Is my business idea a good one? If I had a pound every time ive been asked that.
So you’ve thought of a great business idea. Move over sliced bread here I come. There are some factors that should be thought about and discussed when deciding whether your business idea is a good one or not. Below is a list of some factors that should be taken into consideration when deciding this.
Enough of a market
There needs to be sufficient demand for your product or services or you won’t be able to generate any profit. If the market is growing then this is even better as investors are more likely to contribute and there’s more chance of your business growing in the future. Your market must also be sustainable; do not piggyback on trends as these chop and change very quickly, potentially leaving your business with no customers. Market research is essential to check if your business idea is do-able.
Able to generate enough money
Your business idea must not only sound good they must be commercially realistic. This is where research is essential; you need to find out how much it’ll cost to make your product and how much you’ll sell it for, factoring it essential costs such as salaries, manufacturing costs, expenses and raw materials. If your idea can’t turn a profit then you either need to pick another idea or find out why it won’t be profitable and take steps to monetise it. Speaking to an experienced business person may help.
Potential to grow the business
The best businesses don’t only turn a profit but also show potential for further growth, whether this manifests as an expanded product range or activity in new markets. This is why operating in an expanding industry is preferable as you’ll be more able to take advantage of emerging marketing avenues and ensure your reach is always maximised. The web is another very important topic; if you can’t leverage the Internet to increase sales and expand your customer base then you may have problems in the future.
Serves a purpose
Products must solve a problem or serve a purpose or there’s unlikely to be any demand. Customers must feel there is long-term value in your products or will be unlikely to buy from you. Also, this value must be clear – murky benefits will be difficult to sell. Unless you can quickly and clearly prove your products not only solve a problem, but also do so more efficiently than products supplied by your competitors, you’ll have a hard time selling your services.
Is it realistically do-able
Your business idea must work within the constraints of a start-up business. Likewise, inventions may require such large amounts of start-up capital to render them undo-able. If your business idea focuses on a product, speak extensively to manufacturers before starting-up to ensure you can get the product produced cheaply enough in the early stages. If you can’t, it’s time to have a rethink.
Trunki’s Story-
Rob the owner of trunki had his business idea turned down by the Dragons Den investors. Underterred Rob went on to make a success of the business. Don’t always take advice from other people. If your confident in your product or service then go for it.
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