Do you ever feel as though you have too many business ideas? Do you find yourself going around in circles trying to decide what to do? Are you constantly being distracted by new opportunities but never finish anything (or even get started!)? You are not alone, I’ve been there myself. A question by a reader on my Small Business Crash Course prompted an answer to this problem. The question was aggravated by a lack of availability of start-up finance.
As this is probably of interest to a lot of people and my reply was rather lengthy, I decided to answer it as a blog post here:
One of the biggest problems I have faced over the years is having too many business ideas. The world is so full of opportunities that you can end up jumping from one thing to another and ultimately getting nowhere.
Your second question helps to answer the first, if you cannot get access to start-up capital then you need to narrow down your ideas to those that you can start without capital – at least in the beginning.
Generally speaking offline, real world, businesses that can be started without capital tend to be service businesses that you can perform yourself and that don’t need business premises or selling other people’s products on an agency basis. That’s how I got started.
Online it is much easier as you can set up a website with very little money, around $10 US for a domain name and around $5 or $6 a month. If you are really short of money it is possible to start with a free website from Blogger.com or WordPress.com, until you have made enough to set up your own website. You can then use your website to sell other people’s products online as an affiliate – similar to the agency business above.
Now, down to the choice of business idea from your list. If you don’t have a list and your ideas are just floating around in your head, then write all your ideas down in a list before you forget them. Next look at each idea using the following criteria:
1. Is there a market for what you are proposing to sell? Is it big enough to sustain a growing business?
2. Are there any other people selling the same thing and making money? If you don’t get a YES to both 1 and 2 then put the idea aside for now.
3. If you get YES to both 1 and 2, then consider if this is really something you want to do. In the beginning you will be spending long hours and days setting it up and if you don’t enjoy it, you will not be able to keep going. A question I have often asked myself during my career is “do I want to be doing this for the rest of my life?”
4. Think about the kind of people who will be your customers. Are they the kind of people you will want to spend your working life dealing with?
5. If 3 and 4 are both YES, ask yourself, “Can I really be of help to these people? What can I do for them to make their lives better? Can I do it better than someone else who is already in this business?” The only way to build a successful business is to create happy customers who will recommend you to others.
6. If you are still getting YES’s, Can you produce the product or provide the service at a price that people are willing to pay and that will cover all your costs and give you a good profit? Can you sell enough to ensure that profit will give you the personal income you want and leave some over to reinvest in growing your business?
7. Can you easily and inexpensively communicate the benefits of what you are selling to your prospective customers and easily deliver the product or service to them?
If you have got this far with all YES’s, then you are already ahead of 90+% of people with business ideas! You will have narrowed down your list of ideas considerably, possibly even down to one.
If you still need more deciding factors then carry on with the following:
8. Once the business has been successfully launched, can you give most of the work to other people to do, either by outsourcing or employing people full or part time? If so you will be able to grow your business as large as the market will take. If not you will be limited by your own time and energy. Some people are quite happy to keep the business small enough to do everything themselves but others need to grow.
9. Is it the kind of business you will be able to get someone else to manage? If so, you can then look at other business ideas, if you have that kind of ambition.
10. Does the business have the potential to be sold as a going concern to someone else in the future or is it too dependent on you? If so you can sell and retire or start another business.
ABOVE ALL, once you have decided which business to start, give it your full and undivided attention until it is running successfully or it fails completely. Let nothing distract you from building your business and do not be tempted by other ideas not related to this business until it is capable of running almost by itself.
This is not a complete blueprint on how to run a business, but it should help you to choose the best idea from those you already have.
I hope it helps