A Cool, Free Way to Figure Out a Business Idea’s Potential

by Laura Rich on March 1, 2010 in Entrepreneurship

lampshade on head office party business clothes 200Every day, it gets cheaper and easier to start a business. Want to put up a website? Try the free, open source WordPress platform. Need to sell some stuff? There are free or cheap e-commerce engines that manage the front end of the process. Even fulfillment can be automated, depending on what you’re peddling. And advertising is a plug-in from Google.

But what doesn’t get easier despite disruptive technology is putting together a viable business idea and creating a solid plan for executing on it. I’m not familiar with them, but have no doubt there are websites that aim to automate the business-idea process. I can’t imagine the businesses created this way will last very long or get very big.

The good news is that even if there’s no Web shortcut for good ideas, there’s now a free option that takes you through the rigorous process, holding your hand every step of the way, and forcing you to work out your ideas, through tutorials and worksheets. Most times, these tools are not free, and are usually very expensive.

Rhonda Abrams and USA Today have posted a six-week business plan intensive workshop to help you slow down and think through every stage. Doing this in advance will help put you on a solid course to launching a company with great potential.

Here’s how it breaks down:

Week 1
Idea inspiration – Where did it come from? What are your influences? Abrams provides worksheets to think about role models and what you like about your idea. Additional worksheets focus on setting up business files, laying out the fundamentals of your business and establishing goals. She’s also got tips on naming your company, probably one of the most painful steps if you ask any entrepreneur. See Week 1 here.

Week 2
Competition – Who’s already doing something similar? How big is their market? What’s the potential for your idea compared to theirs? Is yours better, bigger, faster, smaller? This second week of business planning covers an essential component of launching a business: knowing your competition. Every prospective investor will ask you this and you had better have a good answer. The other question? Who you’re targeting. You need to understand their needs inside and out to craft a concept that appeals to them, and that they will pay for. Abrams provides worksheets on market size and customer profile, and some strategies for tapping your network and useful data sources. See Week 2 here.

Week 3
Business filings – Don’t yawn. Incorporation documents, patent filings and licenses and permits may be more painful than a root canal, but you will thank yourself later, especially if you know other folks who failed to do this, failed to get a lawyer, and found themselves in a sticky mess later on. An ounce of prevention, as they say. This third week helps you set up the administrative aspects of your business, as well as the company structure, employee considerations. It also features a worksheet to help you understand your leadership skills. See Week 3 here.

Week 4
Overhead – More of the boring fundamentals that will ensure your success includes determining a location for your business and negotiating the best deal for your needs. Abrams also walks you through determining your hardware and software needs, gets you to think through and lay out a plan for day-to-day operations and set up a production process. She doesn’t miss a thing. See Week 4 here.

Week 5
Money, money, money – First things first: meet with an accountant. Also, understand the taxes you will have to pay out. This is one of the most intense and valuable weeks in the process, as it focuses on setting prices for your product or service and working out financials (cash-flow projections, costs, income, etc.) so that you can present a cleaned up financial overview to potential investors. You often get one shot with those folks—you want to make sure you present them the best possible set of data you can, in the package they prefer. She’ll also walk you through what types of funding you might consider, whether it’s a bank loan, venture capital or a bootstrapped path. See Week 5 here.

Week 6
Opening day – This final week is about actually getting the business to market. One thing I’ll disagree with Abrams about is putting the “elevator pitch” in this week. You’ll need that much earlier in the process in order to speak succinctly to potential investors, corporate partners and customers about your business. Venture Hacks has a nice post on the topic. Otherwise, Abrams has great advice and worksheets on marketing your business and launching it into the world. See Week 6 here.

Which just leaves us with this: Best of luck!

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