Test your new business idea
You can develop a scaled-back version of your business idea to explore a new concept. Once you see how customers react, you can tweak or change it as needed.
If you have an idea for a new or existing business, it’s natural to want to test it out with minimal expense. Borrow from the tech world, and follow these five steps to determine if you have a minimum viable product (MVP):
1. Identify the problem
Define the purpose of your experiment. It may be discovering how to bring a product to market or redesigning an existing process. Identifying (and later solving) the problem will help you determine whether your idea is viable.
2. Set your initial goals
Consider the most important elements of your business idea and stick to these core features. Keep the concept simple and you’ll find what works and what doesn’t before fully committing to the enterprise.
3. Create a minimum viable product
Develop a minimum viable product that represents the business idea. If you see demand, you’ll know the idea works and it makes sense to expand further.
4. Ask customers what they think
Customers can offer valuable insight. Ask for suggestions and feedback, watch for repeat buyers and monitor social media to see how people are reacting to the concept.
5. Make a decision
Once you’ve gathered information and tested your idea, consider whether it’s time to progress into a more robust business. It may be necessary to develop a new minimum viable product several times before reaching this step.
Ready to take the next step? Learn about the different types of startup financing.