How to spot bad business ideas? Truth is, it’s not always easy

We’re all so aware of the amazingness that one feels as you create ‘new’. It might be that product which answers the needs of the latest comments from customers perfectly (and you don’t like to boast, but it’s also probably your best work)! It could be an experience you’ve created which will absolutely knock their socks off — the whole process of building your idea is addictive. Even though we feel sick about ‘the launch’ and how it will be received, we sort of know (deep down) it’s going to be glorious.

Maybe it will be picked up by the press and this will be the moment you’ve been waiting for? Or on the flip side, what happens when the tumbleweeds start to appear, the lack of noise is deafening and no one is coming through the door (real or virtual) at all? How do you know when an idea is not going to work? Let me tell you about something I built, which I absolutely knew was going to be hugely successful, but actually, never was. Although before we talk about having to let an idea go, one needs to check if you’ve fought enough for the idea you initially believed in so much?

Have you fought hard enough for your business idea?

When I create, I look at how to create success in two halves. One is the natural appetite of those who know your brand to consume what you’ve created, and the other is your cleverness and relentlessness in promoting the idea. So…

Have you researched your great business idea enough?

I know, certainly in my experience, that in anything I launch, there is absolute evidence that this idea should work thanks to listening to customer feedback, conducting surveys or looking at competitors and so on. I’m also sure that the idea was grounded in knowledge and thus should have a fighting chance at working — if we get ‘it’ right. And when I mention ‘it’, I’m referring to the long list of elements we all know goes into creating, such as creativity, pricing, tone of voice, atmosphere, photography and magic. Did you get that right?

Have you effectively promoted your business idea?

Is it that you’ve simply not juiced the idea and it’s magic enough? This could be through PR, local advertising, digital promotion, SEO (Search Engine Optimisation) or social media that just wasn’t good enough. Actually this list is a little endless, but my point is, that as far as I’m concerned there’s always MORE we can do. I regularly tell myself it’s impossible that I have done enough, because it sort of is! But at some point, we’ve got to face reality.

Giving up might actually be a good thing

That moment of realisation when you’ve given the idea your all, and it’s not turning out how you expected is tough. You’ve promoted it in any way you can afford and it’s now officially not the next best thing since sliced bread. But how can you give up on something that you’ve put your everything into? Let me tell you about when this last happened to me.

I loved the moment when I realised the Holly & Co Work/Shop (known to the community as a cafe) was starting to do well and our locals were engaged in so much more than just the coffee. I’d always dreamt of creating more physical space, due to the team and my love of bringing a brand to life. And there was another little thing — my husband Frank had always wanted to run a deli.

So we embarked on asking those around us (survey alert, see above!), what they would like in their local community. What would they support and visit frequently? We received back over 200 surveys and overwhelmingly it was a mix of wine bar, deli and community space to hire and work from. At the same time, the shop next door came up for grabs and you can imagine what I did next? Yes, I grabbed it! This was it… the universe was guiding us and the high street was our oyster.

Why was opening a deli in St Margarets a shockingly bad idea?

For 25 years, the building next door was used as a Thai takeaway. To say the ceiling needed work was an understatement. The whole place also needed to be turned into at least three main zones — deli, bar and working kitchen, and the whole lot needed to become a space that small businesses could hire for events with a shop on the side.

From planning permission, which took seven months, to the final lick of paint, the project took one and a half years and cost 25% more than I’d budgeted. But the renovation was only one part of the idea. We’d decided (of course) that we’d only stock beautiful creations made from small businesses. From the six gins we sold in the bar to the bread in our famous ‘Coronation Chicken Sandwich’ to the candles you bought as a gift. The whole place was, like the Work/Shop, a shrine to the talent of this community.

It was a beautiful moment when we flung open our doors and we promoted it hard. There wasn’t a single person in the local area who didn’t know about it as this was our primary audience. These were the folks who not only had asked for it, but were also the very people who were going to keep the idea, and now business, alive. Well, you can predict the ending…

When a business idea goes from bad to worse

Each week in the deli we had a rotation of around ten staff, thanks to the premises being open 7am to 12pm most days, and along with this high wage bill we also had the increased cost (and so it should be) of only stocking small business products. We were dealing with fresh produce and the waste that we tried desperately to reduce, but ultimately, the nail in the coffin was the lack of footfall. All of this culminated in the beautiful creation haemorrhaging money, to the tune of £10,000 a month.

I had to ask myself the toughest questions, because when I see a challenge or accept one — I’m all in! I will not only move mountains but also cut the mountain down and sling it on my back if I can. In fact, I wrote a piece on the eight ways to fall back in love with your business to make sure you’ve tried everything. But sometimes you need to admit what feels like defeat (and Nicola Payne from Oklahoma talks about this beautifully in the article ‘Closing your business: the emotional effects and how to let go with love’). I could not even slightly afford to keep losing this precious money and I knew it was time. I had to call it.

What are the signs that your idea might fail?

The questions I asked myself were…

• If I looked into my heart, whatever I did, were things going to change, however I promoted it?
• Was this the right idea but for another time and a busier high street?
• Did this idea really meet the needs of the customers who’d filled in the survey? Or was it my interpretation of what they needed which ended up being built?
• Was it too expensive for those around?
• Had I created this idea partly to fulfil Frank’s dream?

Sometimes you need to let go of a bad business idea but what you learn from it is life changing

After answering these questions in my heart (and head) and facing into the reality of our latest idea taking the whole business down, thanks to depleting our reserves, I pulled the plug. Within 24 hours I’d told everyone (some of the hardest chats I’ve had to date with Holly & Co) and started the process of closing. We turned the lights off five days later.