Defining Your Business Idea

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Embarking on the exhilarating journey of birthing a brilliant new business idea is akin to igniting a firework of potential. The initial spark of inspiration floods you with ambition, propelling you into the thrilling realm of entrepreneurship. But once the concept takes shape, how do you navigate the labyrinth of assessment and planning to ensure its sustainability?

The key thing is to define what your idea brings to the marketplace. Understanding the WHY behind your venture is paramount, as it unveils the viability of your business model.

Research the existing market and do your homework

A first vital step is to clarify the business purpose of your idea. What does it do, how does it cater to an existing or future need in the marketplace and who will your customers be?

Think about what your product or service delivers to the end customer, and why this customer should part with their hard-earned cash to purchase your offering. In a crowded marketplace, you’ll need to stand out.

Check out the competition

If you’re bringing a brand new innovation to market, you may well be the first in the market. But for most business ideas, there's likely a contender lurking in the shadows, poised to seize your slice of the pie. Research your closest competitors and look closely at their products, services, prices, and their approach to marketing and customer service. 

Do the numbers add up?

Getting a great understanding of your financial model is critical to your success. Ultimately, if your idea can’t generate revenue, cashflow and profit, it won’t sustain a real-world business. A good starting point is to calculate your production costs, set profit margins, and ascertain if your pricing strategy aligns with market dynamics. If you can make enough sales at the right profit margin, will you break even? And will you make a profit? 

Write a rough business plan

Every startup needs a business plan behind it. Important items to include in your plan include:

• A clear outline of your product/service and what it aims to do

• A definition of your key customer and how you’ll meet their needs

• An overview of the market – including a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats)

• A summary of your sales, marketing and business operations

• Your key objectives for the first year – and how you’ll achieve them

• Your predicted financial return – and how you’ll generate these profits

• A breakdown of the initial funding you’ll require

• Timescales for each element – so you can track your progress

As the old saying goes, ‘Fail to plan, plan to fail’. Remember, meticulous planning is the cornerstone of success.

If you’re at the early stages of planning out your business idea, please do get in touch. We can help you test the viability of your business model and start the planning process.

Talk to us about your startup plans.