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Most people start a business based on an idea. In some cases this idea is an improvement to an existing idea, in others it’s a carbon copy of a tried and tested idea and in fewer still the idea is brand new and innovative.
If you’re idea is to take a tried and tested concept and replicate it in a new area (geographical of industrial) then your task is easier than the other two options but still fraught with pitfalls.
To ascertain whether your idea is any good start by identifying if there’s a market for your idea; do people need that service? Just because it’s successful in one location doesn’t necessarily mean it will be in another. Next look at setup costs. If the business is tried and tested you know there is money to be made, but if you launch yourself into the market incorrectly, you’ll spend valuable startup capital trying to attain a strong position. Another advantage that you have with choosing an existing idea is that you can take it to your bank or investors and say “You’ve all seen how X has been successful with Y, well now I want to bring Y to this area”. Investors will feel more assured that they will see a return on their capital if they can see a working business model already in place.
We all see flawed concepts and products everyday; from the sweet machines that get jammed to the mobile phone that switches itself off whilst in your trouser pocket; we’re literally surrounded by once good ideas that now could be improved. If you want to start a new business based on one of these ideas then you need to be critical with yourself at an early stage. Wearing rose tinted glasses and believing in your idea is not enough, you literally need to be able to tear the idea apart in order to build it back up again.
Ask yourself why no-one else has started this business? How much would it cost to improve on an existing product or service? Can you differentiate yourself sufficiently so that existing suppliers of this product/service cannot simply copy you once you’re successful? Can you differentiate yourself so that customers will recognise your product over that of your competitors?
Market research is especially useful for these types of ideas. Asking people about an existing product on the market can often open up new avenues that you hadn’t thought about.
If you’re one of the brave entrepreneurs with a brand new idea then be prepared for a long, hard journey ahead. Very few new ideas make it into the households of UK consumers due to the length of time and dedication that is needed to promote an idea into a product. Dyson vacuums are a classic example. Dyson first had the idea for a bag less vacuum cleaner in the late eighties. It took over ten years for the first Dyson cleaner to hit the UK stores.
With a new idea it is important to be super critical with yourself. Make sure that the idea really ‘has legs’ before mentioning it to trusted friends and relatives. With a new idea, rushing to get investment (for further development) can often be a hindrance rather than a help. Try to develop the idea sufficiently so that it can be patented or trademarked, then approach investors with a strong business plan to support your idea. Although innovation makes the business world go-round, investors are wary of putting their money in something new and untested. Good luck!
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