Have a Business Idea? 25 Questions To Determine Its Viability
We all know that success stories don’t happen overnight. For a business to emerge as a major player — let alone a leader — in its field takes months and often years of hard work. After all, no idea emerges fully formed — but the best professionals recognize when a kernel of an idea has the potential to develop into something that might change the game forever.
This might be the case with you and your Limited Liability Company (LLC) right now. You have all these business ideas swirling in your head, but you’re stressing over which path is the right one. How can you possibly hope to validate your business idea so you can proceed confidently with your plans? While there’s no one-size-fits-all solution to completely alleviate your concerns, here are 25 questions that can at least help you discover if you’re on the right track.
1. What is your mission statement?
This is a fundamental piece of your company’s puzzle. If you don’t know precisely what your purpose is and why you’re driven to pursue it, you should probably go back and reevaluate your business plan.
2. What target audience do you serve?
Much like your mission statement, you’re doomed to struggle in building your business if you don’t know who it is that you’re trying to connect to. Establish your ideal customer profile as early as possible to save yourself from a world of trouble later.
3. Who is your competition?
Until you know which companies you are directly (and indirectly) vying for business with, you’re going to have a very difficult time proving to potential customers why your product or service is superior.
4. What makes your business distinctive?
Once you have identified your competition, you will be much better equipped to isolate your company’s X factor (i.e., the element that distinguishes you from others in your field, making a compelling case why you deserve patrons’ business).
5. What unmet need are you satisfying?
This goes along with your distinguishing factor but is not necessarily the same thing. If you really hope to establish your company as a true leader, you need to find a hole in the market — some way in which you can improve on your competition’s service.
6. What’s your five-year plan?
If you don’t know where your company is headed, then you can’t ever hope to reach your destination. Laying out a five-year plan — with milestones along the way — is an easy way to gauge your progress and motivate yourself to continue your growth strategy.
7. Have you connected with your community?
A huge part of your company’s potential success rides on relationships, namely the one between you and your prospective customers. Reach out to your target audience to get their feedback on your product and plant the seeds of a long-term connection.
8. Have you done your research?
You need to know exactly what you’re getting into with your business as early as possible. That’s why you should conduct thorough and ongoing research into your market, your product, your customers and pretty much every aspect of conversion.
9. How did product testing go?
In many cases, your product or service would benefit from a bit of beta testing. Select a few people in your immediate circle who you’ve identified as part of your key target audience and offer them the chance to try your product. Then get their feedback.
10. What is the company culture or personality?
As much as you need to know your mission statement, you should know what your company stands for. What values do you cling to, and what message are you really sending out into the world? Be sure that your actions reflect that.
11. What did the experts have to say?
Even if you’ve connected to prospective customers in your community, you should still touch base with industry experts (including any willing competitors) to glean any insight you can into how you can build your company for success.
12. What will your business cost initially?
Ah, the numbers. Naturally, you will need to identify the startup costs necessary to really kick off your company. You can have the most impressive product imaginable, but you’re already sunk if you simply cannot afford to launch it.
13. What does the market look like?
This is different from knowing who your competition is. The market conditions reflect the economic state of you’re entering, and will vary wildly depending on the industry you work within.
14. What’s the best time to kick off?
In life and in business, timing is everything. Do your research upfront to ensure you choose the best time of year to launch your business venture. This could mean the difference between an underwhelming opening and one that really shakes things up.
15. Is there room for repeat customers?
Based on your price point and the nature of your business, you may or may not be setting yourself up for potential repeat customers. In either case, you could make a success out of your business, but knowing earlier can help you position yourself.
16. Who are your potential business partners?
So you’ve identified your customers and your competition. Now you need the last part of that critical trifecta. Which companies will you need to distribute, manage or otherwise streamline your business? Know who they are now so you can start building relationships.
17. Is there a built-in demand for your business?
Some products/services just inherently have a built-in audience ready and waiting for them. Others need to do a little more work to cultivate demand. If your business is the latter, you’ll want to take that into consideration now.
18. What have other businesses tried?
By studying where other businesses have failed or succeeded, you can avoid their mistakes or emulate their triumphs. This goes for both current competitors as well as those who may no longer be players in your industry.
19. How do you incentivize your audience?
When entering your market, you need to let your prospective customers know from day one why they should give you their business. It helps to offer incentives, such as discounts, to drive business early on and attract them to your product.
20. What key features/benefits do you offer?
More than just establishing the distinguishing factor in your product or service, this ties into the emotional bond you hope to build with your customers. How does your company make their lives easier?
21. What did your SWOT analysis uncover?
If you are still wondering what a SWOT analysis is, that’s your first problem. You’ll need to know your strengths, weaknesses, opportunities and threats to have the full picture of what your company is facing.
22. Who is on your team?
Any winning company is only as good as the team it puts together. Make sure you carefully select your team members and that you have each one ideally positioned to make the most of their skill sets.
23. Have you begun to build demand?
Remember when we mentioned how you need to know if your business has built-in demand? Well, we’re stressing it again here. If it doesn’t, you’d better start working on that ASAP.
24. Do you have the bandwidth for this?
It’s a question that gets overlooked all too often, but starting a new business is an intense commitment. Dig deep and be sure that you have the time, money and energy to pursue it to the best of your ability.
25. At what point will you turn a profit?
The goal of any business, of course, is to earn a tidy profit. For your new business, that might take some time to build up to, but you should know exactly when that is and what it will take to achieve it.
Getting It Together
Based on your answers to the above questions, you should have some indication of whether your business is ready to move forward. If the above has instilled you with renewed confidence, then congrats! Your business idea may very well be poised to make a big splash. On the other hand, if you still have some work to do, consider this a heads-up on what areas of your business need a bit more attention.
To that end, Incfile is available to help you build your company from day one. It’s our business to provide your company with the guidance, knowledge and ample resources to conquer your competition and your industry at large. Before you take another step toward unleashing your business onto the world, feel free to reach out and discover how we can get your growth strategy off to a powerful start. To learn more, check out our website and get started today!