For some entrepreneurs, it is easy to identify the type of business to start. Some entrepreneurs may need to do more soul-searching. You might need to do some soul-searching to find the best answer for that question: “What kind of business should I start?” This question deserves some attention.
Deciding what type of business to start can be a difficult decision. It makes sense therefore to explore all options and look at multiple options. You don’t need to settle for a single-size-fits-all test that will tell you what type of business you should open. Your individual experience and preferences will dictate the type of business that you choose to open.
This guide is based on the experience and wisdom of entrepreneurs who have succeeded in answering the question, “What type of business should you start?”
Here are some questions that you can ask to help you decide what type of business you want to start.
Based on the experience of successful entrepreneurs who decided which type of business they wanted to start, here are six questions you should ask to help you choose the right small business idea. To answer the ultimate question: What type of business should you start? these are the questions. These six answers will allow you to choose the best business to start based on your individual goals and experiences.
1. What experience do you have?
Ashley Hill, the founder, and CEO at College Prep Ready stated that her company was started because she had financial success in financing her college dream.
She discovered that the market was ready for her knowledge and experience through research. Hill, who is responsible for the trillions of dollars in student loan debt in America, understood the frustrations parents and students face when trying to navigate the financial aid process and the college application process.
2. What is my passion?
Common tip entrepreneurs shared was to follow your passion. Varieteas founder Nick Ehret loves tea. By curating special teas for his monthly subscription boxes, Ehret built a successful business.
He’s a passionate tea drinker and realized that he could make his passion a business. He advises people to pick a business they are passionate about, as you will be working with them every day.
Spark Rental’s CEO, Brian Davis, is a subscriber to a Japanese concept called “ikigai”. It literally means “reason for being.” According to Davis, a great business idea comes from the intersection of four things. These are what you love, what your skills are, what you can earn, and what the world needs.
3. What problem can you solve?
While we all know that necessity is the mother of invention, it’s not always easy to apply that knowledge to the business. A business plan can help an entrepreneur become a successful entrepreneur. There are problems and pain points in almost every industry.
Consider Big Barker, a dog bed manufacturer. The company had revenue of $4.75million in 2016. Eric Shannon, founder, and CEO saw a huge problem in the market of dog beds. Big Barker was born out of the huge problem large dog owners were having to face. Their dog beds were not strong enough to handle the large dogs. They had to be replaced once or twice per year.
4. What is your lifestyle preference?
Your business goals may include revenue in the millions and staff in the thousands. However, that doesn’t mean you have to choose a business model which supports your ideal work-life balance.
Antonella Pisani was the VP of global commerce for Fossil. She also held leadership positions at JCPenney and Guitar Center. However, her main interests were travel and photography. Pisani was aware that she would prefer mobility to pursue these interests and needed a flexible business model. It didn’t need inventory nor space.
5. How much capital can I access?
The lean startup was not a fad. Actually, the idea was born from an inescapable truth about starting a company — people don’t want to put their life savings into a business idea that has yet to be proven or made profitable.
Robert Lomax, a brilliant example of this fact, founded RSL Educational, an education services company, from the needs he observed in his job as a teacher. His experience as a teacher helped him identify gaps in the educational book market. It also enabled him to retain his job and help develop new products.