What is the most critical part in preparing a feasibility study?

Risk Factors and Financial Indicators are the key and most critical part, it will cover market facrots in all.

The critical factors are:

1. Technical

2. Operational.

3. Selling

4. Marketing

5. Financial 

6. Human Resources and

7. Information Technology

 

 

Market factors and financial indicators

The most important part is understanding the business first from Macro point of view and then from micro point of view.
The moment you lose focus of any one , it will take you to different direction.
So, all the elements that form part of the feasibility study are equally important and it would be a grave mistake to ignore any one.

The most important part is understanding the opportunity availability and market demand, as well as know your profit and loss chances and possibility within the existing competitors

Actually, the most critical and most difficult part of the feasibility study is to predict the cash flows of the project / investment and the factors / variables that effects these cash flows with realiability. Out flows are easy to determine than inflows becoz inflows relates to future and future is uncertain to predict. On the other hand, in outflows, the major part is fixed cost / initial outlay that can be determine / predict more accurately and rest is the variable cost that will occur as the project / business progress. All these factors above are required to predict the cash flows with many others i.e. financial, non financial, political, social, rivalry in market, demand of product, etc. In short, many factors that can effect the cash flows and the overall feasibility. Also, we need to keep an eye on the factors that are most sensitive and can change the whole paradigm.

All the above mentioned factors are very important but a realistic projected cash flow is the most critical factor i guess.