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?
Here are some basic differences:
- 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.
- 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.
- 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.
- 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.
- 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.