A couple started a hand and body lotion manufacturing business, which is still going well after a number of years. They started selling at Saturday morning markets, found there was a demand for the product and started developing their business. Now, they still sell to Saturday morning markets but also have stockists at retail stores and sell online.
This is a success story. But it doesn’t always happen this way. We know that the majority of new business ideas fail. Why is this so and what can you do about it? What can you do to ensure that your promising business idea will produce results?
The short answer is to do your homework. But what does this really entail? Unless you know what to do, you could follow the route of so many other one-be start-up ventures and land up with egg on your face. It’s no laughing matter. You would have wasted your time, energy, resources and perhaps feel embarrassed and disillusioned.
Before you even produce a sample or prototype, you need to check if there is a market for your idea. This may involve formal or informal research. You need to check in the existing marketplace to see what products are available and also do searches online to find out if such products or services are available. Depending on the nature of your product or service, you would probably also want to look for advertisements for similar products in general or specialised magazines.
Next up, would be to evaluate your idea to determine if it is attractive. What is your unique selling proposition? What benefits are potential customers looking for? How will your product or service offering reduce perceived risk, especially if you are a small business. Unknown, untried and untested? There are just too many products on the market to leave this step to chance.
An important stage is to test your idea to see if there is demand. This may involve producing a sample or prototype that you may want to take out into your defined niche market and test for buying intention. It’s no use receiving opinions and comments about how good your product is – the only thing that really counts is if people are willing to buy. The best form of testing involves actual purchases.
A stage that is often overlooked is feasibility planning to determine if you could establish a business based on your idea. Here you would look at a source of local suppliers, whether you have to manufacture the product yourself or not, how and where you are going to distribute it and whether you can do it on your own or need others to help you. I think this is an important step before producing a business plan because it gives you a rough guide of critical areas.
You would then prepare a business case for introducing your product or service, which would include a marketing and sales plan. Whether you are introducing a new craft beer, body or hand lotion or a specialised pet care service, it makes sense to come up with a brief business plan to help minimise your personal risk. Some may scoff at written down business plans, but how can you keep all the details in your head without forgetting important elements?
Next time you come up with an exciting new business opportunity. Don’t make the number one idea mistake which is not to do your homework beforehand. Get ready for your biggest step towards generating and implementing your own ideas for success. Why not use proven sources to build and target a product or side income asset of your own? Click on the books page to order your copy of “Breakthrough Ideas” now.