You just had the greatest idea for a small business. Well, you think it’s a good idea, anyway. But how do you even know whether it’s actually a good idea or a stinker?
“Do I like my idea?”
Before you start seeking outside opinions, it’s important to decide for yourself how much you like your small-business ideas.
Ask yourself: Is this plan so good that you’ll pour all your energy into building and promoting your new business? Additionally, try explaining your idea out loud to yourself — if it’s too complicated to put into words, or you find yourself bristling at it when you hear it out loud, that’s a quick sign that your idea might not be fully developed yet.
“What do experts think of my idea?”
Your parents or siblings might think you have a great idea for a business, but really, whether your family is in favor won’t tell you all that much.
Instead, share your small-business ideas with experts and see how they react. An expert could be a business mentor or someone you highly respect in your professional circles (and ideally, they won’t be potential competitors, either).
If the pros see a lot of flaws, take that as a good sign that it’s time to go back to the drawing board.
“Will anyone spend money on this?”
A lot of ideas sound great … until you bring up the subject of money. And at the end of the day, someone’s going to have to spend money on your business to keep it afloat.
When you start to ask around for opinions about your small-business ideas, make sure you get a direct answer about whether that person would pay for what you’re selling. If they’d only like it for free, you’ve got some work to do.
“Am I starting small or large?”
This is kind of a loaded question — rarely do small businesses successfully start large. The usual path is the long, hard road that begins locally and at small scale, then eventually branches out over time.
If your idea absolutely requires large scale to succeed, reconsider — it’s very likely you won’t get the benefit of a nationwide scope right from square one.
That said, don’t completely ignore the question about how large your potential market is — if your target customer base is too small and has little chance of growing, you might find that your small business stays small forever.
“Does anyone need this, or am I chasing a fad?”
Imagine if you tried to start up a business around pogs or slap bracelets when they were the hot fad of the moment — sure, you would’ve made some quick cash at the onset, but what would’ve happened when kids moved on to the next thing? Unless you were agile enough to accurately call every quick trend, you’d likely have ended up going broke.
Whether it’s a service or a product, you’re typically better off creating a business designed around serving a need, or at least something that many people want (and have wanted for some time). That will help give your business lasting power.
Really scrutinizing your ideas is just one of many steps to wade through as you learn how to start your own business, but it’s one that should keep you from laying an egg.
More From InvestorPlace
- 5 Home Business Ideas That Actually Work
- Winning Small-Business Loans in 5 Easy Steps
- How to Start a Business in 5 Easy Steps