How are business deals identified?
Posted Tuesday, March 5 2013 at 02:00
Broadly speaking, people start businesses for one of two reasons – to profitably fill an identified gap (market-driven) or simply to earn additional income (need-driven). The latter is characterised by businesses that simply duplicate existing businesses - it seems like Joseph is getting rich by selling tomatoes in South Sudan therefore I will sell tomatoes too. Is/was your business market or need driven? The examples below are certainly not exhaustive but should help trigger ideas for market-driven opportunities.
• A different twist: Bread is not something new but in 2011 Brood, a Dutch bakery, introduced preservative-free bread baked from natural ingredients, using traditional family recipes. Today, they have four successful outlets in Kampala. We have always had schools but you must know of families that started private schools to provide the specific type of education they wanted for their children. Several years later, those schools still thrive owing to their different approach to education. Fresh fruit and vegetables are widely available but today, packaged ready-to-eat fresh fruit and vegetables are gaining popularity. What product or service can you provide, with a different twist in content, quality, packaging, customer service, delivery options or price?
• New-to-Uganda: In 1996, Uganda Funeral Services offered Uganda a new approach to funerals. Could you offer Uganda’s first affordable professional window cleaning service for tall structures? Or will you duplicate the US Angie’s List and provide online consumer ratings of local service companies and contractors? Does anyone here package soy or goat’s milk? What gap-filling idea can you introduce from another country?
• Trends: Noting the alarming increase in diet related non-communicable lifestyle diseases and the growing number of Ugandans interested in nutritious, easy-to-prepare meals, six years ago Dorothy and Goretti of Nutreal Limited. started developing high quality nutritious products from amaranth (dodo seeds). Today Nutreal Limited. offers ten different products, is distributed in all Uganda’s leading supermarkets and is considering export. In the more economically affluent countries, organic food items are gaining increasing popularity. What current popular tastes present you with an opportunity?
• Market dynamics: What is happening around you? How does your idea fit in? What could you offer Uganda’s oil companies and/or their employees? Uniforms, stationary, food supplies or catering services? What unmet needs has regional integration created? Can you find an effective way of informing East Africans about integration’s implications? What can Uganda learn from or trade within the East African Community?
• Accessibility: In 1995, Celtel (now Airtel) launched mobile telephone services with luxury item pricing. Seeing the untapped mass market opportunity, in 1998 MTN followed and in 2012 boasted over 7.4 million subscribers compared to Airtel’s 4 million. Centenary Bank is the only commercial bank that offers loans as small as Shs100,000. What can you make accessible to more people?
• Structure: Recognising the challenges its member farmers faced in exporting small volumes, Nogamu created Organic Uganda Trading to provide bulk services. Does organising your industry/sector present an opportunity?
Ask yourself all the above in relation to your industry/sector and see what new ideas you generate.
Next week: How do I know my idea will work?