How to Make Sure Theres a Market for Your Business Idea Youve got a killer new product or a service that will have the world beating a path to your door. But is it really something people want? Or is it just something you think they want? Having solid information about what your customers want to buy -- rather than what you want to sell them -- can save you hundreds of thousands of dollars, as well as peace of mind and sanity. Here are four ways to think more critically about your business idea before you find yourself stuck with products or services no one wants or needs: 1. Accept the market as a harsh, but fair judge. If youre in business, you simply need to embrace the reality that the market will ultimately dictate your success. That means you have to make sure the numbers support your idea. Get information about the basics: Revenues for your category in your local market, regionally and nationally. Know how many competitors are out there. Determine if the market is new and growing or static and mature. Say you want to open a clothing store in your area in which customers buy $1 million worth of stuff a year. Youre up against 10 competitors. Since the top three companies in most categories usually get 80 percent or so of those revenues, youll fight the next seven companies for the remaining $200,000. Is that really worth it? Can you ever make a profit? Or is there a way you can create a new niche where you can be a number-one provider? Once you have a handle on the reality of the market, you can make better decisions about how to jump into it, or find a more creative way of serving it (even if you come in as a supplier or vendor serving those companies). 2. Pick proven categories, then find your niche. Broad proven categories typically offer greater opportunities than hot new markets. As I have mentioned before, given the option of going into a sizzling new tech category or buying into the shoe market, Id go with shoes every time. Why? People all...
Posted on: Sun, 23 Mar 2014 11:55:08 +0000
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