How to use this material
New businessesThis module assumes that you have already made tentative decisions about what
offerings the business will sell. Take this last step. You need to complete a financial
feasibility study of them before coming to a final decision.
This feasibility analysis will determine if you can make a profit using this market
segment with these offerings.
For a new business, the offerings will be projected and the calculation estimates
based on industry norms derived from your market research.
Existing businessesAn existing business has the advantage of having historical data. It also has a great
deal of local knowledge about the market it serves. However, every time a business
plan is prepared, it is important to go through the same process by
- Testing the current offerings mix
- Examining and considering new offerings that may be available or offered
by competitors
Through the financial feasibility process outlined below, your business will decide
at regular intervals (yearly business plan process) whether to:
- Add new offerings
- Expand, curtail or eliminate current offerings
For both new and existing businesses, this analysis is an important forerunner to the
development of goals and results and especially to the marketing strategy of the
business plan. This is because a major commitment of the resources of a company
will be directed towards the marketing of whatever offering mix is selected.