it has to offer and how your feasibility project could benefit its growth.

Technical feasibility

The technical feasibility section outlines several operational factors that influence the
success of your business. Discuss your company's location, materials needed to create
the products or services you offer, the manufacturing process, quality assurance
facilities and necessary transportation to ship your products to retail locations.

The technical feasibility section provides your reader with a detailed understanding of
which factors maintain your business so you can continue delivering top-tier products
and services to your customer base. Additionally, this section helps support the
credibility of your financial feasibility section.

Financial feasibility

The financial feasibility section outlines all aspects of your company's finances to the
reader. In this section, you should include information about your investors, current
revenue, assets and liabilities as well as total annual revenue from the previous year.
You should also include a cost-benefit evaluation that helps support your business
needs.

The financial feasibility section aims to convince the reader to either invest their support,
funds or both into the proposed project by showing them the costs needed to maintain
business operations.

Organizational feasibility

The organizational feasibility section demonstrates your company's legal and ethical
practices to the reader. This section should include an outline of the general structure of
your company, such as branch locations or departments.

You might want to include a small bio for each of your founders or board members. You
can also benefit from highlighting the HR procedures that your company uses to
maintain ethical and legal responsibility toward employees, as well as motivational
methods you use to instill productivity in the workplace.

The organizational feasibility section helps the reader determine whether your
company's current practices complement or support the proposed project.

Conclusion

The conclusion is the last written section of your report before your appendix and
reference pages. This section summarizes each of the previous sections. You should
end the conclusion by highlighting one or more recommendations to motivate further
action on the topic. You can make these recommendations into a separate section if
they require more than a few sentences of explanation.

Appendix and reference pages

An appendix is an optional section, but it's usually beneficial for the reader of the report.
This section includes any information that the reader might find useful but which is not
directly relevant to the other topics discussed in your report. Regardless of whether or
not you choose to include an appendix section, you should include references.

A reference section can have one or more pages depending on the number of sources
you used to create your report. You can use company documents, scholarly articles
related to your industry, or any additional documents you wrote during the project's
completion. Be sure to use citations that adhere to the style guide you are using.

Related: How to Measure Productivity and Increase Efficiency in the Workplace

How to write a feasibility study

Here is a step-by-step guide to help you write your own feasibility study:

1. Describe the project.

2. Outline the potential solutions resulting from the project.
3. List the criteria for evaluating these solutions.
4. State which solution is most feasible for the project.
5. Make a conclusion statement.

1. Describe the project

The first part of a feasibility study includes a description of the project you want to
complete. You should highlight its purpose and main components that influence its
success. For example, "This project aims to use department education and best HR
practices to ensure the successful integration of new employees with the upcoming
merger."

2. Outline the potential solutions resulting from the project

Secondly, talk with your team to create some possible solutions that could result from
the project. This can help you later on in the process when you try to determine which
solution provides the most benefits.

For example:

 "Enhanced company productivity"

 "Positive workplace culture"
 "Satisfaction of new and existing employees alike"
 "Improved HR strategies and overall department"

3. List the criteria for evaluating these solutions

Thirdly, write out a list of rules for you and your team to accurately assess these
solutions. Consider criteria such as the potential for revenue, increased productivity,
better communication across departments, expansion of a product line or customer
satisfaction.
For example:

 "Number of new employees joining the branch during the merger"

 "Current state of the HR department and practices used"
 "Current workplace culture and employee optimism"
 "Projected revenue gained as a result of the merger"

4. State which solution is most feasible for the project

Fourthly, after deliberating with your team, make a statement about the solution to
which you want to guide your project. Make sure you include an explanation for why you
want to achieve this solution above the other options you discussed.

For example, "Based on the potential solutions offered by this merger project, we have
decided that the most feasible solution for both the project and the future of our
company is improved HR strategies and overall department. This is because the basis
of our success now and in the future relies on the talented onboarding efforts of our HR
team."

5. Make a conclusion statement

Lastly, the concluding statement helps you summarize your main points. You should
start by reiterating the statement made in your project description that defines it and
your reasoning for starting the project. Then, restate which solution you primarily want
to achieve through the project's completion and explain why you want this solution to
hold more significance than the other solutions.

For example, "The goal of this project is to give our HR department the resources they
need to coordinate a successful merger. We have chosen improved HR strategies and
overall department as the most feasible solution because our HR department serves as
a fundamental structure to other solutions, such as increased productivity, positive
workplace culture and job satisfaction among our employees."