Ensuring your business idea makes money for you is a great first step on your business journey.
Once you’ve worked out if your passion is the right thing to turn into a business for you, the next step is about understanding HOW your idea can make money for you. Or, if your idea is about developing a social enterprise or charity, how will you earn an income from the time you put into your passion to support others to put food on your table and petrol in your car?
Questions to ask yourself to check if and how your business idea will make money
Product idea development
- How much does it cost to make or buy your raw materials and turn it into the finished product?
- How much time does it take to make one item/batch of your product?
- How much do you want to earn per hour? Multiply your time by the amount you want to earn and add that to your raw materials
- Do you need specialist equipment? How much will that cost?
- Do you use electric or gas to make your product? How much can you assign to each product you create to ensure that’s covered in your costs?
- How much will people pay for your product?
Work out how many people you need to buy your product to earn what you want each month. How long will it take you to make the products you need to sell each month – do you have enough time with the time you’ve got available to grow this idea of yours?
Service idea development
- How much time do I need to deliver my service?
- Is it one off, or on-going?
- How much will it cost me to deliver my service? Do I need to travel to deliver it? Do I need specialist software?
- Do I need specialist training for delivering my service idea? How much will it cost?
- How many customers do I need to earn what I want each week and month?
- How many hours do I need to work to earn what I need?
- Do I have enough hours available to serve the number of customers I need to earn what I need?
You may think these are quite basic questions. I’ve come across many people with fabulous ideas, who haven’t considered these questions and realise once I start asking them about how they’ll put their ideas into action that they don’t have the answers. Yet.
Describe how your business idea makes money for you
For now, to get you started, I’d like you to write down everything you can about your business idea, and how you think it will make money for you. Consider what investment you need to put in right now, to learn the skills you need, or buy the equipment or materials you need.
Make a note of your answers to the questions above, and write down everything that springs into your mind about your idea that will help you identify and explore all the options available to you. You may find that by doing this exercise, your ideas become clearer about how you can get started turning your passion into a business. Or it may show that you can’t make money with this particular idea right now.
If you need help working out if your idea will make you any money, book an explore call, and let’s work through your answers to these questions together.
Share in the comments below what additional things you’ve looked at, or explored to check if you can turn your idea into a business.
This article is part of our first book: Passion is not enough – Why running your own business takes more than just being passionate about ‘your thing’. If you’d like to hear more about the book and it’s publication, please join the list here: