How Can I Generate A Business Idea?
Every business is born from an idea.
Business ideas should come from observation, from finding a potential opportunity, or from trying to forecast what people or other businesses might want. It is an idea about what products you are going to offer or what services you are going to provide; where and how you are going to sell them and who are you going to sell them to.
In depth…
To come up with a business idea, you should first identify a business opportunity. Opportunities occur when people discover a problem of some kind that can be helped with a product or service, or when people decide they have certain needs or wants to satisfy.
The sources of opportunities can be various factors including growing and evolving economies and economic niches, technological change, social change, demographic change, or political changes such as war, tariffs, and embargoes. Other conditions that create opportunities include shortages, surpluses, price response, and shifts in demand.
To think of business opportunities, you can ask yourself what things you find frustrating about your society:
- What kinds of things should be there, but are not?
- What things make you really frustrated and angry?
- What things do you find that don’t work properly and should be fixed in some way?
When you see a business opportunity, you need to develop your thoughts into a business idea. A business idea is a short and precise description of the basic operation of the business. Your business idea will tell you:
- What product or service will your business sell? Your business idea should be based on a particular skill that you have. Maybe you have experience with or have been trained in a specific line of business.
- Who is your business going to sell to? Will you only try to sell to a specific type of customer or to everyone in an area? It is important to be clear about who you intend to sell to.
- How is your business going to sell its products or services? You can sell in many different ways. A manufacturer can, for example, sell either directly to customers or to retailers.
- Which need will your business fulfill? Your business idea should always have the customer and the customer’s needs in mind. It is important to find out what customers want when you work out your business idea.
- What impact will your business have on the community, the natural environment and human rights? Your attitude and people’s view on your business will determine your success. If you exploit labor, damage the natural environment (waste generation, water wastage, deforestation) or affect the rights of local populations, people might avoid your business.
When generating a business idea, it is best to try and keep an open mind. The first goal should be to think of as many ideas as possible and make a list of all the business opportunities you can think of. Business ideas can be generated through using your own and other people’s experiences, investigating your environment (including natural resources, people’s abilities and skills, institutions, industries, import substitution, waste products, etc.), and brainstorming.
Before going very far in developing an idea or opportunity, it is important to consider the criteria of feasibility, demand, usefulness and profitability.