More people than ever are now looking to become an entrepreneur – in fact, a recent article on Forbes even suggested that everyone will have to become an entrepreneur.
That’s maybe an exaggeration, but, the point is, entrepreneurship is increasing.
There are many reasons for this – from the ebb and flows in the financial climate, to the lack of a ‘job for life’, to simply having a different outlook on employment from prior generations.
Whatever the reason, if you’re looking to become an entrepreneur, and if you’re looking to find the best small business ideas, the reality is that every business starts with an idea.
But how do you come up with the perfect business idea for you?
We’re going to talk about the key aspects that you need to consider when coming up with the perfect business idea.
What Do I Care About?
The starting point for any business idea is to consider what you really care about.
What grabs your interest?
What do you constantly question or keep coming back to?
It might be that you are passionate about good customer service, or about systems and planning – which you will want to put at the heart of your business model.
Or it could be bigger than that.
You may have come up with an entirely new product or service that will revolutionize the marketplace. Chances are that, if you do have that new product or service, it was created directly from an area that you feel passionately about changing.
Why is passion so important in business?
If ultimately, you don’t feel passionate about your idea then it will be difficult – if not impossible – to turn it into a business.
You’ll be less likely to stay up nights working on your business idea and figuring out how to get it market if you don’t actually care about it.
You won’t stand out from the competition and, perhaps most importantly, you’ll struggle to engage others (i.e. your customers) with your idea if you are less than fully engaged with it yourself.
Don’t believe me?
Can I do this – all day every day is the one question you need to ask yourself before you create anything new.
If your business idea doesn’t fire your interest, and if it doesn’t excite you, you are unlikely to give it everything you’ve got. And succeeding at business is hard enough as it is. After all, over 90% of startups fail.
Alongside planning for success and working hard, being passionate about what you do is one of the main reasons that entrepreneurs cite as helping them to be successful.
Your belief in your business idea will help to:
- Get through the inevitable difficult times ahead,
- Sell your idea to others including partners and investors,
- Create a customer base who are engaged with your idea and convinced by your product or service.
WORD OF CAUTION: a business idea cannot survive solely through passion. In fact, Carol Roth argues that passion shouldn’t be the starting point at all.
Far be it for me to disagree, but, while man cannot live by bread alone, neither can a business survive without passion. After all, being passionate about an idea means that you are more likely to be drawn to it in the first place.
However, it is crucial that, while you need to believe in your idea in order for it to really succeed, there has to be a market for it.
The late Dame Anita Roddick of The Body Shop brought to her business her knowledge gained from international travel, along with a passion for reusing and recycling packaging learned from her mother.
But she also learned from her very early days as a start-up entrepreneur that you had to create and sell a product that was so good, people wanted to buy it.
Running that first shop taught me business is not financial science, it’s about trading: buying and selling. It’s about creating a product or service so good that people will pay for it.
– Dame Anita Roddick
What Are You Good At?
Following on from thinking about what you feel strongly about, consider what you are good at. People often struggle with this concept so try looking at it differently.
Think about the things that you literally CANNOT stop yourself from doing. This is a concept that Marianne Cantwell talks about to help you to stop focusing on strengths and weaknesses and start considering the aspects of your life that you are drawn to naturally.
Are you drawn to a particular way of working – or to a particular type of work?
Maybe you’re a consultant who constantly produces content that helps to coach people out of their particular problem.
Or perhaps you’re a writer who helps other writers to build their own freelance business because you feel passionate about it.
Identifying what you are good at will allow you to consider how best to harness this to create a business idea – it will also help you to recognize the parts of your idea that you will ace at, and where you might need some help.
Marie Forleo IS the brand for her business. She’s sassy and straight-talking. Other small business and personal development coaches might shy away from this – and it might not work in their particular business model.
But this is where her skills are best used. Her specific skills have shaped HOW she delivers her business idea – by being front and center.
Don’t Worry About Being Unique
Marie Forleo is actually a good example of WHY you don’t have to be unique.
Is she the only personal development coach in the world?
Hell no. In fact, I’m willing to bet that she’s not even the only personal development coach in her city.
But did that stop her from creating her business idea? Clearly not.
Budding entrepreneurs often worry that they have to have an original idea that NO-ONE has EVER had before – but that’s simply not the case.
In fact, having others already working in the field that you want to break into actually demonstrates that there’s a demand for this type of business.
What you will bring is your unique self, your unique view of the world and your unique way of operating.
Let’s take A Fictitious Cupcake Company as an example. There are countless cupcake businesses globally (in fact, they may even be old hat. I’ve heard cronuts are taking the baking world by storm!)
Anyway, AFCC isn’t the only cupcake company in the world, but its owner is passionate about design and can create the most beautiful works of art made out of fondant icing that you ever did see, which attracts wedding and special event planners in her area.
Her rival around the corner, the owner of More Delicious Cupcakes Available Here, prefers to focus his attention on creating cupcakes for special diets, particularly without any dairy or gluten – and so they tend to appeal to moms and dads planning kids parties and family celebrations.
The point is, they both produce cupcakes but they both came about via a different passion (yep, we’re back to passion again) and so that will tweak the customer base for each of them slightly.
Of course, there will be overlap – some people won’t be on special diets, while others might not want to spend the extra that it costs for a miniature model of the Empire State building – but each business will have a loyal customer base that comes to them first for all of their cupcake needs.
Solve A Problem
This is the classic way to generate ideas for your business.
What is it that drives you crazy?
What, if improved, would make your life easier?
This will be different for many people, but as long as your bugbear annoys enough other people too, then it may just be a way into a new business.
Think about things in your life that drive you – or your family – crazy.
Or that just make you think ‘why do they do it like this?!’
It could be as simple as living in a rural town where the shops are all starting to close down because no-one uses them.
Why does no-one use them? Because they all close at 6pm before the commuters get home from work.
Solution? Offer a home delivery service to the retailers in the town. They pay a membership subscription to be part of it while customers pay a small delivery charge.
The locals get to support their local suppliers and keep their town center vibrant while the retailers gain valuable additional business out of hours via the home delivery service.
You read about businesses that were launched out of solving a problem all the time.
Take Kezi Levin who was fed up losing her baby’s socks, as they just don’t stay on small feet. Having had 2 babies of my own, I recognize her frustration and I’m pretty sure that she will have realized there would be a demand for a product to provide a solution from her other mom friends too.
Her solution? To come up with Sock Ons – which do exactly what the name implies.
What Can You Improve On?
This is similar to solving a problem. Can you come up with an idea for your business by thinking about how you could improve upon a business idea that is already out there by bringing your unique take on it to the market?
Take Poopy Cat litter as an example. Inventor Thomas Vles wanted to find a way to improve upon the whole ‘dealing with your cat’s litter tray’ problem.
His solution was to come up with a disposable litter tray available via monthly subscription. You’re sent 4 weeks worth of Poopy Cat trays, each lasts a week, and then – rather than changing the litter and cleaning out the tray – you simply fold up and throw out the whole lot (and it’s recyclable).
Look At The Market
As I pointed out above, Carol Roth would say that starting with passion and ideas first is back to front and that you should look at the market first.
And, while I definitely don’t disagree, it is important to take a holistic approach by considering all of the aspects that surround your idea.
Look at the marketplace and consider what areas are currently growing – or starting to grow – within the economy. Are there any trends that you can spot?
Is there a particular market or audience that is not being well served – and could you improve upon that?
A good example of this is by looking at how the financial collapse in 2008 – and the subsequent sustained depressed economic conditions – has seen the fortunes of Aldi, Lidl, Costco and other low cost supermarkets rocket, while their more expensive rivals have suffered a decline in their profits.
In the UK alone in 2014, Aldi achieved it’s highest ever growth of 35.3% in one year.
Don’t forget that you don’t have to create a multi-million selling business from the start.
As I talked about in the last post, your business idea could come from a play project.
This is where you take a business idea that you like, play around with it – on a small scale – tweak it and figure out whether or not it’s something that you really want to do.
This gives you the ability to test the market for your idea.
It means that you can build on your original idea – see what works and what doesn’t – and grow it.
And it gives you the ability to learn what needs to be tweaked while you figure out whether this is an idea that you really care about.
Steal An Idea
For the avoidance of doubt, I’m not advocating anything illegal here. This builds on the ‘not being unique’ idea above by taking it a step further.
Is there a business that someone has already created that you would love to do?
Personally, I’d love to open a coffee shop that sells amazing cafe con leché and has a fantastic book shop, with an events program of poetry slams, author visits, readings and book clubs for different groups on different nights of the week.
It would have a book lending library for children, events for teenagers – where no adults are allowed and they get the cafe to themselves for the evening – and themed weekends.
Not remotely original. In fact, I’m sure there are many like it that I could replicate and bring to my own town (if there was any money in bookselling these days, of course).
You could even ask the owner of your ‘ideal business’ for advice before you set up your own version, provided you’re not going to be in direct competition with that business – for example, if you would be operating in an area that they don’t have any customers in or where it’s a very local business.
The advantage of stealing an idea is that someone has already done all the work for you and figured out the execution/potential profit margins (although they may be unlikely to share the latter, of course).
And if you’re really struggling to find an idea, Paul B. Brown has even invited you to steal one of his business ideas here.
Get Global Inspiration
Like Dame Anita Roddick who was inspired to create her Body Shop range by techniques, products and ingredients that she sourced from around the world, you can look to other countries for business ideas.
There may be successful businesses in other countries that you could capitalize on by bringing them to your own country.
Perhaps you’ve seen something on holiday that sells well – would it work if you brought it to your marketplace?
Scottish entrepreneur, Michelle Mone, came up with her idea for the Ultimo bra after wearing an uncomfortable bra to a cocktail party.
However, it was after discovering a gel implant from the US while on holiday in Florida – and, more importantly, getting the license to use it in her bra – that she perfected her creation and brought it to market.
Look in Unusual Places
As well as looking at business models that you love or admire, it’s worth looking at completely different industries and ask yourself whether there is anything that they are doing within their own business models that you could apply to your idea to make it stand out.
Amazon is the largest global online retailer. Is there anything that your business idea could take from their model?
If you’re running A Fictitious Cupcake Company, would you consider an online ordering service, or a membership/subscription service for regular customers with perks like free delivery like Amazon offers to it’s Prime Members? Or a free cupcake on their birthday to give it a unique personal touch?
Look at different industries to help you to develop your idea beyond the mundane.
Be An Ideas Machine
Of course, if you really want to come up with the perfect business idea for you, you need to start to generate – and keep a note of – business ideas.
Start to keep a list of opportunities and jot them down as they come to you. They may be small sparks to fully-fledged ideas. Most of these you are likely to ditch, while others will show more promise and demand more of your time and further research.
The point is that from now on, you should start to write down all of the business ideas that come to you. Then revisit them. Doodle in the margins and tweak them.
The more that you get in the habit of coming up with ideas, the more business ideas that you will have. And the more that you keep a note of then the greater the chance of coming across your perfect business idea.
Ideas are like rabbits. You get a couple and learn how to handle them, and pretty soon you have a dozen.
– John Steinbeck
Look for Profitability
Where an idea already exists, there may be a way for you to increase profitability in your own model for that business.
It could be that you find a way to deliver an existing product or service that will improve it. Or perhaps you’ve found a gap in the market that isn’t being filled or an area where a particular need isn’t being met.
Perhaps your method of production or delivery will reduce costs and increase profitability as a result.
Look at the internet. Since it’s inception, traditional business models have changed dramatically. Udemy is a great example of a business model that couldn’t have existed pre-internet.
Without the technology now available, it would be impossible to reach the numbers of students from around the world, while keeping the cost of delivery of this training to large groups to a minimum.
In fact, the internet has spawned thousands of entrepreneurs, as the opportunity to reach global audiences at a reduced cost has increased exponentially.
Marie Forleo, Jon Morrow, Mark Zuckerberg – and so the list goes on – have all achieved enormous success as entrepreneurs through the internet and the opportunity that it has brought to them and their businesses.
Finding the perfect business idea for you will come through a combination of these ideas – and where you bring them together to achieve success.
Your Passion – will make you work harder and believe more in your product.
Skillset – will help you to capitalize on your unique strengths and your unique viewpoint will help you to deliver the right business model for you.
Market Knowledge – will mean that you know there is a market out there and that you will understand where it is and how to reach it.
Understanding of Profitability – will mean that you know you can deliver your idea to your market at a cost that the market will bear, but which will still be affordable for you to produce.
If you are still struggling to come up with any ideas – but know that you want to be an entrepreneur – then you might want to look here for some tips on how to ‘get you into the zone’ to make yourself more receptive to ideas and idea generation.
Taking a holistic approach to finding your perfect business idea will help you to create a successful business.
What are things that have been challenging or helpful to you when finding your business idea?