�5

People need their clotheswashed. Maybe we canstart a laundry service.

It’s so dusty here.Maybe we can dopeople’s gardens …

There are all these smallbusinesses … I wonder if they

need someone to do theirbooks?

Good idea, Vuyo. You see,it’s not so hard to think of

business ideas.

People alwaysneed vegetablesand fruit. Maybewe can set up astall in town.

In our story, Mam’Langa, Dudu and Vuyothink of ideas as they walk around theirneighbourhood. They think about things -products and services - that people in theirarea might need or want. This is a good wayto start thinking of possible business ideas.

☛ Always think about your market first.Look around your area.

☛ Speak to people: ask them what theyneed and want.

☛ Don’t be impatient - it takes time!

☛ Don’t try to come up with the ideaimmediately. Sometimes ideas take timeto develop and grow.

☛ Ask people to help you think about ideas- this can be a very useful exercise.

☛ Be as creative as possible.

Now, try this exercise yourself: Think of at least five ideas for a business.

My five business ideas are:1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

First we need to

think of a business

idea. Think about

what people need ...

and want.

Ideas! Ideas! Ideas!

The first step to starting a business is finding abusiness idea. Every business starts with an idea.

But how do you find the right idea for yourbusiness?

2

�6

Now you need to assess your ideas: youneed to decide if your ideas are goodbusiness ideas.

Feasibility Study: Is thebusiness idea a good idea?It is important to think carefully about theideas that you have written down. Thebusiness idea must be able to become asuccessful business. It must be feasible. A feasibility study of your business ideas isyour first step in doing market research.

Like Dudu in our story, you might be able to‘throw out’ some of your business ideas ifthey do not seem to be feasible, beforewasting too much time thinking about them.

There are three important questions that youhave to ask yourself about each of yourbusiness ideas.

1. Do you have a market for your productor services?

You must ask yourself whether there willbe enough people who will want or needyour product or service. Remember, yourmarket is those people who will buy yourproducts or services at the prices youcharge.

Go out and speak to people whom youthink will be your future customers. Askthem what they think of your idea. Is thisa product or service they need or want?Can you adapt your idea to meet theirneeds better?

Also remember to look at yourcompetition. Are there otherentrepreneurs selling the same product orservice? Is there a way of making yourproduct or service different and betterthan the competition?

2. Do you have the skills needed to startthe business?

Entrepreneurs need some skills tomake them successful in business.Many of these skills can belearned. The entrepreneur needsto be able to manage his finances,to market his business, to buywisely, to keep accurate recordsof the business and be able to sell.

Sometimes, the business personneeds technical skills (likedressmaking, hair styling, etc.),especially in a manufacturing or service business.

You must ask yourself whetheryou have the skills to turn your businessidea into a business. If you don’t have theskills, can you learn them? Or, cansomeone else who does have the skillshelp you?

3. Do you have the resources necessary tostart the business, or can you get them?

The book says thatonce we’ve thought ofsome business ideas,

we need to do afeasibility study.

A feasi-what?

We need towork out if our

ideas arefeasible, Mama.

Can theywork?

People do their own

laundry here, so there

would be no market

for that service.

And most people are

not interested in fancy

gardens.

Anyway,

we don’t have the skills to offer

a gardening service. And we don’t

have the resources, like a

lawnmower and gardening tools.

�7

Resources are all the things you need torun your business. They include thingslike premises, or a secure place fromwhich to run your business, money,labour, machinery and equipment, time,raw materials and products.

Make a list of all the things that you willneed for the business. If you do not havethem, work out how much it will costyou to buy them.

Of course, all new businesses need some money to start. But if money isa problem, do not be discouraged. It isgood to start small!

Speaking to peopleLet’s have another look at how Vuyo, Dudu and Mam’Langa research theirbusiness ideas.

Vuyo goes out to small businesses in hisarea, and asks entrepreneurs if they wouldbe interested in having him do their books.

One of the entrepreneurs he speaks to is ashoe repair and leather goods manufacturer.This man says that he does not makeenough money to need to keep books. (Thisentrepreneur is making a mistake! No matterhow small a business, it is important to keepbooks. You will learn more about this in laterchapters.)

Another entrepreneurvisited by Vuyo doesn’tbelieve that Vuyo hasthe skills or experiencenecessary to do hisbooks.

Frustrated, Vuyo givesup his research.

What do you thinkabout Vuyo’s attitude?Do you think he gaveup too quickly? Do youthink he might havefound a market for hisbookkeeping services ifhe had tried harder?

Dudu also does market research on her ideaof making and selling grass baskets.

She discovers that there is a lot ofcompetition in this business.

She also discovers that the market for grassbaskets is limited to certain types of buyers.

And she finds out that the price that shopswill pay for the baskets is not enough to payfor her costs and the time it takes to makethe products.

Her conclusion is that there is “definitely no market for our baskets!”

It’s only tourists and people fromGauteng who like this stuff. My

customers don’t want these grassy things!

I’ll give you R100 for 50!

That’s my best offer.

But it takes a whole day

to make one basket …

Solittle!?

My dear, many people are

making these baskets. And I

can get them even cheaper

from Taiwan. I’m sorry.

�8

Mam’Langa does marketresearch on her idea ofstarting a fruit andvegetable stall in town.

She discovers that thereis a lot of competition.There are many otherentrepreneurs sellingfruit and veg in town.

She also discovers thatmany of them are sellingthe same things.

She thinks there may bean opportunity for a stallthat offers customers awider choice ofproducts.

In addition to researching the market for herbusiness idea, Mam’Langa also researchesthe source of supply for her business. Shefinds out where she can buy the producethat she will sell at her stall. And she alsolooks at the prices.

She discovers that the pricesfor fruit and veg from thewholesalers are good. Butwith so much competitionin town, she doesn’t knowwhere she should positionher stall.

On her way home from town, Mam’Langaoverhears other commuters talking abouttheir frustrations with having to shop intown and carry heavy bags long distances.

Listening to people’s frustrations,Mam’Langa recognises a need - and apotential business opportunity! She asks herfellow travellers (representatives of herpotential market) if they would buy theirfruit and veg from a stall in the township.

Mam’Langa gets very positive feedback onher idea of setting up a stall in the township.She spends some time near the taxi rankwatching the commuters returning fromtown. Many of them are carrying bags offruit and vegetables bought in town.

Yo! There are so many peopleselling fruit andvegetables here!

They’re all sellingthe same things!

… and it’s freshevery day.

Everybody knows me for my

discounts.

The prices

are good … But

where am I

going to sell?

Oh, these bagsare so heavy. And

my feet …

I hate carrying all myshopping from town. The

drivers are so rude!

Oh, yes. It would

help me a lot.

Yes. But the prices

must be good!

Hmm … there’s anopportunity here. Mnisi.

This isold!

Take it orleave it!

�9

There is somecompetition. Mr Mnisialready has a stall atthe taxi rank. But shehears from people that“... his vegetables arelike him: old and dried out”!

She also sees Mnisibeing rude to hiscustomers. She feelsconfident that she can offer people a better service.

Mam’Langa’s businessidea seems to be

a good one. It passed thefeasibility test!

Now take a closerlook at your ideas“Throw out” impractical

ideas if there are any.Then study the feasibility

of your ideas using themarket, skills and resources

test below.

So, we have a market, and we have the skills to buy and sell fruit

and vegetables …

And with the money Wilson sent, and my small savings,

we have the money to start.

Planning for successSome of you may not enjoy writing down your ideas and working out if you have the

market, skills and resources needed to make your business a success.But remember that market research is essential to planning a business. And planning is

essential to ensure that your new business becomes a success.

If you find writing difficult, ask someone else in your family to help you.

Business Idea (number: ......)Market Who will be the market for your product or service?Write down who will buy your product and service? Give as much detail as you can.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Skills What skills do you need for this business?Write down all the skills you think you will need for this business idea.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Do you have these skills, or can you get them?Write down the skills you have, and where you will get the skills you do not have.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Resources What resources do you need for this business?Write down all the resources you think you will need for this business idea.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Do you have the resources, or can you get them?Write down all the resources you have, and where you can get the resources you do not have.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

�10

Do any of your business ideaspass the feasibility test?

If one or more of your ideas seem feasible -great! Carry on to the next chapter.

If none of your ideas seem feasible, there’sonly one thing to do: start theprocess again!

If at first you don’t succeed, tryand try again! Remember thatan important characteristic of a successful entrepreneur isperseverance. A person whobecomes successful is not aperson who gives up easily!

Use as many of these forms as you have ideas you want to test.

You must haveperseverance ...staying power.

Business Idea (number: ......)

Market Who will be the market for your product or service?

Write down who will buy your product and service? Give as much detail as you can.

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SkillsWhat skills do you need for this business?

Write down all the skills you think you will need for this business idea.

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Do you have these skills, or can you get them?

Write down the skills you have, and where you will get the skills you do not have.

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Resources What resources do you need for this business?

Write down all the resources you think you will need for this business idea.

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Do you have the resources, or can you get them?

Write down all the resources you have, and where you can get the resources you do not have.

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