No matter who you are or how big you hope to grow your business, figuring out what product to build or what services to offer is a huge challenge. Starting any business takes a huge leap of faith. You’re jumping off a mountain and hoping your parachute will open and lead you and your business to success.
Here’s how to figure out if your idea is any good and if it’s worth moving to the next level:-
1. Talk to potential customers.
Most entrpreneurs skip this very important step. Not talking to your potential customers raises your chances of failure substantially, so start talking to people as soon as you can. Be sure to talk to as many potential customers as you can so you get multiple points of view. You’ll also gain invaluable insight into what your customers’ offices and workspaces look like, how they work, and how they make buying decisions and shop.
2. Figure out what people are willing to pay.
As you talk to your potential customers, try and figure out what they might be willing to pay for your solution. When it comes to finding the right price for your product or service, there is no formula and no single correct answer. Even within the same industry, what works for one company won’t necessarily work for the next. Pricing products correctly is by comparison, an art. It requires an awareness of the market as it currently exists, the vision and ability to see a market as it could or will exist, and the logic to decide on a figure that will cover costs, send a message and maximizing sales. When you have a price in mind, ask your prospective customer if they would order your product or service right now for your price. You might find that people will say yes right away, or they will tell you what they think the price should be. If you pay close attention, you’ll also be able to tell if the customer thinks they are getting a good deal or if your price is a bit of a stretch.
3. Find out how much money it is going to take to launch your business.
As you gather customer feedback, you’re hopefully honing in on a great business idea. Vetting and refining your idea before you start your business will greatly enhance your chances of success and ensure that you have a solid idea.
At this stage, you should know if you have a winning idea on your hands, but, now you need to figure out if the business can be financially viable and what you need to get it off the ground. At a minimum, at this stage you’ll want to create a sales forecast, an expense budget, and a cash flow forecast.These 3 forecasts will help you figure out what it’s going to take to start your business and keep the doors open as you get your first customers.
4. Start as small as possible.
It’s tempting to dive in at the deep end and build your complete business the way you imagine it will be. After all, you want to realize your vision that you’e been working so hard on. You’ve been talking to potential customers and selling them on your dream, and now its time to make it real.
Try and resist this urge, if possible. Starting small and continuing to gather feedback from customers is a key component to growth. With a smaller start, you’ll be able to change firection faster and react to customer feedback quicker. Starting small also gets your solution out into the market quicker. The faster you can get to the market, the faster you’ll gather feedback.
5. Stay Flexible.
The final key to making sure you have a good idea that will grow into a successful business is to stay flexible. The best business owners check their ego at the door and are able to listen to customer feedback. But, this doesn’t mean that the customer is “always right”. Far from it.
Instead, listening and being flexible enables you to adapt as you go and change directions as needed. You don’t want to react to one customer’s opinion, but you do want to look for broader trends in the opinions of as many customers as possible.
You may even decide that certain types of potential customers aren’t part of your target market. You may decide that you only want to sell to bigger businesses, for example, and you can then adjust your pricing and marketing to reflect that.
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