Feasible or not! Feasibility; an important component that so many new entrepreneurs fail to consider. Before you get to the stage of starting your own business, and opening your doors for the first time, there are two vital aspects that most individuals find very difficult; firstly, getting a new business idea and determining whether this new idea will be a success. Assessing whether your business idea will be feasible is extremely important.
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In a commercial context, feasibility (viability) refers to the ability of a business to exist, be profitable and grow to a sustainable level. With this being said, how do you determine whether the business idea is viable or not? Many ideas of products and services seem to deliver a great customer value. However, along with the delivery of a great consumer value, the profitability of the company in a longer run is a vital factor that keeps the business running. As an entrepreneur, before taking the plunge, it is highly recommended to perform certain feasibility checks to know whether you should proceed to starting your business or not.
There are a number of ways you can assess the viability of your small business idea. You will want to ask such questions as:
- First and foremost; is your business idea unique? It doesn’t have to be a completely new concept that will take the world by storm. You don’t even have to have a business that ‘reinvents the proverbial wheel’, but are there enough unique aspects to make your business different from others like it?
- Next, do you know what it will cost to start your business? Every company has some significant expenses at the beginning to get all the marketing materials, assets, inventory, and products needed to begin functioning as a business. It will take time to get that money back, so make sure you have a plan to cover these costs right away.
- Third, are you selling to anyone and everyone or do you have a niche market you need to target? Do you know how you will reach these people? It may be best to start out broad and then narrow your focus as you find out who begins buying your products most.
- You also have to think about the state of the economy and the time of year you will be opening. For example, is your industry currently growing or are the sales in a decline?
- What is the competition like for this idea? Are there many other businesses in my area that provide similar services? If so, are they successful or do they struggle for business?
- How will my business idea stand out from other similar businesses in the area, in other words, what are your competitive advantages/value proposition?
The above are just some of the questions and research you need to do to determine whether you have a feasible business idea or not. The main way to answer these questions about how feasible your business idea is, is through careful research. Assessing the viability of your business idea is crucial if you are considering starting a business.
Do not skip this step!!!