If you do not have a firm idea at this point as to the type of business you want to be in, that's all right. This is a good time to begin the process of laying out your options and evaluating them objectively. Even if you do have a specific business in mind, it is a good idea to take a step back at this point and consider the world of alternatives.

The Standard Industrial Classification Code (SIC) had been developed to categorize businesses into major groupings. These classification codes are typically four digit numbers. The first two digits describe the general business activity an enterprise is engaged in. The second two digits refer to its specific business activity. All economic activity is grouped into one of ten broad categories. They include the following:

1. Agriculture, forestry & fishing
2. Manufacturing
3. Construction
4. Finance, Insurance & Real Estate
5. Mining
6. Retail Trade
7. Wholesale Trade
8. Services
9. Transportation, Communications & Utilities
10. Public Administration (Government)

Notice that there are less than a dozen major business categories - including government services. Almost any business you can conceive of will fall into one of these very broad categories. The common thread among all businesses is that they derive revenues from providing either a product or a service to their customers.

Most business start-up decisions are not made in a very scientific or even objective manner. Previous experience, capital requirements, personal and business contacts, advice from friends and family, risk tolerance, and existing opportunities all work together to influence the start-up decision. Frequently, an opportunity will present itself and a budding entrepreneur will feel compelled to act on it.

Of course there is nothing wrong with acting on a favorable opportunity. You are doing yourself a disservice, however, if you do not evaluate the opportunity very carefully against other potential alternatives. It is generally not a simple matter to change your course once you have started down a path and committed time and resources to a business concept. It is important that you take the time to carefully evaluate your business alternatives in advance of making any significant commitments.

Ideally your decision should be based on your personal interests and aptitudes. If you do not have a high level of passion toward your business, you will find it difficult to motivate yourself to action. The prospect of money alone is generally an insufficient motivator. You should follow your passions and find a way to make them pay off. Of course there is not a robust market for all passions, but there may be a modest market for almost anything. The Internet is making it easier to identify and exploit global markets in niche specialties. Don't give up on your dream too quickly.

Choosing The Right Business Name