Not every idea is a great one. Even the best raw ideas need refinement. These ideas are going to be the cornerstone you build your entire business around. You need to evaluate the strength and growth potential of your offerings. According to Bloomberg, 8 out of 10 businesses fail within the first 18 months. There are many business practices you can adopt that will help your business become the exception to this staggering statistic, and one of the most vital is idea evaluation.
There are many reasons you may be considering starting a business. Whether it be job security, increased efficiency, or personal fulfillment, being a business owner can be a lucrative and rewarding investment. However, it is also a risky and challenging endeavor. If you’re anything like me, you have new business ideas flying through your head every day. However before you take the next step, an evaluation of your potential product/service is required.
Here are some good questions to ask during business brainstorming sessions:
What exactly will your product/service provide?
If you cannot explain what you want to offer with clarity and focus, chances are you do not have a clear idea yet. If you do not have a clear picture of what you offer, neither will customers. Confused customers do not buy. The economic climate today demands clarity.
Given a choice, would you rather go into the paper map business or the GPS business? It is challenging enough to start a business without having to create a new or fight against an existing market. Spend time researching the industry. Will your product/service create a solution to an existing problem? Is there a new technology that exists that will do the same thing more efficiently? Consult other experts in the field, especially if you are breaking into a new market.
Who is your target market (really)?
In an ideal world, everyone would enjoy and utilize your product. In theory, it may seem like a larger target market would result in more customers and a more successful business. The reality, however, is exactly the opposite. The more targeted and purposeful your marketing is, the more certain customers will be that they need what you offer. In addition, a startup company does not have the resources to market to a very large audience. Highly targeted and purposeful marketing will yield better results and give you plenty of customers to get your business off the ground.
What do other trusted experts in your field think?
Your mom might think your idea is the best. Maybe your friends are all praising your name. But how much do they know about the industry? Ask an expert with whom you have rapport their opinion of your idea. Their knowledge and wisdom will help you refine your idea. In addition, you may not know the harsh realities of what the industry entails. You may make delicious baked goods, but would you be able to run a bakery? Get the inside scoop from experts.
(I don’t remember who said this. Can you add their name in?)
“You don’t have a money problem, only an idea problem.” Creating a business is a demanding and challenging process. Having focused, refined, and tested ideas as your foundation is a necessary first step for success.