Preparing feasibility reports of alternative farm enterprises

A feasibility report comes at the end of a feasibility study. Therefore, in order to understand feasibility report writing it is important to understand what a feasibility study is in the first place.

Feasibility Study of Any Business

A feasibility study of any business is basically an analysis of how probable it is that a given project will succeed, when all of the relevant factors have been taken into account. The last part is crucial: in order to say that a feasibility study is valid, it should have taken into account all of the factors that could influence the outcome of a project. Usually, they are grouped into political factors, technical factors, economic factors, scheduling factors, legal factors, and so on, depending on their characteristics.

Before money and time can be invested in a project, a feasibility study should be conducted, and a feasibility report written. The project manager will then review the feasibility report and determine the positives and negatives of the project and whether it makes sense to make any investment in it or whether it should be shelved or modified.

A Feasibility Study Example

As an example, let’s take a company that is considering the relocation of its headquarters. Amazon, the largest online marketplace, has been in the news lately for considering various large cities for its headquarters. Before it can finally settle on a new headquarters, it will have to perform a feasibility study and take into account various factors to figure out whether the relocation makes sense or not.

Some of these factors include both the labor and material costs of the relocation. The employees will be disrupted by that relocation, and therefore that should be taken into account. Also, public opinion on the relocation as well as its social, legal, economic, and political impact should be considered. All of these factors are crucial in determining whether relocating the headquarters to a particular city makes sense.

Feasibility Study Goals

A feasibility study will test whether something is viable or not. That something could be a project, a new business, or even something as simple as an idea. The whole point of the feasibility study isn’t to tell you what could go right if you follow through with the project; the feasibility study examines what could possibly go wrong and whether, after considering all the potential negatives, it still makes sense to go through with the project. Feasibility studies are also great for obtaining funding as a report that shows that a project is feasible will inspire confidence in potential investors and creditors and make it easier to get funding from them.

The Elements of a Feasibility Study

A feasibility study isn’t one big block of action. Instead, there are components to it, and each component concerns itself with one thing at a time.

The Description
This is a layout. It describes the business and what it offers in terms of products and services. It also describes how the business will make its products and services available.

Market Feasibility
This is a description of the industry within which the project will take place; its market. It talks about the current and future potential, the competition the project will be facing, estimations of the sales, and so on.

Technical Feasibility
This is all about the how of the feasibility. How will the project deliver what it wants to deliver? How will the business deliver its products and services? It includes the manufacture, transportation, required technology, labor, and raw materials, among others.

Financial Feasibility
This is all about the money aspect of the project. How much funding will the project need? Where will the funding come from? How much return on investment can be expected? All of these questions and many others will be answered through a financial feasibility study.

Organizational Feasibility
This is the part of the study that concerns itself with the legal and corporate structure of the new project. It includes a lot of information about the people behind the project, including their backgrounds and the skill sets they possess to bring the project to life.

Feasibility Study on Fish Farming

Fish farming is also known as aquaculture and is big business with an increasing number of opportunities in the field. There is a growing demand for fish as a source of food due to their healthy nature. A small fish farm is also fairly easy to start because you don't need much in the way of requirements and you also won’t have to investment is modest.

A feasibility study on fish farming would look at the viability of the farm; how much it will cost to set up; and also how profitable it will likely be. The feasibility report should contain certain ideal business elements.

Introduction of the Report

This is a summary of the entire project. You can start by discussing the general importance of small-scale fish farming. You can talk about how fish farming will benefit you individually, as well as how it can benefit society as a whole. Also, talk about how you will carry out the project.

The Description of the Report

This part is like an expansion on the introduction, but with a deeper look at some of the major details. You can talk about the specific location in which you will carry out the project, as well as the amount of money needed to get it up and running; and also of how you expect to raise that money. At this point, you can talk about the mission of the project, as well as its vision. You can also write about the history and background of the project and of your motivations behind your desire to start this business.

The Description of the Market

This is all about how you will sell your fish. Start by defining the industry in which you will be operating and where you fit in that industry. For example, will you be selling your fish at wholesale? Or retail? You should also have a clear description of your target market and how you you plan to reach that market, as well as the marketing strategies that you will use.

The Description of the Products

Talk about the kinds of fish you will have in your farm. How will you price them? What led you to choose those specific species? What is your competitive advantage with your species mix?

The Organizational Plan

What will be the legal structure of your business? Will it be a sole proprietorship? A partnership? What licenses and permits will you need to run the business? What about the staff? What special skills will they need? How will you organize them?

The Marketing Plan

You may have described the marketing strategies that you intend to use, but you now need to have a solid plan for those strategies. The market research needs to be planned in detail. You need to know the different market segments available to you and how they differ from each other in terms of income, lifestyle, and spending. You need to outline the strategies that you will use to market to each of these segments, so that you will be able to solve their problems and your edge over your competitors.

The Financial Management

Where will the capital for the fish farm come from? How will you use that capital? What profits do you expect and how will you reinvest them back into the business? How will you prevent losses from occurring - or, at least to reduce the losses when they do occur? You can hire a professional accountant to help you with this part.

The Conclusion of the Report

This part has your conclusion and recommendations as to whether or not to carry out the project.

What is a Business Feasibility Report?

Business feasibility reports are analyses of a proposed venture or project that looks into the following areas:

• A description of the idea or project
• Analysis of the market for the products or services
• Competition
• Technical issues involved
• How the organization will be structured
• Financial projections