Feasibility Study Course Lesson 2 – How to Write a Market Feasibility Study

Part 1 - What is a Market Study & How to Describe Your Industry

By Lahle Wolfe, About.com Guide

A market feasibility study should analyze a variety of potential business scenarios and assess both pros and cons.

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Feasibility Study Course Index - List of All Lessons

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Purpose of Lesson: To assist business women in identifying market competition, potential markets, and market analysis to assess a business idea.

What is a Market Feasibility Study and How Does a Market Feasibility Study Differ From a Marketing Plan?

All feasibility studies should look at how things work, if they will work, and identify potential problems. Feasibility studies are done on ideas, campaigns, products, processes, and entire businesses.

Feasibility studies are assement tools - not just reports to try and sell your business to investors. They should consider both pros and cons and analyze a variety of potential business scenarios.

A Marketing Plan maps out specific ideas, strategies, and campaigns based on feasibility study investigations, that are intended to be implemented.

Think of market feasibility studies as a logistical study and a marketing plan as a specific, planned course of action to take.

What Should be Included in a Market Feasibility Study?

Things to Include in a market feasibility study include:

Description of the Industry
Current Market Analysis
Competition
Anticipated Future Market Potential
Potential Buyers and Sources of Revenues
Sales Projections

How to Write an Industry Description

Give a brief one- to two-paragraph description of the industry your business is categorized as according to the U.S. Department of Labor. Determining your industry is important for receiving government contracts, attracting investors, and for receiving grants (if you form as a nonprofit).

Example: The industrial first aid kit industry is a lucrative, fast-growing field, with contract awards as high as $14 million dollars in 2006. Fictitious Business Example (FBE) is being established for the purpose of producing, and providing, quality industrial first aid kits to the United States Government, privately-held and publicly-held companies to improve worker's safety on the job.

FCE's services are classified under the U.S. Department of Labor Standard Industrial Classification (SIC) as SIC Code 5047 and classified as the industry titled, "Medical, Dental, and Hospital Equipment and Supplies."

Tip: To find your company's Standard Industrial Classification (SIC) go to the U.S. Department of Labor, OSHA web page located at http://www.osha.gov/pls/imis/sicsearch.html