To determine what kind of business would be best suited for you to start, begin with what you know. If you've spent 20 years working as an accountant or you love to build wooden toy trains as a hobby, consider how you can take that experience and turn it into a successful business. You might also find a great business idea right under your nose. Look around your workplace. Do you see needs that are going unmet or can you think of a better way to do something? If so, you might have the seed for a profitable business.
Here are a few more guidelines to help you pick a business that's right for you:
- Do what you love. It's important to pick a business that you will enjoy running. I can't emphasize this point enough. Many people start a business for the wrong reason: to get rich. While it is true that many millionaires in this country made their fortunes from their own business ventures, that should not be your sole motivation for starting a business. If you don't enjoy what you do, you will not be successful, at least not from a mental point of view. Sure, the monetary rewards can be tremendous, but the mental anguish of working in a business you don't enjoy is a high price to pay. I talk to entrepreneurs all the time who are running successful businesses, but are so unhappy as a result that they literally make themselves sick. If you don't enjoy what you do, the business will become a chore, not a joy.
- Don't reinvent the wheel, just make it better. Many first-time entrepreneurs assume they have to come up with a new business idea to be successful. That simply is not true. Most successful businesses are born not of innovation, but of necessity. Instead of trying to come up with an idea that changes the world, take a look at the world around you and see where there might be a void that needs filling or a business concept that needs improvement.
Many successful businesses are the result of taking an already established business concept and making it better. Domino's Pizza was certainly not the first to offer home delivery of pizza, but it was the first to guarantee it would be delivered piping hot to your door in 30 minutes or less. Amazon.com was not the first company to sell books, but it was one of the first that would let you buy books from the comfort of your own home while sitting in your underwear.
- Focus on a niche. Many businesses have gone broke trying to be all things to all people. The ability to offer a billion products under one roof is all well and good for Wal-Mart, but not for most new businesses. Try to identify a niche that you would enjoy working in and think about starting a business therein. If you love to work outdoors, consider starting a landscaping business. If you enjoy working with numbers, think about becoming an accountant or CPA. When's the last time you had your gardener do your taxes? You get the idea. Focus on a niche and become an expert in your field.
- Consider the franchising option. Many new entrepreneurs consider buying a franchise operation instead of starting a business from scratch. Franchises are a good way to jumpstart the process because they have already done much of the hard work for you. They have proven the business model, established guidelines for running the business, spent millions of dollars on establishing the brand and so on. Buying a franchise is typically a very expensive and involved process that is beyond the scope of this article. The best thumbnail of advice I can give you is to thoroughly investigate the franchisor and the opportunity, use your own attorney to do the deal and read the fine print in the franchise agreement.
- Know what sets you apart from the competition. If your local business pool is already filled with other companies doing the same thing you want do, chances are you will fail in the face of established competition. To succeed in such a crowded pool, you will have to do something to stand out from the crowd. If you can't quickly and easily differentiate yourself from a large group of competitors, you're better off choosing another business.
- Above all, take your time. Think about starting part time while you still have your current job (and income) to fall back on. Talk to friends and associates who use the product or service you will provide to see if they would consider become paying customers.
Whatever business you choose to start, I encourage you to take the time required to make an informed, intelligent decision.
Tim W. Knox is the founder, president and CEO of four successful technology companies: B2Secure Inc., a Web-based hiring management software company; Digital Graphiti Inc., a software development company; and Sidebar Systems, a company that creates cutting edge convergence software for broadcast media outlets; and Online Profits 4U, an e-business dedicated to helping online entrepreneurs start and prosper from an online, wholesale or drop-ship business.
The opinions expressed in this column are those of the author, not of Entrepreneur.com. All answers are intended to be general in nature, without regard to specific geographical areas or circumstances, and should only be relied upon after consulting an appropriate expert, such as an attorney or accountant.