Friday, 25 March 2011

How to Come Up With a Great Business Idea

By Michael C. Dwyer 

Unless you live under a rock, you know that people (teens included) are becoming rich off businesses. And unless you actually are a rock, you probably want to be one of them. We've all heard horror stories about businesses failing miserably and owners losing their life savings. But most of these failures come down to two major mistakes.
1. Owners giving up on their business because it hasn't performed as well as they thought or because they couldn't handle the stress. 2. Not having a great idea and a fool-proof plan.
While some businesses may go out for reasons that can't be planned for, many others do go out for the reasons mentioned above. That is why having a sound business idea is important.
Ideas aren't always perfect
I'm going to let you in a little secret that will save you a lot of trouble. Don't look for that perfect business idea, because that perfect business idea will never come. Businesses will almost always have flaws and while its good to scrutinize a business idea, be careful not to be over analyze it.
Revolutionary ideas don't work out
This is going to be controversial because a few entrepreneurs have grown rich from revolutionary ideas; Bill Gates, Paul Allen and Steve Jobs, to name a few. However, most revolutionary ideas aren't the ones that make it big. Revolutionary ideas are almost impossible to do well in for several reasons... 
  • Your on your own, in terms of help. If your idea is truly revolutionary nobody will be able to help you.
  • Lots of trial and error in order to figure out what works
  • No demand for what you offer
  • People don't like change, expect high marketing budgets if you want to sell your idea to the public.
The best thing to do is let other people experiment with these ground breaking ideas, while you stick to ideas that have already been perfected.
Piggyback off others success or non success
Great ideas don't only come from people with a great business sense. Yes it is true! Even people with a bad business sense can come up with great ideas. Identifying a business that is managed poorly and either buying it or starting a competing business is a great way to start a business. The key to this though is to out do your competition in every aspect. In order to make this method work you need to out-market, out-promote, out-negotiate and out-perform your competition. Let your business skills go to work, because if you take this route you will need them.
Improve on what is already there
There are a lot of businesses, A LOT! Most of them look-alike and function alike. Starting yet another business like the rest isn't going to make you money. What you should do is ask yourself "Why would anyone want to my (insert business here) instead of the one at the top of Google, down the street, etc." By identifying what you can provide that your competitors don't you've already taken a step many business owners overlook. Being the first in an industry isn't as important as offering the most. This method is, in my opinion, the very best way to start a business. Here are some companies that started this way, perhaps you've heard of them...
Walmart - Beat competitors by having a smaller mark up on goods. Amazon - Beat competitors by offering customers the best possible experience. Google - Finely tuned search engine offered better results than competitors.
Opportunity from inconvenience
Nobody likes inconveniences and in order to avoid them most people are willing to pay. This is the simplest method for starting a business. It requires very little thought, just find something that is an inconvenience. If it is on the internet, write a program or an info product that deals with the issue. If it is inconvenience that doesn't deal with the internet, your best bet is to provide a service and not a product. Since selling products without the internet usually involves brick and mortar stores.
Hey I am a 14 year old entrepreneur and investor who writes personal finance tips for teens and parents. Read my blog on how to invest.

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