- Make sure your business idea is unique and meets a need or solves a problem.
- Consider the timing and location of your business idea.
- Be aware of any limitations to implementing your business idea, and ensure you have the required skills and qualifications. Also be prepared to sacrifice the hours required to make your business a success.
Before getting a business idea off the ground, you must decide whether it’s worth pursuing. However, to do this, you need to evaluate it by conducting a business idea assessment.
These are the 7 questions you need to ask yourself to help analyze the concept before deciding if the business idea is feasible:
1. Is it a Unique Business Idea Meeting a Need or Solving a Problem?
When a business idea can meet the needs or solve the problems of its potential customers, it immediately has a greater chance of success because it adds value. On the other hand, if it can’t do this, it should at least satisfy consumers’ desires. Therefore, if the business concept can’t do any of these, perhaps you need to think about another idea.
Breaking into a competitive market makes it difficult for a business to survive. Therefore, consider whether your business idea is unique. However, that does not mean you cannot find a niche in an already highly competitive industry.
If you feel your idea has a place in the marketplace, you should research whether others that tried each reached a level of success. Also, analyze any failures to determine what prevented them from turning a profit.
2. Is it the Correct Time and Place for Your Business Idea?
There is no shortage of business startup ideas, with several reaching significant levels of success. However, don’t get too excited because several external factors can impact a startup’s success.
Some business ideas don’t come at the correct time, and not all suit every market.
The gig economy is the perfect example of a business idea that took off because it happened at the right time. It combines digital technology with the need for affordable services. Meanwhile, for people working in the gig economy, it allows them to work on flexible schedules.
All these factors combined gave rise to companies like Uber and its affordable taxi services, the convenience of Rover for people requiring dog walking services, Task Rabbit for job completions, and Postmates for delivery services of foods and essentials.
The gig economy came at a time that offered immense growth potential with solid sales that continue to increase.
3. Are There Limitations to Implementing Your Business Idea?
Often a business idea may have drawbacks or limitations. These can include anything from high startup costs to multiple competitors. Other restrictions include educating customers to use a product or service or getting them to change their habits to incorporate your service or product into their lives.
It doesn’t mean you cannot overcome these challenges, but you must think of creative ways to make it easier. Therefore, you need to consider your business limitations and whether you can overcome them. You must also consider if these drawbacks will outweigh the potential profits—the more pros than cons, the better for your business concept.
4. What are the Startup Costs
Determining the business’s startup costs and how it will make money can prevent you from finding yourself without a company and with a huge debt burden.
Startup costs vary according to what you offer. For example, offering services usually requires less money than researching and developing a new product. Additionally, creating new products requires more time before you can hit the market.
You must include your new venture’s business plan and marketing strategy in your startup costs. Furthermore, you will need to work long hours to help get your business venture off the ground. Since all these require money, you need plenty of savings or an investor willing to fund your idea.
5. When Will the Business Make Money?
Generating an income is the main goal for every new business idea. Next, you need to consider if you can stay afloat until your new business can sustain itself. Turning a profit requires a couple of years, and anything longer than three might not be worthwhile. Finally, you will want to determine if the customer is willing to pay for your product and how much. Products that provide unique solutions tend to have bigger profits, but what you charge must conform with the market.
6. Do You have the Skills and Qualifications that Match Your Business Idea?
You don’t need all the relevant qualifications for your startup since you can employ people to help you. However, good business skills are vital to helping you manage the work and any difficulties that may arise. In addition, the better your qualifications, the more you can understand the progress of developing the product.
7. Are You Willing to Sacrifice the Hours Required for the Business?
Starting a new business takes long hours, money, and hard work. It would help to consider whether these sacrifices are worth making before deciding on a business idea. Therefore, you require a commitment and passion for doing this at the expense of spending time with family and friends and financial insecurity.