I posted yesterday about a ”3 point marketing success strategy”. You can also use another 3 points in planning a new business which I have done both for myself and others.
The 3 points are:
1. Is there a market for my product or service?
2. Will anyone buy from me?
3. How long will it take before I make a profit?
On point 1, if another business is selling it, then there is a market. It might not be large or profitable, but it exists.
On point 2, will anyone buy from you? Probably, providing your price and service matches the competition, you could take one or more of their customers. You might not sell much because price isn’t everything and, as a new business, you can’t prove your service quality.
Essential on points 1 and 2: always check out the competition first, because most new businesses don’t.
On point 3, when will you make a profit? Do a realistic cash flow forecast and you’ll know how long you can last before the money runs out. A better question might be: how long can I afford to wait to make a profit. In my experience, everything takes twice as long as you planned for, hence the reason for a realistic cash flow forecast.
Number 3 has also been significant for me in developing a business: year 1 you make a loss, year 2 you break even and year 3 you see a small profit.