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Money makes the world go round, and this is no less true for your small business. Capital is the resource that decides whether your business grows or not. Therefore, finding it — and using it correctly — is absolutely crucial for success. That’s why developing a minimum viable product (MVP) is key.
Developing a minimum viable product might be just what you need to maximize your return on investment. It’s an information-gathering, low-cost project designed to net you income (or help you gauge the marketplace) for a minimal investment.
In this post, we’ll discuss what an MVP is, why it’s useful for small businesses and, most importantly, how to go about developing a minimum viable product. Let’s get started!
An introduction to minimum viable products
A minimum viable product could be your business’s most valuable player. It refers to a bare-bones method of taking an idea through to production in the quickest possible time, with the least outlay possible.
For example, imagine that your restaurant wants to offer a delivery service, but you have no real research and development budget available. Plus, you could have little knowledge about whether this is a desired service in your community.
By trying out the service with the bare minimum effort required — such as by placing restrictions on delivery criteria and only making deliveries within set hours — you can test the waters for a short time period. If the results are positive and you consider the service viable, you can then roll out the full implementation.
There are a few key elements to keep in mind as your developing a minimum viable product, no matter what niche you’re working in:
- It’s light on features, boiled down to the most essential element of your original idea.
- There’s usually zero to little charge for using it, since customer feedback is more important than revenue for its development.
- It often serves as a precursor to a bigger, more developed idea that may (or may not) be closely related.
To explain that last point further, you could look to sandbox several different aspects of a larger idea. This enables you to gauge the effectiveness of each part, before combining them together down the line.
In fact, the sky’s the limit when it comes to developing a minimum viable product, given the benefits you’ll get. Let’s talk more about those now.
The benefits of implementing an MVP
Developing a minimum viable product differs from the traditional way of launching a new product. Making a full-featured product that’s ready to go involves carrying out plenty of R&D, with all of the costs that entails. An MVP, on the other hand, involves minimal development time.
Of course, there are plenty of industries that shouldn’t use an MVP, such as those where customer safety is directly reflected in the quality of your product.
For example, car manufacturers need to spend a lot upfront, as cutting corners could endanger lives. However, for many small businesses, developing a minimum viable product is a great way to get a fresh project off the ground for several reasons:
- You can test theories about the market you serve quickly and cheaply.
- Since you’re releasing a bare-bones product, you’ll save hours and money.
- You’ll potentially see an immediate return on your slim investment, because the product will be already in the marketplace.
- The results of your MVP testing could also help you refine other products and services you offer.
We’ve already touched on that last point in the previous section, when discussing how to sandbox a project. However, you could take this a step further and turn an MVP onto a fully-formed project, which our delivery service example showcases.
Also, it’s worth pointing out again that while income from your MVP can help you (and is definitely a benefit at a stage where you need to recoup costs quickly), the overall goal is to ascertain whether a product is viable.
Using it that way is simply expecting people to pay for an undeveloped product, and could damage your reputation.
Developing a minimum viable product
With developing a minimum viable product, you should begin by looking into side hustles. This is a way for those with full-time employment to generate extra income — and the process it requires is very similar to creating an MVP. We previously wrote a piece on creating a side hustle, and you’ll find plenty of help there for the task ahead.
Your first step will be to ascertain what type of MVP you want to develop. This choice is usually made in conjunction with determining a budget, as the two elements are inextricably linked. A few popular types of MVPs are explainer videos and landing pages.
Next up is actually developing a minimum viable product. There are a few things here worth considering at this stage. You’ll need to:
- Collate the resources you’ll require.
- Develop the MVP.
- Find an audience through promotion and marketing.
- Ascertain how to test the success of your MVP.
The whole point of this process is to simplify and speed up production. With a effort, you can have your MVP up and running in no time.
Capital is important, but so is growing your business in order to boost your income. Unfortunately, it’s often hard to expand your business without resources.
Fortunately, developing a minimum viable product can help you maximize the resources you do have. It’s a relatively cheap way to get a new project off the ground, without overspending or overcommitting. Because MVPs are flexible, you can choose from a number of different types depending on your budget and needs. This makes it easier to get a new project off the ground, and to find out if there’s a market for it.