Reality Check: Evaluating A Business Opportunity

Now that you've gone through the process of finding and developing ideas for possible small business ventures, it's time to narrow down the list to a few key ideas that have the best business potential. Remember that a business idea is NOT a business opportunity until it is evaluated objectively and judged to be feasible.

Keep your list of ideas to be analyzed to a minimum of two and a maximum of five potential business opportunities at any one time. Seriously considering and developing too many potential business opportunities all at once will cause confusion and spread your time, energy and focus too thin. At the same time, if you focus too early on only one business idea, you are more likely to become personally and emotionally attached to it, and you will lose your objectivity.

Testing the feasibility of your top business ideas involves time and effort to collect key information. At this stage, most of your research efforts should focus on answering this key question: is there a market for my product or service? To help you answer this question, you can do the following:

• Conduct market surveys
• Conduct focus groups and brain-storming sessions
• Conduct personal and telephone interviews with potential customers
• Monitor your competitors, including talking to their customers if you can
• Test the market with your product or service
• Produce sample products or prototypes
• Talk to consultants and advisors
• Talk to retailers, distributors, agents, and brokers
• Read market research reports, industry trade books, magazines, and journals
• Refer to industry associations and Statistics Canada data
• Refer to ED&T's Marketing for Small Business

Once you've finished your preliminary research, complete the following questionnaire for each of your key business ideas. This questionnaire is designed to help you test objectively and compare the feasibility of each of your key business ideas. Note: you won't have exact, detailed answers to all of the questions at this stage.