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Why Are Feasibility Studies Required by the SBA for Small Business Loans?

The reason the SBA (Small Business Administration) might require an SBA Compliant Feasibility Study is because it is about a business enterprise that is a start-up, or expanding, even if you own two other locations and operate successfully taking on more risk means the lender wants to evaluate these items and have it done by a professional feasibility study provider who has no interest in the project.

You might be increasing you debt capacities, or spreading management thin for instance and the bank is concerned.

Have you ever seen a successful restaurant that is busy all the time fail? And wonder what happened? A good and reliable feasibility can illustrate if a market is saturated or if there is a population change concerning cohorts or other essential demographic trends.

That is the job of a third party SBA Feasibility Study provider is to evaluate and report these risks.

Other risks include lack of trained or trainable labor at the cost to operate successfully, or there are other projects in planning that might increase the level of competition. Many more factors.

In a nut shell, its about risks.

SBA Feasibility Study
SBA Feasibility Study


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