[somefeen]

Hi
I have an idea for a business and I'm trying to work out wether it is actually financially viable or not.

I don't have a clue how to go about this though. How do I actually work out simple things like fuel costs and the cost of buying initial stock etc. The prices of these things seem highly variable, diesel consumption for instance is going to vary alot depending on what kind of vehicle is used.

Im even having trouble working out the prices for basic equipment that would need to be purchased before work can even start.

Does anyone have any tips?
Thanks

[Peterdalkey]

You can only attempt doing a business plan after you have done the research! At this stage all you have is an idea, the first step is a feasibility study to see if the idea is commercially at all.
You need to research all the questions you have posed yourself, establish demand for the service product and make an educated estimate of sales revenues. You will then be able to produce a budget to establish if the venture is likely to be profitable. If you are not up for doing this donkey work, just walk away as the actual execution of the project will be many times more difficult.
You can Google to find templates for feasibility studies and business plans to guide you through the steps needed.

[arbitrage]

The "educated estimate" of sales is the tough one for people starting out when you don't have direct competitors.

It would be interesting to get ideas on how to go about this.

[TonyStark]

As an aside, the Consultative Committee of Accountancy Bodies - Ireland produced a business plan guide there a few weeks back. It might be of use when it comes to drafting a plan.

[Peterdalkey]

Originally Posted by arbitrage

The "educated estimate" of sales is the tough one for people starting out when you don't have direct competitors.

It would be interesting to get ideas on how to go about this.

This is a common challenge for those involved in R&D/new product development. The methodology is quite straightforward and involves all aspects of market research and is a long and laborious path, and can be expensive unless you do the work yourself. It is made significantly easier if the product/service is a "problem solver" or is an innovation with obvious benefits/rewards for the consumer.

[Herbalist]

Sage offer a Free Planning For Business software that can be downloaded from their site. It may help you because it will take you through a step by step approach asking you to input information - once you do this the software will put it all together for you into a business plan.

You will need to do your research both on the market and your own plans. There are some figures that you will know for definite up front and some that you will have to estimate.

[VINCWM]

Research EVERYTHING.

[somefeen]

Originally Posted by VINCWM

Research EVERYTHING.

Cheers for the all the advice guys.

Unfortunately the above is the main stumbling block.

When I've tried to research costs for things in the past, I noticed that suppliers and manufacturers of the more serious equipment don't seem to take my correspondance seriously and ignore.
For instance I will email a manufacturer of some piece of equipment explaining that I am hoping to set up a business and how much does the piece of equipment generally cost. I explain exactly what I want but I get nothing back.

This type of stuff isn't available on the second hand market so its not possible to infer the price from whats on the market.

[Peterdalkey]

Originally Posted by somefeen

Cheers for the all the advice guys.

Unfortunately the above is the main stumbling block.

When I've tried to research costs for things in the past, I noticed that suppliers and manufacturers of the more serious equipment don't seem to take my correspondance seriously and ignore.
For instance I will email a manufacturer of some piece of equipment explaining that I am hoping to set up a business and how much does the piece of equipment generally cost. I explain exactly what I want but I get nothing back.

This type of stuff isn't available on the second hand market so its not possible to infer the price from whats on the market.

I suspect that you are getting the brush off because they profile you as a tyre kicker! If you approach them in a professional manner initially by phone and make contact with a real named person in sales, get their email address too. Then explain that you are looking to expand into X area and are interested in Y equipment and Z supplies and require price offers, lead times etc. Then follow up your call with an email confirming the call and specific requests.
I would expect you to get a much more professional response. If you do not, get the name of the MD and contact him directly, you will certainly get some action then!

[somefeen]

RESULT!!
Cheers, seems people are a bit cagey about there prices unless you actually sound like your likely to buy at some point in the future.

[bizzyb]

Originally Posted by somefeen

RESULT!!
Cheers, seems people are a bit cagey about there prices unless you actually sound like your likely to buy at some point in the future.

Just interested to know,did you approach them the way Peterdalkey suggested?