Feasibility Study Cost, Scope, and Timeline

Over the past 28 years, David Howse has worked on over 100 business plans, feasibility studies, and market research projects. 

According to the he Canada Cultural Spaces Fund, a feasibility study is “a report conducted in advance of a project to determine the likelihood of the project’s success. It is prepared by an independent consultant, architect and/or engineer or other specialist.”

Do you need to conduct a feasibility study? The best answer is, it depends.

Depending on your approach, a feasibility study can happen before or after a business plan is written. You could write the business plan first and then use a feasibility study to test the business plan or, you could do a feasibility study on a general idea and then create the business plan from the findings of the feasibility study. For about every 15 business plans I write, I am asked to do one feasibility study. I can’t force my clients to do a feasibility study but I do let them know that such a study costs 1-2% of total project costs and, for one of those 15 prospective business owners, I gave a “NO” recommendation that likely saved him $2,000,000.

The components of this report generally include:

• a needs analysis (is the project needed in the market)
• engineering and design (if your business requires a physical structure (new building) or a process that requires engineering, then an engineer and or an architect may be required to create their own initial feasibility reports
• cost estimate (architecture, construction, business management)
• financial analysis
• operations analysis
• project impact (think of stake holders such as different groups within your community, the environment, etc.)
• market research (testing your assumptions against the results of real market research)
• recommendations

But, since very few prospective business owners have an independent agent conduct the feasibility study, the choice to conduct a study is yours.

On the other hand, Federal and provincial grants often require a feasibility study and, many times, will fund the study.

Before you look for a consultant to conduct a feasibility study, write up a Terms of Reference so the consultant (and if applicable, the grant/funding organization) understand exactly what you need. According to https://buyandsell.gc.ca/ “These Terms of Reference (TOR) have been developed to ensure that the Construction Manager (CM) has a clear understanding of the project scope, procedures and services required to deliver the completed project, within the agreed to budget and schedule.” A similar TOR would need to be written for a business consultant so they know exactly what you need the business consultant to deliver; the TOR define the Deliverables you require from the consultant.

A Sample Feasibility Study Proposal

COVER PAGE

Feasibility Study Proposal

 for the Calgary Business

“The Business”, proposed location: 125 Xth Ave, Calgary, Alberta

Presented to:

Business Owner

President, the Business

Calgary, AB

Email: Calgary-business@emailxyz.com

Presented by:

David Howse

Sr. Business Consultant, Matterhorn Business Solutions

Suite 763, 5319 – 3rd St SE
Calgary, AB T2H 1J7
(403) 991-8863

Email: david@matterhornsolutions.ca

November 27, 2023

Date:                    November 27, 2023

To:                         Business Owner

From:                   David Howse

Subject:               Proposal to Research and Write a Feasibility Study for the Calgary Business, Alberta.

This proposal is for a feasibility study on a new business in Calgary, Alberta called, “the Business”. This proposal, if accepted, will see David Howse of Matterhorn Business Solutions conduct a feasibility study on “The Business, Business Plan, 1 February 2023.”

Once completed, the feasibility study will be presented to the board of the Calgary Business who will then use it as guidance on their business plan.

The feasibility study will help Calgary Business learn if:

1. the cost of the project is justifiable
2. if the project will benefit the community as anticipated
3. and if it will be sustainable long term.

The feasibility study will demonstrate the above three points by (1) defining the business scope clearly (2) undertaking a thorough market analysis (3) objectively assessing the project’s technical, organizational, and financial requirements.

Items of the feasibility study related to costs, construction, and design will come from the contracted architect, engineer, and construction manager.

Matterhorn Business Solutions will provide a detailed review of the business plan and also all components (contracted architect, engineer, and construction manager reports) of the Feasibility Study together into one report.

The Calgary Business believes success will be achieved when a “Calgary Business” is able to offer customers the best prices on recreation services.  Financing sources come from service sales and customer rental fees (seminars, Christmas parties, business use).

It is all the above points that David Howse of Matterhorn Business Solutions will test against in creating the feasibility study.

The time to completion is about 60-90 days from approval. The following pages outline the process.

Feasibility Study Proposed Outline

Below is a proposed outline to demonstrate the scope of the proposed feasibility study. The study’s goal is to determine the feasibility of the current business plan. In the process of conducting the study, alternative strategies, target audience criteria, and or revised financial figures may be offered. Information for the study will be gathered by:

1. Primary Research
   1. Focus Group
   2. Survey
   3. Individual Interviews
2. Secondary Research
   1. Existing Information such as:
      1. Case Analysis
      2. Calgary Business’ Current Business Plan

Executive Summary

Introduction

Mission Statement

Philosophy

Features, Advantages, Benefits (FABs)

Product Specifications  (Design, Engineering, and Construction)

Industry Analysis

Current status for Calgary Business Product-X

Strengths, Weaknesses, Opportunities, and Threats – SWOT Analysis

Historical and current industry trends – including impacting new products and services

Current Trends

Product-X’s Category in General

A brief history of  Product-X’s Category in Calgary

General economic trends and factors

Barriers to entry

Market Area Characteristics

Geographic definition of the market

Demographic factors

Number of potential customers

Diversification of the area’s economy

Conclusion to the strength of the market area

Competition Analysis

Direct competitors including strengths and weaknesses of each

Indirect competitors including strengths and weaknesses of each

Why do customers purchase from the competition?

Strategy to compete

Demand Analysis

Major customers (segments, target audience, personas)

Where are they located?

Why will they buy the Calgary Business’ service?

What do potential customers expect in terms of price, quality, and service?

How do they currently buy competitive and substitute products?

Who or what influences the buying decision?

Other research insights

Estimated worst case scenario (sales)
Estimated best case scenario (sales)
Estimated moderate case scenario (sales)

Conclusion  Does research support the venture?

Appendix 1  Individual Interview Summaries

Appendix 2  The Survey Questionnaire

Appendix 3  Research and Statiscics Methodology

Market Research Proposed Outline

The research portion of the feasibility study will likely use four methods (1) Focus Group (2) Individual Interviews and (3) Survey (4) Case Review.

The purposes of the research is (1) to discover insights to design a valid survey (2) To measure the opinions of the target audience and to see if they match the current business plan objectives and assumptions (3) To find similar cases to offer, if any, real-word best practices for success.

The survey, which will likely be the main research component, will be sent to an approved sample group. The research will follow a standard 12-step process as follows:

Step 1: Establish the need for market research

Step 2: Define the problem

Step 3: Establish research objectives

Step 4: Determine research design

Step 5: Identify information types and sources

Step 6: Determine the methods of accessing data

Step 7: Design data collection forms

Step 8: Determine sample plan and size

Step 9: Collect data

Step 10: Analyze data

Step 11: Prepare and present the final research report (within the feasibility study)

Step 12: Carry out the recommendations of the research (by client should they prove feasible)

Timeline

The following schedule is for illustration purposes only and is dependant on the start date:

Activity                                               Total Time                  Tentative Completion Date

Current Information Review               31 hours                      August 21, 2023           

Focus Groups  and Analysis                30 hours                      Sept 8, 2023

Interviews and Analysis                      10 hours                       Sept 22, 2023

Primary Research                                 75 hours                      September 29, 2023

Organizing the Information                12 hours                      October 30, 2023              

Writing the Draft                                 30 hours                       November 9, 2023

Revising the Draft                                 8 hours                        November 9, 2023

Presenting the Final Report                4 hours                        November 9, 2023

Budget

Based on a proposed 224 hours to complete the feasibility study, the costs would be:

Labour: 200 x $100:                                        $20, 000.00
Project Management* @ 20%                        $4,000.00

Total Cost:       $24,000.00

*Project Management: third-party consultant, secondary research report costs, research software, travel, possible incentives for focus group or survey participants, etc.

David Howse C.V.

PROFESSIONAL EXPERIENCE

Lead Business Consultant – Matterhorn Business Solutions Inc., Calgary, AB 2008 – 2023                           

Managed the execution of marketing plans and client relations strategies for several Calgary-based businesses. Client revenues ranged from $200,000 to $200,000,000 per year.

• General Marketing Management
  • Managed marketing for new business start-ups, product launches
  • Project management from inception to execution
  • Outsource and negotiate external contracts for graphic design, photography etc.
  • Created client briefs, proposals and bids
  • Traditional marketing management: TV and Radio commercials, newspaper ads
  • Digital Marketing Management: multi-platform multi-channel strategies
• International Business Development and Marketing
  • China
    • Four trips (10 weeks total) to Hong Kong, Guangzhou, and Yiwu, China
    • Managed all importing for two product categories from China to Canada
    • Managed vendor selection, vendor negotiation, Canadian legal issues, order fulfillment, and complexities of defective products shipped from China
  • Iran
    • Two trips (5 weeks total) to Tehran, Iran
    • Consulted for a steel manufacturing component producer on international market entry from a digital marketing perspective
• Feasibility Studies, Market and Marketing Research
  • Following a 12-step research process I designed and managed all components of:
    • Market and marketing research on Lethbridge, AB traditional and digital marketing.
    • Global research report as the basis of a feasibility study on a proposed Yoga training centre in Samoa (South Pacific).
    • Calgary Restaurants Digital Marketing Report: researched digital marketing usage among 500 restaurants in Calgary
    • Calgary Industrial Digital Marketing Research Report: researched digital marketing usage among 1000 industrial businesses in Calgary
  • Digital Marketing
  • Developed complete digital marketing plans and subsequent plan execution including:
    • Website Design
    • SEM (Search Engine Optimization and Google Advertising)
    • Social Media Marketing to leverage strategic advantages
    • YouTube Video Production
    • Ecommerce / shopping cart / merchant server integration with a website
• Public Relations and Media Relations Management
  • Press Release writing and submission
    • Over 50 press releases published in local to international media outlets
  • Media Trainer
  • PR Crisis Management (including TV interviews)
  • Acted as Spokesperson (live TV and Newspaper)
  • Press Conference Management
    • Independently managed, planned, and implemented special events including multiple press conferences for Century Downs Racetrack and Casino (Ground breaking and first race)
• Sales and Sales Management
  • Business Development for a bridal accessory wholesaler: Travelled across Canada and the USA developing a client base
  • Business Development for a beef jerky manufacturer: Travelled across Southern Alberta developing a client base
• Business Plans / Financial Analysis / Financial Statement Analysis
  • Analyzed financial statements of a large bridal shop in Lethbridge and advised on inventory and sales policy adjustments
  • Business Plan Writing
    • Over 20 business plans written
  • Created custom Excel template that turns sales forecasts and expenses in to 3-year cash flow, income statements, and balance sheets.

Assistant Editor, Motion Picture and TV – Vancouver, BC and L.A., Ca. 1997 – 2003   

• Professional video editor
• A position divided evenly among creative, managerial, and technical duties.
• 11 multi-million-dollar budgeted feature films, made for TV movies and shows.
• Worked closely with the editor, director, & producer as a creative & technical resource.
• Extremely fast passed environment with constant changes and challenges.
• Liaised with several departments to ensure work flow and continuity.
• Ongoing document management including organizing and maintaining daily reports.
• Credits include CBS, ShowTime, CTV, NFB, and feature films.

Research Assistant – MarkTrend Research, Vancouver BC 1993-1995

• Aided in over 100 research projects from
  • Consumer goods
  • Political
  • Environmental

ACADEMIC INSTRUCTOR EXPERIENCE

Lecturer 

• Mount Royal University, Calgary, Alberta, Canada 2015 – 2023
  • Social Media for Business – Final Project
    • 21 hours, Five semesters in-class and online instruction
    • Coordinated outside not-for-profit directors to liaise with student project
  • Search Engine Marketing – (SEO and Google Ads)
    • 18 hours, 12 semesters of in-class and online instruction
  • Digital Marketing Measurement – (Marketing Metrics and Analytics)
    • 15 hours, Eight semesters of in-class and online instruction
  • Content Marketing
    • 15 hours, Four semesters of online instruction
  • Social Media for Business
    • 15 hours, Four semesters of online instruction

• College of the North Atlantic – Qatar, Doha, Qatar 2018 – 2020
  • 2018 – 2020 (Six Academic Semesters)
    • Marketing Services (MR2450)
      • A third-year marketing course, Four sections, 56 hours per section 
    • Business Research (MR2300)
      • A second-year marketing course, Seven sections, 60 hours per section 
    • Digital Marketing (MR2403)
      • A third-year marketing course, Three sections, 56 hours per section 
    • Introduction to Marketing (MR1100)
      • A first-year marketing course, One section, 60 hours 
    • Introduction to Business
      • A first-year business course, One section, 26 hours 
    • Entrepreneurship (EP2150)
      • A second-year business course, Three sections, 60 hours per section 
    • Student Workplace/Skills Development

• • • • Supervised students on external work terms

• Mentored students on workplace issues and theory-in-to-practice

Curriculum Development

• College of the North Atlantic – Qatar 2018-2020
  • Developed complete curriculum for MR2403 – Digital Marketing
    • Created original twelve module (100+ slides) PowerPoint
    • Trained fellow instructor to deliver the course

• Mount Royal University 2015
  • Developed complete curriculum for Social Media for Business – Final Project
    • Created original 60 slide PowerPoint
    • Developed 34-page social media marketing manual

Guest Lecturer

• Lethbridge College 2009
  • Two two-hour marketing lectures to the Golf Management Program
• Mount Royal University 2011
  • One two-hour marketing lecture to the Fitness Trainer Management Program

Instructor Training

• Vancouver Community College, PIDP 3100 — Instructor Skills, December 2018
  • 28 hours hands-on training to improve lecturer-student outcomes.
• Vancouver Community College, PIDP 3230 — Evaluation of Learning, March 2019
  • 30 hours assessment and evaluation strategies used in education and training

EDUCATION

2018-Present      Masters of Business Administration, University of Edinburgh, Scotland, UK
                              (Two exams left to write. Expected completion 2024.)

2007-09                Bachelor of Business Management, University of Lethbridge, AB

2004-07                Business Administration Diploma (Marketing), College of the North Atlantic, NL