How do I know my business idea is a good idea?

Nikki of Taputapu

 

So you've decided you want to start your own business. Be your own boss. You want to work hard to create your own sense of freedom. You have an idea that you feel can really take off.

Starting a business can be an overwhelming process. When I began Taputapu, it took me months to prepare before launching. But, before all of the preparation and kick-starting a business, how do you even know if your business idea is a good one?

Let’s take a few steps back for those with a business idea humming and brewing. Here are some steps to help you identify if your excellent idea will be a viable business.

 

When considering a business idea, you want to do some market research such as:

  • Do other businesses exist providing the same products or services?
  • If so, where are the gaps?
  • Look at successful companies within your industry and see what makes them successful. 

If other businesses exist that are similar to your business idea, try and find a niche or a gap. For example, you may want to target a different audience, add better features to your product or add extra services that others don’t provide. Steer away from copying an existing business. Instead, you want to be fresh, strategic, and offer something new to the market.

 

Now Google search some successful businesses within your industry (retail, food, beauty, education, toys etc.) look at their websites at their products/services, prices, story etc. What do you think makes them successful? For example, do they have sustainable products, cheap shipping costs, a great brand story, transparent messaging etc.?

Look at their social media accounts and find out who their followers are: young people, Māori, professionals, mothers, etc. Identify the things they are doing well understand who their target audience is because this information will help to inform you about the industry, the type of customers and the benchmark to aim for and higher.

Overall, through the process of market research, you want to come out knowing what businesses are already out there, who is your competition and to work out what your point of difference will be. You want to be confident that your business idea can stand out from others and ultimately solve a problem for your customers.

 

Once you have gone through some market research, go through these following steps:-

 

Target Audience

Identify who your target audience will be i.e wahine, tane, pakeke, tamariki or rangatahi. Do they work full time, exercise regularly, disabled, professional workers, home buyers, have pets, students etc. Write down everything about your target audience and their lifestyle. 

 

Surveys

Send a survey to your target audience (not to your whānau). For example, If my product is for mums, I would approach many mums, etc. In your survey, you want to ask questions that will help identify what the customer needs, what do they struggle with, what would make their lives easier. Then propose some solutions (services or products) and ask if they would buy these things and at what price range.

This information will help you understand the needs of your target audience and how much they are willing to pay. Don’t assume that your target audience will suddenly buy your product. 

 

SWOT analysis 

At this point, you are feeling confident that your business idea is a good one, you’ve done your research, and things are lining up. However, you may have had to pivot slightly or adjust things accordingly. At this point, do a SWOT analysis. Write down the following: 

  • Strengths- What are the strengths of your business (quality products, sustainable process)
  • Weaknesses- What are the weaknesses (limited space, no staff)
  • Opportunities- What are the opportunities (expansion, new skills)
  • Threats- What are the threats (COVID, lockdowns etc.)

 

Ask 

Lastly, ask yourself honestly, am I passionate about this product or service? Can I see myself working on this day in and day out? Are you willing to make sacrifices to make this business work? If you aren’t passionate, walk away and change the business idea. If you are passionate, then get going! You can do this!

 

I hope this offers you some support with your current brainstorm, as it did with my own. I love being able to share my journey and learnings with you all, in the hopes of supporting other upcoming pakihi maori.

If you're interested in exploring other forms of support, here are some links that may help you:-

 

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