Do Your Entrepreneurial Ideas Stack Up?

L.A. Times Archives

Oct. 1, 1997 12 AM PT

By now you should have a general idea about what kinds of businesses you’d like to start. But which one is best for you?

If you have researched your favorite ideas, or completed the three exercises in previous weeks of Entrepreneurship 101, it’s time to evaluate all you have discovered. The Times has devised a tool to help you sift through that material.

Take “Your Business Ideas” from Step 2, in which you wrote down the requirements for your various business proposals. Now look at the form below, “Adding It All Up.” Write down the types of business ideas you researched under each of the columns, Idea 1, Idea 2 and so forth.

If you didn’t do the exercise, you can find it on The Times’ small-business Web site at http://161.35.110.226/smallbiz. Or you can just write down the ideas you have been thinking about and list them under each column.

Now, assign a numerical value, based on how close you come to meeting each of the business requirements for each idea. A score of 5 means you fully meet the requirements to start your business right now, and a score of 1 means you lack them. Write down the score for each category and for each business idea.

Some examples:

* Under “Skills,” if you want to open a graphics design company and have spent a dozen years as an illustrator for a publisher of handbooks or for an advertising agency, you would give yourself a score of 5 for the question, “Do I have the skills or knowledge to run the business?” You might also give yourself a 5 for the question, “Can I hire someone with the skills?” because you probably know many other graphic designers. But if you have spent a dozen years as a hospital equipment salesperson, you would probably give yourself a 1.

Conversely, if you are a hospital equipment salesperson and you want to start a medical supply company, you would probably give yourself a much higher score for the same questions. But illustrators would probably score 1 if they were considering going into the medical-supply business.

* Under “Clients,” if you want to design and sell an upscale line of career clothing to working women in Beverly Hills, but you live in Pomona and all your business and social acquaintances are college-aged, you would give yourself a score of 1. But if you have professional and personal contacts with career women from Beverly Hills and you live in Century City, you would likely give yourself a 5.

* Under “Start-up needs,” if you wanted to open your own personal accounting and investment firm in your home and you need a computer, printer, business phone line and separate room or office, which you already have, you would give yourself a 4 or 5. If you have neither home office equipment nor a room to work in, give yourself a 1.

Now, go through your notes and score each category in the work sheet below.

At the top, put your personal aptitude score from Exercise 3 if you completed it previously. If not, you can find it on The Times’ Web site, or skip it entirely.

There is no passing or failing score. The chart will simply give you a rough idea of how your business ideas stack up against one another.

The ultimate test of your business idea will be your own inspiration, analysis and hard work.

“Choosing a business requires consideration of a lot of different variables, including personal issues, economic issues and basic business needs,” says USC Business Expansion Network director Debra Esparza. “Compare the opportunities you’ve identified with your skills and resources so you can decide on a business you’re most likely to be successful in.”

The USC Business Expansion Network is at 3375 S. Hoover Blvd., Suite A, Los Angeles, CA; (213) 743-1726.

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The Bottom Line

“Entrepreneurship 101” is a tutorial on how to choose, start, finance, plan and grow a business. The program, written by Times staff writer Vicki Torres, was developed by Debra Esparza, director of the USC Business Expansion Network, a community and economic development project. USC’s BEN has counseled more than 5,000 small-business owners in the Los Angeles area in the last six years, helping them with financing, business planning, accounting, marketing and other issues. The tutorial can also be found on The Times’ Small Business Web site at http://161.35.110.226/smallbiz

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Entrepreneurship 101

Chapter 1: How to Choose a Business

* Open Your Eyes

* Explore Opportunity

* Examine Your Attitudes

* Add it All Up

Chapter 2: How to Start a Business

Chapter 3: How to Develop a Business Plan

Chapter 4: How to Finance Your Business

Chapter 5: How to Grow Your Business

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Your Business Ideas

Give yourself points according to how fully you meet the criteria to start your small business, with 5 being the highest score and 1 the lowest. Your scores should help you compare your business ideas.

Your Top Three Business Ideas:

1. Personal Aptitude Score (from last week’s lesson)

2. Skills

Do I have the skills or knowledge to run the business?

Can I acquire the skills?

Can I hire someone with the skills?

3. Clients

Have I identified my customers or clients?

Do I have access to them?

Do I know how to inform them about my business?

Can I meet the costs?

4. Distribution