MARKET FEASIBILITY Market Feasibility July 27, 2017
Business Feasibility CHARACTERISTICS OF SUCCESSUL ENTREPRENEURS CHECKLIST-RESULTS Look at your responses to the questions on characteristics. • If you circled “very much like me (us)”for the majority, you probably have the skills to succeed in small business. • If you circled “not like me at all” for the majority of these qualities, you may lack the characteristics needed for success in a small business. Market Feasibility July 31, 2017
Business Feasibility Are you sure this business is a good idea? Feasibility Analysis Definition: “As the name implies, a feasibility study is an analysis of the viability of an idea. The feasibility study focuses on helping answer the essential question of “should we proceed with the proposed project idea?” All activities of the study are directed toward helping answer this question.” Iowa State University Extension and Outreach Market Feasibility July 27, 2017
Business Feasibility Areas of a feasibility analysis: • Market Feasibility • Technical Feasibility • Economic Feasibility • Business and Financial Feasibility • Management Feasibility Market Feasibility July 27, 2017
Business Feasibility Market Feasibility • Consumer and Product Trends • Demographic Research (Target Market) • Brand Development and Product Attributes (Think Strategic!!!) • Competitor Analysis • Distribution Analysis and Sales Forecasting Who or what resources will create the sales necessary to make the business viable? Market Feasibility July 27, 2017
Market Feasibility Consumer and Product Trends Google will get you to a lot of good information but it’s getting tougher, most current trend-info needs to be purchased! GOOD SOURCES INCLUDE • SPINS • The Hartman Group • Food Marketing Institute • Organic Trade Association (OTA) • Trade magazines by category (The Packer, Dairy Foods, Dairy Reporter, Today’s Dietician, State commodity commissions • USDA AMS or USDA ERS Business Feasibility January 31, 2017
Market Feasibility Consumer and Product Trends GOING GRASSROOTS! • Walking stores with an eye for trends and opportunities • Local co-op department buyers • Farm to table events • Networking-informational interviews (other farmers/food producers, buyers from diverse channels, other food professionals such as culinary instructors or nutrition educators). Market Feasibility July 27, 2017
Market Feasibility-Demographics Who are they and which of the attributes listed might be the most important to your new product or business? • Age • Household size • Education • Income • Job Type • Home Value • Affiliations Census Total Total Households Median % % Median Tract Population Households w/ Families Age Female College Household (Issaquah) Degree Income 322.08 8,497 4,024 2,070 45 57% 58% $ 76,229 American Factfinder: http://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml Market Feasibility July 27, 2017
Market Feasibility Mission, Vision, Values or Beliefs Effective accomplishment of this work is core to every element of your business, especially the development of your market plan • Mission is reason or purpose for your business • Vision is statement (in present “A just and livable world tense) of where your business will with a sustainable be be in five years economy founded on • Value or belief statements are core informed choice and to how we conduct our cooperative values.” relationships and business Market Feasibility July 27, 2017
Market Feasibility Brand Development and Product Attributes NORTH CASCADES MEATS VALUE PROPOSITION North Cascade Meats provides authentic, high quality locally produced pasture raised and finished beef, lamb, and pork. You will know our products because they are source-identifiable from each individual local farm. We are committed to: Compassionate care of our livestock Careful stewardship of land and water resources Preparing our products with the highest attention to food safety Delighting your table with healthy and flavorful beef, lamb, and pork Market Feasibility July 27, 2017
Market Feasibility Brand Development and Product Attributes PRODUCT POSITIONING • For whom is the product designed? • What kind of product is it? • What is the single most important benefit it Economy Quality offers? • Who is its most important competitor? • How is your product different from that competitor? • What is the significant customer benefit of that difference? Economy Quality http://articles.mplans.com/the-power-of-product positioning/ Market Feasibility Confused (?) July 27, 2017
Market Feasibility Competition Analysis 64 oz. Whole Milk Retail Price Business Surveyed Private Label Whole Milk-conventional $ 1.99 Haggen, Inc. Darigold Whole Milk-conventional $ 2.29 Haggen, Inc. Twin Brook Creamery-LP and SI $ 3.59 Haggen, Inc. Jackie's Jersey Milk-LP and SI $ 4.99 Terra Organica Old Silvana Creamery-LP and SI $ 4.99 Terra Organica VAPG Dairy-LP and SI $ 4.99 Projected 8 oz. Cream Cheese Retail Price Business Surveyed LP=Locally Produced (marketed as) SI=Source Indentifiable Survey conducted by NABC, 2-5-2014 • Who are your potential competitors? • Where are they sold? • What is their unique selling proposition and product position? • What are their strengths and weaknesses? • What are their production costs? • What is your differentiation and positioning strategy? Market Feasibility July 27, 2017
Market Feasibility Distribution, Channel, & Sales Analysis • Where will your potential customers seek your product (retail store, gift shop, farmers STORE ACCOUNTS 2016 2017 2018 Stores Stores Stores market, catalog, web site)? Community Food Co-op 2 2 2 • How much are they willing to pay Goosefoot Community 0 1 1 Haggen 6 8 9 and how much will they buy? Payless 0 1 1 • What’s the best way to get your Skagit Valley Food Co-op 0 1 1 product to market (yourself, Star Market 0 2 2 Terra Organica 1 1 1 distributor, common carrier, Town & Country Markets 0 0 5 other),and what are the Other 6 8 10 associated costs TOTAL 15 24 32 • Front-loading your sales (Can you get written commitments or verify your projected sales?) Market Feasibility July 27, 2017
Market Feasibility BUILD YOUR SALES FORECAST MODEL WHOLESALE STORES Cases Per Avg. TOTAL Week Per Case ANNUAL Store Price SALES Community Food Co-op 2 31 23.06 37,482 Haggen 6 31 23.06 37,482 Terra Organica 1 10 23.06 12,507 Other 6 31 23.06 37,482 TOTAL 15 104 124,952 FARM SALES Units Avg. TOTAL Per Week Unit Price ANNUAL Farm Stand Sales 150 $ 2.49 $ 19,407 TOTAL ANNUAL SALES $ 144,359 Market Feasibility July 31 2017
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