A feasibility study is designed to provide an overview of the primary issues related to a business idea.  The purpose is to identify any “make or break” issues that would prevent your business from being successful in the marketplace. In other words, a feasibility study determines whether the business idea makes sense.  A thorough feasibility analysis provides a lot of information necessary for the business plan.  For example, a good market analysis is necessary in order to determine the project’s feasibility.  This information provides the basis for the market section of the business plan.  Because putting together a business plan is a significant investment of time and money, you want to make sure that there are no major roadblocks facing your business idea before you make that investment.  Identifying such roadblocks is the purpose of a feasibility study. 

Chapter 5 of the University of Wisconsin Center for Cooperative's online manual Cooperatives: A Tool for Community Economic Development.