How do you come up with a business idea of your own?
There are two approaches to coming up with a business idea. The first concerns identifying a demand-supply gap; the other involves finding innovative solutions to real world problems.
In this post we will try to explain each of these approaches briefly.
Finding the Perfect Business Idea:
The two approaches to finding your perfect business idea:
Identify a Demand-Supply Gap
The first approach to coming up with a business idea is to identify a demand-supply gap.
By demand-supply gap, I mean the gap between the demand for certain goods and services and its availability in a particular area.
This is better explained with an example.
Let us assume that in particular part of your town, there are a large number of reasonably well-to-do households with kids. You notice that are no toy shops in the vicinity.
You perceive this as an opportunity.
Where there are a large number of kids in the locality, there ought to be a fairly large demand for toys.
Since there are no toy shops in the vicinity, there exists a demand-supply mismatch worth capitalizing upon.
You have found your business idea! 🙂
You therefore go ahead and set up your very own toy store.
Identify and Solve Real-world Problems.
Identifying a demand and supply mismatch can help you come up with a business idea.
However, if you want start to something with is far more unique/disruptive than starting a toy store, you need to focus on identifying and solving real-world problems.
This approach to finding a business idea concerns itself with identifying and solving real world problems.
Let us try to understand this approach with the help of two real-life examples.
First take the case of Google.
Even before Google was born, there were numerous websites with tons of content on the world wide web. However, no one knew how to find these websites.
This was the problem that Google set out to solve by coming up with a search engine that could help users find information on the web.
It was this innovative solution to a real-world problem that helped Google become one of the most valuable companies in the world.
Next take the example of Uber.
Uber was conceptualized with the view to provide a solution to the problem that people face each day trying to find cabs.
While someone is waiting outside his/her home hoping for a taxi to pass by, a taxi might be waiting for a passenger just round the corner but away from the person’s view.
Uber solved this problem by connecting riders with cab drivers using an app-based interface. The rest as we know is history.
The point that I am trying to make here is that you can build a great business by finding innovative solutions to problems that people face every-day.
That is what most successful startups are doing these days. They are using technology to solve real world problems.
The solutions you seek for could be in areas like health-care and nutrition, pollution control, environment preservation, transportation or economic well-being (just to name a few).
The opportunities are endless!
You just need to keep your eyes open.