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How to come up with a business idea

How to come up with a business idea
Enterprise Nation
Enterprise Nation
Enterprise Nation
 

Posted: Sun 16th May 2021

Want to be your own boss and make an impact on the world? Feel like you need something more challenging? That itch to start a business is intoxicating.

You might know the topic you want to tackle or skill sets you want to use, but not how it will work in practice. You might be starting with a blank canvas. Either way, we're here to help.

This guide will help you come up with a business idea and start to figure out whether it will work, including examples that will get you thinking.

How to get inspiration for a business idea

The best place to start is to think about what you have available – whether it's a burning passion or a transit van.

What is your passion, hobby or skill?

Many people turn a hobby or skill they have into a way of making a living.

Are you a dab hand at design? Have an eye for photography? A head for figures? These skills and hobbies can be turned into a business that might make work feel a bit less like work.

However, commercialising something you love has its downsides too. Being forced to do something every day or adapting your approach to meet a customer's requirements risks undermining the reasons you enjoyed a hobby.

Lots of people start a business around a passion. What change do you want to see in the world and how can you make an impact?

  • Worried about the collapse of the bee population? You could run beekeeping courses or launch a pop-up shop to sell honey products and educate customers

  • Want to support single parents? Start a kid-friendly exercise class or build a parent-friendly freelance team around a service you have experience with

  • Think we need to use fewer disposable products? Launch a zero-waste shop or pick a product that needs a new approach

  • Keen to get more people enjoying bike riding? Run off-road tours or open a pop-up repair shop with a focus on education

What do you have that you can use?

Think about the assets you have that you could use to launch a business. Perhaps there's a piece of equipment or workspace you could utilise. It could be anything from gym equipment to storage space.

Ways to identify good business ideas

Business ideas often start as passions. It's great to think about how you could use that energy to make a positive impact, so think about what inspires or fascinates you.

Passion is good for motivation, but you also need to know whether people want to pay for your product. Thinking about challenges you can solve for a customer is a brilliant way to come up with business ideas that are likely to be successful.

Is there a gap in the market?

Have you tried to buy something that you just can't find? Could others be looking for the same thing? If so, this presents a market opportunity.

A lot of people have their big idea when they're drifting off to sleep at night or taking a shower. For Emma Cranstoun, it was her son's bath time that showed her a gap in the market.

"I was washing my son in the bath when he was about five years old and thinking: 'Why am I still using a product with a picture of a baby on it? And more importantly why isn't he washing himself?'

"I started looking around for bath and shower products for kids. There wasn't anything, so with my friend Karen we thought maybe we could create our own. That was about four years ago now and it's been a rollercoaster ever since!"

Emma Cranstoun, co-founder of Scrubbington's

Try to figure out why the solution you're looking for doesn't exist already – there may be a good reason not to launch the business!

  • Is it too expensive to create? If so, perhaps you could find a unique approach to sourcing materials or charging for something, e.g. offer a product as a rental

  • Are enough people looking for the solution? You need to make sure there's a big enough market to sustain your business. Start talking to potential customers!

  • Is there a solution, but it's difficult to find? Do extensive research to figure out whether there is a solution. If it exists, there may be an opportunity to create something similar but with a better route to market

A lot of these questions depend on research, whether it's looking for competitors or chatting to potential customers. Google's useful, but make sure you get out there and talk to people.

 

 

Is there something someone else is doing that you can do better?

If you've bought something and been unimpressed, why not step in and provide a better offer?

Many good ideas stem from spotting products and services that can simply be improved upon or offered for less. Think about opportunities to add a new unique selling point:

  • A coffee company might boast that every bean was roasted in the last two days

  • A social media manager could teach new clients to take great photos

What products have you seen work elsewhere?

It's common for ideas that develop in a particular subculture or country to spread to other areas.

Jim Cregan loved iced coffee when he was living in Australia but couldn't find any in the UK. It led him to launch Jimmy's Iced Coffee, which is stocked in supermarkets across the country. Big brands like Starbucks have since followed suit, but Jimmy's retains a big market share.

Ronke Jane Adelakun was getting frustrated with her corporate job. At the same time, her sister Adeola kept coming back from Nigeria with amazing African print dresses. It inspired them to team up and launch Cultureville.

"She saw the most beautiful fabric. It's the tradition that people don't just buy off the rack - they get things custom made. I would fall in love with the dresses. I'd steal them and hide them until she went back."

Ronke Jane Adelakun, co-founder of Cultureville

Does someone else have an idea you can use?

If you're not able to settle on a viable idea of your own, consider buying into someone else's. You can do so through a franchise or signing up as a party planner or sales agent.

Franchises provide the benefit of being your own boss, while having the support of a central team and using a proven idea.

Here are three examples:

  1. Avon

  2. Neal's Yard

  3. Usborne Books

The British Franchise Association has more information on finding and operating a franchise.

Talk to customers and people in your network

Friends and family are another great source of ideas. What challenges are they struggling with? What products are they desperate to get their hands on?

Think about the space you're working in and the people you meet. Creativity is a product of your environment. If you're interested in a topic, immerse yourself in it. Be helpful and interested, and soak up knowledge like a sponge – you never know when the lightbulb moment will happen!

How do I know it's a good idea?

You'll probably weigh up lots of ideas (and hopefully we've already given you some inspiration!) before you settle on one to pursue as a business.

You might even write a business plan or do some test trading before committing to an idea for the long term.

But how do you choose what idea to invest your time and money in?

There are two key factors:

  1. The idea needs to be something you care about. Building a business is tough. If you're not passionate about the subject you're working on, it's going to be hard to stick with it.

  2. It needs to be commercially viable.

Knowing whether it's something you care deeply about is down to a feeling in the pit of your stomach. But think long and hard about the goals behind your business and what the day-to-day reality of running it will be like.

Here are a few ideas that will help you think about whether it's commercially viable:

Start talking to people about your ideas

There's a real danger in investing too much time or money in something before you talk to potential customers. Ideas sound great when you're scheming with a co-founder or picturing a burgeoning business empire.

Look for opportunities to talk to people about the challenge you're solving. Don't start with your product – you want to learn everything you can about the situation first, so that your solution doesn't bias their answers.

Test your idea

It's never been easier to test an idea.

  • Social media provides an opportunity to get feedback and see if people are interested in an idea before you launch

  • The rise of e-commerce platforms means you can make test sales online with little upfront investment

  • There are lots of low-cost and free survey tools like Typeform

Building a business as a side hustle has become more popular. This takes away a lot of the financial risk – you can start testing your idea while relying on the income from your main job role.

Niche business ideas can be better

It's great to think big. But when you're picking an idea, it might be better to start with a niche offering. Indeed, many brands that are omnipresent today, from Nike to Facebook, started by targeting a niche of target customers.

Meeting the needs of a well-defined audience helps focus your efforts. The more thinly you spread your resources, the harder it is to get traction.

Going niche helps with sales and marketing too:

  1. Your audience is well-defined, so creating a marketing strategy is easier and you'll spend less money experimenting.

  2. Customer loyalty is higher as you're the expert in a field or the only provider of certain products.

So, rather than just starting a business selling clothes, why not become the go-to place for colourful men's blazers? Instead of offering food to suit all palates, how about reinventing pizza, so it offers a balanced meal to consumers interested in healthy eating?

Business ideas you can start working on today

Hopefully, those techniques have got you thinking.

It's helpful to look around and see what else is out there too, so here are some suggestions to get you started.

Business ideas for students

Lots of successful businesses are started at university, but cash is probably limited, so here are some business ideas that students can start for next to nothing.

  1. Delivery: Charge for bringing things to student properties

  2. Broker: Commission students to work on projects for small businesses, from helping with design to social media

  3. Promoter: Run club nights, gigs, comedy or whatever else you think will draw a crowd

  4. Pet-sitting or babysitting: Is there anyone in the local area who will pay you?

  5. Teach: Help younger students or teach people specialists skills like coding

Small profitable business ideas

Many entrepreneurs start businesses because they want financial freedom, a better work-life balance or to be their own boss; it's not always about building an empire.

Here are a number of small, profitable businesses that work as one-man bands or a small team:

  1. Bookkeeper

  2. Social media manager

  3. Handyman

  4. Consultant

What business should you start in 2022?

The type of businesses being started each year depends on how technology and consumer behaviour are evolving.

Here are a few major consumer trends that are going to be important this year with areas to think about:

  1. Working from home: Office equipment, delivery services

  2. Vegetarianism: Food products, restaurants

  3. Shopping online: Selling online, e-commerce services

  4. Moving to the countryside: Office facilities, niche house-hunting

  5. Staycations: Walking tours, renting properties

  6. Environmentalism: Education for kids, environmentally friendly products

What business ideas can you start for (next to) nothing?

Money is a big factor in starting a business and it can hold a lot of wannabe entrepreneurs back. But not every idea needs to cost lots of money. Here are a few to get you started:

  1. Blogger

  2. Vlogger

  3. Social media adviser

  4. eBay trader

  5. Online store owner

  6. Giftware maker

  7. Personal trainer

  8. Photographer

But how do you pick between your great ideas?

When it comes to starting a business, there are so many possibilities. You might even have too many ideas. In which case, don't be afraid to spend some time on a number of them and, wherever possible, let the customer decide – try them out in small ways and see what gets the warmest response.

Finding a way to cheaply test an idea helps you reduce risk and learn quickly. We spoke to founders about their experience bootstrapping, from building an AI-powered market intelligence company to vegan restaurants.

Your idea will develop over time. Don't be surprised if in 12 months' time it looks different to when you started – your offer will get sharper the more experience you gain in the marketplace.

What is important is to get started with the beginnings of an idea. There'll be time to develop it as you get feedback from customers and input from others.

 

 
Enterprise Nation
Enterprise Nation
Enterprise Nation
 
Enterprise Nation has helped thousands of people start and grow their businesses. Led by founder, Emma Jones CBE, Enterprise Nation connects you to the resources and expertise to help you succeed.
 

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