Tips to Choosing a Business Idea

The basic building blocks for any new business venture are:

• The range of products and services that you can provide.
• The likely need for those products and services, either from individual customers (consumers), or from small firms, local government or other types of organisations.

Once you find the right combination of products, services and customers, you have the possibility of success in self-employment. What follows are some ideas about how you can find the right combination.

1. What skills do you have that can form the basis of a business?

This is the most obvious starting point for anyone considering self-employment. You need to be able to offer something that has a high standard of quality, and that demands some level of skill. A variation on this is whether you can apply the skills you used in your work in different ways - sometimes referred to as 'transferable skills'. For example, a Royal Navy electrician could run a security installation business.

2. Can you see some form of opportunity from your existing work or occupation?

This happens remarkably often. You might be working for a business and become aware that it is not offering something that its customers are asking for. This might give you the opportunity to set up your own specialised provision, possibly with your employer's assistance, but you could also 'go it alone'. There could be some legal issues to watch for here, so it may be important to have your employer's consent.

3. Can you combine your skills with those of someone else?

You may see a business opportunity that you do not have all the skills to cover, but you could do so if you worked in association with someone with complementary skills. Some general construction companies have been started by groups of specialist tradesmen combining their skills to form one organisation. For example, a specialist in human resource (HR) recruitment could work closely with a specialist HR solicitor to provide a more comprehensive HR service.

4. Can you turn a hobby into a successful business?

Skills do not have to be work related; they can come from a hobby or personal interest. Many gardening services have started on this basis. One former civil servant now runs a successful model engineering company, based on a hobby that he followed for many years. Other opportunities exist in sports and leisure, such as fishing and hill walking, travel, photography and collecting things.

5. Could you run a home-based business?

Many people do start up in business from a home base, and this can be very convenient for parents with young children. This used to be the preserve of services such as bookkeeping, but with the development of online initiatives such as eBay, home-business opportunities are opening up in all manner of ways. Developments in IT, such as designing 'apps', have become increasingly common, as have 'kitchen table' enterprises, such as producing home-made bread, cakes, jams and sweets.

Some general tips on generating ideas:

• Do as much background research as you can. This does not have to be expensive, as your local business reference library may provide a wealth of information about the business idea you are considering.
• Do check the full extent of the immediate competition for your idea. Some of it could be hidden away, particularly if it is part of the 'informal economy'.
• Do understand who your potential customers could be, and why they would buy the products/services relating to your idea.
• Don't start without checking on all the legal issues. Some of the examples mentioned need either licensing to operate or you must have certain qualifications in order to provide some services. If in doubt, your local Trading Standards office can provide advice.
• Finally: Change = business opportunity, even during a recession!

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