The pursuit of commercial viability: Seven questions new business owners must answer
Tuesday, August 6, 2019/
Anyone can have an idea. Ideas are cheap and they are plenty.
The challenge is turning that ‘amazing’ idea or invention into a commercially viable business entity.
Many people throw their hearts, souls, energy and wallets into developing their idea. Designing, crafting and forming it. Then thinking about how they are going to market their idea to customers using marketing strategies and tactics. They are looking from the inside out.
But there are key questions most new business owners fail to explore first.
- Are there customers and markets looking for a solution that your idea can solve?
- Are these potential customers prepared to pay for your solution?
- Is your idea really innovative, new or different? If so, how many ‘early adopters’ would be willing to buy it and get on board early, versus something they are already familiar with?
- Is there a big enough customer market for your idea on which to build a commercially viable business?
- What competition will you be facing when you enter the market?
- How many businesses are you competing with directly? How big are they?
- Are you entering an overcrowded market with big players who have lots of money to spend on marketing, advertising and sales or is the market a ‘cottage’ industry that has lots of small players?
These questions (and others) need to be answered before anyone officially starts any business.
If you cannot find markets of sufficient size (yet) and you don’t have something that meets clients’ current or emerging needs and priorities, then don’t start.
Because if your business idea is not commercially viable, then it’s a hobby.
A word of caution: don’t get confused or distracted by programmes or books telling you that having an idea and will to make it work is all it takes. It isn’t.
So, before you invest all that time, money and effort, do your homework by checking there is a viable market wanting what you have to offer, that is willing to pay for it, and that you have a distinct competitive advantage.
Remember everybody lives by selling something.
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