Growing your business is an exciting endeavor, and developing a strategy for growth is only the first step on a very long road. Before setting out on that journey, it’s an excellent idea to ensure that your business ideas are viable. The best way to do this is to conduct a feasibility assessment.
What Is a Feasibility Assessment?
A feasibility assessment helps business owners evaluate the merits of any business idea they may be considering. When you get a feasibility assessment, you work with professionals to assess your business, understand what your specific goals and objectives are, and discuss whether or not they’re feasible.
How Does a Feasibility Assessment Work?
This type of assessment doesn’t simply look at your business or plans in a vacuum. Instead, it involves a multi-tiered approach. For example, your feasibility assessment team at MelCap might look at what’s going on in the world economy, the domestic economy, M&A markets, and your particular industry as well as your proposed plan. Rather than looking at your idea in isolation, the team uses this wealth of information to consider whether or not your plan is viable.
A feasibility study doesn’t simply give you a “yes or no” answer on whether or not to proceed. It’s also an excellent way to evaluate alternative plans besides the original course of action. A feasibility study can help you better frame a series of different business scenarios to help reduce the options and choose the best path.
When the Timing Is Wrong
Timing is everything in business, and sometimes the answer to a feasibility assessment is “yes, but not now.” In certain scenarios, the company may be ready to move forward with the plan, but the market is too shaky to sustain it. In others, the market may be strong, but the company isn’t ready. If this is the case, the experts at MelCap won’t simply give feedback about why it may not be feasible today; we also provide short-term and long-term recommendations that will help set you up for success when it’s time to move forward in the future.
How will you be able to tell when the time is right? Ideally, you want a tailwind on all fronts. This means having a strong, robust world economy, domestic economy, and industry in which you compete. It also means having all of your resources in place within the company. If you want to sell your company, for example, this would mean completing a financial assessment, showing strong growth trends, sales, and profitability, having your balance sheets in good order, and having a strong management team that includes a successor who is ready to step up. It also means re-investing in the business and ensuring that your working capital is in good shape.
While there’s always risk involved with any business venture — whether it’s expanding your product line, acquiring a competitor, or raising equity capital — a feasibility assessment will help you better assess the risk to determine if you want to assume it and take the next step. If the risk is too high, we can make recommendations to help you work to minimize the risk so that the idea becomes more viable in the future.
Seek Professional Assistance With MelPlan
MelPlan is the signature feasibility assessment service provided by MelCap to help our clients assess the viability of whatever project you’re currently contemplating. We can help you determine if it’s the right time for your big idea, as well as if your idea is the best plan or if there may be a more effective path. We’ll also work with your team of advisors (attorneys, accountants, investment advisors, etc.) to make sure that everyone is on the same page in developing a plan that’s right for you. We’ve found that by taking the time up front to see if a project is viable, our clients save time, effort, and money.