Question

What information in detail will a company receive if they conduct a market and business feasibility study for a new location. For each piece of Information identify a source for this information.

Answer 1

Organizations are considering the business feasibility study for their new ventures in a new location in order to analyse some relevant factors including legal, social, economic factors to ascertain the strategic moves for establishing the project successfully. Hence it is essential to consider some factors which may affect the new projects in a negative way and with the help of feasibility study companies can collect pieces of information about these factors.

Scope: at first, organisations should analyse the scope of the new business in a new location. The company need to ensure whether their project can fulfil the demands of stakeholders and consumers, whether the community can accept this new business in this location or not.

• Cost: the company should examine the feasibility of the expenditure for establishing a business in a completely new geographic area. It is essential to analyse the cost-effectiveness before going for a new venture.

• Legal constraints: before targeting a new market for business organisations should examine if there are any legal obstacles they have to overcome. Holding a new market in a completely new location means unknown legal terms and conditions.

• Market condition: every business organisation should consider some market studies before planning for holding that market. Whether the market economy is shrinking or growing should be verified prior to the expansion of the business.

• Options: it is important to verify whether that particular location is already proliferated with the same services or products which the organisation is planning. It is essential to get some idea about the demographic factors of the new location.

References

Ground Floor Partners. (2019). Factors That Affect Feasibility Study Pricing | Ground Floor Partners.

Kenton, W. (2019). Considering a New Venture? Consider a Feasibility Study. [online] Investopedia.