3 Questions to Ask When Developing a Business Idea
At one time or another, many of us have had a novel idea and thought, “this would make a great business!” Plenty of entrepreneurs have taken the next step, developing and enacting their business idea, even without special skills, prior ownership experience, or unique qualifications. Creating a thriving business is a challenge, but it is possible. Before getting started on the details, it’s useful to spend some time asking yourself whether this idea is right for you.
1. Is this something I know?
This first question may be the most obvious, but it may also be the most important. You are most likely to succeed — and enjoy your work — if your business idea springs from a topic you know well. If you have a background in restaurant management, for instance, you’re likely to have a wealth of experiential knowledge about food services and may be most suited to creating a business in the hospitality industry.
Likewise, certain skills are transferrable. If you’ve successfully worked in billing, administration, or office management in one industry, you may find an avenue for these skills in an entirely different field.
2. Is there a market for it?
There’s no point in developing an idea of building a customer base is unrealistic. Spend some time considering your own experience, and explore cities and towns near you, to hone a sense of whether your business concept has real potential. Visit similar businesses, and talk to people in the field, to get a feel for their experience.
For more intricate research, you can utilize the internet, or even an established business development or consulting service, to get a sense of market trends and opportunities for growth.
3. Is it financially realistic?
Most new businesses don’t make a profit for their first year or longer, and so it’s important to consider whether your business idea is financially viable. If you have adequate savings and sufficient capital to start, this question may have less bearing on your decision. If, on the other hand, you cannot afford to skip a salary for a year or two, or your business requires excessive startup cash to get going, you may be better off altering or replacing your idea.
Owning your own business can be an exciting and deeply rewarding adventure, but it also carries a lot of responsibility. It’s important to do your homework beforehand, proceed cautiously, and develop a realistic and manageable plan.