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Find the Best Business Opportunity: Go High Demand, Low Competition

More than 17 million Americans own their own business. Most of these businesses are one-person firms. And many are high income business opportunities operated from home.

Heavy traffic, exorbitant fuel prices, corporate downsizing, difficult managers and supervisors, lack of control over one’s work life, and the search for more and more meaningful way of expressing our individuality are just a few factors motivating our search for a top home-based business.

But finding a small business idea that will be a money maker, rather than one that will drain financial resources, requires considerable research, patience and effort.

Avoid highly competitive, saturated small business markets. They are unlikely to result in the work from home business success story you’re seeking. Better to chart a course to blue ocean waters, than to swim with sharks in a blood-red sea of hyper-competition.

Of course, important factors in considering the best business to start from home should include your interests, knowledge, skills, start-up capital, available equipment and other business assets, as well as your physical capacity.

But your top home-base business choice ideally should reflect more than what you bring to the equation. Your decision should follow a thorough search for and careful consideration of one or more products or services for which there will be a very strong customer demand. And that high demand should be complimented by a scarcity of businesses currently meeting that demand.

You should strive to be “first to market” with a new or newly differentiated product or service. This doesn’t necessarily require creation, invention or sale of a brand new product or service. It usually, however, does involve forehead-slapping innovation: thinking beyond the box about new ways to better meet customers needs or solve their problems.

Think about Sony and how that company re-examined an old product – the radio – in a new light. Transitor radios had been on the market for decades. But the Sony Walkman focused on simple problems: how to walk, jog or sit on a park bench while enjoying music and news, without holding or clipping on a cheap looking battery-operated radio, and without shoving an annoying plug into one’s ear canal. Just as important, Sony created their product with a sense of style and flair. It became stylish to show off one’s Walkman while pursuing the then relatively new and fashionable jogging and power-walking craze. Walkmans sold like hotcakes, and Sony designed a multitude of Walkman versions targeting various customer sub-segment needs and preferences.

Consider other companies that have found smooth sailing in blue, uncompetitive waters by looking at a product or service in a fresh new light. Each of these firms was featured in Blue Ocean Strategies, a recent book by Chan Kim and Renée Mauborgne on methods to help companies gain new insight into their markets and create winning, high income, and high profit business ideas:

Cirque du Soleil brought spectacular, often stupefying circus-quality performances to dinner theater settings in vacation destination cities like Las Vegas.

Curves homed in on women seeking fitness and weight loss in small, neighborhood, strip mall-based stores. Each franchise store features an encircled series of mechanical exercise stations.

Starbucks' owner believed that coffee shops near homes and places of employment had the potential to reap a fortune in profits.

Authors Kim and Mauborgne describe how blue ocean thinking sharply contrasts with red ocean notions:

1. WHY compete in existing market space? Blue ocean companies create UNCONTESTED market space.

2. WHY beat the competition? Blue ocean companies make the competition IRRELEVANT.

3. WHY exploit existing demand. Blue ocean companies create and capture NEW DEMAND.

4. WHY make traditional value/cost trade-offs. Blue ocean companies BREAK the value/cost trade-off.

5. Why align the whole system of your company's activities with its strategic choice of differentiation or low cost. Blue ocean companies align the entire system of your company's activities to pursue both innovation AND low cost (cost differing from price, which you companies with little or no competition can often increase).

Contrast a few red ocean industries with the blue ocean thinkers that broke away from the pack:

Airline industry price wars led to a raft of bankruptcies and marginal profits for survivors. Southwest Airlines trailblazed a new market: air travel’s speed, combined with the low cost and flexibility of driving.

For decades, golf equipment industry players competed for a greater share of existing golf customers. Callaway Golf innovated a golf club called "Big Bertha," giving frustrated dubbers and air ballers poised to abandon the sport a large head.

Cosmetic industry competitors thrashed about within a red ocean with high-priced models, costly advertising, and hope-filled (but often over-hyped) promises their customers would regain their youth and beauty. The Body Shop innovated its way to a blue ocean that endured more than a decade, simply by marketing functional cosmetics that solved women’s problems, rather than appealing to their emotions.

The wine industry flooded its market with thousands of brands competing on the basis of costly hardwood barrels, overly-nuanced tannin attributes, and legacy branding. Casella wines innovated with Yellow Tail, a wine that created a blue ocean in a sea of red by stripping an elite industry of its deliberate efforts to confuse customers, and building a fun, uncomplicated brand: a wine those previously intimidated out of the market would enjoy.

Each firm created cost savings AND enhanced value. Cost savings can often be found in eliminating and reducing the very factors an industry bases its competition on. Value is elevated by introducing elements heretofore absent from the industry. And as a market responds to new value, it creates brisk sales volume, economies of scale emerge.

As you think about each of your own potential business ideas, think about these companies. You, too, can focus on needs or problems that have yet to be recognized by competitors now in the marketplace.

Can the product achieve a leap in utility with readily achievable changes? Can an existing product or service be applied to an entirely new market? What about costs and prices, can they be substantially cut? Or is there is an untapped market among consumers who don’t mind paying a premium for a premium version of a product or service (like coffee). Perhaps your new company can meet a business need of a growth-rocketing blue ocean company, riding its success wave?

Time to start innovating! What are your high income, blue ocean ideas?

This article may be reprinted so long as the URLs included below is published in the reprint.

About the Author

Jim Hudson is a Vietnam veteran who began his writing career in 1969 as a Green Beret Magazine report-photographer in Vietnam. His firm, Blue Ocean Company, helps small business owners create blue ocean markets, and research and develop their business plans, marketing plans, and promotional e-newsletters.

To get information on the fastest growing, high income and high profit businesses in the U.S. and the world, along with free special reports, marketing resources and other information on small business, visit http://www.blueoceanstore.com

Jim Hudson
CEO, Blue Ocean Company
(Discover Scorching Hot Business Ideas)
1437 S. Lewiston St.
Aurora, CO 80017
720-690-8442

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