When you run your own business, you’ll inevitably be presented with great-sounding opportunities by prospective partners. But beware, most of what glitters is not gold. Here are some strategies for evaluating potential business opportunities.
While it’s nice to have options, the fact is that only a small percentage of ideas will come to fruition. Successful business people have a sharp ability to rapidly get to the heart of potential business opportunities, assess the facts, make a decision either way and move on.
So how do you work out which ideas to pursue? Rather than long exploratory meetings over coffee, the trick is to start by finding out precisely what the prospective partner hopes to achieve and what they want from you. This can be done in a quick phone call.
While at first it may feel brash, it is important to ask direct qualifying questions upfront. For example:
- What are your goals for the project? Why?
- What is your role? How do you see my business helping?
- What time and financial investment might be required?
- What are the risks and potential returns?
- When would you be ready to start?
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The next step is to match these ambitions with those of your own business.
- Is their opportunity in line with my business goals?
- Should this really be a priority for me right now?
- Do I have the time and budget?
- Does it feel right? Am I motivated by the idea?
Usually, it is clear within 10 minutes whether a potential business opportunity is right for you. If it is, then tee up a meeting. If not, you can get back to business.
I recently read about a bigwig at Motorola who demands that all staff presentations begin with the final recommendations. That way, he says, if he agrees with the proposed recommendations he doesn’t have to sit through the presentation! A nice way to cut to the chase.
How do you evaluate potential business opportunities?