Before You Invest: What Makes a Good Feasibility Study?
Some of the most interesting feasibility projects I have worked on have started with little more than an idea.
Could we build this?
Would people use it?
Is there enough demand?
Could we fund it?
Could it operate sustainably?
Should we invest more time and money in taking it further?
A good feasibility study helps turn those questions into an evidence-based decision. Working with an independent feasibility consultant can help organisations test those assumptions objectively before significant time, funding or resources are committed.
Having undertaken feasibility and research work for community organisations and projects, I have come to see feasibility as much more than determining whether something can be done.
The more important question is:
Should we do it, and if so, what is the most realistic way forward?
For projects involving communities, facilities, visitor experiences or multiple stakeholders, answering that question usually means looking beyond the numbers. You need to understand need, demand, people, place, partnerships, costs, delivery capability and long-term sustainability.
Start with the need, not the solution
One of the most important things I have learned through feasibility work is the value of stepping back before moving forward.
Often, the organisation commissioning the study already has an idea:
“We need a new facility.”
“We want to develop this site.”
“There could be an opportunity to create a new visitor experience.”
By this stage, considerable thought and enthusiasm may already have gone into the proposed solution.
But I think a good feasibility study needs to start one step earlier.
What need or opportunity are we actually trying to address?
Who experiences that need? What evidence do we have? How significant is it? How is it currently being met? What might change in the future?
Sometimes the evidence strongly supports the original proposal.
Sometimes it suggests the idea needs to change.
Sometimes it identifies another way of achieving the same outcome.
None of those represents a failed feasibility study.
The purpose of independent feasibility work is not to validate an idea. It is to help make a good decision.
1. Is there genuine need or demand?
A feasibility study needs a solid evidence base.
Depending on the project, this might involve:
demographic and population analysis
market or demand research
assessment of existing facilities and services
utilisation and participation data
community needs analysis
analysis of gaps in current provision
visitor or customer research
review of previous research and strategies
consideration of future population growth or changing needs.
The scale of the research should be proportionate to the scale and risk of the decision.
A major facility requiring significant capital investment needs a different evidence base from a relatively small community initiative.
But the underlying question is the same:
Is there sufficient evidence of need or opportunity to justify taking this idea further?
2. Talk to the people who understand the issue
Some of the most valuable information in feasibility work does not come from a spreadsheet.
It comes from people.
In my own feasibility work, conversations with potential users, community organisations, funders, councils and other stakeholders have often uncovered information that was not obvious from the desktop research.
It might be an existing asset that could be used differently. A potential partnership. An operational constraint. A funding issue. An unmet need. Or a completely different perspective on the proposed solution.
Depending on the project, engagement might involve interviews, surveys, workshops, focus groups or targeted stakeholder conversations.
The question should not simply be:
“Do you support this project?”
A much more useful question is:
“What do you know that we need to understand before making this decision?”
For community and public-sector projects in particular, I see engagement as part of the evidence base, not an optional extra.
3. Test the options, not just the preferred idea
Independence becomes particularly important when an organisation has already invested significant time and energy in developing an idea.
It is natural for people to become attached to a proposed solution. But a feasibility study needs to be prepared to test it. Depending on the project, that might mean considering:
Option A: Proceed substantially as proposed.
Option B: Develop a smaller or staged version.
Option C: Partner with another organisation or make better use of existing assets.
Option D: Pursue a different solution.
Option E: Maintain the status quo or do not proceed at this time.
Assessing realistic alternatives against agreed criteria gives decision-makers a much stronger basis for determining what should happen next.
Instead of concluding:
“We investigated the proposal and think it is a good idea.”
the organisation can say:
“We tested the realistic alternatives and this option provides the strongest response to the identified need.”
That is a much stronger foundation for subsequent investment, funding and decision-making.
From an idea to something real
Two feasibility projects I have worked on demonstrate why I see the process as much more than producing a report.
Cromwell Menzshed
In 2021, McElrea Consulting undertook the feasibility study for a proposed purpose-built facility for the Cromwell Menzshed.
At the time, the group was operating from temporary premises and wanted to understand whether developing a permanent facility was realistic and what would be required to make it happen.
The feasibility work considered the need for the facility, how it would be used, potential sites, costs, funding, ongoing sustainability and the wider benefits for the Cromwell community.
The project subsequently moved forward and the new Cromwell Menzshed has now been developed and opened. LinkedIn
Of course, a feasibility study did not build the Menzshed. The group itself, its supporters, funders and partners did the hard work required to turn the idea into reality. But it is a good example of the role feasibility can play at an early stage:
Idea → Evidence → Decision → Action
One of the things I enjoy about feasibility work is getting involved when something is still an idea and helping an organisation determine whether there is a sufficiently strong case to take the next step.
You do not always get to see where those projects end up several years later.
It was particularly satisfying to see this one become something very real.
Waimea Plains Railway Development Project
I also undertook feasibility work for the Waimea Plains Railway Development Project at Mandeville in Southland.
This was a very different proposition. The Waimea Plains Railway Trust was exploring the development of a heritage railway precinct at Mandeville, drawing on the area's railway history and creating a working heritage attraction. The concept included approximately 2.5 kilometres of railway track. Readkong
A project like this demonstrates why feasibility cannot be reduced to one calculation.
There may be a physical development to consider, but there are also questions around the visitor proposition, demand, staging, funding, operating arrangements, partnerships, existing assets and the organisation's ability to sustain the project over time.
The different elements have to work together. And that is one of the things I find most interesting about feasibility work.
A community Menzshed and a heritage railway development might seem like completely different projects.
But ultimately they are asking a very similar question:
Is there sufficient evidence to justify investing further in this idea, and what is the most realistic pathway forward?
4. Does the project stack up financially?
Capital cost is only one part of feasibility. A facility may be affordable to build but expensive to operate. A programme may attract establishment funding but have no sustainable operating model. A community project might have enormous enthusiasm but depend on unrealistic assumptions about volunteer capacity.
Depending on the project, feasibility work may need to consider:
indicative capital costs
operating costs
potential income
funding sources
fundraising requirements
staffing and volunteer capacity
utilisation assumptions
maintenance and renewal
financial risks
sensitivity to changing assumptions.
For larger or technically complex projects, specialist input may also be needed from quantity surveyors, engineers, architects, financial advisers or other technical experts.
I do not think the feasibility consultant needs to pretend to be all of those things.
Part of undertaking good feasibility work is understanding what expertise is required to answer the question properly, then bringing those different inputs together.
5. Can it actually be delivered and sustained?
This is an area I think deserves more attention.
A project can have demonstrated need, strong community support and even available capital, yet still be difficult to deliver successfully.
So feasibility also needs to consider:
Who will own it?
Who will govern it?
Who will operate it?
What organisational capability is required?
What partnerships does it depend on?
Are those partners actually committed?
What approvals are required?
Where will the ongoing capacity come from?
What happens when the people currently championing the project move on?
These questions are particularly important for community projects where long-term sustainability may depend on volunteers, grants or a relatively small number of committed people.
Feasible to establish and feasible to sustain are not necessarily the same thing.
6. Understand the risks before committing
No feasibility study can remove uncertainty. Nor should it try to. Its job is to make the important risks visible before significant commitments are made.
Those might include:
Financial risk: Costs increase or expected funding is not secured.
Demand risk: Actual use is lower than anticipated.
Delivery risk: The organisation lacks the capacity or capability required to implement the project.
Partnership risk: Success depends on organisations whose commitment is not secure.
Regulatory risk: Planning, consenting or other requirements affect viability.
Operational risk: The project can be established but proves difficult to sustain.
Community and stakeholder risk: Expectations, concerns or competing interests have not been adequately understood.
Rather than simply assigning each risk a colour in a table, I think there is a more useful question:
What would need to be true for this project to succeed?
That turns risk analysis into something much more practical.
7. Give decision-makers a clear way forward
This is probably my biggest test of a feasibility study. At the end of the process:
Does the client know what to do next?
A study can contain excellent research, extensive engagement and detailed analysis but still finish with:
“Further investigation is recommended.”
Sometimes further investigation genuinely is required. But a useful feasibility study should be more specific.
It should help decision-makers reach a conclusion such as:
Proceed: There is sufficient evidence to move to the next stage.
Proceed with conditions: The project appears feasible provided particular issues are resolved.
Modify: There is a genuine opportunity, but the proposed solution needs to change.
Investigate further: A specific evidence gap needs to be resolved before a decision can reasonably be made.
Pause: The opportunity may have merit, but the circumstances are not right yet.
Do not proceed: The evidence does not justify further investment.
And if the recommendation is to proceed, the organisation should understand what the next stage actually involves.
Independence matters
There is one final ingredient I think is fundamental.
Your feasibility consultant needs to be prepared to tell you that your idea does not stack up.
That sounds obvious. But feasibility work is often commissioned after considerable effort has already gone into developing an idea. By that point there may be passionate champions, expectations, preliminary designs or funding conversations underway.
Independent analysis provides an opportunity to test the assumptions before even more resources are committed. Sometimes that strengthens the original proposition. Sometimes it changes it. Sometimes it stops it.
All three can represent a successful feasibility study.
Because the measure of success is not whether the project proceeds. It is whether the organisation makes a better-informed decision.
The report is not the end product
Ultimately, I do not think the real output of a feasibility study is the report.
It is decision confidence. A good feasibility process brings together research, evidence, stakeholder insight, realistic options, financial considerations, delivery capability and risk.
It helps decision-makers understand both the opportunity and the practical realities of delivering it.
So before asking:
“How do we make this project happen?”
it is worth first asking:
“Is this the right project, and is there a viable way to make it happen?”
That is the question good feasibility work should help answer.
Considering a feasibility study?
McElrea Consulting undertakes independent feasibility studies, research, needs assessments and options analysis for community facilities, visitor and heritage projects, councils, trusts and organisations considering significant projects or investment.
Our approach combines evidence and analysis with stakeholder and community insight to help decision-makers understand the need, the options, the risks and the practical pathway forward.
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