Full Feasibility Analysis

Full Feasibility Analysis
From Preparing Effective Business Plans by Bruce R. Barringer
Note: All fields can be expanded to provide additional space to respond to the questions. A
copy of this template, along with each of the assessment tools, is also available in
PDF format at the authors Web site at www.prenhall.com/entrepreneurship.
Introduction
A. Name of the proposed business
Chocolate Caf with Paintball.
B. Name of the founder (or founders)
Siriwat Tumthong
C. One paragraph summary of the business
The chocolate Caf will offer a variety of chocolate-based food and drinks, with
the addition of an indoor paintball ground.
Part 1: Product/Service Feasibility

Issues Addressed in This Part
A. Product/service desirability
B. Product/service demand
Assessment Tools
Concept Statement Test
Write a concept statement for your product/service idea. Show the concept statement
to 5 to 10 people. Select people who will give you informed and candid feedback.
Attached a blank sheet to the concept statement, and ask the people who read the
statement to (1) tell you three things they like about your product/service idea, (2)
provide three suggestions for making it better, (3) tell you whether they think the
product or service idea is feasible (or will be successful), and (4) share any additional
comments or suggestions.
Summarize the information you obtain from the concept statement into the following
three categories:
* Strengths of the product or service ideathings people who evaluated your

product or service concept said they liked about the idea
* Suggestions for strengthening the ideasuggestions made by people for
strengthening or improving the idea
* Overall feasibility of the product or service conceptreport the number of
people who thing the idea is feasible, the number of people who think it isnt
feasible, and any additional comments that were made
* Other comments and suggestions
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Buying Intentions Survey
Distribute the concept statement to 15 to 30 prospective customers (do not include
any of the people who completed the concept statement test) with the following
buying intentions survey attached. Ask each participant to read the concept statement
and complete the buying intentions survey. Record the number of people who
participated in the survey and the results of the survey here.
Along with the raw data recorded here, report the percentage of the total number of
people you surveyed that said they would probably buy or definitely would buy your
product or service if offered. This percentage is the most important figure in gauging
potential customer interest.
One caveat is that people who say that they intend to purchase a product do
not always follow through, so the numbers resulting from this activity are almost
always optimistic. Still, the numbers provide you with a preliminary indication of
how your most likely customers will respond to your potential product or service
offering.
How likely would you be to buy the product or service described above?
___0___ Definitely would buy
___1___ Probably would buy
___4___ Might or might not buy
___5___ Probably would not buy
___1___ Definitely would not buy
Additional questions may be added to the buying intentions survey.
Conclusion (expand fields and report findings, in discussion form, for each area)
A. Product/service desirability
Its for teenager because teenagers dont have that much to do apart from walking
around, watching movie, or go shopping. This will take advantage of that gap.
There is a fatal flaw in the paintball part; the chocolate would drive ants into the
Caf.
B. Product/service demand
The people didnt like the idea much. More people would not buy it than they
would buy it.
C. Product/service feasibility (circle the correct response)
Not Feasible Unsure Feasible
D. Suggestions for improving product/service feasibility.
The chocolate paint ball should just change to paint ball with normal paint instead
of using chocolate and just use black and white paint ball.
Part 2: Industry/Market Feasibility

A. Industry attractiveness
B. Target market attractiveness
C. Timeliness of entry into the target market
Assessment Tools
Industry Attractiveness
To the extent possible, assess the industry at the five-digit NAICS code level your
potential business will be entering. Use a broader industry category (less NCICS
digits) if appropriate (http://www.census.gov/epcd/www/naicstab.htm).
Assess the attractiveness of the industry the potential business plans to enter on each
of the following dimensions.
Industry Attractiveness Assessment Tool

(used to assess the broad industry, rather than the specific target market, you plan
to enter)
Low Potential Moderate Potential High Potential
1. Number of competitors Many Few None
2. Age of industry Old Middle aged Young
3. Growth rate of industry Little or no Moderate growth Strong growth
growth
4. Average net income for Low Medium High
firms in the industry
5. Degree of industry Concentrated Neither Fragmented
concentration concentrated nor
fragmented
6. Stage of industry life Maturity Growth phase Emergence

cycle phase or phase
decline phase
7. Importance of industrys Ambivalent Would like to Must have
products and/or services have
to customers
8. Extent to which business Low Medium High
and environmental
trends are moving in
favor of the industry
9. Number of exciting new Low Medium High
product and services
emerging from the
industry
10. Long-term prospects Weak Neutral Strong
Target Market Attractiveness

Identify the portion or specific market within your broader industry that you plan to
target.
Assess the attractiveness of the target market on each of the following dimensions.
Target Market Attractiveness Assessment Tool

(used to assess the specific target market, rather than the broader industry, you plan
to enter)
1. Number of competitors Many Few None
in target market
2. Growth rate of firms in Little to no Slow growth Rapid growth
the target market growth
3. Average net income for Low Medium High
firms in the target
market

4. Methods for generating Unclear Somewhat clear Clear
revenue in the industry
5. Ability to create barriers Unable to May or may not be Can create
to entry for potential create able to create
competitors
6. Degree to which Satisfied Neither satisfied or Unsatisfied
customers feel satisfied by dissatisfied
the current offerings in the
target market
7. Potential to employ low Low Moderate High
cost guerrilla and/or buzz
marketing techniques to
promote the firms product
or services
8. Excitement surrounding Low Medium High
new product/service
offerings in the target
market
Market Timeliness
Determine the extent to which the window of opportunity for the proposed business
is open or closed based on the following criteria.
Determine the timeliness of entering a specific target market based on other criteria.
Market Timeliness Assessment Tool

1. Buying mood of Customers are Customers are in a Customers are
customers not in a buying moderate buying in an aggressive
mood mood buying mood
2. Momentum of the market Stable to losing Slowly gaining Rapidly gaining
momentum momentum momentum
3. Need for a new firm in the Low Moderate High
market with your offerings
or geographic location
4. Extent to which business Low Medium High
and environmental trends
are moving in favor of the
target market
5. Recent or planned Large firms Rumors that large No larger firms
entrance of large firms entering the firms may be entered the
into the market market entering the market market or are
rumored to be
entering the
market

A. Industry attractiveness
The industry attractiveness is moderate. Although there were not much firms to
compete with, its hard to know if the customer will be interested or not as its not
important to their life. There is not much change in the technology because not
much people help with the paintball industry, however the paintball industry is still
growing thus our business will hire someone to find ways to improve with the
industry.
B. Target market attractiveness
The target market is attractive because the growth in teenagers targeted company
are rapid and their buying power is increasing. Moreover, there was not much
competitor for the business so its easier to feast from this target market.
C. Market timeliness
The timing is quiet great is because there are not much competitor and the
customer are willing to spend money. The customer has not had other alternative to
choose from and the industry of adventurous entertainment and gaining the
momentum.
D. Industry/market feasibility (circle the correct response)
E. Suggestions for improving industry/market feasibility.
Should make the business more attractive with good use of media and
advertisement.
Part 3: Organizational Feasibility

A. Management prowess
B. Resource sufficiency
Assessment Tools
Management Prowess
Use the following table to candidly and objectively rate the prowess of the founder
or group of founders who will be starting the proposed venture.
Management Prowess Assessment Tool

1. Passion for the business Low Moderate High
idea
2. Relevant industry None Moderate Extensive
experience
3. Prior entrepreneurial None Moderate Extensive
experience
4. Depth of professional Weak Moderate Strong
and social networks
5. Creativity among Low Moderate High
management team
members

6. Experience and expertise None Moderate High
in cash flow
management
7. College graduate No college Some college Graduated or
education education but not are currently
currently in college in college
Resource Sufficiency
The focus in this section is on nonfinancial resources. Use the following table to rate
your resource sufficiency in each category.
The list of resources is not meant to be exhaustive. A list of the 6 to 12 most critical
nonfinancial resources for your proposed business is sufficient.
An explanation of the rating system used in the first portion of the table is as follows:
1 Available
2 Likely to be available: will probably be available and will be within my budget
3 Unlikely to be available: will probably be hard to find or gain access to, and
may exceed my budget
4 Unavailable
5 NA: not applicable for my business
Resource Sufficiency Assessment Tool

Ratings Resource Sufficiency
1 2 3 4 5 Office space
1 2 3 4 5 Lab space, manufacturing space, or space to launch a
service business
1 2 3 4 5 Contract manufacturers or outsource providers
1 2 3 4 5 Key management employees (now and in the future)
1 2 3 4 5 Key support personnel (now and in the future)
1 2 3 4 5 Key equipment needed to operate the business
(computers, machinery, delivery vehicles)
1 2 3 4 5 Ability to obtain intellectual property protection on key
aspects of the business
1 2 3 4 5 Support of local and state government if applicable for
business launch
1 2 3 4 5 Ability to form favorable business partnerships
Ratings: Strong, Neutral,
or Weak

Strong Proximity to similar firms (for the purpose of knowledge
sharing)
Neutral Proximity to suppliers
Strong Proximity to customers
Weak Proximity to a major research university (if applicable)
A. Management prowess
The Founder has no experience in the field of business and has not graduated yet.
However, the owner is full of passion and love and is learning as best as he could
to be able to manage the business.
B. Resource sufficiency
Resource is affordable with some difficulty and might not be as good as it was
planned to be. Partnership are yet to be taken into consideration as the business is
not yet stable enough to accept big decision and would not be able to take that
much risk.
C. Organizational feasibility (circle the correct response)
D. Suggestions for improving organizational feasibility
Should study and learn more about business first before starting your own business
with no knowledge or experiences.
Part 4: Financial Feasibility

A. Total startup cash needed
B. Financial performance of similar businesses
C. Overall financial attractiveness of the proposed venture
Assessment Tools
Total Start-Up Cash Needed
The startup costs (which include capital investments and operating expenses) should
include all the costs necessary for the business to make its first sale. New firms
typically need money for a host of purposes, including the hiring of personnel, office
or manufacturing space, equipment, training, research and development, marketing,
and the initial product rollout.

At the feasibility analysis stage, it is not necessary for the number to be exact.
However, the number should be fairly accurate to give an entrepreneur an idea of the
dollar amount that will be needed to launch the firm. After the approximate dollar
amount is known, the entrepreneur should determine specifically where the money
will come from to cover the startup costs.
The total startup cash needed can be estimate using the following table.
Total Startup Cash Needed (to Make First Sale)
Capital Investments Amount
Property 1,000,000(1month)
Furniture and fixtures 1,000,000
Computer equipment 100,000
Other equipment 500,000
Vehicles 400,000

Operating Expenses Amount
Legal, accounting, and professional services 30,000(1month)
Advertising and promotions 100,000
Deposits for utilities
Licenses and permits 200,000
Prepaid insurance 500,000
Lease payments 30,000(1month)
Salary and wages 200,000
Payroll taxes 14,000
Travel 50,000
Signs 10,000
Tools and supplies 50,000
Starting inventory 200,000
Cash (working capital) 100,000
Other expense 1
Other expense 2
Total Startup Cash Needed = 4,454,000
Comparison of the Financial Performance of Proposed Venture to Similar Firms

Use the following tables to compare the proposed new venture to similar firms in
regard to annual sales (Year 1 and Year 2) and profitability (Year 1 and Year 2).
Comparison of the Financial Performance of Proposed Venture to Similar Firms

Assessment Tool

Annual Sales
Estimate of Proposed Ventures Explanation of How the Estimate

Annual SalesYear 1 Was Computed
Estimate of Year 1 Sales ____18,432,000______ 1game = 800baht per person
Summary: How proposed annual sales, on 1week =480 people

average, compares to similar firms (circle one)
800 * 48 * 480 =18,432,000
Below Average Average Above Average
Estimate of Year 2 Sales ____30,720,000______ 1game = 800baht per person
Summary: How proposed annual sales, on 1week = 800 people

average, compares to similar firms (circle one)
800 * 48 * 800 =30,720,000
Net Income
Estimate of Proposed Ventures Explanation of How the Estimate

Net IncomeYear 1 was Computed
Estimate of Year 1 Net Income 12 month rent=12,000,000
____2,648,000______
Other expense=3,784,000
Summary: How proposed net income, on
average, compares to similar firms (circle one) Income =18,432,000
Below Average Average Above Average Net Income=18,432,000

15,784,000= 2,648,000
Estimate of Year 2 Net Income 12 month rent=12,000,000
____14,936,000______
Other expense=3,784,000
Summary: How proposed net income, on
average, compares to similar firms (circle one) Net Income=30,720,000
15,784,000= 14,936,000
Overall Financial Attractiveness of the Proposed Venture

The following factors are important in regard to the overall financial attractiveness of
the proposed business.
Assess the strength of each factor in the following table.

Overall Financial Attractiveness of Proposed Venture Assessment Tool
1. Steady and rapid growth in Unlikely Moderately likely Highly likely
sales during the first one to
three years in a clearly
defined target market
2. High percentage of Low Moderate Strong
recurring incomemeaning
that once you win a client,
the client will provide
recurring sources of
revenue
3. Ability to forecast income Weak Moderate Strong
and expenses with a
reasonable degree of
certainty
4. Likelihood that internally Unlikely Moderately likely Highly likely
generated funds will be
available within two years
to finance growth
5. Availability of exit Unlikely to be May be available Likely to be
opportunity for investor if unavailable available
applicable
Conclusion (report finding for each area)

A. Total startup cash needed
4,054,000
B. Financial performance of similar businesses
Make more profit than the other business. Most Business make 10,800,000
because their business are far away, this make the tourist their main customer. Our
business is in the city so its more convenient for the customer to come and play.
C. Financial feasibility (circle the correct response)
D. Suggestions for improving financial feasibility
Make the some cheap viral promotion to gain more customers. Lower the expense
that doesnt help in making profit like some ingredient for the menu that doesnt
sell well. Changing the location to a cheaper location would also help with the cost
of the business.
Overall Feasibility: Summary and Conclusion

Overall Feasibility of the Suggestions for Improving
Business Idea Based on the Feasibility
Each Part
Product/Market Feasibility Not feasible The chocolate paint ball
Unsure should just change to paint
Feasible ball with normal paint

instead of using chocolate
and just use black and with
paint ball.
Industry/Market Feasibility Not feasible Should make the business

Unsure more attractive with good
Feasible use of media and
advertisement.
Organizational Feasibility Not feasible Should study and learn
Unsure more about business first
Feasible before starting your own
business with no
knowledge or experiences.
Financial Feasibility Not feasible Make the some cheap viral
Unsure promotion to gain more
Feasible customers. Lower the
expense that doesnt help
in making profit like some
ingredient for the menu
that doesnt sell well.
Changing the location to a
cheaper location would
also help with the cost of
the business.
Overall Assessment Not feasible Lower the cost and gain
Unsure more experiences in the
Feasible business field first before
opening the business
yourself.
Conclusionbriefly summarize your justification for your overall assessment.

This caf is for teenager because teenagers dont have that much to do when they
went to a mall. This will take advantage of that gap by operating as a caf and a paintball
field, which will serve as a new choice for the people and still continuing the concept of a
caf thats in the mall. There is a fatal flaw in the paintball part; the chocolate would
drive ants into the Caf. The people didnt like the idea much. More people would not
buy it than they would buy it.
The industry is moderately attractive, as there were not much firms to compete
with. However, its hard to know if the customer will be interested or not as its not
important to their life. But as entertainment market is still growing, the momentum might
be in our favors. As there are not many firms in the field, when the momentum came, the
profit will be massive. The timing is also great as there were no huge competitor to come
in the market.
The management prowess is not good. The experience is not enough for opening
the business but this means that there are rooms for improvement before actually opening
the business. The owner is interested in the business and would put so much effort into

making the company good. The resource is affordable with some difficulty and will not
be as good as it would exceed the budget. Thus, the quality and the quantity will have to
be reduced.
The start up value is low but it excludes the monthly rent thats needed to be paid.
However, from estimation, the net profit from the fist year would already be enough to
paid for the business. The advertising will be viral and cheap, and would attract customer
to be interested in the game. More importantly, the game is cheap considering the price of
similar firms and the location its in.
To conclude, theres a high chance that the company will be successful from the
fact that this firm is relatively cheap and would attract customer considering the location.
There were not many firm in the business thus will grant us advantages when the
paintball market start gaining its momentum.

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Full Feasibility Analysis

From Preparing Effective Business Plans by Bruce R. Barringer

Part 1: Product/Service Feasibility

* Strengths of the product or service ideathings people who evaluated your

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Part 2: Industry/Market Feasibility

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Industry Attractiveness Assessment Tool

6. Stage of industry life Maturity Growth phase Emergence

Target Market Attractiveness

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Target Market Attractiveness Assessment Tool

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Market Timeliness Assessment Tool

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Part 3: Organizational Feasibility

Management Prowess Assessment Tool

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Resource Sufficiency Assessment Tool

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Part 4: Financial Feasibility

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Total Startup Cash Needed (to Make First Sale)

Capital Investments Amount

Furniture and fixtures 1,000,000

Computer equipment 100,000

Other equipment 500,000

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Legal, accounting, and professional services 30,000(1month)

Advertising and promotions 100,000

Deposits for utilities

Licenses and permits 200,000

Prepaid insurance 500,000

Lease payments 30,000(1month)

Salary and wages 200,000

Payroll taxes 14,000

Tools and supplies 50,000

Starting inventory 200,000

Cash (working capital) 100,000

Total Startup Cash Needed = 4,454,000

Comparison of the Financial Performance of Proposed Venture to Similar Firms

Comparison of the Financial Performance of Proposed Venture to Similar Firms

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Estimate of Proposed Ventures Explanation of How the Estimate

Summary: How proposed annual sales, on 1week =480 people

Summary: How proposed annual sales, on 1week = 800 people

Estimate of Proposed Ventures Explanation of How the Estimate

Below Average Average Above Average Net Income=18,432,000

Overall Financial Attractiveness of the Proposed Venture

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Conclusion (report finding for each area)

Overall Feasibility: Summary and Conclusion

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Industry/Market Feasibility Not feasible Should make the business

Conclusionbriefly summarize your justification for your overall assessment.

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall

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