The task of coming up with a profitable business idea can be very daunting. Setting up your own business requires you to think rationally and thoroughly so as to plan and make key financial decisions. You should have a written business plan. There are many already existing business opportunities that you can choose from. Therefore, being an entrepreneur doesn't necessarily imply that you Must come up with a new unique business idea.
There are many advantages of choosing an already existing business to start your business from. The main advantage is that the existing business opportunity has been already in the market therefore its products are already selling. You'll not need to spend a lot of money in marketing the products because they have customers who already exist. Your task is to find the best strategic location where you'll locate your business and also raising the amount of capital required to start and run the business.
You must ensure that you meet all the requirements including legal procedures before you start operating your own business to avoid breaking the law and being penalized. You should bear in mind that starting a business by using or improving an already existing business doesn't imply that it will be profitable. It is either that it will be making profits each year or hardly making any profits.
It is upon you to make a decision whether to start from scratch by coming up with your new profitable business idea or look for an existing business idea to adopt. It takes a great idea for one to come up with a new business idea that is profitable. However, a business idea that is profitable in the present time cannot remain to be profitable throughout. It will reach a time that it will face stiff competition as a result of new technology, new superior substitute products or other factors that will make its profits to decline.
As an entrepreneur, you have to be aggressive and innovative. Innovation of entrepreneurs doesn't necessarily imply invention of a product but it also implies coming up with new ways of reducing costs and improving the existing products. You should take risks by investing in profitable business opportunities you come across.
Do not focus on profits alone if you want your business to succeed but you should be customer oriented. When you're customer oriented you'll satisfy the tastes, preferences and expectations of the customers. You should not operate the same business throughout without improving the quality of your products and finding out from customers what they want your products to do for them.
What You Should Know About Making Profits
You should have a clear view when it comes to making profits before you start your business. Your business will fail if you miss to apply the objective of earning profits. Entrepreneurs are not supposed to focus on the objective of maximizing profits only. Focusing solely to maximize profits will lead an entrepreneur to charge a higher price for his products, exploit employees or produce products that are of low quality. An entrepreneur who solely wants to maximize profits will never make his business to be successful.
The enterprise that is coldly and solely motivated by the making of money seldom fares well in the long run~By Apply.
However, this is not to say that entrepreneurs should not make profits. Entrepreneurs should focus in satisfying customers and making adequate profits to cover all costs incurred i.e. making adequate profit to enable the survival of the business.
The problem of any business is not maximization of profit but the achievement of sufficient profit to cover the risks of economic activity and thus to avoid loss. But whether it is the motive of business to maximize profit is debatable. However, it is an absolute necessary for the business enterprise to earn at least the profit required to cover its own future risks and enable it to stay in business and maintain intact the wealth producing capacity of its resources~By Prof. Peter Ferdinand Drucker, the world-renowned consultant of management.
Marketing Research
Many upcoming entrepreneurs face the problem of product failure. You should keep on changing your marketing strategies and improving your products so as to satisfy your customers fully. You should not guesswork that the products you're intending to sell will be purchased. You should find out facts in the market if your products will be purchased.
Nowadays, marketing research is vital. Why? It is because consumers know what they need and want thus you should find out from them by conducting a marketing survey. Marketing research will also help you to know if the business you want to start will be profitable. To avoid the risk of your business failing, you should find out;
1.) If the products you're intending to sell are needed in the market.
2.) The place where most potential customers are in order to locate your business near them.
3.) The expectations of potential buyers. Find out from potential buyers what they want your products to do for them.
4.) The purchasing power of the customers so as to make your products affordable. This will help you to know the quantities you should pack your products. Customers with a higher purchasing power will have the option of buying the products that are packed in large quantities e.g. 1Kg, 5kgs, 10kgs, 20kgs etc. On the other hand, customers with low purchasing power will have the option of purchasing your products that are packed in small quantities e.g. 50gm, 100gm, 200gm, 500gm.
5.) If the business you intend to start has competition so as to find your own unique selling proposition to beat your competitors.
6.) The size of the market for your product so as to know how much products you'll produce and the amount of capital to invest.
You should take a step in widening your horizons and in taking your time to search for business opportunities. Read widely business magazines, business management books and other business publications. You should make your business to be the best choice in the market by satisfying your customers, gain loyalty of your customers.