Top 7 characteristics of successful business ideas

Category: Business planning Entrepreneurship Startup

One of the most challenging considerations when developing a business idea is incorporating quality characteristics to make it successful. With so much clutter out there when searching for “successful business idea characteristics”, it was essential to create an improved list that echoes the thoughts of successful entrepreneurs.

Many times people will think of a business idea without actually going through the motions to make it strong and ready for the market. This is one of the main contributing reasons why so many new businesses fail every year. There are several characteristics that make a business idea more likely to succeed; consider the tips below when coming up with your business idea to increase your chances of success.

  1. Scalable

Scalability is the characteristic of a business idea that allows it to grow at the exponential level needed to evolve into a large business. For example, a scalable business model will allow you to transform your revenue from $100 a day to $200 a day without doubling your inputs or costs needed to create that revenue. Although you can have a business idea that is not scalable, this is a key aspect that will take your business idea from average to great.

  1. Solves a problem in a way that is intuitive and people like

So many business ideas fail because they don’t solve the problem in a way that people like, or the solution is not intuitive and is hard to understand. A great example of intuitive solutions is Apple; they have created a product that is intuitive to use, while solving several problems users had with other phone manufacturers.

  1. Has an existing market, or has the capability to create a new market

There are many ways to make sure your business idea has a market. The first option is to find a partially validated business idea. To accomplish this, you can discover business ideas from the news.

Instead of entering an existing market, another option is to create a different market, which you will fill. A perfect example of this was Amazon when they created an e-reader. Although not the first to create an e-reader, they quickly understood what problems existed in the market and addressed them by creating a significant library for e-readers to access.

  1. Enters a growing market

Never enter a market that is not seeing growth. Industries go through cycles, and to think of a business idea in a declining or peaked market will only create grief once you launch. Measuring the growth of the market (if you are entering an existing market) is crucial to making sure your idea is great, and will succeed in the future. One of the best ways to get numbers about industry growth levels is from stock market analysts.

  1. Sustainable: has a multi-year plan

Great business ideas need to be sustainable in two regards:

  1. They use and have access to resources that can last for the next 100 + years. Great businesses never exhaust their key resources, otherwise they will exhaust themselves and die.

  2. They have a vision. Without a vision of where your business idea will be in five years, it will be hard to carry out day-to-day activities that relate to creating a business that stands the test of time.

  1. Profitable

To make sure you have a profitable idea, a financial projection can be used to roughly estimate when you may break-even, and when you will make your first profits. This is a good gauge for your business ideas. If you create the projection and it looks like there is no chance this business will reach profitability within three years, it may be a good time to start thinking of new business ideas.

  1. Differentiated

Your business idea needs to be different from existing products or services. Now I am not talking completely different, but your business idea needs to offer something that is unique and not being replicated by others yet. One interesting example is the big banks. On the outside they all seem to offer and do the same thing. However, if you look closely, some banks specialize in providing the best services for small businesses, or provide the best customer service to their retail clients.

Business ideas can sound great in your head, but it is important you spend the time to improve them. If you are still stuck on how to progress with your ideas, hopefully these tips will help you critically think about what business ideas need to be successful.

 

Ready to get started?

If you are looking for one-on-one support for your startup, give the Business Link Business Advisors a call at 1-800-272-9675 or email askus@businesslink.ca.

About the Author

Mike Nesselbeck

Founder, Business Idea Insight

Mike Nesselbeck is the founder of Business Idea Insight, an online resource built and dedicated to aspiring entrepreneurs who need help with their business ideas. Mike’s mission is to break down the barriers that aspiring entrepreneurs face when it comes to lack of business ideas, or lack of confidence in the idea. He believes no one should be discouraged about the business idea process if they want to become an entrepreneur.