Never undermine your competitors instead, examine the market objectively to have an edge.
Most people’s greatest ambition is to run their own business. However, most do not know the ways to start and ensure it is a lucrative business.
According to CBInsights, 35% of businesses fail due to a lack of market demand, cash flow issues, being outcompeted, having a defective business plan, and legal issues.
Between 2010 and 2018, the African continent’s startup failure rate was 54.20%. From the data also gathered by the Bureau of Labor Statistics (BLS), 20% of businesses fail during their first year, and half fail within five years.
To ensure your idea is not part of the failure statistics, here are three ways to start a lucrative business.
Stop exaggerating the business idea
It may seem beautiful and motivating to love what you do and do what you love, but this is not the case in business. First and foremost, you must determine if there is a market for what you love to be successful.
Begin by asking yourself the following questions: what is the main purpose of starting a business? What are your goals? Who are the target customers? What problems is your business trying to resolve? What will make you distinct from your competitors? What resources do you require to start the business?
Don’t miscalculate your competitors
Never undermine your competitors. You must examine the market objectively and evaluate your competition to have an edge. If you want to attract investors, this is very vital.
Your competitive advantage is one of the most important things a potential investor would want to know. To analyse the market, you can employ these three methods: primary and secondary research and SWOT analysis.
You use the primary method to get your data, the secondary to organise the information and data gathered and go through it thoroughly. The SWOT analyses the idea’s strengths, weaknesses, opportunities, and threats.
Through the research, you will find answers to some of your questions before starting the business. Questions such as: what can make your product unique? Who the competitors are, and what do your potential customers like/dislike in their products?
Put your theory to the test
After you have done your due diligence with the market research and figured out what your customers want, you’ll need to make sure your product satisfies their needs.
Furthermore, your test should be as cheaply as feasible, using a Minimum Viable Product (MVP). This allows you to build a new product for less money while collecting future clients’ feedback.
A/B Testing is another tool for validating your ideas about future business. This approach may determine which website version or design users prefer.
After completing this, you can now seek investments. This also ensures that your time and money are not squandered, and your business will not become a statistic.
Only after these three steps should you start looking for investments and teams. This way, you can ensure that money and effort will not be wasted, and your startup will not become a failure statistic.