To come up with a tangible business idea takes lots of research, planning and assessment of the business situation at hand. Therefore, when we say that a business idea is tangible, we do expect that its implementation will reap tangible results at the anticipated moment.
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In general, business ideas major on boosting profits, driving business performance or improving business capacity in order to address key market gaps within an industry. Therefore, acting upon these well researched and documented ideas is expected to reap tangible results. However, these results are not guaranteed. Therefore, as long as businesses avoid making these five common mistakes that ruin tangible business ideas, they will stay on the safe side.
1. Insufficient Contingencies
The tangibility and success of a business idea largely depends upon your awareness of the risks involved, especially the kind that might reflect serious losses if they were to happen. Once these risk potentialities are established, many businesses merely stop there assuming that the losses are least likely to happen. Yet as we all know, accidents happen without prior notice.
Thus, if a business assumed for instance that the insurance company would settle major losses, it might find that the policy doesn’t cover certain business aspects- especially if the endeavor happens to be particularly very risky. Insufficient contingencies would therefore spell (potential) doom especially if an accident were to happen. This would definitely lead to the stalling of the tangible business idea in question.
2. Outdated Logistics
In the past, outdated logistics referred to statistics that were roughly ten years old. But now, outdated logistics can be as recent as a month’s old data. We live in a world where knowledge is doubling every year; with scientists estimating that knowledge will double every single day in the next ten years or sooner.
Thus, outdated logistics are an evolving dilemma irrespective of how much research goes into a particular business idea. So, don’t be surprised if a logistic framework that worked seamlessly last year happens to stall this year. This is also largely dependent on whether you can catch up to speed with the evolving dynamics of the target market that you wish to work with.
All the same, outdated logistics are largely dependent on the circumstances involved. It all boils down to whether you’re working on a developed, developing or underdeveloped market.
3. Delayed Funding
A tangible business idea is based on the fact that the funds necessary to kick-start a certain project have been pledged. In other cases, many businesses are forced to work with borrowed capital on the basis that the necessary funds will arrive at a later date.
However, when the stipulated timing suffers delay, then the idea is likely to stall. This has happened many times for a lot of businesses, especially when priorities changed suddenly and a project of utmost urgency comes up. Delayed funding can also be attributed to an unprecedented financial shake-up which tends to happen with the current financial challenges being experienced by many debt-ridden economies worldwide.
4. Result-Based Overzealousness
Tangible business ideas are also based on the rough estimate that a certain amount of profit is anticipated once the business idea goes into full swing. This definitely brings about an aura of excitement. However, if left unchecked, this excitement can morph into result-based overzealousness especially if progress does not manifest according to plan.
This often leads to frustration and stress which triggers a pattern of irrational decisions that don’t follow according to plan. Couple this with the cost that comes with such kinds of risky moves and a mountain of losses gradually builds up, resulting in a stalled project.
5. Inflexible Business Practice
Tangible business ideas inevitably address the challenge of business progress with particular emphasis on the effectiveness of a company’s business practice. The modus operandi will ultimately reflect in the success or failure of a business idea. This again ties in to the dilemma of outdated logistics that we mentioned earlier on – when good old fashioned research is mistakenly used to study an advanced market situation.
This might be a reflection of inflexible business practice, especially if everything has to be done according to book. Again, the expertise of the staff involved may be based on an outdated system of higher learning which largely affects their mental reasoning. Therefore, where urgent change is needed in a tangible business idea, inflexible business practice can prove to be a major huddle in a fast paced world of cut-throat competition.
Having considered the common errors that ruin tangible business ideas, it’s clearly evident that tangibility is relative. An effective business strategy in one country can prove to be overambitious in another. Better yet, a conclusive business approach for a certain industry might have serious overbearing implications for another. Therefore, the tangibility of any business idea ultimately rests in the predominant situation that one is exposed to at that very moment.