A question which is I am regularly asked is how entrepreneurs develop their innovative ideas for starting a business?
Whether the idea is original, borrowed, or bought, the idea is the heart of any business through all stages if its life. If there's no idea, there's no business.
An entrepreneur can come up with a number of ideas for a new business based just on their own experiences. These will include skills (such as being good with your hands), hobbies (gardening) or interests (cooking). These could lead to business ideas such as craft workshops, gardening centres or even owning their own restaurant.
However, more often than, it is their own personal experiences and work which help generate ideas.
Ideas are also often based on experiences in the workplace. In fact, it has been estimated that 90 per cent of all new high-potential businesses are founded in industries that are the same as, or closely related to, the one in which the entrepreneur has previous experience i.e. the majority of businesses are established in the same market as the entrepreneur’s previous employer.
In some cases, a number of businesses are established with products or services that have been rejected by the entrepreneur’s previous employer. These could include an entrepreneurial employee’s idea for a new product being turned down by his bosses and as a result, he or she then decides to take that idea somewhere else.
But larger firms can also be the catalyst for new businesses with some businesses have also been established to service the requirements of the entrepreneur’s employer, especially through the increase in outsourcing by companies.
But there are also a range of other sources which can generate ideas for entrepreneurs to consider as the basis for a new business venture.
The first is other existing businesses as many firms do not succeed because they have developed something completely new to the marketplace. Many succeed because they evaluate products and services which existing businesses offer, and analyse how to improve the product or service and create a new venture based on this.
But it also useful to keep up with the business press to examine whether new ideas being developed across the world can be adapted or customised for your local market. For example, Entrepreneur Magazine in the USA regularly reports the best business ideas every year and many entrepreneurs take these and adapt them for their own markets.
Another key source (and some say the most important) is the customer as any business should reflect the needs of the customer. Therefore, trying to anticipate what customers will want in the future and whether current products or services are meeting these needs can develop new businesses.
However, research has shown that entrepreneurs can become attached to their own ideas and will forget to focus on the needs of potential customers. In fact, better businesses ensure that their products are initiated by ideas from customers, rather than just from in-house brainstorming sessions or developed internally by research and development.
Another good source of new ideas are trade shows or conferences. If the entrepreneur is interested in starting a business within a specific industry, a visit to the appropriate trade show can be ideal forum for being exposed to new ideas. In addition, the entrepreneur can also consider the products and services of competitors, identifying market trends, and potential opportunities.
It is estimated that there are almost 20,000 trade shows staged annually in the United States, with some covering every conceivable product category and every industry whilst others are more industry specific. Many potential entrepreneurs can learn an incredible amount of information about products, product needs, or even an entire industry in a single afternoon at a trade show.
Finally, it is not necessarily the idea that is important but the timing of that idea and many ideas will only work when the window of opportunity has been opened for them. For example, it is doubtful that the Body Shop would have been successful fifty years ago. Indeed, the business can attribute much of its success during the 1990s to the growing awareness of the importance of environmental issues in the market-place.