Most business ideas come from something someone feels strongly about, or a need that is not being met. But no matter where your idea comes from, research will help you make sure it sells.
Meet a need
Whatever product or service you plan to sell, find out if there will be a demand for it.
For example, if you love music, you could be a self-employed music teacher. Perhaps you find that the demand for music lessons and related products and services in your area is on the rise. You could open a retail shop selling instruments and accessories. Or you could start a music school and hire other teachers. Eventually, maybe you could combine all of these things into one large business.
But will you have customers?
- A market analysis helps you understand what customers want, what they are willing to pay, and who your competitors are, among other things.
- “SWOT” stands for Strengths, Weaknesses, Opportunities and Threats. It’s a way to assess the risks and benefits of a concept.
Here is a sample SWOT analysis. You would tailor it for your industry or business:
Able to move quickly
Skills to Succeed
|Little start-up money
Small office space
No known mentor
First in this market space
Useful industry contacts
Quickly changing customer needs
You may be able to get help evaluating your idea from a mentor or someone else in your industry. For professional help, consider Business Link.
Many entrepreneurs see a need for something that didn’t exist before, and become the first one to sell it.
You may have had moments when you were trying to solve a problem and wished someone would invent a solution. For instance, maybe you’ve spent time looking for your keys and wishing someone would invent a device to track them down.
If you are not business-minded, you might quickly forget this thought. But an entrepreneur might make such a device their next product. This shows how entrepreneurship involves innovation.
Tune in to trends
If you want to start a business but need an idea first, look at trends. One place to start is demographics, which are traits of whole populations, like age or income.
People tend to do and buy different things at different times in their lives, so looking at how much of a population is young, middle-aged, or older can tell you a lot. For example, the baby boomers (those born between 1946 and 1965) have been setting trends since they were born, due to their large numbers.
You can also look for trends online. Places to look include
- Social media. Find and follow influential people in your market to see what they’re talking about.
- Consumer blogs and online reviews. These are great sources of information about what others are selling.
- Websites where people share photos and lists of what they like.
- Large Internet retailers, such as those where you can bid on items, sell handmade items, or raise money to start a business.
Be careful not to confuse trends with fads. Trends are long-term, while fads come and go. It can be risky to build a business around a fad.
Size up ideas
To assess your idea, ask questions like
- Will I enjoy doing this? Running a business is hard work. If you don’t love your product or enjoy providing the service, you may run out of steam or have a hard time selling it.
- Who would use this? Why will people spend money on this?
- Does this product solve a problem? A product that solves a problem is likely to attract buyers.
- Will my idea still be good several years from now? Make sure the product or service is something people will come back to for a long time.
- Does this product already exist? If so, decide if there’s room in the market for more. Figure out how to give it a new twist or take it to the next level to make it sell. If not, you may have more work to do to prove your idea will succeed.
There are no right or wrong answers to these questions. But reflecting on them may give you better insights into your product idea, or inspire you to think of a new idea.