How Feasible is Your Business Idea?
Feasibility studies evaluate your business’s potential to succeed and identify areas that need further consideration.
01
Identify the problem your co–op will solve
Perhaps you want to provide a
product or service your community
doesn’t have.
02
Consider why customers will choose your co–op
What value are you
providing them?
03
Describe how your co–op will operate
Consider the people, the place,
the facilities, and equipment required.
Your feasibility study should include:
-
Technical Feasibility
What technical resources and qualifications do you and your team require? Consider electricity, internet, hardware, software, and facilities.
-
Economic Feasibility
What are the estimated costs and revenues for the business?
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Legal Feasibility
How might legislation affect your co-op in the areas of land, capital, data protection, and social media?
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Operational Feasibility
How well does your co-op meet the needs of its members?
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Scheduling Feasibility
How long will it take for the co-op to set up, begin operations, and begin to serve its members?
Business Planning
Once your business is determined to be feasible, it’s time to write a business plan. A business plan describes what the business is, how it runs, who will do the work, where the start-up funds come from, and how to mitigate risks.
We’re here to help guide you through the business planning process. For more information about how to get started writing a business plan, see page 26 of our guidebook.
Financing
All businesses need money to get started. Founding co-op members can either raise funds internally or seek outside financing.
External Financing
Bands, Credit Unions, or Aboriginal Financial Institutions (AFIs) may be willing to become an investor in your co-op, providing a loan for start-up capital. Wondering how to approach financers with your business plan? See page 30 of our guidebook for best practices.
Share Capital
Co-ops typically issue two types of shares:
Membership Shares
are purchased by those who want to become an owner of the business. Depending on your co-op’s goals, the cost of membership shares will vary. Do you want the co-op to have a lot of members? You’ll probably want to sell the shares for less than $20.
Investment Shares
are purchased by those who wish to make a significant investment in your co-op. Investment shares cost more than membership shares and offer a return on investment based on an agreed-upon rate of return and payment schedule. Investment shares can be issued or repurchased as determined by the co-op’s members.