Matthew Osborne has always been on the lookout for different money-making opportunities. He had just started a family of his own, and he was earning less than $6 an hour — it just wasn’t enough to make ends meet.
And when you can’t see that ends are meeting, your observation skills suddenly become heightened.
So he did find his opportunity. And in the most unusual of places.
While living in Ohio, he observed that many dog owners in his community were willing to pay someone to clean up after their dogs regularly.
And with over 100,000 dogs within a 15-mile radius from his home, he had an ‘A-ha’ moment and found himself unable to snub the opportunity.
He found a need and decided to fill it.
“The more I looked around in my community and the more I thought about the idea, the more convinced I became that this was truly a need that was not being met in my community,” Osborne shared on his website.
That was how Pooper-Scooper came into existence, a dog clean-up service that removed dog waste in owners’ yards. After many years, the business saw huge success and made Osborne a millionaire.
But not all business ventures are as successful as Osborne’s, and unsurprisingly, there are a few common questions that most fail to ask on the way through.
Too often CEOs and entrepreneurs find themselves over-invested in bad business ideas that drain cash and confidence. [Tweet this!]
The key skill is spotting the good opportunities before you get started on them.
The Qualities of a Clear Business Opportunity
Whether you’re just starting out or want to improve how to identify opportunities that are right for you, check out this infographic and make this your guide for assessing success.
Now let’s take a dive into the main points.
You’ll know that an opportunity is worth pursuing when…
1. There’s a defined person
The focal point of every quality business idea is the consumer. But whatever business you want to venture into, it simply can’t be all things to all people.
It’s called the inch-wide, mile-deep approach. The business opportunity should be narrow enough so you can be in the top 1, 2, or 3 but deep enough so you’ll never run out of customers.
2. With a specific need
Another thing you should consider is if there’s a real need for your product or service. Does it solve a particular problem for your audience?
The trick here is to think about both drivers (the upside and benefits they want) and pain points (what’s annoying, painful, or wasteful).
And the bonus point here is to be visionary. Henry Ford once said, “If I’d asked people what they wanted, I would have built a faster horse”.
Uber is a classic “hidden needs” example that’s changed the way we move with seamless, transparent taxi services.
3. That you have a solution for
This is the honesty piece that asks, “Is your solution really working?” It’s got to do what it says on the tin.
Be a match for your capacity, capability, and character — that is, it lights you up and you’re bloody good at it!
4. You can deliver at the right time and in the right place
As with most things in life, timing is everything. Have a look at Bill Gross here if you think it doesn’t matter.
So that’s timing for you, but what about the customer?
This is that other bit of customer analysis that’s so easy to miss. We’ve talked about drivers and pain points, but what about triggers and fear or barriers?
Triggers are what get your customer thinking about that category at a specific moment. Some focus on the zero moment of truth, but the point is that you need to be in their mind and/or in reach when that moment hits.
It’s been said so often because it’s true: distribution will trump marketing any day of the week. So if you can’t get to the right person at the right time, then it’s probably not the right idea.
5. You can offer value
”So my plan is to slash the price and be the cheapest.”
That’s not a plan. That’s called a race to the bottom, and everybody (yes, including the consumers) tends to lose a price war.
Just have a look at all those ‘free’ rental bikes bust up and clogging rivers all over Australian cities where the business models aren’t supporting maintenance.
You’ve got to add value. And if you’ve got true Blue Ocean (i.e. you’ve broken the value delivery to price connection) then sure, you’ve got a new means of production. But cutting price isn’t a winning play unless you’ve got endless VC dollars and just want to skip between funding rounds before the runway runs out.
The smarter play is to check that you represent differentiated value. You can test this with price modelling before you even start.
Checking the price elasticity of your offer before you get started is easier than ever before and essential to modern launch success. [Tweet this!]
Is it the kind of value that they would pay for? And how much will they actually pay? See the slight but major difference?
There’s absolutely no shortage of ideas in business. And with Porter’s Five Forces changing faster than somebody flicking cable TV channels, we’re seeing things like barriers to entry being disrupted daily from market to market.
In this world, it’s the ability to honestly, and quickly, review the quality and potential of an idea and back the one from many to get started.
And be prepared to pivot again and again until you really hit pay dirt.
Perhaps after all, dogs do have it better than humans — at least they have us to walk around after them collecting up — a final tip of the hat to Matthew Osborne.
Blog image credit: http://www.mcescher.com/gallery/