Entrepreneurs are famous for having more ideas than they know what to do with – but how does one generate successful business ideas consistently?
In a recent interview, serial entrepreneur Travis Luther shares how he built businesses that fit his passions. He tells Business Success Consulting Group’s Adi Klevit what worked, what didn’t, and the system he uses to generate successful ideas he can implement.
The interview is extensive, and we have summarized this portion of the discussion below.
A System for Generating Successful Business Ideas
As an entrepreneur, you likely have more business ideas than you could possibly bring to fruition. Often, the one thing stopping entrepreneurs from acting on a cool idea or launching a passion project is the concern that it may be unsuccessful.
While the system below does not guarantee a successful business (there is a lot more that goes into a business than having a profitable idea), it is an excellent way to weed the unprofitable ideas from potentially profitable ones.
1. Find a need.
We see needs around us all of the time. If you live in a recently developed neighborhood, you may see the need for a corner store, after-school childcare locations, or a local pharmacy. Some are “nice to haves,” and others are “need to haves.” Look at your list of ideas and consider which ideas are “need to haves?”
2. Determine the target market.
Next, determine who the target market would be. For example, a corner store likely has a target market of the neighborhood in which it is located. In contrast, an after-school childcare location could have the target market of every parent with elementary school and kindergarten-aged kids in the area. Understanding your target market will enable you to ask the questions:
a. Is the market broad enough for this idea to be profitable?
b. Is the idea feasible for the market that I have access to?
3. Create a cost/profit analysis.
It’s time to look at the plain facts. You may have a great business idea, but it’s just not going to be profitable. Perhaps your neighborhood has a corner store, but you have an excellent idea for a store that would provide different products or price products at a cheaper rate. While that may be a great idea in your mind, the back of the napkin math may tell you that the corner store stocks particular products at that price because your concept is unprofitable. Take a good hard look at profitability before you jump in with both feet.
4. Determine if this is a viable idea.
With all of the above information in play, you can decide if this idea seems viable or won’t work. If you don’t think it’ll work, you just dodged a bullet. And, guess what? You likely have a million and one other ideas waiting in the wings.
This rapid-fire system for evaluating business ideas is useful for new and serial entrepreneurs, but established business people can also use it. If you have a new product idea or want to branch into a new area, that idea should also be scrutinized. Try this system or build your own for idea evaluation and keep the ideas coming!
Are you ready to start working on your next big idea, but your current business sucks up all your time? Get in touch with Business Success Consulting Group. We find that company owners who implement systems regain their time and have the opportunity to pursue new ideas.
