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Throughout my business consultancy, I have often had to explain to my clients the difference between a business plan and a feasibility study. Many Filipinos seem to get those two terms confused. As such, I have decided to share the knowledge and experience I have on the subject with aspiring entrepreneurs and business owners.

Why is there some confusion between a feasibility study and a business plan? Some say they’re one and the same, whereas others will argue that they’re not. So, which is it?

Actually, it is quite understandable why people are confused. The process that goes through writing a business plan is also the same process we go through when writing a feasibility study. Yet, though the processes involved are similar, there are some basic difference between a feasibility study and a business plan.

Here are some basic differences:

  1. Feasibility studies can be used for non-business projects. Often, this is a general report used to determine whether to move forward with a project or not. You can have feasibility studies for scientific research, information technology research, and/or business research.
  2. For business, feasibility studies are done in order to find out if the business venture you want to get into is workable and profitable. Before investing in a start-up business venture, a feasibility study can be carried out to know if the business venture is worth it. 
  3. A business plan, however, is done only after the viability of the business venture has been established. A business plan is often prepared after a feasibility study has been conducted.
  4. A feasibility study is mostly filled with calculations, analysis and estimates. The importance of a feasibility study is “measurement”.  This is why feasibility plans are often more complex and longer than business plans… it deals with a whole lot of data.
  5. A business plan, however, is made up mostly of marketing strategies and other processes that have to be implemented in other to grow the business. A business plan should not be a very thick report.

To sum it up, a feasibility study is all about business idea viability; whereas, a business plan deals with business growth and sustainability.
 


Comments

Tatz Molina
04/17/2012 3:41pm

I learn more from this website...thanks Our Knowledge.Asia

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04/17/2012 8:51pm

Hi Tatz! Wow! Thanks for your comment. It made my day. :)

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Oliver Arango
04/17/2012 10:28pm

Feasibility is simply pre-requisite to find viability of the project while biz plan helps to realize and achieve the goal & objectives of the biz within time.

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04/17/2012 11:57pm

That's absolutely right, Oliver. However, there are still many people who don't know that. :)

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04/19/2012 2:49pm

Hi Boom,

Thank you for sharing your insights here. I think I should be visiting this site on a regular basis. Well defined and concise explanation.

Keep writing and keep sharing Boom, I'm loving your site:) Stay blessed!

Reply
04/19/2012 6:46pm

Hi Gellie! Thanks for your comment. Just drop by any time. The learning is free! :)

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Olie
05/02/2012 3:13pm

Very informative article. I hope you don't mind if i capture a copy of this and save it for my reference? Thanks...

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05/02/2012 5:00pm

Hi Olie!

It's okay. You can copy this article if you want. Glad to be of help. You might also want to check out my latest article (also in this blog), "Conducting a Feasibility Study".

Cheers!

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Esy
05/18/2012 8:13pm

Yes! Got it. M an economics student n i was askd dis in the examination.

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05/21/2012 8:07pm

Hi Esy!

Wow! I'm glad this article helped you. I hope you passed your exam with flying colors! :)

Boom

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07/20/2012 6:23pm

Excellent tips. Really useful stuff. Never had an idea about this will look for more of such informative posts from your side. Good job Keep it up.

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07/21/2012 4:01am

Thanks for your kind words, Anne. I'm looking forward to collaborating with you on certain (Philippine-India) projects soon! :)

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Roanne
09/10/2012 10:54am

Thanks! This will help a lot with my report! I'm super scared of my prof but this will help! Don't worry I will indicate my sources! THANKS BOOM!

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09/10/2012 9:02pm

Glad I could help, Roanne. Don't worry. This is free information. :)

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09/14/2012 6:50am

I'm just browsing around your site for the first time, interesting read

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Salvador
09/14/2012 9:39am

I'm suppose to read one of your article but here I am, stuck on this page reading every single article (he he he) Sir Boom you really ROCK!

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Boom San Agustin
01/09/2013 2:53pm

Thanks Buddy! You rock harder!!! happy 2013!

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Blessing Abecan
10/04/2012 2:02pm

Wow!That was an excellent job.Now convinced.Thanks

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Kato Denis
01/06/2013 11:58pm

I was one of those who could not make clear distinction between the two,however today i can definitely distinguish the two,thank you for this educative note

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Boom San Agustin
01/09/2013 2:54pm

Glad I could be of help, Kato! Have a prosperous 2013!

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opeyemipopcy
05/14/2013 4:39am

Nice answers..and impacting contribution. Kudus to you all......about biz plan and feasibility study.

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Boom San Agustin
09/07/2013 2:59am

Thank you for your comment. I'm glad I was able to engage you with this article.

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CubeSotto
06/14/2013 11:46am

This is sooo helpful. I had a homework and asked us to research about the difference between the both of 'em. Now, I am not confused anymore. Thanks to you! God bless!

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09/07/2013 3:01am

I'm glad I could help clear the air for you, CubeSotto.

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09/06/2013 7:38pm

Your thoughts about "Business planning" are admirable. It seems you have the rich knowledge about this area. Let me tell that you have written an excellent article. Keep up the good writing. Your contents are amazing and facts are true. I agree to all of your points that you have mentioned.

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09/07/2013 3:04am

Thank you, sir or ma'am! Yes, I actually do both feasibility studies and business plan writing for my clients.

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10/16/2013 4:23pm

I must say the blog post is just useful for everyone else reading it because the information and knowledge it contains is very important. I like the post.

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