Do you constantly have great business ideas which fall to the wayside because you just don’t know how to turn those daydreams into reality? If you’re stuck in the brainstorming stage, that's probably because you don’t know what to do next.
Around 550,000 people, according to the Kauffman startup index, become entrepreneurs each month and you could be one of them. While there’s no guaranteed formula to starting a successful business, there are steps to take in the planning phase that will not only help you determine if your business idea has what it takes but help you get the ball rolling, too.
Sound like you? Here’s what to do next.
Determine the “why” and the “who”
The first step to take after you’ve come up with a new business idea is to concentrate on the “why” and “who” of it. You may think you’ve thought up an awesome idea, but your business won’t be successful if you don’t know the real reasons behind why it’s a good solution, and whom it would be a good solution for.
Start to really think about what problem your business idea solves. Your business may solve a problem for you, but does it solve a problem for others? If nobody else has the problem that your business proposes a solution for, then who will buy that solution?
After you’ve taken a deep dive into why your business is needed in the first place, determine who will be the target audience of your business. Think about the demographics of your target audience, what’s important to these people and how you will reach them. You can use a free tool like Hubspot’s Make My Persona to get detailed about who your ideal customers are. A business isn’t a business without customers, after all.
Search for similar solutions
No business idea is 100 percent unique; there will always be businesses out in the world that are similar to yours. So, don’t sweat it if there are companies doing what you do; in fact, that proves there’s a market for what you do. What you do have to think about is who your competition will be, what exactly they are providing and what you will do differently or better than they do.
To stand out from the competition, you will need to know what sets you apart. Start doing research on the companies that could become your competition. Look at how much they charge, who their target audience is and how they market to them, to name just a few research points. There’s no need to reinvent the wheel, but do look at what these companies are lacking in and how you can improve upon those areas in your business, so that you capture their customers.
Talk to your potential customers
Similar to your efforts to study your potential competition should be your effort to study potential customers. Get out there and start talking with your target audience. See if your product or service is something they would use, find out how much they would pay for it and ask what comparable product or business they’re using now to solve the problem.
You could even get super in-depth and ask people to fill out a survey providing answers that will help you get to know your audience even better. Even negative feedback about your business idea can help you refine your idea.
Lock down the details of your business
Coming up with a new business idea is exciting; your mind is probably buzzing with lots of plans and designs -- maybe too many. So, sit back and lock down the finer details of your business. Will you be offering a product or a service? How much will it cost? How will you be marketing your business? You need to know your new business concept inside and out before you launch. A great and easy way to organize your thoughts is to use a business plan software like LivePlan.
Also, if you haven’t named your business yet, now’s the time to do it. Do some brainstorming and come up with a name that no one else has already taken.
Determine the “how”
After you’ve worked out all the details of your future business, the next step is to figure out how to turn your dream into a reality. Obviously starting a business costs quite a bit of money, so that’s one of the major “how” factors you need to consider. Decide if you’ll talk to investors, take out a loan, or maybe even start a Kickstarter campaign.
Determine everything you’ll need to get your business up and running. For instance, if you’re offering a product, how will you build it and how much money will it cost? This last step is one of the most important in order to take your business from out of your head and into the real world.
Over to you
What are you waiting for? By following these tips, you’ll be well on your way to starting your very own company. If you take the time to plan out your new business idea, you won’t just build a business, you’ll build a successful one.
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This article originally appeared on Entrepreneur.com. Minor edits have been done by the Entrepreneur.com.ph editors.