While there are millions of great ideas out there, that don’t become businesses, this article covers 3 different signs your BIG idea could make a successful business opportunity.
We’ve all experienced that uplifting moment when the lightbulb illuminates, and a grand idea is formed in our mind – “the million dollar idea”. Most entrepreneurs in the world do not have an issue coming up with ideas; the challenge comes with figuring out which ideas are worth pursuing. No matter how small or large a business is or hopes to grow into, figuring out which ideas to pursue can be one of the biggest challenges entrepreneurs and business owners are faced with. We know that time is something you can’t get back, so, how do we know which ideas are worth spending the time, money, and effort on? Which ideas could lead to a successful business? Rather than jumping off the idea mountain with hopes that the parachute will open and lead you to a successful landing, let’s answer the above pressing questions by explaining 3 different signs an idea could lead to a successful business opportunity.
Can you expand and grow with your idea? Can your business model be repeated?
Scalability is the potential of your business opportunity to grow and be applied to an ever-increasing market. Put simply, a scalable business can increase sales when given increased resources. All ideas start small when you think about it. Successful business ideas achieve scalability by understanding how that idea can grow – which involves planning! This is where your business plan becomes essential, as the potential for growth and being ready for growth are 2 very different and separate aspects of scalability. Investors are likely to look for potential as well as readiness, as their return on investments (ROI) depends on the ability of your business to grow and succeed in the years ahead. You must ensure that your business plan includes a plan for growth and development, as well as how you will know you are ready to scale-up and take that next step for growth.
2. Solves a Problem
Are you offering a solution to a problem? More importantly, are you offering a new and unique solution to a problem that currently exists in your market?
The problem you are tackling doesn’t need to be a new one no one else is offering a solution to. What is important, is that you offer a successful solution to a problem no one else has solved as effectively. Remember that competitors in your industry will also be offering solutions to the same or similar issues that your customers are faced with.
This is where it becomes essential that the products and services you offer stand-out in the market, especially when compared side-by-side with your competitor’s offerings. Reality is it is very unlikely you will be able to build a whole new market for your products and services. If you do, good on ya! You will however have an opportunity to reinvent the current market by filling in the gaps with your stand-out offerings. If you have come up with a successful solution for consumers that is unique from your competitors, this is a strong sign that you could create a successful business.
3. People Will Pay – and You Will Profit
Are customers going to be willing to pay what you are asking for your offerings? Will you be able to profit from sales of your products and services?
An idea is only an idea until you have a customer paying for it! Finding the right price for your products and services is essential. No matter how good your idea is or the problem it solves, people are less likely to buy what you are selling if the price isn’t right. Once you know the solution you are offering has value, you will need to figure out what people are willing to pay for that value. It is best to find that sweet spot for pricing where it makes sense for both your customer and your profit margin.
With market research to determine the right price for your products and services, you will be able to assess if your idea is business-worthy and can produce a profit.
Profit is when the business’s income is greater than the operational expenses. Doing a financial projection is a great way to roughly estimate when you may break-even and when you may start to make your first profits. Consider what it will cost to make your products, or to provide your services, along with how much you will sell them for. Make sure you are also factoring in the essential operational costs such as salaries, manufacturing, materials, and expenses. A financial projection is very important for new businesses that need to secure funding, as most lenders and investors will want to see the company’s financial projections to see when they too can expect to start profiting. If your financial projection shows you won’t reach profitability within the first 3 year, then it may be a good time to rethink your idea or move on and start thinking up that next great business idea!
From Idea to Opportunity
There we have it; 3 ways to tell if your business idea could become a business opportunity. While good ideas are exciting, a business opportunity will be scalable with implementable plans, offer a unique solution to your customers, and those customers will be willing to pay you for that product or service so that you can make a profit off your idea.
Now that you can look for the signs of a business idea that will lead to a business opportunity, the next time that grand idea pops into your head you may want to ask yourself: “Is this a business idea, or a business opportunity?”