If you are itching to be your own boss and believe that you have the work ethic and drive to start your own business, you may be holding back for lack of a good business idea.
After all, you don’t need to just offer a product or service that is in demand, but one that you will enjoy providing, especially as you may have to put in extra hours and effort to get it off the ground.
The good news though is that, in this post-Covid world where people are more determined to carve their own work-life balances and entrepreneurship is booming, there is no better time than now to take the plunge.
But where do you start? How do you go about find the right business venture to embark on?
Here are 7 useful pieces of advice to help you:
1. Identify your passions and interests
While you may not be fortunate enough to be working in a field that you love – or maybe the younger version of you used to enjoy it but now you no longer do – starting your own business is an opportunity to mix business with pleasure. You will appreciate the long hours and tough times more if you have a personal interest in what you are doing.
Your first step in figuring out what business path you should follow would be to choose one that aligns with your skills, knowledge, and personal interests. These are key pillars on which to base a new business. Running a business that you genuinely enjoy will increase your motivation and overall satisfaction.
You may already even have the right contacts for securing stock and even people that can offer their expertise. If you cannot, for some reason, start a business based on your passions and interests, then you should at least try to choose a product or service that you won’t hate being involved in. Make sure that you fill a need of potential customers.
2. Conduct market research
Once you have your business idea, you need to investigate market trends, customer demands, and competition within the industry you're interested in. Analysing the market will help you understand its potential, identify gaps, and determine if there's a viable market for your business.
Sometimes you may find that your particular business offering is already being covered in the areas you had aimed to operate, so you will either need to target another area or customer base, or change your idea.
If your business will serve a particular type of customer of a particular income group, for example, research which areas your potential customers live or operate, and then tailor your offering to that area.
If you are really passionate about what you want to specialise in, but find that the idea has already been taken, see if there is any way to evolve or add to the products already on offer. For example, John Lillegren, co-founder of Amy’s Candy Kitchen in Wisconsin, US, already knew that candy apples were not a new concept, so he decided to create high-end candy apples that had gourmet appeal.
3. Assess your target audience
If you have established that you have a strong business offering and know that there is demand for it, you need to then do all you can to understand your potential customers, including their needs and preferences. This will enable you to tailor your products or services to meet their specific requirements, increasing your chances of success.
If you are already dabbling in your chosen business arena as a hobby, you may already be aware of the gaps in the market or extra offerings customers would like. You should also analyse the existing competition in your chosen industry. Assess their strengths, weaknesses, and unique selling points to make sure you do not repeat their mistakes. Identifying gaps or niches that competitors have overlooked can provide you with a competitive advantage.
4. Consider scalability and growth potential
Even if you have found a target market and chosen a business that you will enjoy running, you need make sure that it has the potential for scalability and growth. Assess if the market has room for expansion and whether your business can adapt to changing circumstances and consumer demands.
Bear in mind that, while you may be happy in the short-term with your small business, eventually you may want to evolve it, especially as the cost of living increases. You can’t be charging the same prices for your products or services in a year or two’s time that you are charging now, and if you rely on your existing customer base only, there will also be a limit to how much price inflation they can tolerate. Always look long-term.
5. Evaluate your resources
If you have all the above bases covered, then the next thing you need to do is determine the financial and human resources you have available to start and sustain the business. Consider your budget, access to capital, and availability of skilled personnel. Matching your resources with the business requirements is crucial for long-term success.
Many people may get stuck at this point of their entrepreneurial journey, but don’t let a lack of resources stop you completely. Even if you do not have the money to start your business full-time, you can continue working at your current job and putting a little money aside to get your own venture off the ground. Keeping your income stream while you start earning with your own business will take financial pressure off of you. Yes, it may put pressure on your time as you juggle your job with your after-hours business but eventually it will be worth it.
Many enterprises also offer small business loans that you can consider, but to avoid debt, especially in an uncertain economy and with a new business offering, it would be a better idea to try fund it yourself. Once your business is established and making money you could consider a loan to help you grow it.
6. Seek advice and mentorship
Just because you are starting your business alone does not mean you have to go it alone. Consult with experienced entrepreneurs or professionals in your chosen industry as their guidance and insights can provide valuable perspectives and help you avoid potential pitfalls.
Make sure you identify mentors who want to help you and not sabotage your business because they feel threatened.
7. Test your business idea
Before fully committing to your new venture, consider starting small or conducting a pilot project to test your concept. This will allow you to assess the feasibility of your idea, identify potential challenges, and make necessary adjustments before investing significant resources.
Every business venture carries some level of risk so you should also evaluate your personal risk tolerance and determine if you're comfortable with the level of uncertainty and financial commitment required by the business you're considering.