Is Your Business Idea Any Good?

Many of us have a potentially brilliant business idea, but how do you know if that idea is worth pursuing? Here are four things to try.

test

Jennifer Chua started her business on a gut feeling. When the Toronto-based co-owner of Hip Mommies was pregnant, she was randomly browsing the Web and came across a feeding mat that sticks to the table, eliminating the need for plates and bowls. She and her husband Joey lived in a 600-square-foot loft, and so anything they bought for their family needed to be sleek but functional, and this fit the bill.

The problem: It was in prototype phase and not available for purchase. But Chua had just been laid off from her job as digital art director at HGTV, and her husband ran a distribution business that lacked a clear focus. She knew she had to have the mat – and that she and her husband should be the ones to distribute the product in Canada. “We relaunched the distribution business as a company that distributes responsibly made, thoughtfully designed products by companies that do business ethically – all things that are important to me,” says Chua.

Gut feelings can only take a business idea so far. You also need to make sure that people will buy what you’re selling.

Gut feelings, though, can only take a business idea so far. You also need to make sure that people will buy what you’re selling. Chua and Joey asked friends and family what they thought of the product, spoke to a feeding therapist to make sure it was safe, had conversations with the company that made the mat to find out how it was produced, and met with boutiques and mom-and-pop shops that they hoped would sell the product.

It wasn’t until she met with the buyer of children’s feeding products for the large online and brick-and-mortar baby product retailer Snuggle Bugz that she felt she was on the right track. “She loved it so much, she brought people in from other departments to see it,” recalls Chua. The EZPZ mat was the first product the newly relaunched business distributed in Canada; four years later, Hip Mommies distributes six brands of baby, kid and pet products – all tested in Chua’s home first – and that number keeps growing.

Chua quickly realized that her idea could make for a good business. If you too want your big idea to go somewhere, then follow these four business-building steps.

  • tip
    tip

    Get feedback

    Chua did the right thing by asking others what they thought of the idea, says Dan Kelly, president of the Canadian Federation of Independent Business. “And not just asking your friends or family who love you or have high regard for you, but trying to find some impartial third parties that have some business expertise or background,” he explains.
  • tip
    tip

    Cost it out

    “If you’ve got an idea that’s going to cost you 10 dollars to produce and a customer’s willing to pay five dollars for it, well that’s a pretty fast road to bankruptcy,” says Kelly. Don’t worry if you get some naysayers – Chua ran across people who thought the mat was too expensive – as long as you get a sense that there are enough people out there who value what you’re offering.
  • tip
    tip

    Consider timing

    If there’s a frozen-yogurt shop on every corner, it might not be the right time to open a frozen-yogurt shop. But that doesn’t mean you need to give up on your idea altogether. “There’s an aging population within the business community, and there are all sorts of successful businesses that ultimately are going to need successors,” says Kelly. If you think you have a way to take an existing idea to the next level, it’s worth exploring if there’s a company you could partner with or take over.
  • tip
    tip

    Can you pull it off?

    A good idea will only take you so far if you don’t have the ability to follow it through. Kelly suggests thinking about what you can bring to the company, and then finding others who can help you along the way. Remember, an idea is just the beginning: “Some good ideas don’t find success, and some ideas that are not perfect end up finding a market for their product or service,” says Kelly. “There’s a magic in running a business, but there’s an awful lot of grunt work that comes with it too. Make sure you’re prepared to take risks, and pull in people to supplement your weak areas.”

Have Questions

Our advisors will consider your financial goals and help find the path to get you there.

Find an Advisor