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Feasibility and Business Planning

Feasibility and Business Planning. 2.1 Feasibility Analysis: Testing an Opportunity. What you will learn. Developing a Business Concept Testing the Concept in the Market. Developing a Business Concept. Turn an idea into a business concept

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Feasibility and Business Planning

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  1. Feasibility and Business Planning 2.1 Feasibility Analysis: Testing an Opportunity

  2. What you will learn . . . • Developing a Business Concept • Testing the Concept in the Market

  3. Developing a Business Concept • Turn an idea into a business concept • Business concept – a clear and concise description of an opportunity. • Four elements • The product or service • The customer • The benefit • The distribution

  4. Ask These Questions • What is the product or service being offered? • Who is the customer? • What is the benefit that is being provided? • How will the benefit be delivered to the customer?

  5. Writing a Concept Statement • Basically, put the answers to these questions together

  6. Feasibility Analysis • The process used to test a business concept. • Helps decide if there is demand. • Decides if business conditions are favorable. • Helps make a decision about the business concept.

  7. Testing the Concept • Test the Industry • Talk to customers • Test the product or service requirements • Evaluate the founding team • Study the competition • Look at start-up resources • Analyze the value chain

  8. Testing the Industry • Scan table from book

  9. Testing the Industry • Industry • Group of businesses with a common interest such as telecommunications, computers, retail and grocery

  10. Talking to Customers • Target Customers • Those most likely to purchase the product or service

  11. Testing the Product • Prototype • Working model of a new product.

  12. Evaluating the Founding Team • Does the team have the knowledge and skills to make the business successful?

  13. Studying the Competition • Competitive Grid • A tool for organizing important information about the competition. • Competitor • Customer • Benefits • Distribution • Strengths/Weaknesses

  14. Competitive Grid • Page 98

  15. Looking at Start-up Costs • Business Model • Describes how you intend to make money with your business concept. • Purchase/lease equipment, furnishings/facility • Buy inventory and supplies • Pay employees • Finish product development • Carry the expenses until you have sales and a positive cash flow

  16. Analyze the Value Chain • The distribution channel through which your product or service flows from the producer to the customer. • Manufacturers, distributors, retailers • Deliver maximum value for least possible cost • Each link adds value (cost) • Make it more efficient (cheaper)

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