business concept example in business plan

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As a professional web and software developer, the author possesses a strong foundational background in Computer Science. This equips him with both academic rigor and practical insights into the world of web-based entrepreneurship. As the founder of this platform, webpreneurships.com, he stands at the intersection of technology and business.

What Is A Business Concept? Ultimate Guide & Writing Tips

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Every successful business, from the large corporations that we all know to the small businesses starts with an idea. This idea can be a solution to a specific problem of a group of people, or a way to make life easier for the general public. It could also be a simpler approach to a complicated challenge. This preliminary idea is what we call a business concept.

It is the backbone that gives direction and purpose to a business idea and helps entrepreneurs strategize how to enter the market competitively. However, it is more than just thinking of an idea, it will involve several steps that need to be accomplished for a business to be grown out of it.

What is a business concept?

A business concept is the comprehensive idea and vision behind a venture. It outlines its mission, strategy, target audience, and unique value proposition, acting as a roadmap for turning entrepreneurial aspirations into actionable business plans.

A successful business concept distinguishes a business into its niche, setting it apart from other businesses in the same industry.

Fundamental to the creation of a robust business model, its application spans various aspects of a business, from consumer goods concept that resonates with your target audience to infrastructure concept tailored to support business operations.

A business concept contains several key elements that ensure its effectiveness and relevance in your selected industries. So, what are these components that define a business concept?

Related: What Is A Serial Entrepreneur? Traits & How To Become One

What should a business concept include?

A business concept is not just an idea or a statement of what you want to do that you think has a possibility of generating some profit. It involves several important details for it to successfully guide your whole business timeline. Here are some of them:

1. Structured Business Plan

A structured business plan acts as the foundation of your business, outlining the steps to make your concept a reality. This plan should provide a clear trajectory on how to enter the market successfully, or even which market to choose. The key is to be as specific as you can without limiting the scalability of the business before it even begins.

2. Product/Service Description

It is not just about what you sell but how you position it. This involves detailing how your products or services solve a problem and its unique benefits for the consumers. It is crucial to understand and communicate how your offerings cater to customer’s needs and fit in the marketplace.

3. Target Market Identification

In developing a successful business concept, the individuals you are targeting to be your customers should be specific. It is not even possible to create one without knowing who they are. It is because the very foundation of a business’s existence revolves around solving a market’s problem or providing their needs.

So, you have to be able to describe your target market. This includes their age range, the country they live in or a city if you want to be more specific, their hobbies and interests, and a lot more. The more you know about them the better the business concept will be.

Now, in developing this business concept, it is also important to know that there are several types all dependent on your chosen business models. So, what are the types of business concepts?

Types of business concepts

The world of business has undergone several seismic shifts over the past decades, from the creation of Internet and social media apps to the evolution of Artificial Intelligence. Yet, a business concept is still fundamentally the same.

Its goal is to outline a plan and make an idea an actionable step into success. But since the business landscape has changed and evolved, several types of business concept has emerged. Here are some of the most utilized business concepts:

1. Traditional Business Models

These are the tried and tested business concepts that have stood the test of time. Traditional business models focus on selling a product or service directly to customers. An example would be a restaurant or coffee shop where the primary business operation is done on the spot.

2. Digital Business Concepts

With the surge of the internet in recent years, digital business concept is now the norm. These concepts revolve around online services, apps, or digital products catering to an international market. Companies in this industry aim to meet consumer demands through the online world and the digital marketplace.

Related: Starting An Online Business Checklist: Launching Your Dream

3. Franchise Models

This concept allows the company to extend its brand without bearing the entire cost of operations. Entrepreneurs have seen the success of franchise models specifically used by restaurants, hotels, and clothing brands. It is also a proven and tested business concept.

4. Subscription-Based Models

Subscription-based models are the number one business concept that everyone is trying to accomplish these days. This is because of its benefits for your business, including income stability and returning customers. You can also build upon what you have achieved in the last month and easily increase your revenue.

Understanding these different types of business concepts is important to know how to write a successful plan. But, how do we actually write a business concept?

How to write a business concept?

Crafting a comprehensive business concept is the same as laying a foundation for an infrastructure. It must be detailed, insightful, and adaptable. Here’s a step-by-step guide on how to write a business concept.

1. Understand the Market

Before you can develop a compelling concept, you need to have a good understanding of the market. You have to know the answers to the following questions:

Which industry do I have expertise in?

Which solutions are already available?

What do customers truly need?

Researching competitors and potential gaps in the market can provide informational insights that can help you build your ideal business concept.

Related: What Are Five Things To Consider When Evaluating A Business Opportunity?

2. Define Business Vision

Every successful company has a vision that guides its decisions, operations, and brand-making. Your vision will be the north star of the business. This isn’t just about earning as much money as possible, it is about the impact you wish to bring to your target audience and industry.

3. Identify Unique Selling Proposition (USP)

Your USP or unique selling proposition is what makes your company or product stand out from the crowd. It’s the unique benefit, feature, or solution you offer that competitors don’t. Because there will be a lot of competition whichever market you choose, it’s not a bad sign, it is actually the opposite and it means that there is an actual market for that specific business concept.

4. Seek Feedback & Refine

No business concept is perfect from the get-go. After drafting your business concept it is necessary to seek feedback either from professionals or your target customer. However, doing this without the expense of a big budget can prove to be difficult.

The key is to be creative, and this involves leveraging social media apps and connecting with possible customers to get some reviews on a business concept. It can be through polls and surveys, or even just asking out friends and family who have some type of knowledge on your idea.

Final Thoughts on Business Concept

Developing a solid and detailed business concept will go a long way to help entrepreneurs on their road to success. This is especially true for small businesses, where standing out in a crowded market is more important than ever due to the amount of competition there is.

As discussed above, creating a strong business concept is not just about having a good idea, it is about developing this idea, and making it as detailed as possible without spending a lot of time and resources. It is the preliminary test that an idea must pass before moving forward to a business plan.

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How to Develop a Business Concept

Last Updated on 2024-11-14

Is there a secret recipe to a successful business concept? Short answer, there’s none. But there are ways to create a foundational concept that transforms your idea into a profitable business.

There’s always that ‘aha!’ moment before the next up-and-coming business is born. Indeed, everyone seems to have an idea for a successful startup. However, only a few would dare to make it happen.

If you’re ready to mobilize this dream, first you need to decide what business it would be. Developing a business concept is an important step to express your entire plan in writing. A business concept statement provides a roadmap for your startup once you’re ready to assemble all the resources for your new startup.

What is a Business Concept?

That’s the million-dollar question for which we have an answer. Essentially, a business concept is a brief description of an idea behind the existence of a business. It describes key consumer problems it seeks to solve, articulates how the idea applies to a market and provides a clear direction when processing a business plan .

We all know that business plans are quite extensive; it’ll take a long time to read the entire document. Since most of its readers are busy people like entrepreneurs and investors, it’s unreasonable to read the whole business plan only to find out that the content doesn’t meet the readers’ expectations in the end.

Hence, it’s practical to hit the right balance. You need a document that’s short as a note but still informational as a business plan. This is why you need a compelling business concept statement along with the proposal.

Additionally, a business concept serves as an overview to potential business partners or investors. It provides them with enough information on whether or not they should continue with the proposed plan. Thus, your concept statement should hook your audience’s attention as well as justifies the investors’ decisions

What to include in a Business Concept Statement?

While a business concept statement needs to be short, it should still include key elements of your business. These includes:

A short description of the business

Explain what your business is about and the reason for starting this endeavor. You may also include features that make your company stand out from its competitors. It should be no more than 1-2 sentences long.

Market need

Are there any gaps in the market that your business idea can fill? Identify these market problems that your product or service will solve. You can also pinpoint the lack of products (services) that consumers don’t know they need.

Core products or services

Elaborate more about the product or service that your company is or will be offering. Similarly, discuss why your offerings are the solution and why you are the right company to deliver that idea to the market.

Target market

In here, mention who are your product’s target consumers are. Be specific and present data backed by credible market research findings.

Business model

This is an important element in the business concept since it outlines how the company will make money. Your business model answers the question, ‘ How do you charge customers for your product or service?’   

Unique Value Proposition

What makes your product (service) different from those already in the marketplace? Point out why consumers should consider buying your offerings from that of the competitors. Is it more affordable? Do you offer same-day delivery? Or do you offer better quality products? These are examples of things to consider when writing your Unique Value Proposition (UVP) .   

Competitive Analysis

Identify your potential competitors. What are their strengths and weaknesses? Also, include the annual revenue and market share. It gives the readers an idea about the size of the market and its growth potential.

Related Video: Tips for Achieving Business Goals

This concludes your business concept statement. Touch on the goals of the company in a particular timeframe. These can be short and long-term goals.

Please note that a concept statement is not a sales pitch. So, don’t make any unverified claims or write it like a catchy sales copy. This helps stakeholders gauge if your business idea is reasonable based on the analysis of the market.

7 Tips to Develop the Best Business Concept

• Observe your surroundings – Are there any products or services that are not available right now? Or perhaps what’s currently available doesn’t live up to the things it claims to offer. This is a great opportunity for you to build a better product.
• Check out trends – See if there are any changes in lifestyle or market needs. Tune in to what’s happening on the Internet, TV, or newspaper. For example, more people today are choosing veganism as a lifestyle. This heightens the demand for vegan or plant-based products.
• Nostalgia – Was there a product or service that you liked in the past that is no longer offered in your area? Maybe you want to relive that. Ask around and see if other people share your sentiment.  
• Bring new life – Is there a way to modernize common services such as home appliances repair and pet grooming? Find out how you can transform routine services into something better.
• Gaps in operations – More companies choose to let go of some of their business operations to save time and cost. If you can find a way to close this gap, it can be a potential business waiting to happen. As an example, our founders here at Full Scale saw that new American startups can’t find top-notch developers in the country. So, they built Full Scale, an offshore development company that answers the growing demand for quick and affordable software services.
• Create a new demand – As industries grow, the core needs of the market often gets ignored. Revive or create a new demand that answers an existing need.
• Hobbies and Interests – Yes, your hobbies can also be a great inspiration for starting a business. Is there a clear demand for which your hobbies or expertise can answer?

Related Video: Business Analysis Tips and Tricks

A Business Concept that Works

When starting a business, there are several nuts and bolts you need to consider. Critical of them all is a business concept. It’s a pillar that crystalizes your idea into a money-making machine.

Position your business concept in a way that answers a key need in the market today, and in the years to come. By following the tips shared in this article, you can assess your strengths in providing optimal value for your customers.

In this way, it saves you more time and money and minimizes any missteps in your journey. So, have you already thought about what your business concept will be? How can your idea extend to providing answers or solutions to customers’ problems?

If you’re not sure how your business idea will turn out in the market, you can count on startup gurus, Matt DeCoursey and Matt Watson, to pave the way for you. They are experts in all things startup—from conception to launch.

Best of all, they are the geniuses behind Full Scale , Kansas City’s unrivaled choice for quick and top-quality software development services. From software engineers, web developers, to marketing specialists, we got you covered.

Interested? Get your FREE consultation today.

Matt Watson is a serial tech entrepreneur who has started four companies and had a nine-figure exit. He was the founder and CTO of VinSolutions, the #1 CRM software used in today’s automotive industry. He has over twenty years of experience working as a tech CTO and building cutting-edge SaaS solutions.

As the CEO of Full Scale , he has helped over 100 tech companies build their software services and development teams. Full Scale specializes in helping tech companies grow by augmenting their in-house teams with software development talent from the Philippines.

Matt hosts Startup Hustle, a top podcast about entrepreneurship with over 6 million downloads. He has a wealth of knowledge about startups and business from his personal experience and from interviewing hundreds of other entrepreneurs.

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