When starting a business, the hardest thing is knowing if it’s a good idea and if others will be willing to pay for it. This article will have 4 things to help you determine if your business will be profitable or not with these 4 simple questions to ask yourself.
1. What is the problem?
The first thing you need to determine is what the problem is. People pay for products because it solves a problem. They won’t pay for something that doesn’t benefit them. So first, determine what the problem is. Figure out what problems it will solve and how this will help consumers in their everyday life.
2. Who has the problem?
Next, you’re going to find out who your ideal client is. Who is going to use your product/service? If you don’t know who your clients are, you need to find out. This will help you know your customer and knowing your customer will help you make decisions that will work for those people. A good way to find out who has the problem, is by doing surveys. Don’t give away your business idea, but come up with some none bias questions to ask potential clients, and they will tell you what their problems are. This can help you alter your idea to be even better!
3. What is your solution?
Now that you know what the problem is, and who has this problem, how are you going to solve it? This is where you will take in all the information you got from your market research and surveys and create a product that you think these potential clients will enjoy. Once you’ve come up with your best solution, it’s time to test it again.
4. Will they pay to fix the problem with your solution
Now, the question isn’t if your solution will work, because it probably will. The real question is, are the consumers WILLING TO PAY for your solution to have their problem fixed. This is where you will find out how big of a problem it really is. This might be a small problem that upsets them, but doesn’t bother them enough to pay for it. This is where you will find out what your idea/product is worth to others. When doing this research, be sure not to ask too many family or friends. You want to talk to people that don’t know you, and that are willing to share their honest opinions with you.
It’s best to know if the business won’t work BEFORE you spend all your time and energy building it. Take your time, and get as MUCH information as possible. I know it sucks, and you want to just jump into your idea, but this will help you create a better product/service. This will help you know your customers better than any of your competitors. It will also look good to investors knowing you did your research, and that you’re serious about this. Showing them real market research that you will show them why it’s good to invest in your business instead of assuming numbers.