Starting up the business is a lot harder than many people think, With the problems faced every day we will get many ideas which can be taken forward as a business startup but many ideas remain as ideas only whereas many of us think that the idea we have got is unique form others and we try to take up our idea and try to sort out the possible ways to transform the idea into a product or service and try to set up a business startup but before doing that we have to do proper research on the product or service is required to get to know whether your idea can be changed as a product or a service in the market. Many startups fail because of a lack of proper prior research. In 2019 in research on start-up failure reviles 90% of start-ups fail every year 21.5% of startups fail in 1st year 30% in the second year, 50% in the fifth year, and 70% in their 10th year.
There may be many reasons for a startup failure that leads to shutting down the business very short period. According to business owners, there may be many reasons for failure which include running out of money, not being in the correct market, a lack of proper research, bad partners or management, ineffective marketing strategy, and not being an expert in the industry in which the business is operating.
One of the criteria before validating your business startup ask yourself below 13 small questions to come to a clear picture of your startup idea.
1 Does your business startup idea is solving a problem?
Entrepreneurs are often used as a synonym to problem solvers in the market, solving those problems, and getting a handful rewarded for them. It can, therefore, be argued that any entrepreneurial venture which fails may be a victim of either its failure to untwist the matter which it set itself upon to unpack or simply merely picking the incorrect problem to resolve within the first place. This scenario is that the one that is able to be discussed here. irrespective of how run-of-the-factory your business idea is, the question you yet to always ask yourself is whether or not it solves a controversy that is worth solving. Hopefully, by the time you finish your research about this piece, you'll have revealed a way to come up with a solution to the current question.
2 The problem you are solving is big enough?
Sometimes the issues which businesses tackle don't seem to be as big as we expect they're. It’s very easy to mistake a mere inconvenience for an actual problem. Problems are those issues that many purchasers recognize and are willing to purchase the solutions. On the opposite side, inconveniences are things that most members can learn to measure with. Solutions to inconveniences work best as additional features on products and services instead of because of the base of products or entire businesses.
I know that there are infinite products and services that are often lauded for the way convenient there, but you'll realize that in many cases they solve actual pressing problems. For example, describing a mobile as being merely more convenient than a landline may be a gross understatement. At its worst extreme, entrepreneurs who neglect to think about the sizes of problems find themselves trying to unravel imaginary ones. To use a really famous example, I want the people behind Knees to think that lack of access to virtually unknown sports like handball on TV was a controversy that needed solving in Zimbabwe. They were wrong; it seems that we didn’t fall taken with soccer out of the blue.
3 To what extent your solution is addressing the problem?
You have to clearly identify the extent that which extent that your solution is truly solving the problem it is as important as the how the bigger problem you are solving in the market. For example, let us assume you have identified a problem and it is big enough to solve in the market which can be handsomely rewarded by the market. Now you have to prove that your solution can solve the problem to its whole or 100% of the problem has to be addressed by your solution. For example, let us consider the country Zimbabwe it has many renewable resources solution and the deforestation problem on the other hand that there are many renewable energy resources may be available in theory to solve those problems but many of the villages are not ready to afford most of them. So you may have addressed the real need, but if your solution is leaving a majority of the problem unaddressed then your solution may not be considered. When we take this into consideration setting up a business will have many challenges and you may not be able to come to breakeven or you may have to struggle in the market to soundly establish yourself.
4 Are you really passionate about the idea and setting up a business?
Just having a good problem-solving product or a service is not enough you must have to be passionate enough to monetize out of it and be able to handle the many hurdles that come in the journey of entrepreneurship. The path that leads to entrepreneurship will not be easy as many people think, a lot of effort will go into setting up a business and have to be worked tirelessly in the initial stages of the business. You must be passionate enough to be in all the stages of your business which may give you fruitful results when it is fully operational.
5 How long will your business idea take to break even or make a profit?
Coming to breakeven point is one of the initial targets of any startup businesses but coming to breakeven point usually takes at least two to three years for any business to be at the Breakeven point or even some more years depending on prevailing market conditions and type of business you are in. You must be patiently working on the set goals and climb the success journey step by step. More likely working hard on the initial goals takes you and your business more quickly to breakeven when profit-making is not your motto of the business in the initial stages.
How will you know if you’re not keeping a bigger piece of the market share pie if you don’t monitor your numbers? Businesses are all about statistical numbers such as market shares, costs, revenue, sales, prices, etc. so it’s important to keep an eye on your movement. Regardless if it’s again, or a loss.
6 Are people willing to pay for my product?
Answer to this question will be easy if there is an existing peer in the market but the real huddle come where you are solving altogether a now problem with your product or service in the market willing to pay will raise from the customer point of view the bigger the problem you are solving the more is the return you can expect from your product or service and the 4 Ps of pricing will also come under this question where your price must be competitive in the market to your pears only then you can attract price-sensitive customers.
7 Is there a place in the market for your product or service?
This is one of the most important questions you have to ask yourself that whether your product or service is having a place in the market or not to come to a conclusion when you see history commerce is backed up with many products or services. Market research on what do customers want for their problem that you would like to solve can help you in sorting out one of the hurdles in your journey pilot run listen and learn is also some of the other options that are available which can be used to draw a clear picture on the portion of the place that your products have in the market.
8 What about the competition?
Having healthy competition in the market good sign for your business to be launched and helps you in comparing your growth rate and one thing have to be always kept in mind that rivals can make you harder in your growth hack, competitors make it harder to get more customers to get them to your products or services. Find out strengths and be ready to face the dark side of the competition in the market. All products have their own strengths something which you offer better will attract a certain portion of the customers if your product or service is not having any of the positive sides then you may have to go to your drawing board to figure out. You should not copy your competitor and also cannot ignore them focus on your own brand improvisation a have a unique way of your touch in the products or service which will answer your competitors. You have to ask yourself if your competitor is coming up with new innovations or the strategies that they are using are some of those.
As for your products, being a startup may work to your advantage as many big companies will probably not have time to give you as much attention. You can take over their market share without them realizing it like a ninja.
9 Will my idea impress the investors if you have to raise funds for startup needs?
Defining the problem, your best possible solutions to it, and being realistic are the key factors of any tentative business and also having a less breakeven period are the most likely things that any investor looks into any business idea. You might be clear about your business concept and your prototypes for the product are all sailors and you may be excited about your business plan. Unfortunately, if your product or service doesn't solve a big problem or fill a need for customers, investors aren't going to share your excitement.
It is critical that you can answer all questions when heading into a meeting with investors. Thorough market research along with customer surveys and interviews can help if your product is needed. If you fail to show data to prove that your idea addresses a big problem, it will be difficult to engage the audience and even more difficult to raise funds for your business startup from investors.
10 Have you done SWOT matrix analysis?
SWOT analysis sits on one of the benches of key analysis of the startup businesses to be done before entering the markets, Swot analysis/Matrix is a strategic planning technique used to help the startup to identify its strengths, weaknesses, opportunities, and threats related to business competition or project planning.
In this analysis, you have to clearly put your strengths, weaknesses, opportunities, and threats which you have or going to be faced in your path to setting up a business.
SWOT analysis will consider some assumptions that strengths and weaknesses are internal circumstances, while opportunities and threats are external circumstances. SWOT is an acronym for the four parameters the technique that this analysis examines
- Strengths: characteristics of the product or service that provides it a competitive edge over others.
- Opportunities: elements within the company environment that the business could exploit to its advantage.
- Weaknesses: characteristics that place the product or service at an obstacle relative to others.
- Threats: elements within the environment that might cause trouble for the business.
It is important to increase leverage on strengths, minimize threats, and to take competitive advantage of available opportunities. Conducting a SWOT analysis is useful for strategic planning and for determining the objectives of a business.
11 Reached out to potential customers for feedback?
Feedback from your potential customers in the pilot batch testing of your product helps you in improvisation of your products and also it acts as one of the checkpoint if your product or service if they are having sufficient demand in the market. Many business Startups in their initial stages produce a pilot batch of their products to distribute them to potential customers and seeks their feedback once they use the product which in fact helps the company in various deciding factors.
12 Do you have a mentor or industry advisor for your ideas?
Many business opportunities do not require mentors and can be driven alone but having a mentor from the same industry will help you in minimizing unnecessary expenditures or missteps. One more benefit of having a mentor is you will have a proven formula for your business Startup idea.
13 Do you have access to the all resources you need to launch a business?
Last but not least you have to cross-check whether you have all the various resources that you will be required to start and smoothly run your business this final check is compulsory to take on the decision whether to take forward your idea or not once you feel you are confident enough that you are available with the resources required and also their backup you can step ahead and move coins to start your own business.
All the above question may be small but plays a very key role and acts as deciding factors for you to decide on opening an ideal startup.