In this tight economy many people are considering ways to start a small business, especially a home business. If that’s you, there are several things you need to consider before starting your venture.

Many years ago, Saturday Night Live did a sketch with John Candy and Dan Akroyd. They opened a store in a mall that sold one product – cellophane tape. All the walls were filled with that one product.

The partners were filled with hope on opening day. They were going to make a fortune. Of course the didn’t

There were several reasons for their failure. First, mall rents are expensive and tape sells for a pittance. They would have had to sell tens of thousands of tape dispensers every month just to break even, let alone make a profit.

An obvious reason for the inevitable business disaster is that a roll of tape lasts a long time in most businesses and homes. If you sell houses or cars, that’s not a problem. But retail stores usually must rely on having repeat customers who buy from them frequently.

Third, this tape store was doomed because tape is available practically everywhere — in drug stores, grocery stores and big box stores, to name a few. People had no reason to make a trip to the tape store when they ran out. They could even go to the local convenience store or pick it up when they go out to buy other items.

So keep this lesson in mind when considering a new business, or before you invest too much time, money, sweat and emotion in a small business that may not be viable.

You may want to ask yourself some of the following questions before investing any time an money:

Who are your prospective customers? Have you defined them?

Is somebody else already filling this need?

Can you sell your product or service with enough profit margin to make it worthwhile?

Do you have a competitive advantage?

And finally, do you have enough capital to start and sustain the business in the early stages?

Answering these questions will help you to determine whether or not your small business idea is a sound one.

Danek S. Kaus is a business journalist and publicist, and the the author of You Can Be Famous! Insider Secrets to Getting Free Publicity. Read his Blog and learn more about his Services