A feasibility study answers one question before you spend: will the project cover its costs and return its capital, and when? This feasibility study template has two parts: short questions that write the study's text section by section, and a linked financial model that calculates profit, break-even and payback. It opens on a car wash in Riyadh, and three more examples are ready to start from.
In the car wash example: startup capital SAR 226,000, monthly revenue SAR 57,450 and fixed costs SAR 34,000 a month, giving net profit of SAR 9,100. Break-even is at revenue of SAR 45,320.19, and the capital is paid back in about 24.8 months.
How to use the feasibility study template
- Pick the example closest to your project, or start blank.
- On the Financial model tab, enter setup items, then your products with prices, unit cost and monthly quantity, then fixed costs such as rent and salaries.
- Go back to the Feasibility study tab and press Edit answers to describe the idea, market and competitors. The figures carry over by themselves.
- Switch to advanced mode to add demand, marketing channels, team and the risks specific to your project.
- Download the study in Word to edit the wording, and the model in Excel to try other scenarios.
What a feasibility study is and why you need one
A feasibility study tests a project on paper before you test it with your money: who will buy, what setup and running will cost, and what is left as profit. There are four types that complete each other: market (customers, competitors, demand), technical (site, equipment, team), financial (costs, revenue, profitability measures) and legal (the company's legal form and the licenses the activity needs).
A bank or financing body asks for one before considering a loan, a partner asks for one before putting in a share, and you need one to compare two sites or two sizes of project. A car wash owner choosing between a plot rented at SAR 8,000 and another at SAR 12,000 only has to change one number to see the effect on profit and payback.
What goes into each section of a feasibility study
| Section | What it answers |
|---|---|
| Executive summary | The project and its location, capital, expected monthly profit and payback, in one paragraph a partner or lender reads first. |
| Market study | Who the customer is, how many will buy, who competes with you and why customers choose you. |
| Technical study | Site, area, equipment, team and hours, plus the table of startup costs. |
| Financial study | Revenue, variable and fixed costs, a five-year income statement, break-even and return on investment. |
| Risks | What could push the figures below the estimate, and what you will do if it happens. |
How to do a feasibility study: from idea to decision
The method is the same for any project, and the order matters because each step feeds the next:
- Market: count potential customers and watch a nearby competitor; this gives you monthly quantity and price.
- Costs: startup costs are paid once before opening, fixed costs are paid every month however much you sell (rent, salaries), and variable costs rise with each unit (raw materials).
- Revenue: price × monthly quantity for each product. In the example an exterior wash sells 1,200 times at SAR 25, giving SAR 30,000, with water and materials costing SAR 6 per car.
- Profitability: net profit = revenue − variable − fixed, then break-even and payback.
The break-even point is the revenue with neither profit nor loss: fixed costs ÷ (1 − variable cost share of revenue). In the example variable costs take 14,350 of every SAR 57,450, so the project needs SAR 45,320.19 a month to cover its rent and salaries. The payback period is capital ÷ monthly net profit: 226,000 ÷ 9,100 = 24.8 months. On the five-year sheet, cumulative cash flow is minus SAR 116,800 at the end of year one and turns positive at SAR 23,720 in year two.
Feasibility study for a small business or online store
A small business has limited capital, so a simple feasibility study is enough: a short setup table, a few products and clear fixed costs. An online store's costs are mostly opening stock and advertising, with no shop rent. In the Online store (perfume) example, capital is SAR 180,000, of which SAR 90,000 is stock, and advertising is SAR 15,000 of SAR 36,000 in monthly fixed costs. Monthly revenue is SAR 91,800, net profit SAR 15,500, break-even SAR 64,170.87, and payback 11.6 months.
The other examples show how cost lines change by sector: an AC maintenance business in Jeddah puts its capital in a service vehicle and tools, and a greenhouse farm in Qassim sells by the kilogram to wholesalers. Their prices and quantities are assumptions, so replace them with real supplier quotes. Restaurants have a separate restaurant feasibility study that works from daily orders.
Feasibility study template in Word, Excel and PDF
Each format has a job. Word is for the written study, when you want to edit the wording or add photos of the site. Excel is for the numbers: revenue, profit, the five-year projection and the summary sheet are formulas that read from the input cells, so changing a price updates profit, break-even and payback in the same file and the tables never drift apart. PDF is for sending the study to a partner or lender exactly as it is.
To start from scratch, the blank Excel button gives the four sheets and the summary sheet with their formulas and no figures, and the blank printable form on the study tab gives the section headings with lines to write on.
Common feasibility study mistakes
- Estimating sales from hope rather than counting: watch a nearby competitor for a week and count its customers.
- Forgetting working capital, so cash runs out before the project reaches break-even.
- Using the same quantity for every month of year one, although the first months are weaker.
- Mixing variable and fixed costs, which gives a wrong break-even point.
- Copying license fees from someone else's study instead of asking the authority.
Before you rely on the study
Every amount in the template is entered by the study's author, and the page adds no government fees. Commercial registration, municipal license and civil defense permit costs in Saudi Arabia depend on the activity and city, so check them with the relevant authorities. A study submitted to a lender may need statements in the format that lender asks for.
When the project moves from study to operation
Microtec's ERP accounting system brings a business's sales, purchasing, inventory, finance and HR into one place, where the project's figures are recorded after opening.
Feasibility study questions
Is there a free feasibility study template as a PDF?
Yes. Fill in the study and press Download PDF for a file ready to send, or choose the blank printable form for a copy with lines to write on. Downloads are free and ask for your name and email once.
Can I submit this study to a bank?
It works as a basis once your real figures replace the example's. Some lenders require their own format or a study from a firm they approve, so ask for their requirements and move your figures into it.
How long does a feasibility study take?
From a day to a week for a small project. Most of the time goes into collecting quotes and counting demand at the site; entering the figures in the template takes little time once they are ready.
Does the template include a worked example?
Yes, four with their figures: a car wash in Riyadh, AC maintenance in Jeddah, greenhouses in Qassim and an online perfume store. Pick one and the study and the financial model fill together.
How do I do a feasibility study for a small business?
Start by counting demand at your site, then enter setup and monthly costs, then your prices and quantities. Work out monthly net profit, break-even and payback; if payback is longer than you can wait, change the size or the site.
How do I calculate the payback period in a feasibility study?
Divide startup capital by monthly net profit. In the example: 226,000 ÷ 9,100 = 24.8 months. If monthly profit is zero or negative, the capital is not recovered on those assumptions.