Quite a bit of readers mentioned that they would love to see more entrepreneurship content on the blog. Throughout my entrepreneurship journey I’ve completed a few courses on business growth and development that I’d love to share. In light of this, I’ll be doing a series on Kingdom or Christ-centered entrepreneurship.
Kingdom entrepreneurship speaks to christian business owners being deliberate about running their businesses based on Godly principles and showcasing God’s love in all aspects of business. All this is done in an effort to please Him and partner in establishing His kingdom here on earth. In one of my earlier posts I shared that a principle of biblical money management is working diligently. This extends to running your business in a way that glorifies GOD. Christ-centered entrepreneurs have the opportunity to employ and empower and bring GOD’s light to the marketplace.
In today’s post I’ll share 6 steps to testing your business idea.
Research suggests that 80% of small businesses do not survive beyond the first 5 years. This means that stars in your eyes and what you perceive as a great idea will not be enough. Validating your idea allows you to test your assumptions through real life experiences.
As we go through each step, remember to document your feedback and response to all questions.
1. Evaluate your WHY, strengths & weaknesses
- Knowing the motivation for your proposed business is critical to determining the level of effort and time that you’ll be willing to commit to. Making extra income may not be a sufficient motivator to sustain the journey of entrepreneurship. Entrepreneurship requires hard work as it involves creating a valuable product/service and communicating its value in such a way that persons are willing to buy into your vision.
- Assess your strengths and the available resources you can employ in the creation of this product/service. Are you passionate or gifted in a certain area? Assess how these strengths can serve the business idea well.
- Assessing your shortcomings/weaknesses will also inform whether you’ll need additional training. Carefully determine if you’re willing to undergo this process.
2. Break down your idea into a rough business model
Some business experts suggest drafting a business plan to work through the knots and bolts of the business but at the initial stages, it’s best to produce a rough draft of your business model.
- What problem in your industry is your product/service addressing?
- Who is your target audience/ideal client?
- What is the process like to create this product or offer this service?
- For example, how will you obtain your raw ingredients to manufacture this product? What products are necessary for you to offer this service?
- What is your value proposition?
- Your value proposition is the expected gains that a customer would receive or the specific pain points/problems your product(s)/service would address.
- Who are your competitors?
- What is your unique selling point?
- How will you deliver your product/service to your target audience?
Answering these questions requires conducting research to clarify these points. Information can be found through online articles, books, podcasts, YouTube videos and consulting other entrepreneurs.
3. Evaluate the market
Your market consists of all the customers who have a need for your product/service offering and may purchase at some point.
Evaluating the market involves carefully assessing how competitive the market is.
Do a rough Google, Facebook and Instagram search on other players in the market in your country or region. What products/services are they currently offering? How do they currently market their products/services? What are their strengths and weaknesses?
Your direct competitors are those which offer identical or similar products/services while your indirect competitors are those which offer products/services that your potential customers could use as substitutes.
Ordinarily a market that is easy to get into (low barrier to entry) will be highly competitive. A saturated market does not necessarily mean that you should give up on your business idea but you must anticipate that you’ll have to spend more time and effort into setting yourself apart and building a unique brand. This again ties into your value proposition and your unique selling point.
A market with few competitors may seem compelling but do some research on the reason for this. A high barrier to entry may mean that the start up and maintenance cost of the business may be exhorbitant and you must determine if the idea is worth heavy investment in the initial stages.
Evaluating your competitors and their current offerings may spark ideas on how you can improve on a product/service, address a specific pain point or identify a niche within your market.
4. Communicate with your intended audience
So you may have identified how you’ll set yourself apart from your competitors but you must determine if those added features are things your customers will appreciate and be willing to pay for.
Get in touch with a few persons you believe would fall within your ideal customer base and ask them questions to validate your business concept. I’d encourage you to extend your communication beyond friends and family members. They may be willing to purchase from you in the initial stages out of love and support but that will not be enough to sustain a business. Getting sufficient feedback will allow you to obtain genuine suggestions on the viability of your product/service offering.
Communicating with your ideal customers, whether face to face, surveys using platforms like Google Forms or social media will help you to appreciate the pain points that your business will attempt to alleviate.
5. Do the Math
Now that you’ve gotten that helpful initial information, work the numbers. How much will it take to produce, package and deliver your product to the end consumer? How much are persons willing to pay for the product/service? Will you be able to make sufficient profit to cover all direct and indirect expenses related to the business?
For service based businesses, what platforms will you need to offer the service and what are those associated costs? Will you have to rent a space to carry out this business?
If the start up costs are high, you may have to scale down or tweak your idea until you’re able to launch your ideal product/service. Scaling down also gives you the opportunity to further test the market and your willingness to continue with the idea.
6. Prayerfully consider this idea
This step belongs at the beginning, middle and end of the process. Recently, I listened to an episode of the Kingdom- Driven Entrepreneur Podcast, where the guest, Jaime Cross, shared on how GOD had given her a billion dollar business idea. GOD provided her with this idea after she desperately asked that He take her family out of a difficult financial situation. Notwithstanding this initial blessing, she shared on how her entrepreneurship journey involved her consistently putting in the work and consulting GOD for His guidance and direction along every step. God may grant you direct insight on a business idea or your passions may indirectly lead to one, but He expects that you be faithful in its development at this stage as well. He may only provide a nudging, which will later be clarified and developed by the application of the earlier steps in this post.
In that same podcast episode, she spoke further on how GOD gave her the nudging to introduce a new strategy for her business. GOD gave her a general idea and encouraged her to conduct her research and put in the work. After 3 months of research and seeking the counsel of mentors, she launched a business strategy that has since then, revolutionised her business.
A clear understanding of your product/service and the market in which it operates, from the inside out, will give you the sort of the perspective you need to serve your target customers well.
Steward this idea and vision. Be faithful in the small things; even in the initial stages.
“Commit your work to the Lord and your plans will be established.” Proverbs 16:3
Look out for more christ-centered entrepreneurship content next week.