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FIND OUT THE BUSINESS POTENTIAL OF YOUR IDEAS WITH A JAPANESE RECIPE (EPISODE 4 OF THE MINI SERIES “FROM SCRATCH TO A BUSINESS YOU WILL LOVE”)

Over the last couple of centuries, while the western cultures were very busy implementing the concept of capitalism and living in the illusion that money brings happiness, the Japanese culture had already understood that happiness consists of finding your life purpose and living according to it.

The Japanese term ikigai is composed of two Japanese words: iki refers to life, and kai roughly means “the realization of one’s expectations and hopes”. Ikigai is seen as the convergence of four key elements:

  • What you Love
  • What you are Good at
  • What the World Needs
  • What you can get Paid for

Living according to your ikigai is a very good idea: in his post on “Psychology today”, Christopher Peterson reports the results of a research conducted by a graduate school of medicine in Japan. One of the purposes of this study was to analyze the correlation existing between ikigai and longevity. Ten of thousands of people responded to a survey and then were followed for a few years. Controlling for other factors, 95% of survey respondents, who reported a sense of meaning in their lives, were alive seven years after the initial survey, versus 83% of those, who reported no sense of meaning in their lives.

I am convinced that the four ikigai‘s ingredients are the same four ingredients that you need to create a business, which is at the same time “right for you” and potentially successful. In a previous post, I have discussed the importance of following your calling and I explained you a possible way to find it, by solving a puzzle. If you have done the puzzle exercise, you have already investigated what you love and what you are good at, so you should know the first two elements of your ikigai. In another post, I suggested a fun way to come up with business ideas related to your calling. What you need to do now, is to evaluate these business ideas according to the two remaining ikigai elements: what the world needs and what you can get paid for.

Offering something on the market that the world doesn’t need or isn’t willing to pay for is, believe it or not, a very common mistake. The problem is that many inexperienced entrepreneurs assume that people need and want what they have to offer, but this assumption is often not correct. Only a few small business owners make the effort to test the market and to ask feedback on their idea to potential customers.

I will give you an easy example. A few months ago, a small shop selling Italian cheese and other delicatessen opened in the small village near Bern where I live. As I was curious and eager to speak my native language, one day I entered and I asked why they decided to open that shop. The answer was “because my father knows how to make cheese and we have a deal with a cheese factory where he can make the production”. I was expecting something along the lines “because we have asked people in the area and we are pretty confident that they will buy our cheese”, but this wasn’t their answer. I bought a piece of cheese, said good luck and left. The cheese was ok, but was it so much tastier than the industrial cheese that I could find in the supermarket in front of the shop? In my opinion, no, it wasn’t. They were also selling Italian wine (available also in the supermarket) and a few other products, but nothing that, in my opinion, was worth the additional time and money needed to pay an extra stop at their shop after buying other stuff at the supermarket. I don’t know how they are doing, but I never see a client in the shop and last time I passed by, there was a big sign advertising a 50% sale.

I think that they simply assumed that people were willing to buy their cheese, but they didn’t do anything to prove their assumptions. What about preparing a 3 minutes survey for people coming out of the supermarket, asking them, for example, if they normally buy cheese at the supermarket, what kind of cheese they like, and whether they were willing to go to a different shop to buy a locally produced Italian cheese? They could have adjusted their offer based on the tastes and preferences of their potential clients, but they probably haven’t. They have just “assumed”.

I see this is a risk for many expats. When we move to another country, we generally miss something that we think is great in our home country and we think “if I open an Irish pub, if I sell Thai arts and craft, if I open a school to teach a new martial art, I will be successful because I have no competition”. Well, it’s not that easy. You may not have competition just because there is no market for what you have to offer!

How can you know whether what you want to offer is needed and people are willing to pay for it?

  1. First, you can prepare a short survey, as just discussed, and ask people to answer your questions, either “live” or online.
  2. Second, you can look at your competitors and study them: are they doing fine? If you open a similar business in the same area, do you think you will be able to attract some clients? Why should people decide to come to you instead of the competitor?
  3. Third, you can bring these questions up in a brainstorming (read this blog if you want to organize or participate to a brainstorming). For example, in some recent events we dealt with the question “do people need in-office massage and how much are they willing to pay for it?”, “would a car pooling service from city to city work in Switzerland?”. The feedback you receive may be enough to make you take a decision, or, at a minimum, will give you a clear indication of what exactly you need to do to find the answers.

Ikigai can also be used as a quick and dirty way to assess the business potential of an idea. I give a score from 1 to 5 to each ingredient of the ikigai recipe:

  • How much you Love it
  • How Good you are at it
  • To what extent the world Needs it
  • Whether people willing to Pay for it

Some of my online course beta testers have decided to go ahead or to abandon a business idea just applying the Japanese recipe.

From my side, this is all for today. Now it’s your turn:

  • If you liked this post, please share it with your friends;-)
  • Try the ikigai recipe on your idea(s) and write a comment to let me know whether the result is delicious or terrible…!

Ciao!

Gretel