John M Shanahan & Co.

linking practice to business

Chartered Accountants
Registered Auditors

Phone: 057 93 22100

email: info@shanahan.ie

What makes a Good Business Idea- Great!

It doesn't have to read "Made in China"  when "Made in Ireland" can do just fine.

March 22, 2016

You’ve got an idea for a business, and it seems like a good one. In fact, the more you think about it, the more it seems like a great idea, to the entrepreneur it dominates his thinking and may even become an obsession.

While there are those who believe that there are no real “new” ideas out there, look more closely and you’ll find some new creative product and service making life a little more interesting, while others actually save lives. Some involve technology that sounds like it comes from a Sci-fi movie, while some are based on ideas so simple and yet so brilliant, you’ll be kicking yourself for not thinking of them first.

We at, John Shanahan of John M Shanahan, Chartered Accountants, Tullamore, Co Offaly take a look at some of the criteria an entrepreneur can use to decide whether or not your idea can be developed into a viable business model.

So, the burning question - how do you know you’ve got it?  What determines whether an idea has real business potential?  And what separates the good ideas from the truly great ones?

By asking the following questions, it should bring you closer to an answer – and possibly to your own new business idea – which can be either product or service.

Is your Idea based upon Life's Experiences?

Very rarely do people pull new ideas completely out of a hat. Instead, most great business ideas come from the inside – what you know and feel passionate about.
Henry Ford, a car mechanic, created the Ford Model T car in 1908 and went on to develop the assembly line mode of production, which revolutionized the industry. As a result, Ford sold millions of cars and remains a household name worldwide.
In 1975 when Bill Gates and Paul Allen started Microsoft, their vision of “a computer on every desktop and in every home” seemed farfetched. Today, thanks to Microsoft and many others, that vision is a reality in many parts of the world.
In 1975, the 20-year-old Steve Jobs and Steve Wozniak set up shop in Jobs' parents' garage, and began working on the prototype of the Apple-1, and we all know where Apple is in the world rankings today.

When passion meets experience, chances are you are on to a winner.

Does your product have a (USP) Unique Selling Point?

Great ideas stand out from the crowd by doing something new, different or better. Does your idea solve a problem? Does it save time or money? Does it cut out the middleman, making it easier and/or cheaper to buy the product?
Here are five basic steps to determine your USP.

  1. List the features and benefits that are unique about your product. Do a Google search and compare your features and benefits with your direct competitors. Identify the benefits which sets you apart;
  2. Decide what emotional need is being specifically met by your product. Think about this from your customer's perspective and add it to your list;
  3. Identify aspects of your product or service which your competitors cannot imitate. Put a star beside anything that cannot be easily duplicated, reproduced, or copied;
  4. Create phrases about your unique product or service that are short, clear, and concise. Be sure they can be easily communicated to and understood by your customers.
  5. Answering your customer's primary question: "What's in it for me?" Make it to the point and state it as a benefit to the customer.
     

Is it a Sustainable Product?

In modern day parlance, sustainable products are those products which provide environmental, social and economic benefits while protecting public health and the environment over their whole life cycle, from the extraction of raw materials until the final disposal.
Take for example Woodie's DIY business offers a range of environmentally friendly products including energy-saving lamps, solar garden lights and composters for recycling garden and household waste etc.
Business ideas which offer an enduring product tend to produce the most successful ventures. Can your idea potentially generate revenue over the long term?
Imagine what your business will look like in three, five or ten years, and then attempt to define the size and scope of the market – if it still exists.

Does it have an Optimal Price Point?

The suggested retail price of a product is determined in such a way as to compete with prices of other products. A product may be introduced with a specific price point, but that price may be altered depending on current demand and competition.
The one thing that literally can make or break you and which most entrepreneurs never put enough thought into is, pricing and pricing strategy.
There are two major concerns when it comes to pricing. The first is to ensure you are actually making a profit, and the second is in regards to where you stand compared with your competition.
It’s one thing to solve a problem; it’s another to solve it in a way the market values it and is willing to pay for. Don’t flatter yourself my assuming that all others see the same value in your idea as you do. Instead, figure out how they perceive the value and what they would be willing to pay for it. Only then can you decide if you have a viable business model.

Finally, can you Make it Happen?

The one key factor that separates the great ideas from all the rest, is implementation.  Can you turn your idea, no matter how brilliant, into a living, breathing business?
If not, all you may have is an idea - just that!
No matter how creative, a business idea doesn’t become great until someone executes it well, and that doesn’t always happen on the first try, take Coca Cola for example. In fact, it often takes more than one iteration to get the implementation right. When you do, that’s when your good idea becomes a great one.

Our own Michael O’Leary has earned a fiery reputation for his maverick and no-nonsense management style based entirely on delivering results, which he has succeeded in doing since he took the helm at Ryanair in 1994.

JOHN M. SHANAHAN & CO. can assist you in starting up your own business help you formulate your business ideas, ensuring you receive an expert, specialised and professional service tailored to meet your needs. Contact us for more information.

Phone 057 93 22100 or email info@shanahan.ie or use our contact form here- Contact Form.

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