All successful businesses started as initial abstract conceptions: the entrepreneur’s ideas. While it may be quite easy to imagine an idea for a business, not all such imagination can be translated into a real business opportunity. In other words, not all conceived entrepreneur ideas will actually have a business value or promise of profitable realization. Hence the aspiring entrepreneur, if he must be successful, must have to sieve the flood of ideas that come to him, and identify those that can be turned into promising business opportunities. This reality check is by no means easy, and evaluating the viability and profitability of entrepreneur ideas may be a frustrating obstacle for the intending entrepreneur. In the light of this, this article aims to provide insights to guide the aspiring entrepreneur in assessing his/her small business ideas, and identifying which one bears the best potential for successful realization.
Also read: The value of business ideas.
The entrepreneur ideas may arise from radically innovative concepts that bring into existence what has never been before. However, most small business ideas originate from answers to simple questions such as: ‘How can I improve on an existing product/service, or correct an existing market inefficiency?’; ‘Is there a potential market vacuum not being served by existing products or services?’ or ‘How can I provide a product or service differently from existing options?’ etc. But whatever entrepreneur ideas that become articulated out of these inspiring questions does not guarantee a successful business outcome. The small business ideas that bear promise of profitable commercial value, would be those that positively address the following evaluating questions:
Does it solve a problem or fulfill an unmet need?
As I pointed out in my previous article on The Value of Business Ideas, a key value-defining quality of profitable entrepreneur ideas is its relevance to customer needs or problems. Both big and small entrepreneur ideas aiming for a successful business outcome, must offer benefit to the customer by solving a problem or fulfilling a need. Customers buy products and services for just one reason: to satisfy their needs. So, if business ideas are such that they bear no compelling relevance to customer needs, they cannot hope to be profitable.
Will customers be willing and able to pay for it?
The major point of a business commitment is to make money. Realizing money from entrepreneur ideas depends on potential customers’ willingness and motivation to pay for the product or service. This in itself depends on the inherent value the entrepreneur ideas bear or hope to deliver, such as providing a convincing solution to a problem or satisfying an existing vacuum of needs, etc., and the price you ascribe to such value. Small business ideas, or any entrepreneur ideas for that matter, would be pointless and commercially worthless if they do not attract customers willing and able to pay for the product or service. It is the capacity to attract paying customers that validates entrepreneur ideas and determine their chances of profitable business outcome. In addition, promising entrepreneur ideas should inherently demonstrate a clear and sustainable mechanism for realizing profit.
Is there a significant, unique and favorable market niche for it?
The aspiring entrepreneur must have to establish if there is a real market for his/her small business ideas, and what the general market climate looks like- for e.g. current market trends and risks, existing market policies and regulations and how they affect the entrepreneur ideas, etc. Promising and viable small business ideas must be able to uniquely fit into a market niche for products or services in that category. The market should also be one that is willing to accept and accommodate the ideas. Promising entrepreneur ideas offer a product or service that would be accepted by a large market. Without such a sizable market, the entrepreneur ideas may never be launched successfully. Profitable small business ideas should inherently possess properties that enable it to adapt to the existing market, while creating a unique identity and marketing strategy that exceeds existing customer expectations. All successful entrepreneur ideas have an intrinsic innovative proposition and unique strategies and values that set them apart in a positive way from the pool of competitors in the market.
Are you sufficiently passionate and motivated about it?
Starting and running a business commitment will most likely consume your time and energy. In addition, in every start-up, risks and discouraging obstacles are almost practically inevitable. Therefore, the entrepreneur ideas should be such that the entrepreneur is sufficiently passionate and motivated about, so he can sustain the enthusiasm and patience needed to drive the idea to a successful business outcome. It would similarly be helpful in this regard if the small business ideas are such that the entrepreneur has considerable skill and experience about.
Can you organize sufficient resources to launch the idea?
The aspiring entrepreneur must also factor in the feasibility of funding his/her ideas in evaluating the strength of his/her small business ideas. Every start-up would require some form of start-up capital and you have to weigh your entrepreneur ideas against the financing options available to you, or your capacity to organize the resources necessary to translate your small business idea into a concrete commercial enterprise.
In conclusion, it is my sincere hope that these insights and considerations will guide you in identifying entrepreneur ideas with the promise of successful realization. Good luck!