How to Research Your Business Idea

When Your Idea Looks Like a Flop

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Entrepreneur Assist offers a collection of free business planning and productivity tools, letting you access free business books, bookmark your favorite articles, schedule events and reminders and share documents to assist you in your idea evaluation and market research process.

How to Create a Marketing Plan , will help you strategize your marketing efforts.

The U.S. Census Bureau has the stats and demographics you need to know.

FirstGov.gov is a well-designed, easy-to-navigate portal to the government online. Click on the tab that says "Businesses and Nonprofits."

• Your local Chamber of Commerce can be an indispensable resource for local information for your new business.

• The Encyclopedia of Associations by Gale Group can be found in libraries, and is an essential tool for locating your industry's associations. Also search on Google, and be sure to check whether the association has a trade publication.

• At TSNN.com , you can access a searchable database of trade shows worldwide.

Entrepreneur's Top Colleges listing can help you find a local school that offers entrepreneurship studies.

• Two of the greatest resources known to entrepreneurs are the Small Business Development Centers (SBDCs) and SCORE (Service Corp of Retired Executives) . Each SBA service offers free and low-cost help to small-business owners and entrepreneurial wanna-bes, and should have a local office near you.

After all this-the idea stage, analysis of the idea, competitive analysis-you might find that your idea (and not your competitor's, as you'd hoped) is the one with the holes. Does that mean you need to scrap the whole thing and resign yourself to life as an employee? "Not always," says Keller. "Sometimes it just needs to be reworked or retooled."

That can be disheartening if you've already spent X amount of hours in the idea stage, plus X amount of hours on market research-only to find that you're not quite ready to get started after all. But taking the time to refocus your energies and determine why your idea needs some tightening is the best predictor of future success. "No entrepreneur wants to hear that his 'baby' is flawed, but only by listening and reacting to feedback can he give his idea a chance for success," notes Shenker. "Ask yourself, 'Is this a weakness that can be overcome?' If you can't create true value for your customer and your business, then it's time to pick another idea to pursue."

Remember, though, that many ideas simply need some fine-tuning. Before you panic and start flipping through your idea books again, closely consider whether you can make this idea work. After all, there was a reason you thought of that idea in the first place. Some ideas that seem like they'll be total duds after doing a little research end up being great successes. "Ideas that seem like a flop are always interesting to me," says Keller. "Sometimes you look into an idea and find it was just luck-but many times, you find the original founder had some clear insight into the potential. That insight was his or her focus, and it seemed to lead them to success.

"I've seen many people launch ideas that I thought were beyond foolish," Keller adds, "but then I learned more about the idea, the customer and the vision-and realized the true risk being taken."

When Your Idea Is Ready to Go
The market research you've conducted thus far ought to be a good indicator of where you need to go next with your idea. One key factor to consider is pricing. You want to do it competitively while also considering what the market will bear. For products or services that have a close competitor, Keller advises pricing with respect to the competitive position. "Higher-priced positioning requires an idea with enough relevance and importance to customers to overcome the gap between your idea and the nearest competitor," Keller says.

The beauty of being in business for yourself is that you have the option to make changes at will-so if a pricing structure isn't working, you can alter it. "Price high to start-you can always drop the price down," says Keller. "You can never go up."

Shenker adds that you need to be sure your product or service is delivering enough value to command the price you set. If possible, test different pricing offers as you go, and determine what works best.

When you're ready to get started, be sure you're selling where your target market is likely to buy. "Your marketing plan and budget should include a well-crafted distribution strategy," notes Shenker. If you'll sell over the Internet, budget for media to drive new customers to your site. If you'll sell via retail distribution, you might need workers with industry experience to help you reach your target market.

Remember, too, that you can always seek help in this long, arduous process of bringing an idea to fruition. The Internet, your local library, the U.S. Census Bureau, business schools, industry associations, trade and consumer publications, industry trade shows and conferences, and new-product development firms can be invaluable sources of information and contacts. "It's just a matter of seeking knowledge from as many sources as possible," notes Keller. It's also a matter of putting your ego aside and being willing to create a business that will not only survive, but thrive. "If you have an idea, don't be afraid to refine it, retool it, rethink it," adds Keller. "The more you do before you launch, the less you'll have to do [afterwards], and the less painful the lessons tend to be."

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Karen E. Spaeder is a freelance business writer in Southern California.

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