All righty then; you have your assessments in hand, now what? Have you answered them candidly? Have you looked at them carefully? If you have, you’re now at the stage of “Is my idea feasible?” Whether your IDEA is original, borrowed, or bought, it’s pivotal to all the stages of your business operations. It’s what will keep you fired up!
So how do you determine if your idea is feasible? You conduct a feasibility study. Don’t get nervous that I used the word “study.” It’s just a tool that enables you to look at the positives and negatives of implementing your idea. Keep your Feasibility Study handy, because you’ll refer to it often. It looks like this:
Your idea is worth pursuing if it satisfies the following tests:
Test 1: Strengths, Weaknesses, Opportunities and Threats (better known as a SWOT). For your business to be feasible, the strengths and opportunities must outweigh the weaknesses and threats.
Test 2: Financial
Businesses are created to make a profit. If your business idea is not financially viable, you can stop here.
Test 3: Sales Volume
Almost any idea is financially feasible if it has a high enough sales volume. The question here is will you be able to achieve the sales volume that you need to make your idea work?
Test 4: Marketing
After your sales volume analysis, then you must consider the marketing of your product or service. This will outline how you’ll reach your sales volume.
Test 5: Personnel
Now you’ll decide what types of employees you’ll need; and when they’ll be needed.
Test 6: Common considerations
They’ll vary by the type of business and may include: finding suppliers; ability to manufacture your product; and capacity to provide customer support.
*A more detailed analysis will be used to create your Business Plan.
If the answer to these questions are “iffy” or negative, then you have my permission to put your three assessments wherever you file your “Heck no, I’ll never look at this again – commonly called ‘File 13.” But then again, you never know what the future may bring you, so maybe you should hang onto them. You’ve actually conducted the pre-venture drill “ready, aim, fire” instead of “fire, aim, ready” which is the approach that many would-be entrepreneurs take.
Business Start-Up Options
I don’t want to appear to douse your passion of starting your business, because it’s one of the most satisfying endeavors you’ll undertake. But, I must reiterate what I told you in Part 5. “It’s easier to stop at this point than after you’ve spent your entire savings or the bank’s money. Whatever you ultimately decide, your assessments won’t be wasted. They’re the foundation of your decision to start or buy a business.” But I left out some other options, so here’s the list:
1. Start a business by providing a new invention, a product or service spin-off, turning a hobby into a business, meeting an unfulfilled market need or expansion of a part-time job. This option provides you the most freedom to develop business strategies; establish marketing, advertising and public relation approaches; and establish human resource policies, etc. If you’re successful, you’ll have the satisfaction of knowing you did it all yourself.
2. Buy an existing business. Most successful business acquisitions are purchased by knowledgeable, adequately financed business people.
3. Purchasing a franchise. There’s still entrepreneurship independence, but with reduced risk. This option is also considered a business start-up.
4. Technology transfer. It’s less common to start a business this way, but a viable choice. Certain products and services that have been developed by state and federal agencies, as well as colleges and universities are made available for commercial use. NASA is a perfect example of an opportunity for technology transfer ideas.
5. Licensing your idea. Here, your product or idea can be marketed and you’ll receive a percentage of the sales revenue.
6. Buying an idea. It’s just as creative to find someone with a good idea, product or service for you to purchase. Sometimes the seller doesn’t have the time or money to start the business on their own.
7. Form a joint venture. If you have an idea, but lack the capital or means to manufacture it, search for a partner who has the resources to produce it.
Here’s something interesting about those options. Each option will appeal to a different person based on their skills, business and industry experience and acknowledgment of the risks.
Benjamin Franklin said, “By failing to prepare, you are preparing to fail.”
Have your answers ready from this last part of the series “To be or not to be . . . that is the question” Next article: “Paper and pencil?”