Tips for Writing a Technical Feasibility Study

Tips for Writing a Technical Feasibility StudyTips for Writing a Technical Feasibility StudyA technicalfeasibilitystudy assesses the details of how you intend to deliver a product or service to customers. Thinkmaterials, labor, transportation, where your geschftlicher umgang will be located, and the technology that will be necessary to bring all this together. Itsthe logistical or tactical plan ofhowyour business will produce, store, deliver, and track its products or services. A technicalfeasibilitystudy is an excellent tool for both troubleshooting and long-term planning. It can serve as a flowchart of how your products and services evolve and move through your business to physically reach your market. Begin- or End- With an Executive Summary The word summary is key here. Highlight the key points of each section youll include in your technical feasibility study. You can do this in advance to provide yourself with a sort of guideline or skeleton to follow as you prepare your stu dy. It is often easier and mora concise to write it after youve finished, so you have the information you want to include right in front of you. In either case, the summary should appear at the beginning of your technical feasibility study. Preparean Outline Even if you decide to write your executive summary last, you can begin with an outline that will serve a similar purpose in guiding you through the remainder of the study. The order in whichyou present technical information isnt as important as making aya you have all the components in place to show how you can run your business. You donthave to include specific financial information in the technical portion of yourfeasibilitystudy. However, all information in this component should support financial datarepresented elsewhere. Basic areas youll want to cover include materials, labor, transportation or shipping, physical location, and technology. Be sure to include a thorough description of the services or products youll be of fering. How will your business benefit consumers? Give investors a reason to choose you over your competitors. Calculate Material Requirements List the materials youll require to produce a product or service. This section is where youll indicate where youll get those materials. Include information such as whether volume discounts will be available as your business grows or if you plan to manufacture your parts at some point in time. Include what parts and supplies youll need to produce a product, including things like glue and nails. Mention all materials that will be involved in producing or manufacturing what youre selling. You dont have to include actualfinancial data in this portion of the study either. However, financial data that supports your narrative assessment should be included as an attachment in a separate spreadsheet. CalculateLabor Requirements You cantrun a business, offer services, ormanufacturer productswithout the help of others and that help will cost you . Even if you start your business as its only employee, youll have to add to your labor pool at some point if you plan to grow. In most cases, labor will be one of your biggest small business expenses, if not the biggest. List the number and types of employees you need to run your business now and that you might have to employ in the future as your business grows. You can break labor into categories if necessary, such as senior-level management, office, and clerical support, production or distribution staff, professional staff including lawyers, accountants, engineers, and marketing, and fulfillment employees- those in the mailroom or shipping department. If you plan to outsourceorder fulfillment, fundraising, or other aspects of your companys business, be sure to list what functions youre targeting and to whom youll send ansicht tasks. Transportation and Shipping Requirements How will you transport items if you must send them from one place to another? Smaller items can be ship ped via local carriers, DHL, or USPS, but heavy orbulkitems must be transported via a freight or trucking company. If youreshipping perishable items, youll need special overnight handling. You might also need special permits to ship certain items, and nonprofit organizations should consider applying for discounted postal rates. These are all things that affect the how of moving your goods from one place to another. If you offer services, how will trainers, educators, consultants, andausverkauf personnel get to customers and clients? You will need a licensed distributor or pharmacy to ship on your behalf if you offer a product thatsgoverned by state or federal law such as medications or prescription medical supplies, Calculate Marketing Requirements How will you reach consumers? It is a crucial consideration because your business will fail without them. Its something investors will be keen to know. Go beyond simple advertising plans, although this is important, too. Exactly what type of advertising campaign do you plan to launch?Will you lean more heavily on print media or other options and what consumers will you target? Explain why they would want to buy from you rather than any of your competitors. The Physical Location of Your Business Where you run your business will have an effect on your success. If yourestarting in ahome-based office, determine when and if youll need a brick and mortar office at some point in the future- office spaceoutside your home. Will you eventually need warehouse facilities, your factory, or your trucking facility? Will you require a retail storefront or any other purchased or rented facilities to conduct your business? Discuss the pros and cons of where these facilities will be located in the physical location component of your feasibility study.Should they be in one central location or across state lines? Do you need special parking considerations for customers or trucks? Do you have to be near other facilities such as a n airport, a commerce center, or a shopping mall? Technology Requirements to Run Your Business Every business needs at least some kind of technology to operate. The technology component of yourfeasibilitystudy should include discussionsabout telephone answering systems, computer hardware and software, and inventory management. Dont overlook items like cash registers and potentially the ability to accept credit cards and process checks. You might need special devices to accommodate the disabled, or teleconferencing equipment and facilities. Cellphones and PDAs are almost a must for most businesses, and you might need alarm or camerasystems and manufacturing equipment as well. Include Target Dates Tell investors when you plan to do what to bring your concept to fruition. Dont neglect to mention the small steps. Cover it all, from initial organizational meetings to when youll purchase equipment or facilities and when and how youll open your doors for business. Be reasonable. Yo u dont want to promise that youll perform by a miraculous deadline then fail to do so. Support Your Financial Information Dontmake the mistake of trying to entice investors with your staggering growth projections and a potential return on their investment. Theres always an increase in expenses with an increase inrevenue. Dont rely strictly onfeasibilitystudy conclusions to impressan investor. An experienced investor or lending institution will read your entire report and come to their conclusions. Its therefore critical that the technical and financial data in your study reconcile. If other parts of yourfeasibilitystudy show growth, youll also have to project labor and other costs and the technical ability to support that growth. The technical component should serve as the written explanation of your financial data because it offers you a place to include detailed information as to why an expense has been projected high or low. You can explain why its even necessary. It demonstr ates to potential investors and lenders- and in some cases, potential clients- that youve thought about the long-termneeds your business will have as it grows. Summary of the TechnicalFeasibilityStudy Be sure to include all the technical requirements of your business from production to customer receipt. This information will help investors know more about the operations of your business. Having a great idea for a product or business isntenough- you have to show how you can make money from it. The technicalfeasibilitystudy addresses the physical and logistical mechanics of it, and how youll be able to get something into theproduct and back out the door to customers.