Now, at this point you may be asking, why do I know if existing businesses are profitable?
Not unless you’ve got a good friend in the business. It’s the same thing as the pizza business. If you walk in cold, to the pizza joint, and you ask to speak with the proprietor, and you say hey I’m thinking about opening up a pizza shop next door. How many pies you selling on Friday night? He’s going to look at you like you’re crazy, and he’s going to boot you out of his building.
But, if you happen to be friends with the proprietor, and you say “John, I’ve been watching you for the last few years, and I appreciate and respect you. And you seem to be doing all right.”
John says, “You know buddy, I am, I’m doing okay.”
And I say “You know, I’m thinking about maybe opening up a pizza joint. Don’t worry John, I’m not going to put it across the street. And you can maybe give me some advice, and you know I’ll put it all the way on the other side of town so it doesn’t bother you at all. John, would it be okay with you if I opened up a pizza joint on the other side of town?”
And John says “Yeah.”
And I say, “John, could we sit down, and you kind of tell me what some of the numbers are? Maybe I’ve just got dollar signs in my eyes. Could you tell me what you’re spending on your workers, and how much you’re spending on dough, and actually, how many pies you’re selling.” Then he might tell you.
Here’s the thing, unless you’ve got a friend at Amazon, and that probably wouldn’t be ethical. Or, you’ve got a friend who’s got his own infomercial. Or you’ve got a friend that sells something in a particular niche. Folks, you’re not going to get the insider data. It’s just not there. You’re not going to get the insider data. And, believing that you can know how profitable something is before you get started is a fallacy.
Everything I’ve just given you is going to help you to determine, ascertain whether there’s a need, and whether there are things being sold in the particular niche in which you are interested.
This method isn’t a shortcut, but it will tell you exactly what your customer really needs – and what she really wants to buy.
You’re going to have to go where people are that are interested in that topic and, likely, fastest way to do it is to run advertising, and get people to become subscribers, and ask them what their needs are.
Now in these modern times it becomes much easier with social media reaching so many people. If you run a questionnaire on Facebook, Instagram, Pinterest etc. you will be able to get a lot of feedback very quickly.
Now, is that a lot of work?
Is it any different than the due diligence that you would put into opening up a pizza joint? If you were going to invest $100k of your hard earned retirement money on a pizza joint, would you spend a month or two doing research in town? You would spend money every night, you would eat pizza at a different restaurant, and you would take notes about what you liked about the restaurant and what you didn’t like.
You would record the results for future use. Some ideas you would implement straight away but save other good ideas for later.