Ent New Vent Creation Chapt 3

Front 1

Forms of Feasibility Analysis (4)

Back 1

Product/Service Feasibility

Industry/Target Market
Feasibility

Organizational Feasibility

Financial Feasibility

Front 2

Product/Service Feasibility Analysis (Purpose)

Back 2

Is an assessment of the overall
appeal of the product or service
being proposed.
Before a prospective firm rushes
a new product or service into
development, it should be sure
that the product or service is what
prospective customers want.


Test overall appeal of product
is it what the customer wants
is there an adequate market for it
how it is going to be sold and distributed to the customer
use prototype to see if and how it works

Front 3

Industry/Target Market Feasibility Analysis (Purpose)

Back 3

Is an assessment of the overall
appeal of the industry and the
target market for the proposed
business.
An industry is a group of firms
producing a similar product or
service.
A firm’s target market is the
limited portion of the industry it
plans to go after.


overall appeal of market for product
industry is a group of firms that make the same product or put together the same service
how big is the industry
how big is the market

Front 4

Organizational Feasibility Analysis (Purpose)

Back 4

Is conducted to determine
whether a proposed business has
sufficient management expertise,
organizational competence, and
resources to successfully launch
a business.
Focuses on non-financial resources.

Front 5

Financial Feasibility Analysis
(Purpose)

Back 5

Is the final component of a
comprehensive feasibility analysis.
A preliminary financial assessment
is sufficient.

Front 6

Components of financial
feasibility analysis (3)

Back 6

Total Start-Up Cash
Needed

Financial Performance of
Similar Businesses

Overall Financial
Attractiveness of the
Proposed Venture

Front 7

Mouse trap fallacy

Back 7

just because you have a great idea doesn’t mean you will be successful

Front 8

First mover advantage

Back 8

Communicate product to market

Fresh image

Develop valuable relationships (fulfillment-take and package goods, delivery)

Gain recognition

Does it matter if discovery or creation opp? Creation more so, if the market is ready for your product

Advantage
Define playing field
Set up barriers to entry (key)
Patents
Government regulations
Little to no competition, secure market share

Front 9

Advantages to be second company in

Back 9

Another company improve on product
less risky
dont need to sink a lot of money into the company
image-people already understand product
venture capitalists more willing to invest-can see it work

Front 10

Financial Feasibility

Things to know:

Back 10

Time needed to earn a return
Margins
Risk
Figure out profit margins and risk to get investors

Front 11

eBay stores

Back 11

Successful at the beginning
Economics (how much they take) > Time saved not going on eBay yourself

Front 12

Segway

Back 12

Flop
Over estimating
Investors over excited about product
Didn’t do testing in cities
Didn’t think of how it would fit into the lifestyle of market
Assumed it would be new and used everywhere
Couldn’t prevent it from getting stolen
Where is it going to run (sidewalk-not NYC, street-only 10 mph)
Sunk a lot of money financially
Demand wasn’t there
Made sense in theory
Didn’t break often
Big financing, could think big out of the box
Billionaire for Europe buys Segway
Dies in Segway accidents off cliff