Inspiration for a new business can strike at anytime, but how do you know if your idea is unique, or can even be turned into a profitable enterprise? This is where researching your business idea is vital. If you take the time to look closely at every aspect of your new small business idea you can quickly answer a number of key questions:
Is my business idea already in the market?
Does my business have a market to sell to?
Can I manufacture my products cheaply enough to make a profit?
Are there any other businesses that have the rights to my business idea or product?
What will customers be prepared to pay for my products?
Is the service I am thinking of providing really needed in the marketplace?
Can I protect my business idea with patents or copyright?
The key aspect of any new business is whether there actually is a market for the service or product you want to start a business selling. Above all other considerations performing detailed research on your potential market is crucial before you begin to invest in your new small business.
You can perform detailed market research by following these steps:
Published reports, market research surveys and government statistics can all be used to develop a profile of the market you hope to sell to.
Original research can be carried out with focus groups and field research in the high street or with specialist groups of potential customers. You can do this yourself, or hire a market research company to complete the research for you.
Look at the other businesses in the sector your enterprise will be competing with. Do they have any services or products that are similar to yours? Ask yourself if your product offers enough unique features to carve its own niche in the marketplace.
Just because your service or product doesn't exist in the marketplace, doesn't mean that it hasn't been thought of before. You must identify if there are good reasons why the other businesses in your market have not launched their own product that is similar to yours. There could be less of a market than you perceive there to be, or costs may be too high to manufacture your products.
Use the expertise of your local business support organisations. Business Link, Enterprise groups and Chamber of Commerce can all offer invaluable help and advice.
Funding Your Research
Developing your new business idea has to be paid for. New products and services can be expensive to research and develop. James Dyson for instance went through hundreds of versions of his vacuum cleaner before arriving at a working prototype. You can fund your research via your own savings, investments from family and friends, or look for any available grants that are available. Websites like BERR [www.berr.gov.uk] are a good place to start, as is your local Business Link [www.businesslink.gov.uk].
Protecting Your Business Idea
It's very easy to become guarded and secretive about your new business idea. After all, you don't want anyone stealing your idea. However, sharing your business idea with others can give you constructive advice that you can use to decide whether your new business is viable. There are, however, a number of options open to you to protect your business idea, these are shown below.
If your new business idea is to produce a new product you can protect your invention with a patent. You should be aware that applying for a patent can be a long and expensive process with no guarantee that you will be granted the patent for your new product. The UK Intellectual Property Office's website: www.ipo.gov.uk/patent.htm, contains detailed advice. Note that you have to renew your patent each year for up to a maximum of 20 years. The patent application procedure can take nearly 5 years to complete. You can, though market your product without the final patent being granted if you're confident that you have a unique product that no one else has patented.
Researching your new business idea will mean you'll have to discuss this with a wide-range of people. If you're concerned that your idea may be stolen you can insist that a non-disclosure agreement is signed before you reveal any details of your business idea to the third party. This practice is common in software development for instance.