2.2. Business Idea & Value Proposition

2.2.1. The Business Idea

The business plan must concisely describe the subject of the business concept: this is the business idea. The business idea describes the idea to make a business successful. A business idea wants to sell a performance - that is a product or service. The service is an offer that is directed at the concrete needs of a target group or at the customer. The customer benefit is the top priority. Only if the service resulting from a business idea is accepted by the customer does it have a chance of success in the market. Only then can it become a profitable business.

The business idea includes the terms "idea" and "business".

The idea is oriented towards needs. Thus, the idea of wealth, of happiness, of beauty and health is directed towards a human condition that can be satisfied by different means, in a particular social situation and at a particular time. Ideas have cultural differences. If the idea also contains an economic trend, the challenge for the entrepreneur is to develop a "sellable" service from it. This makes a fundamental distinction that is insufficiently considered in some business plans.
With the term business, the question must be answered as to how a service can be generated from an idea that is in demand. The business is directed towards the need, the economic unit of needs. The need is always concrete, even if it is often difficult to forecast its value. In the competitive society, the customer decides on the need or demand. The need, in the form of supply and demand of goods, is mediated in the market. A business becomes profitable when it makes a profit.

Now the market is not a one-way street. A distinction can be made between buyers' and sellers' markets. In the first case, it is mainly the buyers who decide whether to accept an offer. In the second case, it is mainly the sellers who decide whether to make an offer.

Note: Just as a new offer targets a need and can thus create demand, the desire for a service can inspire a company to create an offer for this demand

The business idea represents a paid exchange of services. It mediates between need and want and becomes concrete in supply and demand. The exchange in modern markets is hardly ever done via natural exchange, but via a means of payment. Consequently, modern customers must be willing to pay money for a product or service. When developing a business idea, the service offer must be designed in such a way that it finds a demand. If the idea is directed at the need, the business idea is directed at the need and thus at the concrete demand of the customers. The demand must be defined quantitatively in the business plan in the sales forecast.