A business opportunity is an area where your knowledge and skills can be put to use to create revenues. It is a stepping-stone towards starting your own company, but it also could be something you do part-time on the side.
Business opportunities come in many different shapes and sizes, so it can be difficult to identify if one really exists in front of your face. In this article we will look at how you can identify a business opportunity so that you never miss out on an opportunity again!
1. Explore the industries and markets
- Explore the industries and markets to identify trends, gaps, and opportunities
- Identify customer needs and wants by exploring the marketplace
- Look for opportunities within those trends and customer needs
Look for gaps in the market or opportunities to help customers by offering a unique approach that solves their problems. For example, if you’re looking at creating an accounting software business, it may be worth researching trends within the industry (like cloud computing) and identifying customer needs (such as better reporting tools).
By exploring what customers are looking for in an accounting solution, you can discover gaps in the market or opportunities to help them with a different approach.
2. Look at your interests and passions
When looking for a business opportunity, you should look at what you’re interested in and passionate about.
Look at your interests:
- What do you enjoy doing?
- What do you have a lot of knowledge about?
- What are your hobbies?
- What are your interests (e.g., fitness, cooking, travel)?
Look at what skills and talents that others have complimented:
- If someone says they think that you’re really good at something, and it’s something that involves an activity or skill set that could be turned into a business idea – listen!
For example, if you’re good at talking to people and enjoy meeting new people in social situations, you could turn that into a business idea by starting a networking group of your own.
If someone compliments your ability to write or speak, you might look at turning that into a freelance business idea. When you look at what you do well and what interests you, it’s easier to come up with potential business ideas for yourself.
3. Get feedback from others on your idea
- Get feedback from others on your idea
- Ask people you trust for feedback.
- Ask for feedback from people who have experience in the industry, and ask them to give you honest appraisals of your business idea. You want to make sure that they understand what it is that you’re doing and why it matters to them, so that they can offer real suggestions based on their own experiences with similar projects or businesses like yours.
An important step in the process of identifying business opportunities is to get feedback from others. You could also consider:
- Friends and family
- An expert in the field, such as an industry professional or someone who has started a similar business
- A mentor who has experience with starting a business in your field of interest. If you have no mentors, reach out to someone who does have them and ask for their advice. They may be able to recommend someone they trust or know personally.
- A coach who specializes in helping entrepreneurs launch new businesses (for example, through an online course). They can help you identify strengths, weaknesses and other issues that might affect your ability to succeed as an entrepreneur.
A business consultant who can help you identify opportunities in your field of interest. For example, if you’re interested in starting a restaurant, they may be able to help you find the right location and find suppliers.
4. Research your target market
When you are researching your target market, you need to consider the following questions:
- Who is my target market?
- What does my target market want and need?
- How much is my target market willing to pay for a solution that solves their problems?
- How much will it cost me to reach them with my business opportunity?
The answers to these questions will help you determine if a business opportunity is right for you.
Once you’ve identified your target market, the next step is to get in touch with them. You can do this by creating a website or social media page where people who are interested in your business opportunity can sign up for updates on new products and services.
5. Identify the problem you are solving and see if it is a big enough problem to generate money
Once you have identified the need, you should ask yourself if it’s big enough to create revenue. In other words, is there a real problem that your product or service will solve?
If not, then don’t bother with the rest of this article.
A good way to determine if this is true is to ask yourself whether someone else might be able to solve this problem for you more effectively than yourself. If so, then move along – there’s nothing here for you.
For example: “I’m making a website that helps people find jobs” vs “I’m making a website that matches employers with candidates.” The latter sounds like something I could build from scratch using WordPress in my spare time (and probably should).
You should also ask yourself if your solution is truly innovative. Is there an existing product or service that offers the same thing you’re offering? If so, what makes yours better?
6. Define your offer in less than ten words
The goal of this exercise is to be able to explain your offer in less than ten words.
This is a great way to think about the essence of your business and make sure it’s not just about you, but also what value you are bringing to people. If a stranger were walking by your store, would they understand what you do? Can they explain it in one sentence or less? If not, then you need to find ways to simplify and clarify what makes your business unique.
Another benefit of defining your offer in less than ten words is that it helps filter out any noise when talking with potential customers or investors (or even partners). It forces them into focusing on their needs instead of trying too many different things at once – which often leads people astray from their true goals and objectives.
7. Understand the financials
Understanding the financials of your business is important because it will help you understand how much money you need to get started, grow and stay in business.
The first thing you should do when identifying a business opportunity is look at its cash flow. This means that if someone buys your product or service and pays for it with their credit card, then they’ll owe you money every month as long as they keep using that product or service!
If this doesn’t sound like something that happens often for most businesses (or even most products), then there’s probably not much point in pursuing any further research on this particular opportunity—because if no one has ever bought from them before, then chances are extremely low that anyone would buy again once they’ve lost their initial investment.
8. Evaluate the competition
Evaluating the competition is a critical step in identifying a business opportunity. It’s important to understand who your competitors are and how they are positioned in the market, as well as how you will differentiate yourself from them. There are five key areas to keep in mind when evaluating the competition:
- The customer base – Who are your customers? What types of products or services do they buy?
- The market size – How big is this market? Is it growing or shrinking? Where does it exist geographically, demographically, etc.?
- Market growth rate – How fast is this market growing overall (either locally/nationally/globally)? What factors lead to increased demand for your product/service?
- Trends within the industry – What trends have an impact on this industry (e.g., technology changes)? Are there any major forces that could affect someone choosing between buying from you versus from another company (e.g., price wars between competitors)?
- Market share held by competitors
Conclusion
When you’re ready to start your business, there are many resources available to help you. You can contact your local Small Business Development Center or SCORE chapter, who are both nonprofit organizations that provide free business advisory services.
In addition, there are many startup incubators and accelerators across the country that offer mentorship programs and even funding opportunities for entrepreneurs with great ideas but little cash on hand.