We get the “business viability” question fairly often around here. People want to know if their business idea, as an idea, will work. Fair enough.
The answer to that, like just about everything else we talk about here, is not a cut and dry one. Asking if a business idea will work is like asking if those two people getting married will stay together.
There are a lot of variables in that equation. It depends on a lot of factors. And there are no guarantees.
However! Whether you want a business or a marriage to be viable, there are indicators you can look for and questions you can ask yourself. Dave hogged all the questions in his earlier series on decision making, so it’s my turn now.
Let’s talk about business viability.
Viability depends on how you want to define the term in the first place.
Business viability depends on the objectives you have for your business in the first place. It’s like choosing a house or a car. Is this one the right one for you? It depends on what your needs are. And everyone’s needs are different.
If viable for you means “I need to take home $200,000 a year after taxes”, then that’s a very different story than if you only need to take home $40,000.
If viable for you means “I need to make this work in 15 hours a week by myself”, then that’s a different story than if you have a 40 hours a week and you’re looking to hire an assistant or employee.
If viable for you means “I can handle operating at a loss for a year or two before it takes off”, that’s a different story than “I need rent money NOW.”
The more constraints you put on your business, the more you’ll have to do for it to be “viable.” So the answer to viability for you is truly a custom job.
Viability depends if enough people actually want to buy the thing you’re selling.
This connects to the first point. If you’re selling a very niche thing, and there aren’t a lot of people who will be likely to buy it, that is not the same as “That business isn’t viable.”
It can be completely viable if the number of people who want it is enough to satisfy your objectives. So if you’re selling something kind of weird but only need to make $40,000 a year, you’re in a much better position than someone who needs to make $200,000 a year. All you really need is enough people.
We see clients get caught up thinking that because EVERYBODY doesn’t want the thing they’re selling, that they’re hosed. But that’s not the case.
As long as enough people are willing to buy from you, your business has the potential to be viable. The more you can lower that number, the more viable your business can become.
Viability depends on your resources and creativity.
In general, if you have enough creativity you can find a way to make just about anything sell. If you’d asked me if I thought that selling blankets with sleeves was viable, I’d have probably raised an eyebrow. But the proof is in the pudding, or in this case, the Snuggies infomercials.
I promise you, no matter how weird or niche your thing is, there are people out there selling far weirder things than you making money hand over fist. That money didn’t come easily, though. There was a lot of hustle involved and a lot of resources used.
People tend to have about ten times the resources and creativity they give themselves credit for. When they’re willing to challenge themselves to tap into it, we tend to see a lot of good things happen.
So, viability? A lot of it depends on what you bring to the table on those fronts.
Viability depends on your willingness to sell. ACTIVELY.
This is one that kills a lot of businesses that could otherwise be successful.
In the dating world, the number of dates you get is directly proportional to the number of people you ask.
It’s no different in sales. You ask more, you sell more.
- If you ran a hot dog stand in Manhattan, and when people walked by you stood next to the sign that said “Hot Dogs” and smiled at them, hoping they’d notice you’re selling these tasty hot dogs, you would sell relatively few. This is the “I hope they notice I’m selling something” approach.
- If you ran that same hot dog stand and wore a t-shirt that said “Midtown’s Best Hot Dogs” and when people walked by you called out “Hot Dogs! The best in Manhattan. Only three bucks, all the toppings you want”, you would get a lot more people buying your hot dogs. This is the “I will tell people this thing is for sale repeatedly” approach.
You’ll make a lot more money with the second.
And it has NOTHING to do with the viability of running a hot dog stand.
Next, viability depends on how much YOU want to put into it.
People get moralistic about this and I don’t like that. I don’t like it a lot. There’s an attitude of “If you REALLY wanted it you’d work as hard as it takes.”
Generally, the people who tell you to work as hard as it takes are later blindsided by a divorce, a heart attack, or both. And they always say “they never saw it coming.”
(Perhaps it’s a good idea to look around at life outside your business once in a while.)
Your ittybiz is YOUR ittybiz.
You alone know what kind of lifestyle adjustments you’re willing to put in place to allow it to succeed.
You alone know what the threshold is that, once crossed, turns a good idea for you into a bad idea for you.
So is your business idea viable?
I don’t know.
Your odds of viability go up when your demands on what it produces for you go down.
Your odds of viability go up when you get better at sales and marketing.
Your odds of viability go up when you’ve really looked at what it will take to meet your objectives, and you (and the people you care about) are okay with that.
Just about any business is viable. You just have to figure out what’s viable for YOU.