Business Ideas: Sorting Out The Good From The Bad

Posted by under Business . Updated: October 30, 2020

It’s always nice to brainstorm business ideas once in a while.

And if only there was a way to instantly turn those money-making ideas into reality, I bet everyone would become entrepreneurs.

But that’s not the case in real life – not only does it take time, effort, and money to build a business; there are also as many bad business ideas as good ones out there.

So in today’s world where ideas are cheap, funds are limited and time is a luxury, how do you determine if an idea is actually worth pursuing?

The short answer is there’s no easy way, but of course, there are some things we can do to immediately sort out which ones are potentially good and which ones are just plain bad. So how do you do that?

The reason why some people say that ideas are cheap is that anyone with enough creativity can think of ways to make money today. A few hours is usually all it takes to come up with possibly good business ideas, even shorter if you’re among friends who could brainstorm with you.

I did this recently with some friends and here’s what we thought would be good businesses to put up today:

  • A store for affordable gadgets and accessories, a business like CDR King.
  • A boutique that will focus on cycling – we predict that this would replace running as a sports hobby in the next couple of years.
  • A photocopying center built for franchising.

To test which one of these three will be the best business idea for us to pursue, we took into consideration three factors:

Profitability

The first test to see if an idea is good or bad is to see if it will be profitable. Ask yourself who your target market is and what value can your business offer them.

The gadget store will take a bite out of the profitable market currently monopolized by CDR King. The sports boutique hunches on an emerging trend, while the photocopying center is a traditional business venture that we think has good potential to succeed under franchising.

From the three, the cycling boutique seems to be the weakest because it’s profitability is based on an assumption. But given actual market research, it can be determined if this business idea has real profit potential in the future.

Implementation

The second test to know if your business idea is good or bad is to ask yourself if you have the skills and resources to actually implement it.

The gadget store and the sports boutique will require us to have contacts of suppliers from abroad, thus the need to know all about “importing” above other things. And this is something we have no prior experience in.

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In the meantime, for the photocopying center – importing machines will not be a necessity because there are numerous local distributors for it and all we needed is to forge a partnership with them.

From the three, it seems that the last one is the easiest one to implement for us. However, if we can take the time to learn all about the processes involved in importing products to the country, then the other two would become more plausible for us to do.

Cost

Lastly, the final test to know if your idea is a go or not is to calculate the cost of implementation. In short, can you afford it?

Importing would mean buying your initial inventory in bulk containers and that can cost millions. The first two options therefore would require a large business capital.

On the other hand, while it can also be expensive, hiring a business consultancy firm to build the franchise model would most likely cost less.

Additionally, putting up a photocopying center near a school or business area is comparatively cheaper than opening a mall business which the first two ideas would essentially need to reach our target market.

Again, the third idea is the best choice in this criteria. However, do remember that one cannot truly know the cost of pursuing a business venture unless one has written a business plan.

If your money-making idea has passed the profitability and the implementation factors above, then I believe that a thorough cost analysis is something you should seriously consider doing.

In a nutshell, I believe that all money-making ideas have the potential for success, especially when done by people who have the essential skills and the right resources.

And when circumstances come that we have to choose among several business ideas – looking at profitability, implementation, and cost would certainly be a fast and easy way to determine which one has the best potential.

Lastly, and most importantly, realize that as you are sitting there, wondering if your business idea will be good or not – somebody, somewhere out there could be thinking the same thing. So it’s always better to immediately follow through with action once you find a good opportunity.

Remember, even the best ideas are worthless without proper action. Dreams can become reality only when you do something and work for it.

Author’s note: This article was written in 2010. Currently, in 2019, numerous affordable gadget stores have opened, CDR-King has waned in popularity, several specialty stores for cycling have appeared, and a photocopying service business franchise still doesn’t exist (as far as I know).

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3 Responses to “Business Ideas: Sorting Out The Good From The Bad”


  1. Ymawitoh says:

    Nice one as usual Sir! Thanks again.

  2. lito says:

    bought 2 avr’s both 500watts so it says, yung una ginamit lng ng 1 month sira na at ng ibalik ko syempre tpos na warranty me service charge daw na halos kasing presyo ng AVR ( ano ito gaguhan o lokohan ) edi inuwi ko knlng tapos yung isa ang specs eh SVR-500 gumagana pero yung PC ko nag o auto-shut off ng buong taon at pabalik balik ako sa gilmore pra pa check ang CPU at hilong talilong na lahat ng Technician pinalitan na lahat ng piyesa at nag-upgrade pa ako at dagdag memory, lagay ng video card na mataas specs,palit ng cables atbp. nag reformat ng paulit ulit nagpalit ng OS ng paulit ulit PERO wala pa din nag o auto-shut off pa din ang PC 3 days from now pinalitan ko ang AVR ng mas cheaper brand then at long last nka bukas lahat ng browser at applications at downloading at 3 days nka bukas ang PC hindi na namamatay o nag o auto shut-off ang CULPRIT eh yang produkto ng p…tng..i…ng CD-R KING na yan na walang kwenta na ang serbisyo pati produkto at kaya pala 2 weeks lang ang warranty kasi cgurado sila na 1 month lng itatagal ng items nila (hindi lahat) pero nasaan ang quality control at proteksyon ng customer-WALA at ipapaayos mo pba kung ang presyo eh konti nlng eh bago na.?!@#%*^”#* sana sa dagat dagatang apoy mapunta ang me ari nito

  3. Jack says:

    We were very fortunate that it was possible to do a small ” test run” for our first business idea. The three month period gave us the oppertunity to look for any flaws or details we may have missed and make an adjustment to the business plan. My beautiful Bride surely is gifted as everything worked beyond expectations. After obtaining all the necessary government licenses and paperwork our biggest issue is and always was finding enough capital to meet demand.

    We are still, three years in, able to live well on less that my SS checks and Beautiful Bride’s academic writing income. We do NOT allow ourselves much in the way of “extras” or vacations. All of my trading income from sell options in my retirement accounts has been added to the business and all business income has been reinvested back into growing the business. Still, we could grow much faster with additional funding. Yes, we could quit everything else and live off of our business but it is great fun to watch it grow. We also anticipate how much more charitable work we can accomplish if we chose to continue what we have done the past three years vs retiring.

    Fitz always points out the importance of ” multiple streams of income” and we fully agree. If one business should enter a rough spot, hopefully you will have a bit of a safety net from your other income streams. In addition to offshore income, we developed several ideas here in the Philippines but none ever exploded to the upside like our first business. They exist but are not huge performers. I guess that is a good thing for now as once again, we would have a serious problem finding more catial if it were badly needed.

    So yes, it is important that you choose wisely what you put your capital into and be a good steward along the way. I find it amazing what happens with a good idea, some patience and compounding by reinvestment!!!

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