A large handful of small businesses fail within the first year of opening. This isn’t a new thing; it’s been happening for decades. Why do so many small companies struggle to get going? You can point the finger at lots of different aspects of a business, but it largely stems from the idea itself.
Put simply, your small business idea sucks!
It might seem good initially, but when you start unpacking the idea you realize it’s really bad. The problem is that too many entrepreneurs are either stubborn or blinded. They don’t see the negatives in their idea because they’re so eager to get things off the ground.
So, to avoid the same fate as these business owners, you need to learn why your idea sucks. As luck would have it, you’ve come to the right place! Here are some common reasons a small business idea should be left in the contemplation phase:
It’s based on a temporary trend
Your business idea sucks because it’s based on a temporary trend.
Temporary trends are trends that seem like they’ll make loads of money, but quickly fizzle out. For example, you started a fidget spinner business a few years ago and all your profits were lost within a year. The key is to identify business trends that continue on an upward trajectory for a long time.
A good example of this is the CBD/cannabis industry. Starting a CBD business is currently trendy because this industry is consistently growing year after year. You can go to a place like The Trimmer Store, get the tools needed to help you cultivate your own plants, harvest them, turn them into CBD products, and make a lot of money. Yes, you’re forming a business around a trend, but it’s not a temporary one.
Ongoing and growing trends are those with data to back them up. You can see an upward growth over many years or months. Temporary trends are things that come out of nowhere and become popular overnight. Always be wary of these as they rarely last.
It’s too niche
As entrepreneurs, you’re often told to find your niche. So, it’s probably frustrating to hear that your business idea sucks because it’s too niche.
Finding a niche is all about finding your gap in the market. You cater to an audience that perhaps isn’t getting what they want/need. The aim is to find a steady collection of eager customers, focusing on them over your traditional consumers.
Unfortunately, you can sometimes get too fixated on finding your niche that you narrow your vision too much. You’re bringing out a business idea that caters to too few people. Sure, there are some people that are interested in it, but it’s way too obscure and niche to make regular profits.
It’s okay to find a niche, just make sure your business isn’t too specific!
This can be compared to the first point about trends. However, it’s more of a general look at business ideas being too outdated.
For example, you start a brick & mortar clothing store. It’s not a temporary trend, but it is a business idea that probably worked better in the past. Nowadays, people like to shop online. If you hope to gain foot traffic to your clothing store, you better have a very unique business to market. Ironically, if you took the same idea and modernized it – by bringing your business online – you may have more success.
There are simply too many small business ideas that won’t work in modern times. The good thing about this mistake is that it’s the easiest one to correct. Sure, your current business idea is outdated, but can you modernize it? The above example shows how this can be done, but there are other business ideas that you can bring into the modern world and equip for the future.
All in all, your small business idea sucks because of one of these three issues. Or, if you’re really unlucky, it’s down to all of them. How do you come up with an idea that won’t suck? To start, you need to focus on a business idea that’s not based on any temporary trends or is stuck in the past. It needs to be something that will clearly be successful right now and in the future. It shouldn’t be too niche, either!
Once you have some ideas that tick these boxes, you have to start running the numbers and seeing if they’re financially viable. If it seems like you can afford to start this business – and your research suggests you can make money – then it’s worth a shot.