Every great or large business or entity that ever exists started with an idea – an idea that was initiated to solve someone else’s problem, improve or discover news ways of doing things, producing a product/service, or something of impact and interest to particular group of people or community.
The journey to starting, running and growing a business into a successful venture is not an easy task. It requires hard work, competence, time, energy and money.
A business Idea
A business idea is a concept, product or service that can be used for financial gain. General characteristics of a promising business idea is that, it should be problem-solving, innovative, unique and profitable. A good business idea should be one that solves a problem and innovates over period of time. As Richard Branson puts it, “A business is simply an idea to make other people’s lives better.”
Entrepreneurs creatively exploit changes in our world. Some of the businesses and industries that were inexistent over the past years exist today to solve current problems, bringing new things and adding value to lives. Management expert Peter Drucker says that for a business to be considered entrepreneurial (Willing to take risks in order to make a profit), it should exploit changes in the world. Bill Gates understood the need for everybody having a personal computer, the explosion in computer technology led to creation of Microsoft. Mark Zuckerberg understood the need for a universal website that can connect people around the university that led to start of Facebook in 2004. Today Facebook is the world largest social media platform for sharing information with family and friends, create awareness for your business and so much more.
The source of business opportunity in the marketplace that entrepreneurs can exploit includes changes in laws, situations, or trends; inventions of totally new product or service; ability to make competition irrelevant through influence of price, location, quality, reputation, reliability and/or speed, and technological advances.
Having a very inspiring business idea can be misleading sometimes because not every idea is necessarily an opportunity. In fact, most ideas are not viable business possibilities. An opportunity has a unique characteristic that distinguishes it from an ordinary idea. According to Mariotti and Glackin, authors of Entrepreneurship – Starting and Operating a Small Business defines an opportunity as an idea that is based on what consumers need or want and are willing to buy sufficiently often at a high enough price to sustain the business.” It’s therefore stated clearly that business viability is determined by its long-term survival and its ability to sustain profits over a period of time.
The best way to know whether a business idea is viable is through brainstorming. Brainstorming means identifying the possible problem you are trying to solve, what skills do you have or need, and a good understanding of the complex situation altogether. Secondly, discussing your business idea with a close friend or family member or form a focus group. Don’t worry about someone stealing your idea; the discussion and views of different people will give you a different perspective which will help you improve and develop your business idea.
But because we tend to make decisions with our emotions, and the fact that strong emotions may overwhelm you to the point where you can’t see the benefits and the cost of an action, the Cost/Benefit Analysis is the best tool to help you in comparing the cost and benefits in your decision-making process.
Before investing time and money into any kind of business it’s important to do cost/benefit analysis to guide and inform decision-making for investment. Create a table with two columns; in the first column list the money and time you will have to invest, and the opportunities that you will give up to operate the business (if it’s leaving your job to run your own business what will it cost you?). In the second column list the money you will get (compare to your current earning from your job, if you have one) and the knowledge and experience and the opportunities and benefits you will gain.
And of course Cost/Benefit analysis is not effective, complete or accurate without including opportunity cost. Opportunity cost is the cost of your next-best investment. It asks questions like what are costs of your next-best investment? What would you have done if you had not started investment in your business idea? What are you ready to forego for this investment? Is it worth it?
The state of the economy of South Sudan is very vulnerable. Though the country has been enriched with several minerals, there is over reliance on extraction and exploitation of one resource, which is petroleum. The business risk is too high due to political unrest which led to economic instability. The exchange is skyrocketing. The devaluation of the currency (South Sudanese Pounds) in 2015 to encourage exports and shrink trade deficits is another reason.
Some of South Sudan economic misfortunes may not be solved through pumping of too much dollars into the economy to encourage investors, but having policies and regulations that remove the barriers of starting a business and mitigate the risks of embracing entrepreneurship. This may include cutting down the cost of registering and acquiring business licenses; having an effective protectionism policy that protects home industries from overseas competition; prioritize small business in acquiring business loans; and setting aside Youth Enterprise Development Funds under an independent body or committee – this idea works well in Kenya and South Africa.
There has never been a right time to start a business despite troubling economy; its right time that South Sudan embraces entrepreneurship. In fact, there are so many problems that affect the people in this country and every problem comes with a business opportunity. Clinging to job security and high paying hard currency (in US Dollars) job won’t help us much to solve the problems or reverting the economy to the good old days but venturing into businesses and innovation.