So, you have a business idea, and you believe that it could be great? Yet, as every good entrepreneur, you don’t want to jump towards setting things in motion before you actually check whether the idea is any good. In short, you want to validate the concept first, and then, if everything turns out to be working in your favor, go for it and launch the company. Of course, there will never be a time when basically everything is working in your favor, meaning that you also have to take risks, but the idea is for you to recognize the risks worth taking, and to stay clear of those that aren’t worth it at all.
If you’re still looking for an idea, this could help: https://fitsmallbusiness.com/how-to-come-up-with-a-business-idea/
Anyway, the path from idea to execution is definitely not a short one. As mentioned, validating the business concept is one of the crucial things you will have to do here. But, you may not be sure either why or how. So, those are some important questions that we will answer for you below, hoping to help you understand the importance of the validation process, as well as hoping to teach you how to do it the right way. Without any further ado, thus, let us get started.
Why Validating Your Business Concept Is Important
Unsurprisingly, we are going to begin with the question of why validating your business concept is so important in the first place. Why can’t you just jump to conclusions, dive in, and hope for the best? Well, I suppose it is already clear why doing business that way is never a good idea, but let me make things even clearer for you, so that you don’t start making any kinds of hasty moves.
For one thing, the validating process will help you avoid wasting your resources. You have probably heard already that most startups fail. What you may not know is that this is usually not because the idea is bad, but because the customers simply don’t want to buy what is being sold, either at this point in time, or pretty much never. So, the idea may be fun, innovative and interesting, but still not work because, well, there is simply no demand. Click this if you’re on the hunt for some ideas.
Then, when you take the time to validate your business concept, instead of just going for it without thinking things through, you’ll also reduce your risks. This is because validated ideas will lead to less pivot surprises, as well as to more predictable outcomes, and we all know that predictability is crucial for business. Furthermore, doing this can help you identify what works and what doesn’t right from the start, and then adjust accordingly, so that you don’t wind up investing in an idea that is sure to fail. And, of course, if you thoroughly plan everything and you have proof that your idea will work, you are much more likely to find investors and partners.
How to Validate It
Okay, the importance of validating your business concept is probably clear by now. What you want to do next is figure out how to do it. And there are, without a doubt, some important steps that you need to take here.
- Make the Idea Clear
First things first, you have to clarify your idea. And I’m not talking about simply writing down what you want your business to do, sell, or provide. You also have to think about the target audience, define the problem that they have, and then figure out what kind of a solution you want to provide them with. Naturally, don’t forget to think about the revenue model in the process as well.
- Do Market Research
Once the idea is clarified, you’ll have to proceed towards doing market research. This is a rather broad and loose term, and people don’t always know exactly what it entails, which is also another reason why startups often fail – they don’t do it right. You have to look into the competitors thoroughly, and possibly identify any gaps in which your service or product may come in handy. Then, talk to potential customers, do interviews, surveys, focus groups, and test some minimal versions, such as product prototypes, landing pages etc.
- Check and Compare B2B Services and Prices
Of course, you will probably have to partner up with some other businesses in the process, such as suppliers, distributors, etc. What you should do is use tools such as Kwote Advisor and similar to check and compare B2B services and prices. This will help you not only understand what to expect in terms of your costs, but also potentially figure out how much you may be able to charge for what you’re offering.
- Plan for Scaling
Finally, plan to scale. Don’t build a business model that has no opportunity for growth. Think beyond the current idea. Think about how you can grow in the future, and then make decisions in the present with that in mind.