Step Two: Does Your Business Idea Pay!
Before you start a new business, you must explore the question: Does your buiness idea pay? It is critical to make sure your business idea actually pays before you jump in with both feet.
Many entrepreneurs have lost heart, soul, time and money because of a dream business venture for which there was no paying market. Regardless of the passion you may have for an idea, if it doesn’t pay . . . do not go down that path.
Take the case of Michelle M. who had so much fun sharing miniature doll tips, patterns and resource links that she decided to open a pattern store.
She researched her market and confirmed there was a tremendous interest in new patterns within that niche – something she knew already through being a member of high-activity sewing forum – BUT – she did not do the necessary research:
- Would her market actually pay for patterns?
- How much would they be willing to pay?
- What other items do they typically buy, besides patterns? Were they currently shopping at online stores that offered patterns and more?
- How much of a market share could she realistically expect to command; and how much would that make in income and sales?
- How often did her ideal customers actually buy? Every week? Three times a year? Once in a blue moon?
Because she was an established authority figure in her niche, she was able to generate interest quickly and sell some patterns… but not enough to create a viable, profitable business.
However, Michelle was determined to work in the niche; so, she went back to the drawing board. Further research indicated a strong need for reliable miniature doll sewing supplies such as miniature trims, tiny patterns, pleating boards, micro buttons and the like, as well as miniature kits and accessories for miniature dolls (e.g. wigs) and dollhouses (e.g. furniture).
She researched online stores already selling these items, and made notes about what was missing. (Being a miniature doll expert, she was easily able to identify these gaps.) She also read blogs put out by site owners relating to the niche and paid attention to what customers were asking for.
She then sought out wholesale suppliers such as Alibaba.com (paying particular attention to “Search Feedback”) and making sure there were escrow-based paying arrangements.
The next step was to calculate how much she could mark up these wholesale items, as well as how much her target market would pay.
She then outsourced the projects of setting up a shopping cart and creating with a stronger, more focused website design. Neither of those projects were areas of expertise for her and hiring the contractors was well worth the money. Ten years later, she is going strong and making a steady income. In her words, “I am not making six figures, but it is just the way I like it, everything in balance.”
But . . . you say to yourself, “What if I have no idea what I would like to do online?” You either feel you either no skills or a mismatched smörgåsbord of skills that range across the board? Or, maybe you are highly skilled in certain areas, but completely burnt-out in that business and badly in need of a change of pace. How do you go about finding a new career – without having to start at ground zero?
Be sure to visit again soon for the next step!
Want all of the information? Begin at the beginning: Building an Online Business.
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