Problem Solving

Found a Problem to Solve? Now Ask These 4 Questions.

The classic advice that is given to aspiring entrepreneurs is find a problem to solve.  Good advice.  But there is more to it than that.  There are actually 4 questions that I recommend that you ask your target market before you run off to create your solution.  Because ultimately, the market decides if you are successful.

 1.  Is this really a problem?

You have identified what you believe is a problem.  But what does your market think?  Is it a real problem, or maybe just an annoyance.  Something that they are trying to solve or something that they don’t really think much about or are willing to put up with?  I have been guilty of this in the past.  If your target market isn’t actively trying to solve this problem, you will have the hurdle of trying to educate them about the problem and why it needs to be solved.  Yes, it may very well be a problem.  But you may go broke before you convince enough people if you have to educate them first.

2.  Do they believe your solution will solve the problem?

You have a solution.  Awesome.  Does the market believe it is a solution?  More to the point, is it an effective solution?  Ideally, it will be a no brainer solution.  Meaning that it is so obvious when you explain it that the buy in is immediate.  Again, if it takes a huge education and convincing process to get buy in, your sales process will be slow.  Worse yet, maybe your solution is in the category of negative problem solving…….or it is seen as that.  What is negative problem solving?  You solve one problem but create a different problem in the process.  Not really a solution.

Your customer has to be able to recognize how this will fix the problem and see this as a big improvement over their current situation.  Most people won’t pay for a minor improvement.  Which leads us to the next question.

3.  Are they willing to pay for this solution?

This is a big one.  Is this really a big enough problem that the customer will pay to fix?  Not everything rises to this level.  People are busy.  Is this really urgent in the scheme of things?  Is it worth the trade of money for it to go away?  Demonstrating that your solution saves time, money or removes an annoyance or inconvenience can get your customers attention.  Then they can make an analysis of the trade off.  Is it worth the price?  Which then leads to the next question.

4.  Do they value this solution so much that that they are willing to pay you enough?

You have to provide your customer with a value that is greater than what it costs you to deliver……..all of your cost to deliver.  That includes profit, taxes, paying yourself, and all other operating expenses.  Not just the direct cost.  This is the real meat question.  Warren Buffett put it accurately in his quote.  “Price is what you pay.  Value is what you get.”  There has to be a spread between those numbers.  The bigger the spread, the better.

Price is what you pay. Value is what you get. – Warren Buffet

Businesses are built on solving problems.  But not all solutions will win the day.  You need to take it through the next four steps to determine if you have a real business idea.  This is really the process of idea validation.  Unless you do these steps, you will burn money and time coming to the same conclusion.  Validate your idea before you build.

 

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