Identifying Business Opportunity: What Kind of Business You Should Start in Your Locality?
It is possible to start a business in your hometown or city, whether you belong to a huge metropolitan area or a smaller place. Though entrepreneurship is a major buzzword these days, people have been running businesses for centuries, in every town or city with a sizeable population.
There has been a rapid explosion in the number of small businesses registered and self-employed persons in recent years. While we are all aware of the benefits of being your own boss, many aspiring entrepreneurs with a desire to start small businesses are unsure how they can identify the right business opportunity in their city or town.
How to Identify Business Opportunities in Your City or Town?
Doing good research can help you come up with many ideas that can work out in your town or city. Sometimes you may have an exciting idea, but you have to assess your execution plan thoroughly.
Today there are so many tools at your disposal to research the potential risks of a business, such as social media, professional business consultants, online courses, etc. Many entrepreneurs and successful people are willing to mentor and share their lessons with budding entrepreneurs.
Use Social Media Extensively
Social media has become an indispensable part of any business strategy. From the neighbourhood dhaba to the artisanal craft shops, every small business owner is reaching new heights by leveraging social media effectively. Not only can you access new customer bases but you can also build brand reputation and value by managing your online reputation effectively.
Social media is also an excellent research tool. You can use it to connect with fellow entrepreneurs, research the popularity of your ideas, learn from experts and those with experience, and discover new business opportunities by watching trends.
Some of the most useful social media tools for research are:
- YouTube - Vlogs, free courses, marketing, etc. are only some of the many uses of this video platform. People often talk in detail about their problems, opinions, niche business ideas, etc.
- WhatsApp - Many brands successfully used WhatsApp as the cornerstone, and the new stories-feature can bring you wide exposure.
- Facebook Groups - Excellent for connecting with potential customers, finding the drawbacks of your business ideas, and gaining access to new audiences.
- Meetup - You don’t always have to identify business opportunities yourself. Sometimes, you can get on board with someone who wants a partner with your skillset. Meetup lets people form groups that can help you network with those who know the hurdles of establishing a business and connect you with useful contacts.
Talk to Local Business Owners
If your town or city has several flourishing local businesses, there is no substitute for connecting with the owners and learning from them. While conversing, you may discover business opportunities that solve their pain points, and they may be more willing to do business with you, as they know you. Tour their facilities.
Keep Your Eyes Open for Problems that Need Solutions
Have a place to note down all ideas that come up, no matter how big or small. Here are some tips on how to identify problems that can turn into business opportunities:
- If you currently work in a corporate setting, observe the business processes to see if there is anything you can optimize with a new business.
- Speak to people to discover pain points and unmet needs.
- Think about the big challenges facing the town or city you live in and how you can solve it.
- Watch review platforms, online forums, go to conferences, fairs, etc.
- Find niche areas that have low competition and add value. Practice ideating regularly, and you will find that it gets easier with time.
- Research products and services available outside India and adapt them to your town/city.
- Find out if there are products your town specialises in. Is there a craft or an agricultural item that is unique to where you live? Do you reside in a nature spot? If so, then the food and hospitality business may be ideal for you.
- Can you apply a different business model to a known industry? That’s how Uber and Lenskart became big.
- Dropshipping - Identify a product that you can resell.
- Train under an established business person, consultant, or work with a startup.
Evaluate Your Saleable Skills
You may already have skills that you can scale up or a passion that brings you great fulfilment. Many people have set up successful writing, design, and web development careers by just acquiring a few skills for which they had a penchant.
Think about your strengths in previous jobs and businesses and industries you already know well. Learn some emerging skills and technologies. You may have an advantage if your business idea comes from there.
Become a Franchisee for an Established Business
A way to enter a well-established field is by franchising for an established business. In time, you may be able to learn enough to set up your own outlet, with a difference. If there is a successful business with a product that may work in your locality, you can acquire the rights from them.
The advantages are that they will provide equipment, marketing tactics, strategy, training, access to raw materials, and, most importantly, the right to use a trademarked good with brand value. It may not pay as well as owning full rights, but the expenses and learning curve are also likely to be smaller.
For a business to be successful, customers are needed, and they will buy the product only if they feel that it adds value to their life. You have to convince the buyers that your product is truly going to make a difference. For example, if you live in a cold town, an AC business may not do well.
If you operate in a saturated sector, it would be difficult to convince customers to switch over to you. It is next to impossible to avoid competition in any niche and, hence, innovating eventually becomes the only way forward.
Some areas where opportunities can adapt to Indian towns or cities include
- Agri Business: India has been an agricultural economy for centuries, and the sector still employs the majority of the population. As food is a basic necessity, food-based businesses are generally the only ones that sustain even in small, remote locations. Natural fiber-based business ideas also have more scope, provided you can innovate.
From small shops that sell noodles to hungry mountaineers to new startups rebranding age-old snacks like tamarind and mango candy, there are some truly remarkable ideas that people are executing.
- E-commerce: As logistics networks improve and supply chains spread out to the hinterlands, e-commerce ventures are now taking off even in smaller towns and cities. You need not necessarily be a big e-commerce giant to float your idea.
- Tourism: The pandemic was a one-off that interfered with tourism, and it’s already recovering. Eco-tourism is increasing in popularity as environmental awareness builds, and India has high biodiversity in most smaller cities and towns. This area is one where reputation and quality matter more than marketing and is, therefore, a good idea for those who may not have big budgets.
- SaaS: The world is now irrevocably digital, and technological solutions are the future, and therefore, the software-as-a-service (SaaS) sector has tremendous potential. The good news is that Bangalore and Gurgaon are no longer the only places where IT businesses can do well. Capital cities and small towns are also locations for new businesses.
There are many more areas we haven’t covered, so don’t neglect to explore to the fullest extent.
Why Should You Start Your Business in Your Home City or Town?
With the never-before-seen connectivity and globalisation, small business owners have access to a large consumer base, even beyond their location. The power of the internet and social media can be leveraged to grow a business to a bigger scale than previously imaginable.
Plus, when you start a business in your city or town, you have a better idea of where to source the requirements of your enterprise. You are more likely to have networks that can help you in reaching the right people, or you will be able to develop networks easily. You can cut down on the costs of living and sourcing raw materials, labor, land, etc.
The Government is actively supporting aspiring entrepreneurs with various initiatives like StartUp India for easy access to capital and compliance. Banks have mandates to earmark their credit targets for micro, small, and medium businesses. Many laws related to wages and labor have been simplified and streamlined to encourage employment generation. Many universities host startup incubators for entrepreneurs till the business scales up.
This new decade is the best time to start a business in your town or city, as the Indian economy is rapidly growing and about to become the third-largest in the world.