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Business Start Up Ideas:
Summarize Your
Idea
Remember the following about any idea for a new business:
- Always be on the lookout for ideas. They can come from
anywhere: your work experience, a hobby, or even your experiences
as a consumer when an existing product or service doesn't
meet your needs.
- Identify a niche. Usually the niche, or opportunity, will
be an innovation or proven idea in a new market or a unique
idea in an existing market.
- Learn everything you can about the business you want to
start and the marketplace you'll be operating in. This means
getting work experience and collecting information so you'll
know the arena inside and out.
- Make sure your idea is so focused that you can express
it clearly in 50 words or less. Summarize your business
idea in 50 words or less.
Begin testing your idea by asking probing questions. Put
answers in writing. Do this for each idea you have.
- Where did your idea originate (from a specific experience,
industry observation, a sudden inspiration)?
- If your idea is for a new product or service, describe
how you expect to get it accepted in the market.
- If your idea is for an improvement or variation of an
existing product or service, describe why consumers will
use it instead of what is already available.
- Describe your market niche in 50 words or less.
- List at least three qualifications that you have that
will allow you to pursue a business in this market niche
(work experience, education, research, reputation, etc..).
- What are your two most important personal goals for the
next five years (independence, visibility, income, personal
satisfaction, etc..)?
- How will this business help you achieve those personal
goals?
- List and describe briefly the two most significant barriers
you expect while launching and operating your business.
- Explain how you expect to overcome these challenges
Test Your Idea
As you evaluate your idea, keep in mind the following:
- Market research doesn't have to be complicated or expensive,
but you must do it.
- Conduct research to determine whether there is an adequate
number of potential customers to support your product or
service. Use the following sources for statistical and demographic
information:
- Libraries and published directories
- Computerized databases (available at many libraries)
- Web sites (posted by both business/corporate resources
and public agencies)
- U.S. Small Business Administration (1-800-U-ASK-SBA)
- US Bureau of Census, US Department of Commerce (www.census.gov)
- Trade associations for your industry
- Local chambers of commerce
- Test your idea with potential customers and others who
can offer constructive feedback (e.g., friends, relatives,
bankers, suppliers, executives). Keep a written record of
the responses.
- Be prepared to make changes based on the responses.
- Study and evaluate the competition.
- How will your product or service be an improvement over
the competition?
- Price your product competitively-higher if your product
or service improves on an existing one, and lower if it
will be equal to what is on the market. Be sure you can
make a profit.
For each of the following categories, list two potential
sources (with location and phone number) who can comment candidly
about your business idea.
- Bankers (check your local Yellow Pages under "Banks")
- Trade associations (search the Internet or check the Encyclopedia
of Associations, available in most libraries)
- Government or university-affiliated organizations
- Successful entrepreneurs (from magazine or newspaper articles
and local references)
- Suppliers (check local Yellow Pages, classified advertisements,
and publications such as the American Wholesalers and Distributors
Directory, available at major libraries)
- Answer the following questions about your market:
- Identify your three most important groups of potential
customers, defining them by the criteria (e.g.., age,
demographics, industry, etc..) you believe are most
relevant to your product or service.
- Name your primary competitor for each of the three
groups.
- Describe how each group feels about this competitor.
- Describe the factors that are most likely to make
each group leave a competitor and switch to your product
or service.
- Where did the answers to questions 3 and 4 come from
(printed pieces, market study, questions to prospective
customers)?
- Describe what accounts for the success of each of
your competitors.
- Describe what makes each competitor vulnerable to
loss of customers. u can make a profit.
Answer the following questions about your pricing policies:
- Provide details and/or a calculation of how you arrived
at the price for your product or service.
- List the prices that your most significant competitors
charge for their corresponding product or service.
- If your prices are higher, why? How will you justify them
to customers?
- If your prices are lower, why? How will they help you
attract customers?
Protect Your Idea
Start-up entrepreneurs tend to worry about having their business
ideas stolen. Successful entrepreneurs, however, have mixed
feelings about the importance of legal protection. It is important
to keep the issue in perspective:
- Don't worry about protection so much that it interferes
with your test marketing and business development.
- Be discrete about revealing details of your business
idea, particularly with competitors.
- If you think your idea qualifies for legal protection,
talk with a lawyer. The options are:
- Patent - to protect an original device
or process
- Copyright - for printed material, such
as consulting manuals, books and maps, or computer software
- Trademark - to guard a product name,
logo, symbol, or figure
-
Service mark - to guard a brand or
service name, logo, symbol, or figure
Here are eight basic steps to ensuring that you have sufficient
legal protection:
- For the best protection against having your business
idea stolen, be sure you know the character of every person
you discuss the idea with.
- If you share copies of your business plan, be sure to
number each one and record the name of the individual who
receives it.
- Ask those who will view your business plan to sign a
nondisclosure agreement that prohibits their using or discussing
the information.
- Be sure any employment agreements limit the ability of
someone who leaves your company from using proprietary materials,
designs, and formulas, or from taking customer names with
them.
- File for a patent to prevent others from copying your
invention.
- File for a copyright to prevent others from copying your
material, including print, software, music, films, art,
and recordings.
- Register your trademark to prevent others from using
a special name or logo you plan to use.
- To protect your ownership rights, obtain the services
of a qualified attorney who is experienced in matters involving
intellectual property protection.
For more information about patents and trademarks, log on
to the U.S. Patent and Trademark Office, at: www.uspto.gov.
The Office provides forms
to the public to use in certain situations to assist in the
filing of correspondence for a certain purpose and to meet
certain requirements for patent applications and proceedings.
Use of the forms for purposes for which they were not designed
is prohibited.
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