Hi all ,
as I travel for at least 20 hours a week I thought this would be a great time to write my practical guide to starting your own business. I will be approaching a different subject each week from initial idea to compliance ,cash flow ,expansion and finally selling your business. For the next week or so I will be focusing on how to evaluate your initial business ideas and to consider the right strategy. As always if you wish to discuss any ideas you have please drop me a line via the contact form.
Evaluating your idea.
when you first have an idea for a business venture it is important that you do not make the mistake of immediately jumping to the cash flow stage and working out how much it will cost and eventually earn. Many thousands of pounds can be lost if the idea itself is the problem as no amount of additional funding will make a bad venture into a good one.
firstly it is important to consider the idea in a structured way I will use various good and bad examples to highlight the thought processes that you should consider.
idea 1 I think dogs should have designer trainers.
ok this may sound slightly absurd but the logical path should be the same
assessing the market.
does the product already exist – whatever you are planning to do remember to research other like for like businesses, this could be in your own area, or across the globe. I came up with this idea whilst on the train trying to think of a good example of a bad idea, when I searched the Internet i found that there are a number of organisations producing and selling boots for dogs this highlights that is highly unusual for your idea to be unique.
If your idea is unique it is important to consider why, it’s best to take a pessimistic view at this stage you can always convince yourself later of the merits of the venture.
Firstly you should consider
is the venture legal?
is it ethical?
why has it not already been done?eliminate an idea that competes directly with companies who could reproduce your product
is there a market for the product?
if your idea is already in the market today then:
it is also important to have a practical view of what you want from the venture? It’s fine to dedicate a couple of hours a week to a venture as a hobby or an additional revenue stream however if you are planning to make this a full time role then this will have an effect on how you assess the market.i have decided that I want to appeal to the super rich with diamond and gold encrusted booties. I believe I can sell a small number of the product with a high return on my investment.
In essence this is a feasible business idea.i have researched the Internet and am confident I can make a pet friendly shoe which models itself on the footwear of the rich and famous.
a key question at this stage is what are the barriers to entry? If I can do this what stops someone else from doing the same, it’s best to be critical of an idea that can be easily replicated by big businesses within the same industry. It may be possible to protect your product by patent but this is very unlikely due to the precise nature of what you can and cannot get a patent for.
I have decided that as I have a direct link into the social circle of professional footballers that I will use this to sell dog boots that look the same as the football boots they wear, and bling booties for the female dogs.
Continued on evaluating your idea part 2