MSME DIGEST With Kola Owolabi
“What can you tell someone who is full of ideas but skeptical about executing any?”
One of the most common reasons people hesitate to start a business is not because they lack ideas; it is because they believe they lack capital. Many aspiring entrepreneurs convince themselves that unless they can raise millions of naira or attract investors, their business ideas must remain on paper. This belief has unfortunately buried many potentially successful enterprises.
The truth, however, is quite different. Capital is important, but it is not always the biggest obstacle. The real challenge is knowing how to match the business idea with the resources already available. Virtually every legitimate business can be started at some level with the capital currently within the entrepreneur’s reach. What changes is not the business itself but the market entry strategy.
This is where a well-prepared business plan becomes indispensable. A robust business plan helps an entrepreneur answer critical questions: What can I start with what I have? Which customers should I target first? What products or services should I introduce initially? How do I grow gradually without overextending my finances?
Many successful businesses today did not begin on a grand scale. The founders of Amazon started by selling books online from a garage. Apple began in a modest garage workshop. Closer home in Nigeria, several leading fashion houses, catering businesses, digital agencies and logistics companies started with just one customer, one sewing machine, one laptop or one motorcycle. They expanded because they had a clear plan for growth rather than waiting endlessly for “adequate capital.”
Once you understand that your available resources determine your entry strategy; not whether you should start at all; you can confidently focus on selecting the right business idea.
Here are three practical ways to identify the most viable business idea among the many competing ideas in your mind.
First, choose the idea with proven market demand.
This is perhaps the most important consideration. Never fall in love with a product before confirming that people are willing to pay for it. Businesses succeed because they solve problems that customers already have.
A business with existing demand offers an enormous advantage. Customers can place advance orders or even make upfront payments before production begins. Such pre-orders significantly reduce the amount of startup capital required.
For example, many Nigerian cake bakers, event planners and furniture makers work almost entirely on customer deposits. Likewise, American companies such as Dell built part of their early success on taking customer orders before assembling computers. The market itself helped finance production.
When customers are already searching for your product or service, your biggest challenge shifts from raising capital to delivering value.
Second, choose an idea that aligns with your existing skills.
Skills reduce startup costs because you already possess one of the most valuable business assets.
If you know fashion design, starting a tailoring business makes more sense than opening a pharmaceutical store. If you are skilled in graphics, digital marketing, software development, photography or catering, these skills provide an immediate competitive advantage.
Your competence builds customer confidence, generates referrals and attracts repeat patronage. More importantly, satisfied customers are often willing to pay deposits before work begins, easing your cash flow and reducing dependence on borrowed funds.
Many successful entrepreneurs simply monetized skills they had developed long before they considered themselves business owners.
Third, do not be afraid to copy a successful business model.
Many young entrepreneurs wrongly avoid businesses that already have competitors. They mistakenly assume that competition means the market is saturated.
The opposite is often true.
A thriving competitor is usually evidence that customers exist. Rather than searching endlessly for a completely unique idea, learn from businesses already succeeding around you. Study what they do well, identify areas where you can improve customer experience, and carve out your own niche.
Think of the numerous supermarkets, restaurants, pharmacies, filling stations and POS operators that coexist profitably in the same neighbourhood. In the United States, Starbucks did not stop because coffee shops already existed. Netflix entered a market that already had entertainment providers. Competition simply confirmed that there was a market worth serving.
For a first-time entrepreneur, entering a proven market often carries less risk than trying to create an entirely new one.
The journey from idea to execution does not begin with millions of naira. It begins with selecting the right opportunity, developing a realistic business plan, and executing a market entry strategy that matches your present resources.
Ideas become valuable only when they are implemented. The best time to start may not be when you have all the money you desire, but when you have enough clarity to take the first step.
Have a business question that has been bothering you?
Send it via WhatsApp to the number in my byline below. Your question may be selected and answered in a future edition of the “Entrepreneurs’ Frequently Asked Questions” series in “MSME DIGEST”, helping thousands of other entrepreneurs who may be facing the same challenge.
Kola Owolabi is a Fellow of the Nigerian Institute of Management Consultants (FIMC.CMC) and Chief Executive Officer of David Solomon Consulting Limited, based in Igbesa, a suburb of metropolitan Lagos, in the vicinity of Crawford University. The company can be reached via phone or WhatsApp at 08023203198
