Is my business idea viable?

Is my business idea viable?

How to put your business idea through its paces – and see if it still stands up

Sadly, not all great ideas translate into great businesses. Even if you’ve thought of a fantastic product or service, you need the right business model, pricing, funding, marketing and people to make it work – and of course, enough customers willing to pay for it.

So how do you know if your idea is worth pursuing? Here are a few pointers to make sure you’re onto a winner before diving straight in.

Is there a market for it?

The first step towards determining whether your business idea has legs is to carry out extensive market research. You need to establish if there is a market for your business, and whether this is big enough to make the venture a success.

Many great ideas have been scuppered by a lack of research and this stage should never be overlooked. Not only do you need to work out whether there is sufficient demand for your offering, you must also determine what marketing, pricing and business model will work for your target market.

To do this, you need to find out as much information as possible about your potential customers: How many are there? What type of people are they? Where do they shop? How do they behave and what drives their purchasing decisions? If they are consumers, how much do they typically earn and how much disposable income do they have? How often would they buy your product or service?

Research strategies

Thankfully, you can carry out much research yourself at little or no cost. Market research falls into two main categories: primary (which you conduct yourself) and secondary (analysing data published by secondary sources). The research can be quantitative (based on numbers and statistics) or qualitative (based on attitudes and opinions). Ideally, you want a mixture of all of these sources to gain a reliable picture of the market.

Your primary research could include focus groups, to gauge prospective customers’ attitude towards your offering; surveys; or sizing up the competition. Look at your rivals’ use of technology, customer service, prices, marketing and business models and try to find out what your potential customers think of these things – this will help you to identify areas for improvement.

Often you can access valuable secondary data free of charge simply by asking for it via a phone call or email, or for a nominal charge to cover postage or photocopying. Much of it is also available online: trade and industry associations often publish data such as sales figures, economic trends, and other statistics and reports. Look at industry specific magazines and publications too.

Remember, the goal is to arm yourself with as much information as possible about the state, size and needs of your market. Do enough research to ensure the results aren’t one-sided, and take feedback on board. Be prepared to change your idea according to what your customers want, not what you prescribe as the best solution.

Posted by Winston Wambua, Senior Business Consultant

 For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype Winston.Wambua

Digital & online businesses

Digital & online businesses

Get all the latest information on starting an online business and the wealth of new opportunities in the internet and digital industry. Take advice and inspiration from those who have succeeded in fields such as mobile business apps and eBay shops and discover how you can set up your own online business.

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·          Posted by Winston Wambua, Senior Business Consultant

 For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype Winston.Wambua

  
 

Why buy a franchise?

Buying an existing franchise can be a great way to start a business
Buying an existing franchise can be a great way to fast-track your way to running your own business. However, there are also pitfalls that must be avoided when you buy a franchise.

There are two routes into franchising.

Either you buy a franchise directly from the franchisor or you look at an existing franchise for sale.

An existing franchise for sale is often advertised online or sometimes the franchisor might point you in the direction of a franchisee who wants to sell.

If you do decide to buy a franchise, you will be looking at a business that has already been tested out. This can be a good thing as you will know the business has already proven to be a success.However, it is important to find out why the franchisee wants to sell that particular franchise.

For sale signs are put up for perfectly good reasons such as retirement, personal reasons or a desire to move into a different area of business.

However, some franchisees might want to sell because the business has not been financially viable. You should probably not buy a franchise such as this! Are you certain that you will be able to make the business profitable if they cannot? You need to find out the reasons for the business’ lack of success. If, for instance, it is in a poor location or the market that it is catering for is not large enough, then you should probably not enter into the deal.

Also, you must make sure that you are getting a good value for money. Compare the costs of the franchise to other businesses of a similar nature.

Also, make find out how much an original franchise from the same company would be sold for now.

The devil, as they say, is in the detail and you must make sure that you get all the relevant facts prior to purchase. Or, you will find yourself in the same situation as that franchisee, desperately trying to re-sell that franchise.

Posted by Winston Wambua, Senior Business Consultant

 For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype Winston.Wambua

 

Start a franchise in Dubai

Prior to starting a franchise it is crucial to be armed with the best business franchise information

and advice, all of which can be found here at Startups. We take a look at the pros and cons of

franchising, how to choose a franchisor and the legal aspects involved in buying and selling a

franchise. From internet franchises to fast food and plumbing, make sure you have all the

franchise information when choosing your next move.


Posted by Winston Wambua, Senior Business Consultant

 For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype Winston.Wambua

10 reasons to start a business while working

Why juggling two jobs can give your business the perfect set up

After a gruelling day at the office, crunching statistics and pushing pens, the last thing anyone wants to do is go home and do it all once more, so it’s understandable that many prospective entrepreneurs think two times about starting a business while working.
But, in fact, there are many advantages to burning the candle at both ends – here are the top 10:

Reduced risk

If you keep your existing job while building your business, you’ll retain a guaranteed income – and reduce the risks associated with starting a business.
Hannah McNamara, founder of corporate coaching firm HRM Global, took a day job in a chair shop while she was establishing her own firm. She says this “took the pressure off both financially and emotionally.
“Setting up a business is a time when you’re testing your emotional strength, and if you’re worrying about debt collectors coming round you’ll feel unnecessary pressure – and may end up making bad decisions.”

Extra time

A day job also gives you extra time to set up your project. Rather than rushing your vision into the public domain, you can make sure you have clients lined up, suppliers and partners in place, and a top-notch website.
Tristram Mayhew, who started building Go Ape while working for General Electric, says:
“In our case, we came up with the idea in August 2002 and didn’t chuck in our jobs until 12th January. We found that people often don’t come back to you for two or three weeks; for us, the insurance took two or three months. So you can’t rush it through in a matter of a few weeks.”

Independence

Tristram adds that, by keeping cash coming in from your existing job, “you may not have to resort to an investor or take loans, or at least minimise that.
“It’s incredibly important to maximise your equity shareholding. When you start out, it’s the most expensive time to sell equity because everyone investing will say it’s very risky, so the equity is almost valueless.
“You might find you give away half your business for something which seems a lot of money at the time - £100k, £50k, £20k – but if it does succeed, you may come to regret it.” When faced with the risk of losing control of your business, those few weeks of all-hours torture might suddenly seem worthwhile.

Commitment

Anyone starting out in business will, at some point, question whether they have the desire to see their vision through. Well, once you’ve spent a few weeks balancing two jobs, you’ll know for sure whether you’re sufficiently committed.
Tristram says such a gruelling schedule “will test your passion [for your business idea]. Most people’s experience of starting their own business is working all hours. If you don’t like the idea of starting a business while you’re working, maybe it’s not the thing for you.”

Companionship

If you’re setting up a business on your own, things can get very lonely if you’re working by yourself all day.
Hannah McNamara says that one of the benefits she gained from working in a chair shop was “sanity”, adding that “starting a business from scratch can be very lonely, so having people around you can help you stay focused, and can even give you new ideas.”

Contacts

In most cases, your employment contract will forbid you from poaching your existing firm’s clients and customers straightaway. However, you may be able to use the contacts later.
Hannah advises any prospective entrepreneur to “make sure that you’re using all of your existing work contacts effectively. Many people’s first customers are the ones they worked with in their old job.”
New skills

Rather than viewing your existing job as a distraction from your new venture, you can use your salaried role to hone skills which will help you in your start-up.
According to Hannah McNamara, “before working in a shop, I didn’t have much experience of selling directly. In the shop, I had to listen to people selling and come up with a solution, rather than coming up with the hard sell. It really helped my listening skills.”

Time management

As an entrepreneur, good time management is key, and combining a full-time job with your new venture is a great way to learn true time management skills, in a real-life environment. If you can balance the demands of the two businesses, and switch between salaried employee and self-employed decision-maker, you should be well-equipped to handle life as an entrepreneur.
Hannah says that, when she was working two jobs, “I found the time I spent on my business was very focused time. If you’ve only got a few hours a day, you make sure those hours matter, and you’re actually doing something productive.”

Creativity

When you’re balancing two jobs, you have to think outside the box to maximise time and money. This can only lead to creative solutions, as Hannah McNamara says:
“I put sales CDs onto my MP3 player on the bus to the chair shop, rather than reading a novel or listening to music. I practised it at the chair shop, and was able to employ the things I learned in my business.”

Positive thinking

Because you have the safety net of the salaried job, you’ll know you’re starting the business because you want to, not because you have to.
Tristram Mayhew says: “It’s important psychologically to be making a positive choice to start your own business. I was about to start a new job in Barcelona (with GE) and it was important for me to be able to say ‘no I don’t want that, I want to start my own business’.”

Posted by Winston Wambua, Senior Business Consultant

 For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype Winston.Wambua

I WANT TO START A NEW BUSINESS

Am I an entrepreneur? i want to be my own boss but do I have it in me to become a successful business owner? How do I analyse my business skills and goals? These are some of the questions all entrepreneurs ask themselves before starting a new business. If you are not sure about any of these questions don’t worry, DBA Business Advisors are at hand to offer free and confidential initial business start up advice.

DBA Business Advisors is a specialist integrated SME start-up solution provider. DBA assist you, the entrepreneur, in developing new business ideas and transforming these into viable concepts. DBA advisors can test your business concept by conducting thorough market research and confirming feasibility of your project. DBA consultants develop comprehensive financial model of your business to confirm profitability. This forms the bases of detailed business plan that gives an in-depth picture of your business to all stake holders including the investors to confidently invest in your business.

Each international jurisdiction presents unique challenges to start-ups. The Gulf Cooperation Council Countries (UAE, Saudi Arabia, Qatar, Bahrain and Oman) have been actively encouraging expat entrepreneurs to invest in these countries. Various incentives including zero corporate tax, zero personal income tax, full repatriation of capital and profits, 100% ownership have been on offer through some free business zones.

United Arab Emirates remains the most entrepreneur friendly country in the Middle East. However the expat should particularly be aware of some basic start-up issues.  Shareholding of non-GCC nationals in the legal structure of a limited Liability Company is restricted to 49%. Majority shareholding remains vested in a GCC national. However this legal structure is challenged by every day practice. A UAE national can, for a fix annual fee, agree to become a silent partner holding majority shares. Minority shareholder can be given powers as an attorney of the majority shareholder to manage the company without any interference. Rights of the expat investor can be further strengthened by trust and side agreements between parties. DBA Business Advisors have built strong relationships with UAE nationals who have proven their committeemen to investors. We will be happy to make an introduction.

DBA strategic partners can assist you in sourcing customers, staff and supplies for your business at deeply discounted prices. Finding the right location for the business is a major task. Through our real estate partners we can find best location for your business to enhance revenues.

DBA business advisors have a dedicated team to seamlessly process your trade license application. The process of incorporating your business in UAE starts with reserving a trade name and obtaining an initial approval from the Department of Economic Development. The application for trade name can be completed online. Regulations pertaining to the applications are available at the site. Costs for obtaining a trade name vary depending on the type and language of the name. On submitting online application or submitting it in person at the Economic Department, a date when approval is granted is issued. All fees must be paid before the trade name approval certificate can be released.

DBA will usually submit your initial approval applications at the same time as submitting their trade name approval application. The documents needed for this step vary depending on the business structure of the company. For certain businesses special permissions are required from various ministries. At this point special approvals required from ministries will be submitted. DBA advisors have thorough knowledge of these requirements and will assist you with right documentation.

If you are planning to open your new business within a free zone, keep in mind that the process for registering a trade name is usually taken care of by the free zone authority and each authority has different application processes. However DBA consultants specialise in free zones and will guide you through the process.

Opening a branch of an existing company requires an added set of documents that verify the legitimacy of the branch and its future managers. A list of necessary documents for licensing a branch or any form of business can be found on the DED website.

The procedures following the DED’s initial approval vary depending on the business structure. DBA will submit all of the documents you needed for the initial approval, as well as a few others, including the initial approval, the trade name approval and the final tenancy contract for the office or warehouse.  If you are applying for a limited liability license, you will need to prove your capital requirements by depositing the required amount in a commercial bank and obtaining an undertaking from that bank that the deposited amount will only be released to the managers upon proof of company registration.   

If one of the partners of the LLC is an existing company, a copy of that company’s memorandum must be translated, notarized at Dubai Courts and submitted along with the rest of the required documents outlined on the DED website. The clerk at the DED will assign a time to pick up the approved application. Return at the declared time, pay the final fees and submit an application to be inscribed in the ministry’s commercial register. Once the formal license is awarded, the company must apply to become a member of the Dubai Chamber of Commerce and Industry.

Mergers and Acquisition team with in DBA Business Advisors will assist you to identify and acquire appropriate business for you. We can carry out commercial and financial due diligence on businesses and will prepare legally binding purchase and sale agreements. Once the final contract has been agreed upon and a payment plan set into motion, the act of transferring ownership must be performed through an amendment in the trade licence at the Department of Economic Development. If the business was foreign-owned, a new Appointment of Local Services Agent contract must be signed with the local sponsor and notarised at the Dubai Courts. The fee for amending a trade licence for new ownership is Dhs.500, but other fees may be applicable depending on the circumstances.

Acquiring and opening a local or international franchise has become quite popular in the region, but the process can be extremely complex depending on where the franchise is from. The best place to start the process of opening an international or local franchise is the Franchising Middle East Exhibition held each year at the convention centre.

Dubai’s ever-expanding market and its reputation as a financial hub for the region make it a prime location for private equity. There are several opportunities to invest in successful businesses in the region, and most companies looking for investors start their search at the Dubai International Financial Centre.

DBA business advisors are with you through the full life cycle of your business, from your business idea to incorporation, from market feasibility to growth strategy, from financial advice to operational improvements and from innovation to exit planning.

Posted by Winston Karumba, Senior Business Consultant at Adam Consulting

For more information about Company Formation or inquiry you can contact me on

Tel + 97155 3350517

E mail winston@adamadvisors.com

What’s my business really worth?

Whether you're buying an existing business or selling it to an outsider, you will require a business valuation that establishes a realistic and fair value of the business. This value will be an important starting point when it comes to the transaction.

Business valuation is more of an art than a science. There is no right or wrong answer when it comes to business valuation. Though there are various models available, inputs to those models are based on judgement and that comes from hands-on experience. Business value estimated using any of the available models becomes focal point to put a price tag to any business.

Valuation is subjective in nature and depends heavily on the correctness of the assumptions made by the valuator. Hence it is quite easy for biases of the valuator to creep into his/her valuation. For example, if a valuator likes a company very much then he/she may be very optimistic about the future potential of that company. Similarly, if he/she had some bad experience with a company then he/she may have pessimistic view about the future of that company. Public news about a company can also have some influence of its valuation. To avoid such biases in valuation, one should use multiple methods of valuation and an independent valuator.

DBA Business Advisors is an expert in the business valuation and is happy to offer the best services for most competitive prices taking into account all the requirements and expectations of every client. We use a variety of business valuation methods to determine a fair price for your business, some of the methods are briefly explained below.

Asset-based approaches

This business valuation method sums up all the investments in the business. It is widely used when it comes to liquidating a business. There are two distinct ways of calculating the value under asset-based approach, either it lists the business net balance sheet value of its assets and subtracts the value of its liabilities or it determines the net cash that would be received if all assets were sold and liabilities paid off.

Market value approaches

Market value approaches to business valuation attempt to establish the value of your business by comparing your business to similar businesses that have recently sold. Obviously, this method is only going to work well if there are a sufficient number of similar businesses to compare.

Discounted Cash Flow (DCF) approaches

The DCF approach is widely accepted valuation method as it is based on the idea that a business's true value lies in its ability to produce wealth in the future. It measures the value of a company by estimating the expected future cash flows, and then “discounting” those future cash flows by the buyer’s required rate of return in order to determine their present value. DCF allows the valuator to take into account any short to medium term expectations and input various valuation considerations directly in to the cash flow or the rate of return. DCF quantities most of the subjectivity involved in valuation.

Although the Discounted Cash Flow approach is the most popular business valuation method, for most businesses, we believe that some combination of business valuation methods will be the fairest way to set a selling price.

DBA Business Advisors is an expert in the business valuation and is happy to offer the best services for most competitive prices taking into account all the requirements and expectations of every client and assist through

For more information about Company Formation or inquiry you can contact me on

 Tel + 97155 3350517

 E mail Winstonk@live.com

Skype: Winston.Wambua