Very few good ideas ever make it to a successful business. In fact, 80% of small businesses fail within the first five years. But not to fret, you don’t have to be one of those failures.
Here’s a five-step process to turn a good idea into a profitable business.
Five Steps to Turn an Idea into a Business
- Analyze the size of your market. Consider the area you’re prepared to cover; is the total market in that area large enough so that even 1% would create a significant business. Don’t make the rookie mistake of thinking that “everyone” will want your product or service. Who might really buy it?
- Analyze your personal brand. Do you have enough recognition that even a small percentage of the market might purchase based on your name and reputation?
- Analyze your price point. Are you maximizing your price based on perceived value to the customer, rather than your costs plus markup? And remember, the key number is PROFIT, not revenue.
- Analyze your long-term business potential. Ideally, a startup business should reach $100,000+ in revenue within two years. And that revenue should be profitable.
- Finally, analyze your ego and motives. Are you starting a business just because it’s the trendy thing to do? Or are you really in a position to provide something of value to others? Really think about your rationale before you take that next step.