Management

Purpose: The purpose of this assignment is to conduct a feasibility analysis of a business idea (product/service) to determine its commercial viability in the marketplace. The business idea must be yours, not an existing one.

Product/service feasibility analysis is an assessment of the overall appeal of a product or service being proposed. Before rushing a product into development and/or starting a new business, a firm should be confident that it is what customers want and that the product or service will have an adequate market. Concept testing and usability testing are the two primary techniques used in feasibility analysis. A concept test is usually followed by the development of a prototype or model of the product as appropriate and necessary to get feedback regarding its usability from potential customers. We shall concentrate on concept testing (using a concept statement) for this assignment.

At the end of this quarter, you will take a copy of your feasibility analysis report to the Entrepreneurial Capstone class, where you will develop a business plan. Having completed a feasibility analysis report means that you have conducted an in-depth research on the commercial viability of your business idea, and the result is good enough to put together a business plan. The components of a concept statement (to be used as your Table of Contents) are as follows:

Description of the Product or Service Being offered (Introduction): This section describes your business idea and/or concept. (7 points)
The Intended Target Market/Industry Analysis: This section states the businesses or people who are expected to buy the product or service. In this section, you will identify and cite as many credible sources as you can (ten minimum) that show the size of the potential market. This is an important area in feasibility analysis, because the idea will not get anywhere, if there are no customers for it. Describe your customer in great detail, who are they, where do they shop, what is their income, etc. Also state in this section, who the top competitors are and the market share/position of each. Find out how much money they are making and how much money is being made in the industry. You must also show money is being spent in your industry. In this section you must quote your ten sources. I will count them. (20 points)
The Benefits of the Products or Service: This section describes in detail, the benefits of the business idea (product and/or service) and includes an account of how the product or service adds value and/or solves a customer need. Make your case here and be specific as to the benefits and features that could attract and keep loyal customers for the new product/idea, once you are ready to take it to market. (12 points)
A Description of How the Product will be Positioned Relative to Similar Ones in the Market: A company’s position describes how its products or service is (or will be) situated relative to the competitors. What you are doing in this section is basically a SWOT Analysis. (10 points)
A Description of How the Product or Service will be Sold and Distributed: This section specifies whether the product will be sold directly by the manufacturer or through distributors and franchisees. (7 points)
A Break-Even Analysis for the 1st Year: You will need to project expenses to the anticipated time of break even so you can determine when that might occur and the amount of financial resources you will need until the company is cash flow positive. The most critical time is the first 12 months, but if break-even won’t occur for two years, then you need a two year projection. (10 points)