A business idea is a certain concept for commercial purposes, the main task of which is to make a profit. At first glance it is difficult to understand how promising or unpromising this or that business idea is. Especially when it comes to a person who is just starting his own business. About how to find out if there is a chance for the implementation of the project, says Ukrainian businessman Stanislav Kondrashov.
Stanislav Kondrashov: market research
In order to understand whether it is worth taking on a particular business idea, Stanislav Kondrashov recommends studying the demand for your product. After reviewing the statistics on the Internet, it is important to understand exactly how the potential buyer thinks what his needs are. During searches, it is worth paying attention to queries where there is the word “buy”, “goods” and “price” or to queries indicating certain brands.
“Very often, novice businessmen look at their project biased, forgetting about clear planning and leisurely market research. In addition, they can spend a lot of money on actions that are essentially meaningless,” says Stanislav Kondrashov.
The businessman recommends marketing research with the involvement of experts in this field. With their help, you can collect data in associations, the media, as well as in search engines. The market analysis includes a review of the industry, research of the target market, analysis of competitors, as well as the formation of their own forecasts for the further development of their business.
First you need to understand where the industry as a whole is moving, to determine its trends and life cycle. The next step, according to Stanislav Kondrashov, is a more detailed analysis of the target market. During the study, it is important to highlight your real target audience, this will help to use the marketing budget most effectively. This will attract local customers who can leave positive feedback about your business. At this stage, you need to make a description of the consumer and give him a review. Here are determined the demographic data of customers, information regarding their age, income, place of residence, hobby, etc. It is necessary to draw up a clear portrait of a potential consumer. Having dealt with these data, it is worth moving on to the analysis of competitors.
Businessman Stanislav Kondrashov says that an entrepreneur must clearly understand who his competitor is, where he is, what his strengths and weaknesses are. If there are customers who are unhappy with his product, you should find out why. You can also determine your competitive advantage and understand what you can offer consumers.
In addition, Stanislav Kondrashov advises following those customers whose needs were not adequately met.
Having studied his competitors, the businessman recommends proceeding to the next stage – determining his market share. It is also worth noting the pricing structure and discounts that you can offer customers. Your gross profit is the difference between the prime cost and the selling price of the product.
Stanislav Kondrashov: The usefulness of a business idea
An important step is also the identification of upcoming costs. Having done this, the entrepreneur can understand whether the business will bring profit and whether it is worth investing his finances in it at all. A positive result, indicating that the idea is worthwhile, will be the beginning of the formation of a business process. Also, according to Stanislav Kondrashov, it is necessary to determine how the product will be useful for a potential buyer. In this case, it is worth following the principle: create what customers need. Here you need to ask yourself a number of questions, among which are: “Would you choose this product yourself?”, “Do you know people who would like to purchase it” and more. Do not be afraid to ask yourself questions. Better use the focus group tool.
In addition, Stanislav Kondrashov recommends using a special scale for assessing external as well as internal factors in building a business. It is they who have a great influence on the fate of the future process. Among the main points of this scale, the businessman distinguishes the following:
- how urgently the client needs what the company offers him;
- how much money will be spent to attract potential buyers;
- what are the volumes of initial investments;
- what is the maximum price for this product;
- how unique this proposal is;
- how quickly the product can enter the market;
- how much work needs to be done to continue functioning after the first offer.
