Your favorite hobby may be the worst business idea you’ve ever had.
There are times when every businessperson gets so hung up on the product or service he/she is selling that the object of business is forgotten. I’ve been there many times. It becomes a trap.
Have you known someone who is the best at a craft who is convinced to go into business by well- meaning friends and family, and is unable to make the business succeed? Just because you are a good baker doesn’t mean you should open a bakery. Being friendly and talkative won’t guarantee you will be a successful car salesman. Knowing the contents of the bible won’t fill the pews if you don’t know how to minister to the congregation. Even schools and cities will struggle to lead adequately without knowing how to market the needs of the tax paying public.
The reason you are in business is to capture revenue by making a sale. Sales mean cash flow. Without cash flow the business will fold, even non-profits, schools and churches can’t operate without sufficient revenue. Whether the cash flow is generated from the sale of shoes, houses, or donations, it must be able to pay the bills to keep the operation going.
How often have you thought all you have to do is to make a better product than the competition to bring in the customers? How often have you spent hours, days, or months making your service better, broader, cheaper, and faster only to discover that sales (or donations) are still not enough to sustain the business? It happens everywhere, every day.
Hang your shingle on your company door and watch the business come flowing in. Dream on.
“Work smarter, not harder.” Heard that before? Of course you have. Have you also found that working smarter isn’t always easy? Most times working harder is the first thing we do, because its easier. But it can kill your business and you. Smarter means sell first on paper as a proof of your business concept.
Selling first sounds crazy if you have yet to produce a product or service plan. Creating a product or service that has no desired need in the market is also an expensive waste of time and effort.
If there is a pain point that can be cured by the purchase of your service or product, you may be on the right path to succeeding. Before the operation begins, however, there must be a thorough study that your interest is correct. The study will include a step-by-step process beyond the idea stage. Be careful that your idea is more than a dream. A goal without a plan is just a dream. Dreams can be filled with mistakes where budgets, demographics, competition, and hobbies are nothing more than an exciting game with no realistic chance of success.
Key performance indicators, or KPI, are the gauges useful in tracking progress. Relating to sales and revenue generation the KPI may be used interchangeably regardless of the product or service responsible for the revenue stream. Using the “Widget” in place of your product name could help to keep mindsets logical and less emotional.