BY MARY FISCHER-TRACY
Starting a business is not easy, if it were everyone would be a small business owner! To run a successful business you need to lay out a plan, ask questions and be patient.
Feasibility of your business idea is very important. Feasible means “capable of being done, effected or accomplished” (dictionary.com). You need to prove that your idea will most likely be successful. I decided to walk you through how to determine if your idea is feasible or not before moving on to the next topic.
Many people want to start a business that THEY want to do. But the real issue is what customers NEED, and how much will they pay. Clients often come into my office and tell me a long story about what they want to do but they have no way to monetize it. Usually these types of new business owners want to do some sort of service business that they see a need for but their target market has no money to pay for it.
For example, a woman saw a need to get music into lower income adolescent lives. She wanted them to be able to come to her establishment and learn to play instruments as an after-school program. That is a really great idea…But…Who is going to pay them so they have money to pay rent, rent instruments and pay instructors? Think about the feasibility of the business and whether or not you are going to run a business or a not for profit business.
Opening a not-for-profit business is not something the Small Business Development Center can help you with, but we can point you in the right direction.
So…Let’s get back to opening a feasible business. You must do research to determine the feasibility of your idea. Market research is about asking questions to your target market. First we determine your target market before we start asking questions. Don’t ask your friends or family because they want to be encouraging and make you happy. You must ask the people who could potentially use your product.
For example, let’s say you have a new pet product, only for dogs. Who is your target market? Dog owners…right? But not ALL dog owners. There are some dog owners who don’t have extra money to buy new toys or products for their dogs. Let’s say you have a grooming product. Many dog owners do not utilize groomers or grooming products, but there are some dogs who must be groomed monthly or every six weeks or so. What dogs are these? Usually dogs like shih tzus and poodles. If your product will be on the high end side you need to figure out what income bracket your target market will most likely be in. So far we have your target market as dog owners of highly groomed dog types who have an income of over $50k.
So now we have your target market. How do you find these people? You can join some groups on Facebook pertaining to the type of dog you are targeting. You can ask local pet stores if you can set up a table and talk to their customers about your product and have them take a survey. You can construct a survey yourself and send it out to dog owners on different platforms like email, Facebook, Instagram and Twitter. You should ask at least 100 people about your product including how much they would pay for it, how they would use it, what is important to know about their dog product (e.g. Ingredients, where it is made, sizes etc.) All of this information gives you great information…but most importantly it tells you if it is a customer NEED or WANT which helps make your decision of “Is your idea feasible.”
Mary Fischer-Tracy is the business consultant at the Wisconsin Small Business Development Center at the University of Wisconsin-Parkside. To make an appointment for consulting, call (262) 595-3363.