8 Ways To Identify Business Opportunities In The Market

The wave of entrepreneurship has hit everyone. Almost everyone, especially the young, wants to become an entrepreneur. Many boot camps are being organized to train people in the basics of entrepreneurship. But the initial and most difficult step is to choose the appropriate niche for your business. It takes real wisdom to identify the right business opportunity in the market. 

A business opportunity is not just any random idea to earn money. A perfect business opportunity needs to have these basic characteristics:

lIt should require no or less investment

lIt must have a measurable market

lIt should require less or no labor

lIt should attract regular clients or buyers

lAssures a favourable profit margin 

lThere is little or no risk of liability

Now, you must be thinking about how one can identify the right business opportunity. Also, should one think of opening it with a potential business partner or a sole proprietor? Well, whether you plan to be a sole proprietor or collaborate with someone, recognizing the right business opportunity sets the game. 

Let us see how you can identify the right business opportunity in the market. But before that, let us see the psychological approach coined by Graham Wallas in 1926 for creative problem-solving. These steps are followed by almost everyone for decision-making. 

After these generic steps, we will have a look at the factors that are as per the modern approach. That will help you identify the right business opportunity as per the market’s growth. 

1) Preparation

It is the data collection stage. Most entrepreneurs select a niche as per their experience. If I have worked for a moving company, then there is a probability I may buy a moving franchise because of the adequate knowledge I have. 

2) Incubation

Once you collect all the data, you will store it in your subconscious mind. It is not necessary that you keep thinking about it. But your actions will be as per it. They will rely on your intuition, and you will not even realize it. For example, a person who has studied film studies will note the camera angles, the shots, the colour theme, etc., rather than enjoying the movie completely. 

3) Illumination 

It is the eureka moment stage. The solution suddenly strikes your mind at this stage. You get the clear idea at this stage. 

- The business idea will suddenly pop up in your head. 

4) Verification

At this stage, the person evaluates the viability of the idea. He or she will take the data on it, evaluate it, rationalize it, and then make a decision. In the case of a business idea, the person will evaluate it by looking at the sources of investment, chances of return on investment, etc. 

So, this is a basic approach that is used by people to take decisions and is used in the entrepreneurial journey also. Now, let us look at various other factors that should be used to identify the business opportunity. 

In the psychological theory we studied, the entire process is based on our experience. But is it prudent to follow it? The criticism of the theory is strong due to the notion that the market is inconsistent. If I had worked in the food industry and opened my restaurant near a pandemic, then I would have regretted it for the rest of my life. 

So let us have a look at the decision-making process that is as per the industry.

1) Find an innovative startup 

Instead of just going as per usual, explore the various ideas that are available in the industry. Recognize the niches that are flourishing and everyone is vouching for. For example, providing virtual assistance, cleaning, or moving services are the new trends in the industry. 

2) Evaluation

Now that you have identified some niches, start with the evaluation process. Do not follow the rat race; instead, consider these factors:

- How much investment will it require?

- Is there a lot of competition?

- What is the probability of return on investment?

3) Analyzing the competition  

After shortlisting the various niches, start exploring the organizations that are already in the market. Start analyzing the competition. Take note of their strategies, as well as the areas where they fall short. Analyze each point and see if you can inculcate all these things into your business. 

4) Identify your trigger points

Ever thought that the watches from your favourite brand are too expensive? How about creating a brand that offers a replica of your dream brand with promising quality? It will ensure a return on investment because there will be people like you who are facing similar problems. 

For example, dating apps became a huge success because people otherwise found it difficult to find a date on other platforms. 

5) Recognize your talent 

Identify the talent you are known for. Let’s say your family likes the cakes that you bake, you can open a bakery. It is turning your passion into your source of income. You will never be bored of this business and you will also be able to put in your all for something that you really like and are admired for. 

6) Listen to your potential customers 

Have you ever gotten requests to provide paid services through your social media handle? For example, people like your captions on social media and want you to write for them. People may also like your aesthetic photo grid on your Instagram and ask you to let them use your serene pictures. You can fix up a budget with them. This will help you build clients in the market. 

7) Study the demand and supply patterns  

The next important thing to examine is the demand and supply pattern. Identify the things that are in demand in that area. The proximity factor is very important. You cannot easily study the demand on a wider scale. But you can select a specific area. 

For example, delivering home-cooked food near university hostels can get you huge profits. 

8) Study import and export patterns

Many items are imported from other countries. These goods are expensive because of the excessive excise duty. So you can try and produce a replica of those goods and make a huge amount of money out of it.   

To conclude, you need to have strong exploration skills. It is important to have a nose for business and grab every competitive business niche. Whether you plan to be a sole proprietor or want a business partner on board, the above-mentioned points will lead you to new heights. 

Hope you are all set to start your entrepreneurial journey. We wish you all the best for your future. 

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