Based on the work of Klofsten (2005) which examined the innovations and strategies implemented by entrepreneurs, it was seen that the most successful individuals focused on developing business ideas that served a particular need and fit into a specific market niche (Klofsten, 2005: 105-119).
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Klofsten (2005) explains that all too often people who enter into the world of business with their own ideas and concepts neglect to undertake a comprehensive market analysis of the consumer environment that they find themselves in (Klofsten, 2005: 105-119).
As a result, these entrepreneurs go into direct competition with well established competitors who have better supply chains and brand recognition which all too often causes new entrants into the competitive environment to bow out as a direct result of competitive forces which in effect boxed them out of the consumer market (Acs et al., 2012: 289 300).
The most effective entrepreneurs create ideas along the lines of developing new markets, indirect competition or even complimentary services which create added value for an already well established product (Heinonen, Hytti, & Stenholm, 2011: 659-672).
For example, the creators of Coffee Joulies (tiny beads which are added to hot coffee to keep it warm for extended periods of time) developed their idea long the concept of a complimentary service within a specific market niche.
In their case they did not develop a product which would directly compete against the plethora of coffee holders and canisters today, rather, their product could easily compliment any coffee canister and boost its effectiveness while at the same time remained within its own exclusive market niche.
Other studies which have examined the idea creation process behind the development of product ideas by entrepreneurs saw that successful entrepreneurs sought to innovate already present business ideas or concepts into a way that would more effectively appeal to consumers (Popovich & Buss, 1990: 26).
This was seen in the case of “Snog” which is a successful U.K. based yogurt franchise developed by Rob and Pablo which focused on creating healthy yogurt options (they used a special type of syrup from Mexico that has a lower caloric content than sugar) for a health conscious public.
Thus, it can be seen that the process of innovating an already existing product into something which better appeals to the general public is definitely an effective method of idea creation which becomes a source of considerable success for entrepreneurs (Rubenstein, 1994: 652).
Focusing on the issue of market creation, Riese (2011) explains that another method utilized by entrepreneurs to come up with ideas is through a market analysis of various consumers at the local level (Riese, 2011: 445-460).
This means that successful entrepreneurs utilize the “bird in hand principle” which consists of utilizing resources which are already on hand in order to create a successful venture.
These resources are not limited to financial resources or skill sets but can also be composed of readily available consumers within their general vicinity.
Examples of this particular type of idea creation can be seen in the current popularity of food trucks in not only the U.S. but in some areas of the U.K. as well which serve a variety of restaurant quality dishes.
By selling a product which is readily available at any restaurant but by making it more easily accessible and affordable this results in a considerable level of business success for any enterprising entrepreneur.
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Acs, Z, Audretsch, D, Braunerhjelm, P, & Carlsson, B 2012, ‘Growth and entrepreneurship’, Small Business Economics, 39, 2, pp. 289-300. Retrieved from www.EBSCOhost.com
Heinonen, J, Hytti, U, & Stenholm, P 2011, ‘The role of creativity in opportunity search and business idea creation’, Education + Training, 53, 8/9, pp. 659-672. Retrieved from www.EBSCOhost.com
Klofsten, M 2005, ‘New venture ideas: an analysis of their origin and early development’, Technology Analysis & Strategic Management, 17, 1, pp. 105-119. Retrieved from www.EBSCOhost.com
Popovich, M, & Buss, T 1990, ‘101 ideas for stimulating rural entrepreneurship and new business development’, Economic Development Review, 8, 4, p. 26. Retrieved from www.EBSCOhost.com
Riese, H 2011, ‘Enacting entrepreneurship education: The interaction of personal and professional interests in mini-enterprises’, Cambridge Journal Of Education, 41, 4, pp. 445-460. Retrieved from www.EBSCOhost.com
Rubenstein, AH 1994, ‘At the front end of the R&D/Innovation process: Idea development and entrepreneurship’, International Journal Of Technology Management, 9, 5-7, p. 652. Retrieved from www.EBSCOhost.com