Fifteen Important Factors to Consider Before Starting a Business
The Market gap: This is the problem or needs of the consumers you want to resolve by introducing your product or service.
A Valid Business Idea: Not all ideas can become viable business ventures. The idea must be unique and practical.
Your product/Service: Attributes of your product or service that will deliver value to your customers. The product should be affordable, accessible, and of high quality. You can either bring a new product to the market or offer the same product just like your competitors through differentiation.
Market Demand: Is there enough demand for your product? What is the size of your market? Any growth potential? The greater and long-lasting the demand, the higher the probability of success in the marketplace.
Target Market: Who are your customers? A customer segmentation analysis enables you to understand your potential customers in terms of their behaviors (preferences and tastes), geographic location (Where they live), demographics (age, sex, education level), and psychographic ( for example, customers who desire organic food products).
Capital: The amount of money needed to start a business depends on the nature and size of the venture. Sources of capital are bootstrapping, your savings, loans from family, friends, and financial institutions, and grants.
Competition: Are there competitors offering the same product as yours or offering substitutes? What is their pricing strategy? Are their products of high quality?
Location: Where will you offer your product? The location of your business matters the most. Options include home, brick-and-mortar location, or online.
Business Plan: Not mandatory, but it gives you clarity about your business. It can be used to access financing from angel investors, loans from banks, and grants from some organizations.
Mindset: To start and manage a successful business, you must be passionate about it. You must put your heart and soul into your business venture.
SWOT Analysis: This will help you understand your market deeply in terms of strengths and weaknesses (internal factors and within your control) and opportunities and threats (external factors and outside of your control).
Formation: Sole proprietorship, partnership, or corporation.
Market Knowledge: You need to be conversant with the market you are entering. Knowledge is power, and the more you understand your marketplace, the more you are likely to succeed.
Government Compliance: Some businesses are highly restricted or deemed illegal by the government. Make sure that your business is legally acceptable and unrestricted.
Technology: Businesses are now leveraging technological resources like their websites and social media accounts to attract customers and sell.