The first few years of a start-up
business are the most critical. If it can't create enough momentum at
this stage of its life, chances are, it won't last long. The
Australian Bureau of Statistics reports that an average of 44 small
businesses close up shop every day. Aside from rising energy costs
and labour costs, lack of local government support is also cited as a
small business killer.
Ensuring the survival of any small
business involves taking these risks into account even before you
open up shop. This is where a feasibility study comes in, a
formalised paper on the viability of a business at a given location.
While you can conduct your own feasibility study, businesses often
call upon economic analysts for this task.
You can create a basic premise by
detailing four aspects of your business: the product/service, local
market, price, and long-term plan. Each aspect hosts a number of
questions, determining the nature of your product/service, your
preferred supplier, average income of the target market, possibility
of offering discounts, and so on.
The results of the study should tell
how profitable your leased location is. However, it's not a surefire
indication of what to expect in running a business. You have to be
ready for unforeseen circumstances like an abrupt economic downturn,
even if the feasibility study says otherwise.
No comments:
Post a Comment