There is no ‘easy button’ for starting a business. Face that fact now or be in for a rude awakening. It all requires effort, research, more effort, and some legwork long before the OPEN sign can even be placed on the door (or virtual door). You’ve been through the ‘decision to do it’ process and you’ve explored your talents. Chances are both of those actions took weeks, months, or years to finally come to a reasonable conclusion.
Now that you are gung-ho about the business idea you have, it doesn’t mean you are ready to quit your day job. You need to go back to the drawing board and determine whether or not your business will be profitable.
How do you make the determination, you ask? While there is no sure-fire calculation or formula in most businesses to predict how successful you will be, you can guesstimate how well your business can do by using the following tactics:
Check Out the Competition
Whether you plan to have a brick and mortar business or operate solely online, you can benefit from looking at the competitors in your proposed niche business. If you plan to establish a business that relies on local customers – let’s say a pizza shop – consider how many other pizza places there are in town. Ask yourself what would set you apart from the others that would bring in steady customers. Find out if other similar places lasted against the competition. Is there really a place for another pizza joint?
Develop Your Business Plan
You might downright panic at the thought of having to create a full-length business plan but the reality is in most cases, the process of developing a business plan is essential to really taking a close look at your ideas, goals, intentions, knowledge, and finances for the business venture you wish to undertake.
Some people will argue that a business plan is only necessary when you need loans or investor assistance. While that can be true to some extent, a business plan is still a highly recommended tool to help you see the realities of going into a particular business.
There is an element of common sense that must be involved in pre-planning a new business. If you live in a small town or a rural area, a 5-star hotel might seem a bit ludicrous. Okay- it’s pretty ridiculous! However your small town may benefit from a Bed & Breakfast or a donut shop. Consider your ideas and how they relate to your specific situation way before giving up your day job, your steady income, and your savings account funds.