A feasibility study will need to cover all of the following areas:
Common needs
- What are the potential members’ common needs?
- What products and services will the co-op provide?
Market potential and strategy
- What market capacity exists in the co-op’s area of operations?
- What kind of competition will the co-op face?
- How will the co-op distinguish itself in the market? How will it be different from competitor stores?
- What are the financial benefits to the members of the co-op?
Operations
- How would such a co-op work?
- What are the primary suppliers for the co-op?
- What services would the co-op offer?
Financial needs and sources
- How much money will be needed to get started? What will this money be used for?
- What are the approximate costs of operating such a co-op?
- Will the co-op’s operations justify and cover the costs, including debt service?
- How much money could come from members initially and how much from other sources? In the long run, how much will members have to contribute to the base capital of the co-op and how will it be collected?
- What are the options and costs for obtaining outside financing?
Startup needs
- What will it take to get such a co-op started, in terms of lead time, availability of facilities, seasonal production cycles, etc.?
- What management skills will be needed?
- What facilities will be needed; what would they cost and are they available?