Look Before You Leap
Before committing a lot of time and money to a business idea, you must first find out whether your business idea is feasible. In other words, will it work and will it make you money? If you jump into business without checking your idea, you risk wasting a lot of your own money and time. As the saying goes: “look before you leap”.
Sometimes you will find out that your idea is not feasible. Don’t worry: you may still be able to change the idea to make it feasible. It is common for a business idea to change as new facts are discovered. Even if you find that there is no way to make your idea feasible, you still benefit, because you have saved yourself from wasting time and money on an idea that won’t work – you can then start looking for a new idea that will work.
Why Would Anyone Buy From You?
While business is not just about making money, you do need it to stay in business and this money must come from customers. If people won’t buy your product or service, or won’t buy enough of it for your business to pay its own way, your idea is not feasible. So, before you launch, you need to know that there are enough willing customers to support your business.
Unless you can secure your customers in advance, there is no way to be certain that your business idea will be successful. It can be easy to get carried away with an idea when the product or service is something you like. However, this doesn’t mean that enough other people want it to make your business viable. This means that your business idea must be based on something that your target market values.
Factor to Consider
Be very wary about getting into business based on positive feedback from just your friends and whānau – unless they will purchase enough of your products or services to make your business profitable in the long term, what other people think matters a lot!
In other words, you should start by looking at your business from your potential customers’ point of view. Try to put yourself in the customers’ shoes and see your business as they see it. Even so, this will not be enough: you will at some point have to do some market research. That means going out and collecting data from people in your target market. Only when you have completed your research will you really have a good sense of whether your business idea is feasible.
Your basic question is: why would anyone buy from you? To answer this question, you need to consider many other questions as well. For example:
- Will your business provide customers something they need, and therefore cannot avoid buying? If so, are there other ways they can satisfy this need already?
- Will you provide something customers will want, but could go without? If so, do they know that they want it? How badly do they want it?
- Do any other businesses provide similar or alternative products? If so, will your business do a better job than these existing alternatives? If so, how?
While it is very tempting to follow your own gut feelings, never assume that you know what customers think or what they like. Never take a risk on a hunch when you can gather evidence to support your decisions.