Take a moment and ask yourself these questions before starting a business.
So you’ve gotten that business idea and you are ready to start your business?
Don’t jump into doing things yet…
…take a moment, breathe in, relax. And ask yourself these questions.
In this post you’ll find crucial questions you must answer to improve your odds of succeeding with your new business.
Here are some key questions you must ask yourself before starting a business:
Questions Before Starting a Business:
Why do I really want to start this business?
Why exactly do you want to start your own business?
Is it because you’re tired of your unreasonable boss? Is it because you want to enjoy absolute control and freedom?
Could it be because you want to live a flamboyant life?
These reasons are not strong enough to start your own business.
In fact, this is one of the colossal mistakes that most Entrepreneurs make, and after struggling for a few years their businesses will eventually collapse – all efforts and resources wasted!
Don’t want to experience such? Then you need to provide genuine reasons why you want to start the proposed business.
“Which gap do I want to fill in this industry?”
“What impact do I really want to make in this industry?”
“Are there any pressing problems I can help people solve with my skills and expertise?”
These and more are what make a good “why”.
NOTE: If your reasons are not strong or genuine enough then don’t ever start that business otherwise it may soon fail!
What problem am I trying to solve with the new business?
The only reason people buy from businesses is because those companies have solutions to their needs.
As long as consumers believe a business can offer them relief to their pain points; they will do business with them.
Therefore, before starting that your proposed business it is crucial you firstly determine the actual problem you want to help people solve with your products/services.
For instance, Microsoft’s products solve problem related to desktop publishing and office-related tasks
Adobe’s products solve problem related to graphic design and editing.
Nigerian’s Dangote ensures every household in Nigeria can buy salts, pasta, sugar easily.
So, before sinking in monetary and other resources to start your business be crystal clear about the problem the business is going to solve.
Is the business model you intend to implement sustainable?
This is another crucial question you need to provide honest response to if you intend going far with your business.
No matter how viable or lucrative a business idea may sound, if it is not futuristic then it’s not worth trying at all, or what is the essence of starting a business that will soon go out of fashion – nothing but total loss!
However, there are several ways you can identify sustainable business ideas, which include the following:
Study the Demand trends.
You can do that simply by assessing the past and current level of demand for that business type. If the trend seems to be consistently dropping, then it may indicate a “no-go” area.
Check for existing or potential competing inventions.
This is yet another way to identify a sustainable business idea; you can do that by checking around for existing or proposed inventions that may counteract with the business in the next few years.
Hire an expert.
To be on safer side, you can also hire the service of a professional to help assess the sustainability of your idea before building a real business around it.
This single decision will save you much efforts and money.
What is the target market for my business?
No business in this world can survive without the consumers; in fact consumers are the heart of the business.
Hence, if you intend starting a business, you need to identify and have a good knowledge of the market you intend serving.
What are their peculiar needs?
What is their income level?
What is their taste and preferences?
What is the percentage of the people with the purchasing power? Etc.
If you don’t conduct a proper analysis about your intended market, you are likely to fail along the line because you won’t be able to come up with products that best match their current needs and financial capacity.
Who are my major competitors?
Imagine being in a race with someone you already know most of his weak points. Will the game be easier for you or not? Of course it will!
This is applicable to the business world as well. You can’t thrive that much in an industry that you don’t have basic knowledge of the existing competitors.
You’ll only be doing some guess work as well as trials and errors, which might eventually lead to wasted resources.
It is imperative you identify, study, and understand your competitors if truly you want to capture a lion share of the market after launching your business.
The reason is that proper identification and understanding of your competitors is one of the things that can place your business in a favorable position when you eventually start.
Therefore, you need to study the existing market leaders;
What type of products or services are they offering?
Why do people patronize them than many other firms?
What are the basic strategies that accounted for their success?
What are their core strengths and weaknesses?
Is there anything I can do better than most of these firms?
Your ability to give honest, satisfactory responses to these questions will determine how well your business will thrive when you eventually start it – so don’t take it lightly!
What makes my product or solution special or different from the competition?
Having identified your potential competitors, another thing you need to conclude on is the special value that will distinguish your products and or services from the competitors’.
One thing about consumers is that they are very wise and sensitive; the vast majority of them won’t even bother patronizing your business once they perceive that you’re not offering something better than what they’ve been buying before your products were introduced to the market.
That’s why you need to assess the products offered by your potential competitors and look for the basic loopholes that you can exploit.
Although there are several ways you can look for flaws in the competitors’ products, but one of the most effective ways is by listening to or reading the complaints and negative reviews people are giving about the product – be it online or offline.
Once you’re able to identify these flaws you can then build your product in such a way that will redress the flaws detected.
What skills do I have and need to run your business?
No matter your chosen business line, every business requires various skills to be operated smoothly, and this varies from industry to industry.
If you suddenly launch into a business that you don’t have the required skills and knowledge, there’s high tendency that such business will soon fail, because you’ll find it difficult to deliver the quality that perfectly matches the expectations of your customers.
The bitter truth is that most customers are value-oriented and they’ll always patronize a firm that can provide perfect solution to their problem any time any day. Therefore, make sure you identify & acquire the necessary skills before launching into that business.
What funds do I absolutely need to start?
Money is the blood of every business, and any shortages can ruin your business in no time.
That’s why you need to first identify the basic costs required for starting and running your intended business.
Having said that, the cost will be determined by several factors, including your intended business scale (small, medium, or large?), your intended industry (capital-intensive or labor-intensive?), machines and equipment needed, etc.
However, it is not enough to just identify the required cost; you must also ensure that you make the money available before starting the business in reality.
Apart from personal sources, you can raise funds for your intended business through many other sources, including bank loan, loan from friends and relatives, crowdfunding, Government grants, and lots more.
WARNING: When raising capital for your business, make sure a larger percentage of it comes from your personal sources i.e. the amount you are borrowing must not equal or exceed your total personal contribution.
This is a way of preventing your business from collapsing in case any of the creditors suddenly request for their funds before the agreed deadline. There are lots of businesses that have gone bankrupt due to this mistake, don’t recreate that!