3.1 Introduction

This section is a slightly different but very helpful way of evaluating your business ideas to see if they represent real business opportunities. Business ideas can be evaluated chiefly by using two methods, namely, a feasibility study and a viability study.

A feasibility study is a general examination of the potential of the idea to be converted into a small business enterprise. This study focussed largely on the ability of the entrepreneur to convert the idea into a small business enterprise.

A viability study is in-depth investigation of the profitability of the idea to be converted into a small business enterprise.

One needs to consider two things before evaluating a business idea:

What are the chief business activities?

Who are your consumers?

The business activities that you can perform with your small business idea will consist of two or more of the following:

The manufacture of a product
The provision of a service
The sale of other people’s products and/or services

Your consumers will consist of:

Individuals, and/or
Organizations

So, you will have the following six options:

The manufacture of a product for individuals
The provision of a service to individuals
The sale of other people’s products and/or services to individuals
The manufacture of a product for organisations
The provision of a service to organisations
The sale of other people’s products and/or services to organisations

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3.1 Introduction