Different Ways of Generating New Business Ideas
Guide on developing new business ideas.
Some people claim that there are no new business ideas anywhere again. But I want to say that as long as this earth still remains, new business ideas will continue to spring up.
New business ideas may come as a result of new technology, new innovation. New business ideas may even mean finding new ways of doing old things. People always ask me, ‘With all the business ideas we have seen so far, can there be any new business idea at all?’ My answer is ‘yes’. There is no year that will pass that people will not come up with new business ideas. I remembered the year that GSM was launched in my country, a lot of new business ideas suddenly sprung up. GSM business was a new business idea itself. But along side with this came numerous new business ideas such as sales of recharge cards, phone call service, bulk SMS service, dealership, sales of mobile phones, repairs of phones, phone charging, sales of mobile phone accessories.
These provided business opportunities and employment for many people in my country. I believe something like this must have happened in your country. Your own may not relate to GSM market. Apart from the GSM related business ideas I just mentioned, let’s consider how social media created several new business ideas too. So the question is not whether there will be any further new business ideas. The question we should ask is, ‘how can one come up with one?. I believe that is why you are here. In this article, I shall be discussing the following:
- How to get new business ideas
- How to handle new business ideas
- Why people don’t work on the new business ideas
- Advantages and disadvantages of new business ideas
How to Get New Ideas
The following are the different ways by which you can come up with new business ideas:
Do something you saw in another country
Travelling is part of education, they say. In business world, travelling can give you an edge too. I mentioned that a lot of new business ideas sprang up when the GSM was first introduced into my country. But unfortunately, only few people saw these opportunities. If people had travelled to a country where they were using GSM, it would have been easier for them to see the various new business ideas that they can turn into small businesses. If you travel to another country or city, and you see something that you can replicate in your own locality, this become a new business idea to you.
Something didn’t work well
Have you ever bought something and the thing did not work as you expected? If you are complaining, other people may be complaining too. It is even possible you have unfulfilled customers from your place of work. You can ask them what their pains are. You don’t have to work in a leadership role within a business to gain valuable insight into what some customers or employees complain about. If you have entrepreneurial spirit in you, you can turn their complaints into new business ideas. The best business ideas represent solutions to problems that make things better, easier, faster, or more efficient.
From article you read
If you study successful entrepreneurs, you will discover that they read a lot. At times, you wonder where they get their business ideas. Some of them buy magazines and journals not just for reading sake. They are actually seeking for new business ideas. If you work as an employee, this is a secret your boss may not tell you. Why some people will ever remain an employee is that, their jobs do not even allow them to have time to read articles that can expose them to business ideas. If you are seeking for new business ideas, articles from business journals can be a good source.
Gap in the market
If you looked for a product or service and you could not find it or you notice any gap in the market or in the supply chain, this can be a good business idea. If you want to get new business ideas through this way, it means you need to be observant of what go on in your environment. For example, one of the new business ideas that are waiting to be tapped in my country is the provision of storage facility for agricultural products. There is a gap in the market. During harvest, we have fruits and other agricultural products in plenty to the point that some of them usually get wasted. When the harvest season is over, these products become very scarce in the market. In your own environment, if you can identify a gap in the market, that becomes a business idea.
Tapping into your vast experience
If you are looking for new business ideas, you may not need to look too far. You may just need to look inward. Do you have skills and experience you can monetize? Possibly you have been looking at your skills in isolation. If you list all your skills and experience and combine them together, you will be surprised at how many new business ideas you can generate.
Fed up working for other
When you work as an employee, your opinion may not always count. You may have very good ideas on how to transform the business where you are working. How do you feel when such good ideas are thrown into dust bin? This can be frustrating. Your own may be that you are not getting a remuneration that is commensurate with your roles. It can even be that you are fired and you don’t want to go back into 9 – 5 pm work style. This is the time you can come up with various new business ideas through brain storming. When you don’t have option that can provide you a source of income, you begin to think creatively. Necessity is the mother of invention. If you find yourself in this position, many new business ideas will come to you. But at this point, it is risky to act. In the next paragraph, I shall discuss what to do with your new business ideas.
How to Handle New Business Ideas
You should not rush to implement your new business ideas no matter how feasible it may look like. Rushing to implement new business ideas without challenging the problem you want to solve is risky. You will be faced with the risks of commission; that is, getting things wrong. On the other hand, you can be faced with risks of omission, making you overlook ideas which could be better. You need to properly define the problem and then come up with a solution. At times, your first solution may not even guarantee a success. Having options can increase your chance of success.
Having come up with many new business ideas, you need to evaluate them properly and then select the best option. The acid test of new business ideas is the ability to sell products or services in sufficient quantity to real customers to generate sustainable cash flows and profits. If your new business idea passes the acid test, then you can start planning for implementation. At this stage, you need to identify possible obstacles and how to overcome them. You need to prepare your mind that you will face obstacles and rejections. Your persistence and doggedness will help you in the implementation of your new business idea.
Read Also: How to Evaluate Business Opportunities
Why people don’t work on their new business ideas
You don’t become an entrepreneur by just having tons of new business ideas, you need to put one into practice and make it work. Below are some of the reasons why people don’t work on their new business ideas:
You told yourself it is not creative enough
If you think this way, you are not alone. But what is your benchmark? Certain new business ideas do not have anything to serve as yardstick to measure the level of creativity you have put into them. Until you take them to the market, you may not know how creative you are.
Nobody is doing it
Some people believe that if no one is doing it, then it is not good. In other words, if the idea is good, other people would have been doing it. That is one of the reasons we don’t see unique business ideas as such. People believe in ‘çut and paste’ type of business. They say something like this; ‘Mr A is doing the business and he is doing well, I will do it too’. The fact that nobody is doing it, does not make new business ideas not feasible.
Expert says it cannot work
If there is anything that can dampen the zeal and morale of anyone with new business ideas, it is negative comments from experts. Statistics says that only about 3% of new business ideas get funded. We all know that you need funds to actualize any business idea. So, you can imagine what happens to over 90% of the new business ideas that are not funded. If people that ought to provide funds don’t believe in your dream, how can you make it a reality? Some of the business ideas that have transformed into multi-national companies today were once rejected by experts. Thanks to the doggedness and persistence of the ‘dreamers’. Such people now serve as encouragement to us today. Examples of these people include, Thomas Edison, James Dyson and Phil Knight.
Believing the statistics that many new business ideas fail within 3 years
Fear of failure makes some people not to do anything with their new business ideas. It is true that many businesses fail within their first three year. There are many factors responsible for this. One of the factors has been discussed earlier. People rush into starting a business without properly evaluating the feasibility of the business idea. You can increase the chance of success of your business through proper planning.
Read Also: 22 Reasons for Small Business failure and How to Avoid Them
Advantages of New Business Ideas
It may be difficult to come up with new business ideas but if you are able to come up with one, you tend to enjoy the following advantages:
Large Market Share
Because you are the first person in the market gives you an advantage over late comers. You can easily capture and dominate the market before it becomes crowded.
Less Competition
Competition is always less if your business idea is new. At times, you may not even have anyone to compete with you. This allows you to charge reasonable high price. With this, you can quickly recoup your investment capital.
High Profit Margin
You don’t need to spend too much on advertising. Advertising is one of the major overhead costs that eat up the margin of business especially in a competitive market. Since you are not competing with anyone, savings on advertisements can boost your bottom line.
Imposition of Switching Costs
It is not uncommon for customers to shift if there are new entrants into the market. But as a pioneer in the market, you have the opportunity to impose switching costs on customers. By the time customers evaluate the costs of switching and compare with the benefits they may enjoy from the new service provider, it may be more cost effective to stay.
Disadvantages of new business ideas
New business ideas are not without their own disadvantages. Below are few of them.
Higher Risks
New business ideas attract higher risks. There is no assurance that the business will succeed.
Implementation
Implementing new business ideas can prove to be more costly. You will need a lot of investment in research and development.
Access to Funds
Accessing funds may be difficult. Investors may not believe that your new business idea will work. Therefore, you may suffer rejections and this can lead to frustrations. This is where you need perseverance.
Read Also: Creative and Unique Business Ideas for 2020