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Choosing A Legitimate Business IdeaMost business ideas often come from a person's necessity for that product or service. If you live in a small town and have to drive 50 miles to buy a computer, you could start a business selling and repairing computers. If you lived in a big city, chances are these types of shops are all around you which would make it harder for you to compete. In this situation you would probably have to come up with an idea that is either unique or has a large market. All because the idea has already been taken doesn't mean you can't start a business using that idea. It just means that you need to be more competitive as far as pricing, customer service, and quality. One place you could look for a business idea is in franchising. Companies such as Mcdonalds and Dunkin Donuts have been repeated endlessly and are almost always successful. This is because these companies have already built a name for themselves and have a system that works well. Once you've established your idea you'll need to test your idea to make sure it's legitimate. The first thing you should do is ask people that you think will give you an honest opinion. You will probably get some good pointers as to why your idea will or will not work out. If you're selling a product you could purchase a sample from a vendor and see if you could find a customer. I would recommend doing this prior to purchasing a larger quantity. A lot of people get so excited about their idea that they fail to test whether their products will sell or not. Remember, you don't have a real business until you actually have enough customers to make a substantial profit. The cost of running your business could mean the difference between success and failure. You've probably seen a lot of businesses that stay in business for a few years and eventually shut down. This is mostly in part to the fact that their overhead exceeded the amount of revenue they were bringing in. If these companies had no overhead the owners would be extremely wealthy. Failing to accurately estimate how much it will cost to run your business is one of the biggest mistakes that people make. A few things you need to consider are the cost of leasing your commercial space, hiring employees, utilities, and your phone bill just to name a few. You also need to factor in the unexpected costs such as repairs to your equipment. Some businesses take time to build up so you'll need to make sure you have enough money to keep the business running initially. A lot of businesses don't see a profit for up to year after their initial startup! The reason why most people start a business is to escape the long hours they are putting in with their current employer. Starting a business might seem like it would give you more independance but most people find it's the exact opposite. You might actually find yourself putting in more hours than you did when you worked for somebody else. If you can't afford to hire a manager you'll probably have to fill in that position on your own. If an employee doesn't show up you'll also need to fill in their position as well for the day. Until your business gets off the ground you could easily find yourself filling in almost every position in your business. Marketing Is Important Knowing how to market your business is also something that is extremely important. If you don't know who and where to find your customers you should definitely put some research into this. Should you be advertising in related magazines or in your local newspapers? If your business is internet-based you could probably invest your advertising dollars into search engine advertising. Some companies stick with just one form of advertising that they know has a good return on their investment. Marketing often takes a lot of trial and error but should definitely be researched prior to starting your business. Marketing is one area that most companies fail to properly do. If your marketing budget is large enough you could actually hire professionals to do all the hard work for you. Many of these professionals have been doing this for years and already know what works and doesn't work. Writing a business plan is one thing that many people find unnecessary. A lot people think that it's a waste of their time and doesn't serve a purpose. Maybe if you were running a small lawn service you could skip over this step. Anything that involves more risk should be well planned out to give you a better idea as to what you're getting yourself into. You might even realize that your idea isn't right for you. It's better to learn your lesson the easy way then by actually wasting years of your time and money to learn that lesson. Understanding your needs, wants, and financial situation can help you determine what the right business is for you. Dec 7, 2007
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