For an idea to become a profitable business opportunity, it should be evaluated, both within your current group and experts. I am writing about five major questions to ask while evaluating your business idea, though there can be several more addressing wide array of concerns in order to create a foolproof plan.
1. Targeted Market Segment
You need to identify important problems of the consumers that your business intends to target, and think about the value they will gain. It is important to focus on customer’s needs rather than the attributes of the product/service planned. The market need has to be carefully assessed. “Is there a market segment that you can target by offering clear and compelling benefits at a price the targeted customer is willing to pay?” The answer to this question will help you identify the market segment you are trying to enter. The segment may be described in terms of demographic, geographic, or lifestyle factors.
2. Business Model
You have to clearly identify how you intend to solve the customer’s problem. This will include a detailed product description and overview of how it is going to be produced and delivered to the target customers. Think about developing and employing superior organizational processes, capabilities and resources as compared to your competitors. Your business model will clearly identify the economic viability and the profitability of your startup.
3. Market Size
Ponder over your market size and share. Think about who will buy your products beyond your family and close friends. You have to figure out a way to convince your target customers to buy your product. Also figure out a way if you can reach out to a different segment of customers at the same time. This will also help you realise the kind of investment you require to run your startup, and then you have to plan for raising finance.
4. Maintaining Niche and Protecting your Business
You will have to constantly think about how are you going to protect your business from other existing businesses in your domain and possible new entrants. There has to be some differentiating strength that gives you an advantage. business strangths can be as varied as low-cost structure, superior and/or innovative product quality, dedicated channel, or proprietary elements such as patents, copyrights etc. Also focus on building relationship within your domain. the number and quality of contacts up and down the value chain is an important determinant of eventual business success.
5. What’s in for you?
The business should make it worth to be you part of it. it should be a startup you are proud running.Any startup that gives you back your money within three years is good. if it can within one year, its brilliant.
We at Stratessence regularly sit with budding entrepreneurs over coffee and evaluate their business ideas. If you are interested to have an informal chat session with us [sometimes it runs for 3 hours, few mugs of coffee, and several sheets of paper used], write to us at firstname.lastname@example.org . And yes, we don’t charge you anything!