We guide you through how to turn an idea into a business that will become profitable for you, with 5 simple steps to follow for success.
Passion is what draws us to business. Passion is what keeps us motivated to stay the course. What gives entrepreneurs the power to stay on track and turn a passion into a profitable success? It takes thorough research, a rock-solid plan, an iron-clad structure, and a great deal of perseverance. Passion fills in the gaps between all of that.
How to turn an idea into a business that will be profitable
Many people forget that starting a business based on your passion means you have two jobs: To work on your company and run it as an entrepreneur, and secondly, to work in your company delivering your products or services. Here is a 5-step plan to turn a great idea into a profitable business.
1. Do a business case study
A business case study is an involved process. It might be one of the most important steps you take when you plan on starting a business. Think of it as a business on paper, a hypothetical business. You need accurate projections that take into account what the consumer markets are doing and how this can affect your business in the coming months and years. How to calculate start-up capital requirements for business
By creating a hypothetical business and testing it out in the current markets, you can analyse the risks, the potential for profit, your target audience and its demands, your rate of productivity required to generate a profit and what it will take to make it successful, alongside the financials like expenses.
This is a way to test the financial viability of your business idea. It is imperative to go through this process and not follow the outdated mindset “build it and they’ll come”.
2. Create a realistic timeline
Once you know what your potential pitfalls in business might look like (thanks to your detailed business case study), you can work on an accurate timeline to launch. This timelines factors in the actions you need to take in order to mitigate risks and generate as much profit with as few expenses, as possible. It’s realistic. It also factors in your current workload if you’re employed by working on the hours you have available to you.
If you have a smaller budget, your timeline will probably be longer because you’ll have to do a lot of your startup work yourself. Your timelines will also help you to stay on track with your goals and consistently achieve success. How to start a business: 10 steps
3. Set up your workflow and operational structures
Once you have your viable business idea and a plan to move forward, alongside a detailed timeline of events, you can start to implement the structural aspects of the business. This is also the time to create your brand – what are your core values? How do you wish to implement them into your code of conduct?
Then, consider how you will go about managing your operational functions, scheduling and managing workflow tasks, invoicing, and keeping track of project progress. These account for the structures that will enable your business to stay organised as you grow and take on larger workloads. It is important to lay the foundations for remaining organised from the start.
4. Handle the paperwork
There’s a great deal of paperwork involved in starting a business. These days, however, a great deal of it has become digitised. Alongside signing documents to register your business and legitimise everything, you also need to handle aspects such as building a website, creating visibility by creating profiles on social media platforms and beginning the process of gathering your support team – your accountant, your administrative helpers, your marketing team and your HR support.
If you’re on a tight budget, many of these services are available on an as-needed basis, particularly your HR (which is very important). Get help in setting up so that if you are going to DIY it, you know you’re doing it correctly.
5. Remain accountable for the success behind each step of your progress
Since you have a detailed timeline that was created using the data collected from your thoroughly researched business case study, your startup strategy is divided into achievable goals. Each of these goals has a timeline attached to it. How to manage risk in a business
You are not only responsible for the steps outlined to achieve that goal, you are responsible for its success. That requires full accountability from you to do whatever it takes to achieve your next goal. If you’re stuck, get help.
If you run out of budget, analyse how it happened, or, move the timelines on your entire business plan and re-analyse the viability of the plan. Work with your accountant to find solutions that keep you on track.
How to identify a good idea
What do you need to start a business? Clearly: a good business idea. But what exactly does that mean? A business idea is more than a spontaneous idea that comes to you in the shower or over a beer with friends. It not only includes a solution to the problem, but also initial considerations as to how money could be made with it.
Your idea is the core of your concept. Develop them step by step into a business model and later describe in your business plan how you want to implement them.
How do I recognize a good idea? It:
- solves a real problem or solves it better than existing companies,
- fits the founding personality and
- meets a market that is big enough to be able to make a living from.
How do I find an idea that suits me? The following questions will help you find a suitable business idea:
- Why do I want to start my own business?
- What am I particularly good at?
- What do I enjoy?
- What is important to me in life?
If you have answered these questions and go through the world with open eyes, always looking for unsolved or poorly solved problems, you will soon get closer to your business idea. Do it like brainstorming: write down everything that comes to mind, even if it is off-beat. Evaluated and sorted out later!
Three ways to develop your own idea
Basically, all business ideas can be sorted into three drawers with the inscriptions: tried and tested , improved and new .
- Proven business ideas
This drawer contains all business ideas that have already been tried and tested several times: from the law firm to the fitness studio to the pet shop. Free yourself from the thought of having to reinvent the wheel. You can also be successful with a proven business idea – provided you can answer the following questions:
- Is there an undersupply or is the market already oversaturated?
- How can I assert myself against the competition?
- What makes my company unique?
Incidentally, franchise systems are the best proof that innovation is not a must when setting up a business: they are based on the principle of transferring a proven concept to several locations according to the same pattern. Maybe franchise is an option for you too? Or How to start a subscription business
The takeover or continuation of a company can also be an option to implement a proven business idea. The topic of succession is not only present in the media, it is a real issue in many companies. You can think about whether you can imagine becoming a successor.
- Improved business ideas
Sometimes the success of a company is based on solving a problem a tad better than before. If your offer is simpler, healthier, more environmentally friendly or more exclusive than that of your competitors, you are on the right track.
To improve a business idea, you should clarify the following points:
- Which problem can I solve better than existing companies?
- What can I leave out, add or modify in order to achieve a better solution?
- Why are the existing companies sticking to the old solution?
- Is my solution so much better that customers are giving up their habits and willing to switch?
It is important that the improvement relates to customer benefit. Think about how you could improve a proven business idea from a customer perspective.
- New business ideas
Developing a completely new idea and thus solving a problem for which there is no solution at all – that is considered the supreme discipline in the start-up scene. The following questions are instructive if you want to take this path:
- What problem are you solving that has no solution yet?
- For whom is this problem significant?
- Are your potential customers even looking for a solution?
- Why is there still no solution?
New ideas are often particularly risky because it is unclear whether a target group can be found and whether the technical implementation will work. This is not the case with companies that rely on a proven concept. To do this, they have to grapple with the competition and find a strategy to assert themselves alongside the top dogs in the industry.
So each type of idea has its advantages and disadvantages. Whether it has been tried and tested for generations or never been there, the decisive factor is whether it is well thought out and cleverly implemented.