Testing Your Business or Project Idea

So you’ve had an idea! You think it would make a really great business and are thinking about starting up. So what are some “tests” you should put that idea through to really work out if it’s “the one” you should pursue with all of your time, energy & money? Try these:

Excitement levels
When you think of your idea and turning it into a business, how excited does that thought make you? Starting and running a business takes a lot of heart and soul to make it truly successful, so if the idea doesn’t “rock your boat” in some way then it’s probably not right. The most successful business people will always tell you that passion for your idea and business is essential. So really ask yourself right now, does this idea wake me up at night? Does this idea fill my belly with butterflies when I think of where I can take it? Does this idea lead directly to thoughts of who you could work with on it? If you answered yes to these, then your idea has passed its 1st test!!

Outsiders
Have you told anyone else about the idea? What do they think of it? Of course, you may be worried about people “stealing” your amazing idea, so put due processes in place to protect yourself (MOUs or confidentiality agreements or get some legal advice if you’re truly worried), but then get out there and ask everyone you know what they think! Get them to pick it apart and ask you a million questions. This will help you to see what research still needs to be done, where the holes in the idea are, where there is more potential in the idea and perhaps will show you if the idea is not right in its current form. Of course, “advisers” have been proven wrong before, but no one has built a successful business without the advice of others. If your idea has withstood this barrage, you are doing really well.

Anyone done it before? Why not?
If your idea looks like it will be the “first of its kind” or “too good to be true”, ask yourself, why has no one else had this idea or done something with this idea before. Often the reason why no one has done it before is because it is not a really great idea, or its time has not yet come. Do your research in your industry to really find out why no one has done this before. It could be that the idea is so simple that no one has seen it yet, and it is truly brilliant. Or it could be that others have not seen any value or money in the idea. You need to find that answer for yourself too, to pass this test.

Uniqueness
Every customer you will get, generally, means you are taking them away from someone else! So what is going to make yours stand out such that customers will come to you rather than anyone else? How well do you then know your potential competitors, direct and indirect? Do a SWOT not only on yourself, but also on your competitors. You will learn a lot about your idea with this test.

Start up costs
How much is it going to cost you, and thus how much may you have to risk to get it started? Can you put together a 6 month budget to see what you are going to have to put on the line to start it up? How does that amount make you feel? Perhaps you can get out and sell some of your idea (product or service) at cost or for free to really test your market. Just starting small is a great test for your idea – just selling 1 tutoring lesson, 1 new computer mouse, 1 piece of clothing on ebay – what was the experience like, what was the demand like, get your customer to give you feedback, learn, learn and learn more. This will provide a huge wealth of information that will help to direct your next move in testing your idea further. And by the way, if you do this you have started your business!!!

The market
Of course a general look at your individual industry market and the general economic market can help to test your idea. How are other businesses doing in your area? Are they growing, stable or contracting? Get out there and look at trends, read industry magazines, talk to people in the industry, go to networking events – really submerge yourself in the market you are thinking about. You will get a sense of the vibe and energy around your area. Good vibes = good idea!

The numbers
Now depending on the type of entrepreneur you are and why you are starting, the financial numbers can also help to test your idea. For those of you just wanting to get out there, and get started and see how it goes – do just that, just start now. Others want to see that the “numbers” all add up – that is, that there is going to be profit and good profit in this idea. This will mean putting together at least a 1 year budget backed up with your research of the industry, competitors and market information. Get someone on your team who is really good at all of this stuff, and put your idea up against the toughest test, financial! Here at The FRANK Team we just got started, and then looked at the numbers as the phones started ringing, it has been purely organic from that point onwards

Of course this is all just some general guidance based on our experiences here at The FRANK Team and how we test our ideas as we come up with them – and the tests we have learnt the hard way that you should put your ideas through before going ahead with them. You need to do your own research and then ultimately it is going to be your decision.

And remember, there is no one way or right way when it comes to business. Just make it up!

So what is your great idea? How have you tested it so far?

Jessica Kiely
The FRANK Team