Developing Business Ideas

For a start, you could pursue the following tasks:

1. Identify the value proposition of your business idea
   This is to identify and briefly describe the unique value that you may be able to bring to your customers that your competitors cannot.
2. Discuss products/services with prospective customers
   Would they buy from you, at what price, with what frequency etc.?
   
   Why would they prefer your products to the competitors’? Find out what they really think – there is a danger that people will tell you what they think you would like to hear. Listen carefully to what is being said; watch carefully for qualifications, hesitations etc. and don't brow beat respondents with your ideas – you are looking for their views.
3. Assess the market using in-depth market research
1. How is the market segmented (by price, location, quality, channel etc.)?
2. What segments are you targeting?
3. How large are these segments (in terms of volume) and how are they changing?
4. What are the price make up/structures?
5. What market share might be available to you bearing in mind your likely prices, location, breath of distribution, levels of promotion etc.?
4. Analyse your competitor
1. Who are they and how do they operate?
2. Are they successful and why?
3. How would they react to your arrival?
4. What makes you think that you could beat the competition?
5. At whose expense will you gain sales?
5. Consider possible start-up strategies
1. Will you be able to work from home or part-time?
2. Will you seek a franchise or set up an in-store concession?
3. Will you start by buying in finished products for resale as a precursor to manufacturing?
4. Will you contract out manufacturing?
5. Will you buy an existing business or form an alliance?
6. Could you lease or hire equipment, premises etc. rather than buy?
7. How will you stimulate sales?
6. Set approximate targets and prepare first-cut financial projections
   Estimate possible sales and costs to get a feel for orders of magnitude and key components and to establish a rough break-even point (that is when your sales might start covering all your costs).
7. Prepare a simple action plan
   Cover the first year of operations to highlight the critical tasks and likely funding needed before the business starts generating a positive cash flow. This is critical especially if you have to undertake significant product or market development or need to give credit to customers.
8. Critically examine ideas from all angles
1. Can I raise enough money?
2. Can I get a premises/staff etc.?
3. Will the product work?
4. How will I promote and sell?