Here’s a story.
I stumbled into my first business at the age of 19. I went on to successfully own other businesses as I grew. Back then, I didn’t know the term for that was serial entrepreneur. [I don’t like the term much either]. I was not able to maximize my potential in those days because I didn’t know enough
so I failed, a lot. but I grew. Eventually I packed my bags and went in search of an upwardly mobile environment.
But here’s the real important news, As I learned the ropes of business and I realized there were hundreds of millions of people who just like I was didn’t know enough to succeed at their dreams so I dedicated my life to providing that life and business coaching for individuals and organizations.
Which brings me to the question that started me on this path, how many people know whether their business is truly a feasible idea? As it turns out, not many.
So you have a business Idea – now what? You are grinning from end to end and telling your best friend how you’re going to rule the world with this totally badass idea. You’re already dreaming of the Rolls Royce Dawn you’re going to order from the UK. Please calm down and realize – a good idea is a very small portion of a successful business venture.
Your friends and family might support you like a bastion but there are two KEY people you should be asking questions about your business idea –
No.1- Your Customer;
No.2 – Yourself.
Go through the following 7 questions, if you are on the right track, your responses should be a Big “Yes!” before you start investing time and money into your brand-new cutting edge, earth-shaking business idea.
Question 1- How Many People Demand For This Product Or Service?
A young man came to me and said, and said he wanted to start a vegetable retail business, I said okay. Then I asked him, – how many people are demanding for this product? He said “well, a few neighbours and friends but I’m really passionate about it. It will go places” I told him to have a rethink.
If your answer is nobody or just two friends, just stop! One of the biggest mistakes new entrepreneurs make IS pushing a product onto a market, instead of first identifying a market and then developing a product to serve it. Your product must excite your customers, solve their problem and must be something they are willing to pay for. Most important
Question 2- Are People Already Making Money From It?
Often the first person to do something isn’t the one who ultimately succeeds. Google wasn’t the first or second, to develop a search engine. Apple wasn’t the first to come up with a portable music player. Dangote wasn’t the first or second to start a cement business in Nigeria. They just found ways to do it sooooo much better.
Question 3. What Does It Cost To Produce One Piece/Unit Of Your Product?
If you are making or offering a product, don’t only consider profit. You need to calculate how much exactly it will cost to develop a unit. Next you have to make sure there is enough margin for reinvestment into further production, marketing (and/or hiring other people to create what you’re selling)
Long term phenomenal success demands that you are able to produce your product for 20% of the cost the market is willing to pay for it. If you are making a shoe that on average would sell for $500USD, you should be able to produce it for $100USD. For you to make real profits, you have to factor in all the overheads, your time, from the beginning to see real profits in the long term.
Question 4. Who Is Your Target Market?
If ‘everybody’ is your target market, then you are going to need Superman, Socrates, Hercules and his father Zeus to succeed. It is insanely difficult and ridiculously expensive to market to ‘Everybody’. You have to tailor your message to a highly specific market if you must lower your marketing costs and improve the impact you make.
For example, you could have a software product that only sells to the security aspects of website development or a financial planning practice that works only with the civil service structure in your home country. That way you can target your marketing and demonstrate to those specific buyers just how great your product is for them.
Question 5. Can You Sell 10 Pieces Of Your Product Or Service Without A Website, Flier Or Brochure?
Yes I know, popular belief says you do but no, you don’t need a website, business cards, fliers or brochures when you first start your business. In fact, if you can’t sell 10 units without the above media, then the original principle of that your business isn’t compelling enough.
For instance, my getting into business consulting was a natural path and consequence of the established business reputation and street credibility I had from solving specific problems with no website or brochure or ads.
Your product needs to provide a solution to an underserved market. If you can’t get people fired up about what you’ve got to offer simply by showing it to them, you better not fully launch because you won’t get them either.
Question 6. Is The Product A One-Time Purchase Or Is It Consumable?
Will people buy your product repeatedly or will it be bought once forcing you onto the hectic life of constantly searching for new customers? It is better to be in a business where people consume your products on a regular basis. This way you can get a customer once and keep them for life. I prefer to build up a loyal customer base that is constantly knocking at my door.
Question 7. Do You See Yourself Doing This uninterrupted For 10 Years?
Entrepreneurship is not about getting in, making money fast and getting out.
To become an overnight success you need to stick at your business for 5 – 10 years. If you’re looking to make quick cash, find something else! You may not give up your whole life, but you MUST commit for a significant period of time in order to succeed.
A good idea is just a small part of what it takes to build a credible business. Make sure you have a solid business model, clear demand from a target market and a consumable product that you can sell without bells and whistles or a cry for help.
Work towards a positive response to all the above questions and you’ll have a better chance at lasting success.
So in closing, here are 3 quick tips for improving your chances of business success:
Invest in your education as a business owner – I shared deep truths on this secret in my book. You don’t have to know it all from the start but the more you know, the faster you’ll grow. You can get my book here for free.
Enlist the help of an experienced coach or mentor.
Surround yourself with positive people who want to see you succeed.
Please engage me in the comment box below.
I’d love to know your thoughts on this and how I can help you even more.
Love, peace and blue cheese!