How to Spot Business Opportunities
A common problem faced by many established entrepreneurs is how to spot new business opportunities to expand their ventures. As a starting point, Young Entrepreneur has an interesting post about how Virgin’s Richard Branson identifies an opportunity.
This is a hallmark of Branson’s strategy for entering new markets - look for industries where the customer is either being taken advantage of or is receiving such poor service that they would welcome a change. One of the hardest jobs of a new business is to convince customers to switch from an existing supplier to their companies.
However, that is just the tip of the iceberg. Sizing up opportunities involves different considerations such as:
Opportunity vs. Your Competencies.
Even if there is a gap in the market, it is important to match it with your competencies and experience. If the problem in one industry is customer service for instance, is your business equipped to make a difference in this category?
Additional investment
Entering a new market is always expensive for you have to build a customer base and promote heavily to increase awareness. It is time to check your bank account if you have enough resources to survive this new battle. Do not be tempted to shell out additional money out of your pocket. Ideally, any expansion must come from the income of your existing business.
Profitability vs. Other Business Opportunities
Try to evaluate and compare several business opportunities so you can find which one has a better return on investment and higher projected income over the long haul.
