Be tenacious in making your business idea work – but not blinkered

Monday, February 1, 2010 17:05
Posted in category Starting a business

A good business idea?During our last Business Plan Workshop we had an interesting question asked  – “when should someone accept that their idea for a business will not work?”

Normally I am adamant that you need persistence and belief in yourself, never give up your dream. But this made me stop and think.

Certainly in the past I’ve had entrepreneurs contact me to describe a business idea that I can see is never going to work and sadly they may have spent years of their time and thousands of pounds in developing it.

More importantly than my opinion, when I quiz them on the evidence to indicate there is a need and if anyone would actually pay for the product or service, the information is non-existent or poor at best.

By evidence I really mean market research and that’s not just asking your friends if they think it’s a good idea. Rather the idea must be one that will form the basis of a business, that will satisfy a real need and that the public will give you their hard earned cash for it.

Actually the market research doesn’t have to be rocket science, but it must be reality. There are a lot of papers already written on most market areas that can start you off (the British Library’s Business Centre is a good source).

There are always competitors, or alternatives to your idea that you can check out. You can talk to prospective buyers, either consumer or trade and don’t ask general questions leading them to say that it’s a nice idea, ask for advance orders – pin them down. Then you’ll see the reality.

Once you are up and running, the question becomes “how long should you give it, to show that it will work?”

Again my instinct is to not give up too easily. If the market demand seems to be there, but you have to overcome difficulties, that’s normal and the great entrepreneurs have all had to overcome initial hurdles. But if it’s not taking off, stop and think whether it’s anything that can be fixed, or a fundamental flaw.

Michael Birch, who sold his social web site Bebo for $850M a couple years ago had tried lots of different ideas. Some worked, but weren’t scalable. Some worked but weren’t able to make a profit. Others may have been a good idea but there were basic flaws. Such as the address book updater (I think there are still some of these around).  He found that unless everyone on the contact list updated their address books, the user would simply stop using it. Of course not everyone did update, so it never took off.

Each time he learnt from the experience and moved on. How long did he give each one? Probably only a few months, but the Internet can give very quick feedback. For a traditional business it can take longer, however you should have set realistic goals that allow for the market you are in and be checking against them. If you’re not meeting them, what’s the reason?

You may find it is obstacles that can be overcome, or it might be that there is a basic issue with the business concept that no amount of tenacity could fix. Being tenacious and determined needs to be applied to the overall goal of being a success, not just one venture.

Knowing when to take the learning and move on, without giving up at the first sign of trouble is a difficult one. But I think it can be seen as the difference between operational problems and concept failure. If the homework is done first many of the concept issues should have already been spotted.

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One Response to “Be tenacious in making your business idea work – but not blinkered”

  1. Bill Aitch says:

    March 13th, 2010 at 4:15 pm

    We all expect the population of UK to continue growing exponentially way into the distant future, therefore my wish to produce raw, even oven, & table ready food materials should be a good runner.

     

    Unfortunately, all wholesalers, retailers, also gov.uk simply stonewall me when I attempt to discuss the situation with them. I have tried the most expensive aftershave, but it is a complete waste of time, space & other resources. There appears to be no room for a new boy on the block.

     

    Suppliers are much the same. They do not answer any form of communication, & refuse to meet me face to face. I fail to see that these people are so busy, in such an economic collapse. With the depression set to continue for at least another 5 years, if I were in business, I would welcome all the new contracts that I could lay my hands on. Most of these people appear to have a death wish. They certainly do not wish to quote any new consumer for the supply of goods or services. Even when I offer cash on account, they show no interest whatever. The best interest I have seen in many years, was when I handed out £300 (25%) deposit on my new freehold caravan just 2 weeks ago. The salesman almost snatched my hand off. He could not get my money fast enough. At least I will have a Freehold roof, immune to TV licence & poll-tax, & devoid of letter box, complete with the daily deluge of junk mail etc, on some grass verge somewhere, until I find a suitable plot, at an affordable price, free-, or leasehold.

     

    How long before it goes awol?

     

    At 60 years young, I have even less hope of paid employment than 10 years ago at 50. The civil service will not even assist me to find unpaid “work experience” as a dishwasher. A neighbour, completely illiterate, mid 50′s, was forced into “work experience”, full-time, with the local council as a gardner for 6 months. They extended a further 2 months, then spit him out, at no cost to themselves after 8 months, still yet on the basic Unemployment Benefit. The Benefit Office/Council even denied him 2 hrs/week to attend literacy classes, which he had commenced just a few weeks before the work experience. He still yet dreams that one day he will be literate enough to commence with ITC education. The charity providing his literacy education have meantime collapsed, after the council withdrew £250,000/annum funding. That after a partnership of 12 years. We already have 3 of the 5 charity centres up & running again, as the ex managers find their own independent, but shaky, funding. I tutor BSL, also ITC in 2 of the existing centres, part-time, for free. I also do household removals for free, providing a pair of fit young volunteers are available.

     

    In my own case, maybe I should simply bite the bullet, admit that I am not welcome in UK as an independent economic unit, & purchase a single ticket to S. America, Panama or Costa Rica, where my skills, & motivation, will be much more welcome.

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