Updated: Jun 29, 2021
A great way to grow a business is to add an additional product/service. As business owners ideas pop in our heads all the time of what else we can provide our clients or customers. However, a poor decision will lead to wasted time, lost financial investment and potentially risk your current business. Here are three questions to ask yourself to help sort through your ideas:
1) Why is my business ideally suited to provide this product/service?
You will have the best chance of success if the new product/service can be sold to your current target customer base. In addition, if the product/service can be dropped into your current business model with little investment you it will be easier and cheaper to execute.
Note - Concepts outside of your current customer base or business model may be quite fruitful, but they will take a lot more research, time to execute and potentially financial investment. Understanding that up front is important when weighing your options.
2) Who is my competition?
Adding a product/service may expand your competitor list. Evaluate your competition and understand how successful they are at providing the product/service. Consider what you would do differently that would entice a client to choose your business over the competition.
3) How much money will I make?
A quick financial analysis will tell you if the idea is worth investigating. You also need to consider if any of your current business will be cannibalized by the new product/service and include that loss in the analysis.
The goal is to spend time only on the best ideas. If your new product/service passes these three questions then you can feel more comfortable putting in more time into researching the concept in depth and potentially creating the new offering. Best of luck!