It is always exciting to come up with challenging visions of putting together a company. You have to keep in mind, though, that the outcome of your flashy business dream isn’t depended on unique marketing tools or people hidden behind this effort but on the business idea per se. In the end, everything comes down to the core of this idea and to how profitable can be proved to be. This is, of course, inextricably connected to the quality that you provide as well.
That’s why, it’s critical to examine your idea after freeing your mind from common misconceptions. According to reports, deciding on an idea for a startup is usually based on two personal biases:
- The startup has to be based on an idea connected to the owners working experience/past. So for instance, a hair stylist should open a hair studio and a journalist should run his own new site. Such an approach is appeared to be the most logical choice but many times it’s just a big mistake. Every decision you take has to be business centered instead of job focused. In the same sense, being a good cook doesn’t mean that you have what it takes to keep a restaurant running.
- The startup is the realization of a childhood dream – take note, the fact that you have a strong passion for something does not signify that you can easily make money out of it. This, in particular, is probably one of the most valuable advice that someone can offer to a fresh businessman. Running a startup successfully is much more complicated than you imagine, so there’s absolutely no reason to put even more obstacles on your way by choosing your favorite instead of the most profitable and functional business idea.
- Once you created a startup, you are bonded with it for life. I know that anyone who opens a new business feels confident and ambitious that this is his/her one and only chance to build something of their own. That’s why, there’s so much energy spent on personalizing their choice as much as possible. It has to represent a stable part of your life. However, truth is quite different. A startup can be just the first step in your business adventure. You should make your choice based on what could lead easier to the next step instead of what would be your desired profession for life. It’s all about evolving yourself after all.
- The available capital is the most important parameter when starting a startup. Money is definitely important but not everything. In that aspect, if you haven’t come up first with a solid business plan and a service or product able to captivate the interest of the customers then money can’t make that much of a difference. A strong capital base can guarantee a boost to your effort but not its success per se.
Question is, how you could make sure that your exciting idea could lead significant profit back to you. Below are main considerations on how to decide on an idea for a start up:
- Focus on a repeat purchase service or product
Just so you know, a repeat purchase product is the most valuable parameter for building a solid and most importantly lasting business plan. In simple words, offering a product that customers will have to buy on a high frequency is the best idea. It’s clear, then, that the main focus of interest should be to attract customers with whom you can build an ongoing business connection.
- Be certain your profit margin is high enough
Competing continuously under the principle of offering the best prices is, most of the times, impossible. It goes without saying that if you have to deal with low profit margins, it’s more than necessary to have a significantly higher amount of capital. In that manner, you can maintain a balance in the company during the first phases of the whole project. In any case, achieving a high profit margin should be one of your top priorities, since thanks to this you will be in position to support financially the growth of your business.
- Support your idea with a competent team by your side
One of the most common mistakes in the market is to start building your business plan without having the right people around you. Before you do anything else, it’s crucial to find the best possible advisers and professionals (lawyers, accountants etc.) who can help you with putting together a solid plan. By doing this, you instantly increase the status of your idea and you improve your chances of captivating the general attention.
- Go for something global
Having your own small business may seem nice and cozy, but it’s not always the best idea. When you decide to put together a challenging startup plan, you should focus on how you could reach out to an international audience through your business. As you can easily understand, this can be really tough given the existing cultural and financial differences around the globe. For that reason, it’s essential that you come up with a service or product which could captivate attention broadly.
- Monitor the needs of the market
As we already mentioned before on the common misconceptions part, the fact that you love something doesn’t mean you can get profit out of it. That’s why, you have sometimes to take a step back and start researching the needs of the market. In that manner, you can get a good understanding of the general situation on the market and detect any potential opportunities. It’s for sure a quite long procedure but pretty valuable. By getting to know the market and its urgencies, you acquire more experience and you come closer to your ambition of building a prosperous startup.
- Personalize your choice as much as possible
Yes, the most important parameter is to choose a startup idea based on its potential and not on your personal interests but it’s critical that you don’t lose yourself completely through this journey. Even if you end up following a path that isn’t inextricably connected with your background, try to add a personal dimension to it. This could either concern the people that you chose to be part of this effort of the way you structured your business.
- Talk with other startup founders
No one knows better the difficulties and obstacles that you are facing than people who have been in the very same position before. As long as you don’t ask for help from your potential direct competitors, there’s absolutely no reason for them not to share some of their struggles with you. It could also be an alternative way of networking that could be proved pretty useful in the near future.
- Choose your business based on your customers
Reaching out and interacting with your customers will be one of your main tasks, when you will eventually put your company together. This parameter can make your selection process much simpler. To be more specific, it would be a good idea to think thoroughly how you would like your customers to look like. This could help you a lot in picking what kind of business you would like to have. On top of that, if you feel comfortable in interacting with your customers, you will end up offering them more efficient and better targeted services as well.
- Be impulsive
If nothing else has worked for you so far, then being impulsive may not be such a bad idea. Sometimes the best ideas come out of luck or a moment of inspiration. In that sense, following your instinct may seem like a risk but under certain circumstances it can be proved to be the smartest choice. Just be careful, though, not to confuse spontaneity with hurry. Regardless of how you came up with a certain idea, you should always analyze every step thoroughly.
Starting your own business requires tons of effort and the combination of many different parameters which often people tend to ignore. Despite all the above, though, the most important point that you have to keep in mind is what is your broader ambition for this project. In the beginning, keeping it local may look like a satisfactory choice but soon it won’t be enough. And then you have to be prepared.