However, anyone venturing into a business should not only depend on the ideas generated or his/her natural talent but should also consider the following factors:

1) The Market: The market consists of the people you want to sell your products to. In other words, it is the target population.

Question: Mention a particular good/product and enquire about what category of people the goods/product is meant for, i.e. who does it appeal to most, children, teenagers, or adults? For example, selling of condensed ice cream. Most children love ice cream, thus your targeted population or market are children.

2) Demand: Demand is not complete until the goods produced are bought, consumed, or used. Thus, one must consider the ability of the consumer to pay for goods or services. If goods are not bought or used they become useless and ineffective. One should also consider how many people are in need of the goods that he/she is producing/selling.

- The marketing strategy/packaging.

- The quality of the product

- The ability of the consumer to pay for the product. This also depend on:

* The price of the product.

* The income of the consumer.

It is therefore pertinent to consider the price and how it will affect the demand. If the price is high, demand may be low and profit will be reduced. However, if price is low, profit can be increased assuming cost of production remains constant. This also depend on the degree of elasticity of the product.

Consider the former example of ice cream; and the question “How many children will be able to buy ice cream at the selling price?”

1. Having determined the demand for the product, one must ensure the availability of the product to the consumers.
2. Location: Where will you stay to sell your goods or products? The location of a business is very important. Assuming that the market and the demand for the product is known, one must ensure that the business is located in a place where the consumer will have access to the product or services. In choosing a location, one should consider the comfort of the customer, i.e., the target population. Taking our example of ice cream, the best place to sell would be close to a school. This takes into consideration the comfort of the consumers, who in this case are children.
3. Raw Materials: What are the things you need in producing the item you so desire or in the sale of it? Are they easily available or obtainable? One should always ask “can I have easy access to the raw materials?” Availability of raw materials affects the profit of the business. Where the raw materials are not easily obtained, it is advisable not to engage in such business.

Discussion: In making ice cream, what are the things you need to make ice cream? Where and how can they easily be obtained? How does this affect the price of the goods eventually and the profit?

1. Transportation: One should consider the cost of transporting the goods or the product from where it is made to where it is needed. i.e., to where the products are going to be sold. One should also consider the cost of transporting the raw materials from where they are obtained to where they will be used for production. It is also important to consider the product to be transported and the durability. For example tomatoes are a perishable product, which can be damaged when transporting. Therefore, the transportation and storage of such products will need serious consideration.

There are instances where the issue of transport may not be too important.

- One of such instance is where the retailer buys in large bulk; the transport cost may be greatly reduced on each unit of the commodity.

- Where a retailer buys from a wholesaler and sells in the same market; in this case, transport cost is eliminated and the problem of storage is also solved.