The following blog post is a case study for a recently completed project by Research & Marketing Strategies (RMS) in Baldwinsville, NY. RMS is a feasibility study firm that conducts market research to provide businesses with the information and answers they need to determine whether a venture is feasible or not. The final report from RMS includes: usage predictions (and potential modeling); recommendations to make the venture most successful; competitive profiles of other area organizations; and area demographic trends that will impact the venture. For more information about RMS and our feasibility studies, contact Sandy Baker, our Business Development Director at SandyB@RMSresults.com or by calling (315) 635-9802.
Background: A bank on the Atlantic coast of the United States partnered with Research & Marketing Strategies to assess the feasibility of opening a dinner theater location. The bank had a dinner theater client who requested a small business loan to pursue this venture but to ensure the venture would be successful, the bank came to RMS to obtain statistically reliable information to help decide whether to approve the small business loan. Results from the research gauged the level of community interest and provided the banking client with potential opportunities and interest related to the dinner theater.
Approach: Although RMS’s process for a feasibility studies involves a recommended five-component approach (see Five Key Components of a Market Research Feasibility Study), we were able to work with the banking client to provide them with the answers they needed within their limited budget. To tackle the feasibility of the venture, RMS completed a quick pulse telephone survey within the expected primary market area (PMA) of the proposed dinner theater. (What is a quick pulse telephone survey? Click here). The quick pulse survey inquired about likelihood to visit the area and how the availability of a dinner theater would impact usage and reasons why. Other secondary objectives covered in the script included impressions of the venture, the testing of price points and recommendations of how to make the dinner theater most successful.
Results: Here are a few of the key takeaways from the final report, which detailed how RMS determined that the dinner theater in the proposed PMA would be a successful venture. RMS recommended to the bank that it approve this small business loan because of the following statistics:
- A large majority of households surveyed were likely to visit the PMA for the dinner theater within the next three years. About one in five likely visitors said they wanted more entertainment venues available in the area. Most were unaware of any dinner theater options currently in the area.
Over half (54 percent) of respondents would be at least somewhat likely to visit a dinner theater located in the PMA within the next three years.
- There is a high level of interest in a dinner theater option in the proposed location with a majority of respondents saying they would be likely to visit it. An even larger majority (80 percent) believed that the concept would be successful. Furthermore, the proposed ticket price range ($44 to $66) was acceptable to 92 percent of respondents.
- Likely visitors would be most inclined to visit a dinner theater during the months of June through August. Building interest among locals in the fall months will be important if the theater is to remain open after September.
Because the information and the data obtained from our study had proven so valuable, the bank is now considering using feasibility studies through RMS for any new business loan over a specific dollar amount as part of its standard loan approval process.
For other feasibility study blog posts and to read more about the work RMS does click on the links below: