We find that there are seven common themes that arise when assessing whether a business idea will succeed.
1. Your idea has a strong point of difference
To survive in business, you need a compelling point of difference. If your idea is not novel, then what makes you different. The stronger this difference is, the stronger your competitive advantage will be.
2. People say “WOW” (and want it)
An instant “wow” response is a great indicator. But people still need to be able and prepared to buy. Most people love the look of a Ferrari but only a fraction will ever buy one.
3. Your idea will be hard to copy
Take action before you start the business to build barriers to competitors. Get expert advice on what you can protect through patents and copyright/design protection. Registering your branding as a trademark is a simple step to build those barriers!
4. You have hard evidence of demand
We all dream. “If only 1% of the Chinese market buy our idea, we will be millionaires!”
But when you start a business, you need hard evidence, not wishful fantasies.
Careful market research is an important first step but more convincing are test marketing results, sales made or advance orders, signed contracts and interest generated through social media.
5. The market is growing
All markets go through cycles. Is demand for your product or service in the early growth stages, at maturing or in decline? What evidence do you have to support this? Ideally, the potential market should be emerging or strongly growing rather than being mature or in decline.
6. The market will accept your price
You may have the most exciting product or service but can you bring it to market at a price the market will accept and still make a sustainable profit? No matter how special, there’s still an upper limit to what people are prepared to pay for a product because there are always alternatives (including not spending money at all).
7. You have the ability to convert the idea into a business
Ideas are plentiful but the ability to translate ideas successfully into a viable business are much harder. Do you have a track record of accomplishment in business or at least of “getting things done” successfully?
Seeking professional advice is essential in assessing the viability of a new business idea.