Is your business idea a good one?
When considering your own business, answer the question, "Why will my business be a success?" Spend some time researching and evaluating your idea. Ask your friends for honest feedback on your plan. Review your business idea with professional counselors. Think through your idea and ask yourself these questions:
- What business am I interested in starting?
- What services or products will I sell?
- Is my idea practical, and will it fill a need?
- Who is my competition?
- What is my business's advantage over existing firms?
- Can I deliver a better-quality service?
- Can I create demand for my business?
Before running out and getting a loan or ordering your business cards, take time to assess, research, and develop your idea.
Discuss Products/Services with Prospective Customers
- Would they buy from you? At what price? With what frequency?
- Why would they prefer your products to the competition?
- Find out what they really think: people may tell you what they think you want to hear. Listen carefully to what is being said; watch carefully for qualifications or hesitations; don't browbeat respondents with your ideas. You are looking for their views.
- What risks and hurdles do they see related to your business idea?
Assess the Market Using Desk & Field Research
- How does the market segment (by price, location, quality, channel, etc.)?
- What segments will you target?
- How Large are these segments (in volume terms) and how are they changing?
- What are the price makeups/structures?
- What market share might be available to you bearing in mind your likely prices, location, breadth of distribution, levels of promotion, etc.?
Analyze Your Competition
- Who are they and how do they operate?
- Are they successful and why or why not?
- How would they react to your arrival?
- What makes you think that you could beat the competition?
- At whose expense will you gain sales?
Consider Possible Start-up Strategies
- Will you be able to work from home or part-time?
- Will you seek a franchise or set up as an in-store concession?
- Will you buy finished products for resale as a precursor to manufacturing?
- Will you contract out manufacturing?
- Will you buy an existing business or form a partnership?
- Could you lease or hire equipment, premises, etc. rather than buy?
- How will you stimulate sales?
Thoroughly Examine Ideas from All Angles
- Can you raise enough money?
- Can you get premises, staff, etc?
- Will the product work?
- Who will you promote and sell?
- What possible problems will you face? Consider "What if" scenarios.
Bear in mind that the planning period for a new business can easily last several months or even years. Do not rush into the first feasible idea without letting it develop in your mind for a reasonable period. You may have a tendency to get fired up and enthusiastic to the point that your heart is starting to rule your head. Instead, step back and think!!