Brainstorming and selecting the type of business you will start
is key to becoming successfully self-employed. It involves
discovering the business that fits you best and finding out whether
there are enough customers willing to pay good money for your
offerings.
"When clients are trying to decide what kind of business to
start, I have them list what they consider to be their strongest
talents, skills, and educational experiences," explains Jean
Wall, a business counselor with the University of Alaska Small
Business Development Center located in Anchorage. "If
they've produced a list of four or five different types of
businesses they feel they're interested in, I have them do a
self-evaluation to determine how well their current abilities,
talents and education meet the needs of the businesses they've
identified. Personal interest in the ultimate business is
important, too. The business idea that makes the greatest match
overall with these criteria is an excellent starting
point."
As a fledgling entrepreneur, it is critical that you conduct a
thorough self-assessment in order to find this match. To do so, ask
yourself a series of personal questions, and jot down your
responses. For example, what kinds of things do you most enjoy
doing? What do you like to do on your day off? What is it
you've always said you were going to do someday? What are the
things you do that others compliment you on? If you could design
your perfect day, what would you do? To what degree do you enjoy
interacting with others? What types of things do you not
like to do? Take the time to note both your strengths and
weaknesses, your preferences and aversions.
Content Continues Below
Next, brainstorm and come up with a list of potential business
ideas that mesh with your abilities, interests and lifestyle.
Almost all businesses fall into one of two categories: selling
products or selling services. Nearly any innovative product can
become the basis for a successful venture if it can be produced
cost-effectively and there is a distinct market for it. Unlike
product-based businesses, many service businesses can be started
more readily, as they frequently involve no inventory and, thus,
have lower start-up costs. Think about which category appeals to
you most, then take your decision-making from there. Remember to
use the results from your personal assessment as a checklist to
evaluate your options.
If you find that you're having trouble coming up with viable
business ideas, keep in mind they can come from a variety of
sources. Often, they extend from past or present career positions,
hobbies, personal interests and leisure-time activities. Sometimes,
they result from identifying future trends or businesses that are
succeeding elsewhere, or from finding some sort of problem and
coming up with a solution. Occasionally, they seem to just appear
from out of the blue. Ideally, they allow for the fulfillment of
long-standing goals and dreams.
"I've been into motorcycles since I was 5 years old,
and I raced motocross for ten years. It was my lifelong dream to
work on motorcycles full time," says John Young, 24, owner of
Xlent Custom Cycles in New Lenox, Illinois. Young's business
provides custom-built motorcycles and after-market Harley Davidson
parts and accessories.
"I realized that Harleys were something I really got into
as I got older, and I knew there was a great market for them out
there," Young states. "Having been around the bikes, I
knew quite a bit about them and about the local market demand. The
biggest risk I faced came from the fact that there were competitors
in my area. But I knew I could overcome that risk, because the
competition's rapport with customers was not good. They treat
people badly, and I knew I could use that to my advantage. I'm
as busy as I can get right now."
Customers are the most crucial ingredient in your recipe for
entrepreneurial success. Before settling on your ultimate business
idea, therefore, it is imperative that you determine if you'll
be able to find enough people in your community who'll need,
and be willing to pay for, your offerings. Remember: The most
successful businesses flourish not only because they provide
fantastic products or services, but also because they fill a
specific need in their communities.
Once narrowed to a desired venture, your goal is to learn
everything you possibly can about your intended marketplace before
opening day arrives. Conduct your own feasibility study to figure
out who is most likely to pay for your product or service once it
becomes available, and how your offerings will differ from those of
any businesses currently serving their needs. After identifying the
pool of potential customers, you can conduct a mall-intercept
survey, a direct-mail survey, or a telephone survey. Ask people in
the local market whether the product or service is needed, what
they're looking for in such a product or service, and how much
they'd be willing to pay for it. Purchase and evaluate your
competitors' offerings, and visit your local chamber of
commerce to see how many competitors already exist in your area. If
possible, talk to a few entrepreneurs who are doing what you'd
like to do to get a better picture of the traits, abilities and
customer appeal required to succeed.