In the current market, many farmers, country estate owners and landowners are looking for alternative ways to diversify their rural business. They want to expand their offering of goods and services to increase revenue streams and provide additional support to the local community.
Conducting a feasibility study can help detect and capitalise on new opportunities to diversify, explain how and why the project should be executed and visualise the project beyond conception stage.
This guide will take you through the various stages involved in the creation of a feasibility study, its benefits to you and your business, and how our rural diversification experts can help your business identify and evaluate opportunities in the rural food, drinks services and the concessions market.
What is a Feasibility Study?
As the name suggests, a feasibility study is created to determine the viability of a project idea during the first stages of conception. This study helps to determine whether the project is both profitable and a logical fit for your business to undertake. Once you have made your initial business case to your stakeholders, you can begin the process of putting your plan into action with a feasibility study.
A feasibility study considers all the aspects of your rural diversification project to help identify the scope of work required, test project assumptions, articulate the project context and determine whether the project is feasible.
A well-constructed and investigated feasibility study will offer detailed insights into the economic, legal and technical aspects of the project, such as accounting statements, market research and analysis, legal requirements, planning permission and resource allocation.
What are the Benefits of Conducting a Feasibility Study?
Gain Valuable Market Insights
Your feasibility study will provide a detailed analysis of the market research, suggestions of local and regional suppliers, farm shops, restaurants, country estates and delis in the area, site plan, demographics and customer surveys. Your study will therefore allow you to gauge the depth of demand for your product or service.
Make Better Cash Flow Projections
Conducting a study will help you determine whether you have enough capital to adequately fund the project. The study will assess funding opportunities and possible grant applications to apply for, to help raise initial funds to get the project up and running. If you plan to secure funding from external financial institutions then this will be considered in the feasibility study under the financial projections section. This study is also a valuable tool to provide insight and understanding of the project for potential stakeholders, investors and families.
Identifying Optimal Timing for Launch
Every business has multiple facets such as production cycles, supply chain, cash flow and financing operations that can impact on project success. Therefore, conducting a feasibility study in the early stages of project conception will prove valuable to identifying optimal timing for the execution of your new product or service offering.
What is included in Our Feasibility Study?
An Executive Summary and Overview
At the beginning of the study we will provide a detailed overview and history of your current location and operation, while also outlining the scope of the project. This section is also used to define and understand the method of implementation and the approach that will be taken, to achieve the business goals and objectives.
Product or Service Marketplace
This is where we will offer our own recommendations for local and regional suppliers, product offering that is carefully chosen based on target demographics, product labelling, upselling opportunities, signage and equipment. For example, we may assess how often consumers visit farm or food shops in the area by conducting a survey, and look at current economic activity in the area, based on employment and business opportunities.
To ensure that your new farm shop, garden centre, deli or restaurant hits the ground running post-launch, we will compile together a full marketing plan and strategy. You will, for example, need to implement a comprehensive PR strategy pre-launch and post-launch and establish relationships with the local press and through word of mouth. We will also make suggestions for paid advertising campaigns, possible events attendance to help increase exposure alongside any marketing collateral to help promote your new brand.
Using a business model canvas we will assess the target market and how strong your retail competition is in the area. This involves a detailed breakdown of possible competitors in your location radius, their product and service offerings, community engagement survey results, and customer demographics.
The SWOT analysis is used as a strategic planning tool to evaluate the strengths, weaknesses, opportunities and threats of your new business venture. From gathering insightful data and market research, we will establish these strengths, weaknesses, opportunities and threats for you. For example, a strength could be that a new service offering will widen your potential target audience, and a weakness could be that there are little funds available. No matter what, we can help you work through any potential weaknesses or threats to ensure maximum profitability and potential for the project to succeed long-term.
To ensure that the project is sustainable we will anticipate the need for input from external resources, such as during the construction phase, gaining planning permission and consent, or the employment of staff. We will recommend the correct course of action for ensuring that we meet all the requirements, by considering the practical elements of the project, who will be involved and at what stage, and the best form of communication between all parties involved.
3D Drawing Concepts and Design
During this stage we will focus on turning your vision of a farm shop, a deli, or restaurant into a reality by designing 3D layouts and mood boards of farm shop counters, play areas, restaurant seating, kitchen layouts, dependent on your taste. We will also focus on additional elements such as lighting and flooring, branding and exterior garden spaces.
Financial Projections and Procedures
For the financial projections section, we will conduct a combined five year budget and profit loss summary. This will focus on potential sales projections and both gross and net profit, a full breakdown of your central overheads, such as staff wages, capital expenditure, marketing materials, utilities and depreciation.
Here at Appetite Me we are here to see your project through and offer additional help, support and advice post-launch. The feasibility study is therefore just the beginning, as we will be keen to see how your business evolves once operations are up and running. We will also be committed to helping you market your new business through digital marketing strategies and word of mouth, advising on new product promotions and shop placement, and opportunities to up-sell.
With Appetite Me there is the opportunity to grow your business further with a garden centre, play area or additional retail outlets to extend your product offering. This is part of our concessions service of bringing expert retailers and garden centres together and developing them into desirable retail destinations.
The Five Stages of Project Feasibility
During this stage, our project consultants will study the technical aspects of the project. This section will answer the all-important questions as to whether your business has the technical capabilities and sufficient resources to carry out the project, assessing areas such as labour, materials, logistics and construction.
Also referred to as market feasibility, economic feasibility is a detailed investigation into the current market landscape, future market potential, sales projections and competition. This section is important for determining whether the investment will be worth it by running a cost-benefit analysis to estimate project costs, revenue, operations and maintenance costs and any useful capital budgeting techniques to help manage income streams.
This section will assess the legal and regulatory requirements for the project success. As a farm shop provider for example, your priorities will be to ensure you have planning permission to build on the land, that your staff have a basic food hygiene certification and are compliant with industry standards and regulations.
This area is geared towards assessing how your needs can be met by undertaking the project. During this stage we look at how your working environment will be affected, how end-users, stakeholders and anyone else involved in the project will be updated with changes along the way and what the proposed system will look like post-completion. We will also carry out a risk assessment to determine the risks and challenges associated with the project.
Also known as time feasibility, this assessment is crucial for project management and success. It can help us to determine how reasonable the project’s timeline is and how long it will take to complete. We will also identify any internal project constraints, such as budget, resource, logistics and determine a realistic timescale for completion based on these areas.
Rural Diversification Consultants
Appetite Me are rural diversification experts specialising in farm diversification, farm retail, food and drink manufacturing and agri-tourism for landowners, garden centres and country estates.
We create and design our own in-house feasibility studies tailored to your business requirements, providing invaluable knowledge to help inform your decision making process and enhance the overall success of the project. If you want to find out more about our feasibility offering, then get in touch with one of our project managers today here.