You don’t need to battle too much with the puzzle, how to choose the right business to start when you have more than one idea on your table?
Though choosing the right business idea at times can be as tough as it is for a king threatened with capture in the game of chess!
When he loses all his steps, he checkmates.
You have to be strategic while brainstorming on how to choose the right business you can do out of your available options.
So, if you just want to start a new business and you don’t know how, one of the best answers you could get is to do your research very well before you dabble into it.
There are eight good factors you need to consider first, which will tell you the business that is good for you.
And in this post, you’ll discover what those factors are.
What You Will Learn in this Guide
Why Research Before Choosing Business?
You need to assess yourself as much as all the business ideas you have in order to know which one is the best to do. You must make a move that will lead you to success, not a move that will lead your business to an untimely death!
The suitability of your business hinges on the environment and your personality.
Whatever numbers of time you’re going to start up a new business, irrespective of the level of your experience and exposure, you have a single choice to make out of hundreds upon hundreds that are available.
And this is the roadblock that every business owner meets at one point in time.
Reason is that there’re many businesses under every existing industry. And you have to make the right choice based on the economic circumstance that surrounds you and the business.
Assessing yourself, the business and the environment is, however, key to your success in any chosen business. And you must consider these factors before committing your money to any business.
Otherwise, choosing the right business to do in an unfavorable environment or when you don’t have the acumen could be disastrous.
Entrepreneurs whose level of patience and good judgment is poor may have their businesses suffering from simple mistakes.
A business without a good planning or structure won’t be able to survive even in a less competitive environment.
Factors That Determine The Right Business To Do
Making a wrong choice can greatly affect your business sooner or later.
So, you have to consider the following factors before you can say a business is right or not for you.
As a prospective business owner, pay attention to the following strategic steps. Each will guide you on how to choose your industry or business. They all factor into your overall decision.
So, let’s start.
Journey Into Unknown
Anytime you think of starting a new business, the first thing that comes to your mind is “What business should I do?”
Before you can answer the question, two things come to play.
One is “YOU”, the other is “BUSINESS”.
So, what’s the connection between you and the business you plan to start up?
How do you think the two can boost your productivity?
Let’s say your interest is in fashion, you’ll be bothered about which part of the industry to venture into.
“Should it be wedding wears, men’s fashion, ladies’ fashion or babies’ fashion?”
You have various options but don’t know which one to settle for.
That’s normal as an entrepreneur.
Just let the question go further until it gives you a strong clue about who you are and which business go well with your personality.
- Do I flow well with people?
- Do I love kids?
- Am I comfortable with opposite gender?
- How great is my marketing skill?
There’re more questions to test the connection that exists between you and your business ideas.
At least, the few above will guide you further.
They’re to show you exactly who you are and which business is right for you.
If you don’t flow well with people, not comfortable with kids, don’t like mixing with opposite gender, or can’t even deliver a public speech confidently, find other part of the industry that will accommodate your personality.
That’s how your personality can be greatly utilized in whatever business you choose.
Inquire into the risks associated with the available business ideas you have before you can choose one.
Investigate who you’ll be competing with, what is the effect of the business on your health, are you not going to spend more than your budget, or make a loss rather than profit?
This step will give you the foresight into what the future has in store for the business.
Based on this assessment, a business that is more promising is the right business for you.
Popularity or Profitability
If you want to know which business is right for you, consider the profitability not the popularity of the business.
You may see a lot of people rushing into a business, that doesn’t guarantee the business will profit you if you join them. In fact setting up a slight different business can make the customers want to have a new taste.
What works for others may not work for you or vice versa.
You need to be innovative before a business can work for you. As that can be a great strength you need, it’ll also prepare you to compete well in the industry at large.
Your assessment about “YOU” and the “BUSINESS” as stated earlier will say “this business is good for you and the other isn’t”.
Don’t choose a business because it works for others.
Don’t trust, a business is right for you because it’s right for others. The profitability of the business is a key factor to show you which either side you belong.
Let’s say you have access to a grant or bank loan. Knowing the profitability level of the business will guide and give you confidence to bargain well on the loan and get a suitable package for the business.
May be a long term loan is what you need, you have to know how profitable the business is before you can decide.
If the business won’t yield profit immediately and you collect a short term loan, you can see there’ll be a problem.
Ability To Compete
Since you have no shares in other people’s businesses, those who are already making it in a business are the players to compete with.
Depending on how fierce the competition will be, you may not have the ability to compete.
Your strength, weakness, opportunities, threats (SWOT) are the major factors you need to consider while entering a market.
I’m sure, you don’t want to enter a business which you don’t have the strength to do?
Ask yourself, can the profit in the business take care of building a very powerful brand clout, knowledge, skills, experience, and both material and human resources it needs to survive?
At the very earlier stage, you have to first ascertain you have all it takes to do a business before dabbling into it.
When there’s a lot of people in a business, you have a lot to compete with.
Meanwhile, the problem isn’t competing with others but the possibility of the business to finance all it takes to survive.
If the business has it all, then it’s a good one for you.
In fact, your emergence will really shake the industry at large.
This involves two fundamental traits, the “knowledge” and “experience” to do a certain business.
Under this section, let’s talk about knowledge. Experience will be addressed in other section.
Some businesses are in the category of “Too Sure”.
They’re “Too Sure” because most people believe they can manage them as long as they can hire some experts without having the knowledge or skills required.
But you have to consider your capacity to have the experts permanently on ground.
Temporary appointment doesn’t solve the problem. Rather, it degenerates into a bigger problem of incompetence that can make customers lose trust in your service.
By the time your customers come today, tomorrow and thereafter and don’t meet the right person on ground, the business becomes nonviable.
What about the cost?
Can the business take care of the cost of hiring the appropriate numbers of experts you need without the business suffering from it?
If the cost will be too much, why hiring? Why not acquiring the skills and produce your own workforce?
It would have been a good substitute if you know about the business.
Customers want to be sure that what they’re paying for is cost-effective. They like to see what value makes your business different from others.
That makes nothing too sure about a business you know nothing about. Such a business isn’t the right choice for you regardless of the profit and possibility of hiring an expert.
Experience and Track Record
It’s possible you have worked in an industry before. Starting your own business in that industry will give you the edge to thrive.
With your previous relationship with a company as an ex-worker, doing business with the company won’t be difficult unlike someone coming there for the first time.
But that is only if you were not a bad staff!
You must have gained some information, experience, skills, training and network of contacts where you have previously worked, which can help your new business grow.
If you bring all these together, any related business could be your “best bet”.
So think about your previous jobs, contacts, clients and industry and let that determine your right business.
In such a manner, you can easily establish your customer base.
It won’t be difficult for you to get raw materials, experts, and where to sell your own products since you’ve gained the experience in your previous job.
Your relationships with the old suppliers and distributors you met while working in your previous company can still work.
In fact, all the risks that are involved won’t be new to you.
So, you can even find a way of doing business with the company you work with at present.
Use the information you have on the company’s products to choose your right business. You can start by being a retailer, distributor or even a supplier and later expand your tentacle to other companies in the industry.
With such an approach, you have many privileges such as timely supply, trust, discounts and so on, which an external customer may not have.
In fact, having a good track record can make investors show interest in your business. Your previous experience will make anyone putting his money on your business comfortably.
If at all cost you must choose a highly competitive business, even if you don’t have the technical know-how, no experience and track records, you should upgrade yourself before starting the business to avoid making critical mistakes in your planning and decision making.
Upgrading yourself on the right business means, you can’t do the business until you’re professionally equipped.
Study the business, consult expert for training, network with others in the business and attend related events.
Don’t fight it.
Don’t compromise it.
Take your time to learn and don’t rush.
It happens that way when you choose a business you don’t know much about, you have to pay the price in hard way.
Evaluate Your Business Ideas
What you need to test is your compatibility with your chosen business.
Businesses perform greatly when owners don’t have anything against their ideas.
It’s possible to choose a business you don’t have passion for. May be you’re only doing it because you inherited it or because your friends are doing it.
Some businesses may not go well with the faith of the owners.
For example, some people won’t be comfortable going into brewery because their religion is against alcohol.
So, you have to check critically how well your ideology, you faith, your health, culture and tradition go with a business before choosing it.
It is better to make a U-turn at the earlier stage, not after you have paid for the rent, bought equipment, hired people who will work with you, or after other investors have put their money in the business.
In conclusion, the overall analysis is that before you can identify the right business to do, take your time to consider the one that is more appropriate for you.
Nothing is wrong in doing businesses that are popular. But if you must do them, ensure you have all the resources required. That will eventually make the business suitable for you.
For the need to compete for the future, you must take this guide earnestly. Look into the future of all the business ideas you have.
The one that is most certain in another five or ten years could be the right business for you.
Taking the future so serious will give you the foresight into whatever business you have in mind and you’ll be able to pick the right one.