You’ve got an idea you think could turn out to be The Next Big Thing, but if it doesn’t meet a few key conditions, you could just be putting your small business in jeopardy.
Here are a few things to think about before taking the plunge, from Maryalene LaPonsie at Small Business Computing.
Start by asking yourself if the idea fits in the context of your current business. If it’s not compatible with your current offerings, it’s at greater risk for becoming a flop. Consider Colgate’s idea to sell dinner entrees in the early 1980s or the short-lived Hooters airline that was grounded after only three years. If it seems like a random idea, it probably is.
Does the idea fill a want or need? Market research should help you here. A product or service for which there is no demand could be destined to fail, unless you’ve got the rare invention that people didn’t know they needed. Ask yourself these questions:
- Are there competitors offering the same product or service?
- Do these competitors have a weakness you can exploit?
- Is there an underserved customer base or geographic region that could benefit from your idea?
Finally, make sure you can afford to take the risk by looking at your financials. If you are not a numbers person, hire someone to help you estimate the anticipated payoff, as well as how much you stand to lose if your idea flops. In the event that a loss could put you out of business, consider brainstorming for another great idea.
Don’t let your impatience put a stable business in jeopardy. Even “can’t-lose” ideas sometimes fail.
Adapted from How to Take Smart Business Risks by Maryalene LaPonsie at Small Business Computing. Follow Small Business Computing on Twitter.