How to Find Profit in Problems

Ever have a problem you needed solving? Of course you have. Now the question becomes how many of those problems have companies or businesses been able to help you solve? Probably the vast majority of them nowadays. It seems there’s always a business or product available to solve even the most niche and insignificant of problems. To the consumer, it’s likely annoying having this constant advertising shoved down your throat for everything. However this isn’t written for the consumer, but rather the individuals and business who try to come up with solutions for these problems. In the latest Praxis exercise, I learned how to find profit in problems; here’s how you do it.

First is coming up with problems. This task is easy enough. Everyday problems likely include things as seemingly innocuous as missing a sock, needing to find something to fill your free time with, or wanting something to eat. The intermediate problems are things like back pain, yard work, or cleaning the house. Then the big expensive problems are things like house and car repairs, legal consulting, or loan payments.

In my experience as an average consumer with these three levels of problems, I’m most likely willing to give my money over to a solution for more low level problems and some of the intermediate problems. A lot of the super insignificant problems day to day have a billion infomercials selling overpriced items for half off if you call the number on the TV, and a lot of the big expensive problems and intermediate problems I’m more inclined to save wherever I can. But things like filling time, getting food, or dealing with back pain I don’t mind dishing out for a bit. So that’s step one done for you: target the problems people will most willingly pay a little more for.

Next is identifying as many possible solutions to the problem or problems you come up with. This part is a little bit more difficult, but not impossible. The key here is not to exclusively think about how many profitable solutions there are. Think about the options that don’t require the consumer to spend money. Let’s look at some examples I came up with.

First problem is “There’s no bread or cereal in the house to eat”. A pretty common and simple problem. Here are the solutions I came up with.

1. Use other food to make breakfast with

2. Go to the grocery store and buy bread and cereal

3. Go to a restaurant

4. Order food for delivery

75% of the solutions I came up with require spending money. Now think about the range of businesses that could potentially benefit from this problem. Grocery stores, convenience stores, restaurants, food delivery services, restaurants that deliver come to mind. When you spread it out, that’s a lot of names on the table who could be making a buck. Let’s look at another example.

Consumer wants to listen to some new music.

1. Look on the internet

2. Go to a record/CD shop

3. Check out a local concert/play

4. Go to a local club/bar

5. Watch a TV show/movie you haven’t seen

6. Ask a friend for a recommendation

A couple more options this time around. How many of them can money solve?

1. Look on the internet

2. Go to a music shop

3. Check out a local concert/musical

4. Go to a local club/bar

5. Watch a TV show/movie you haven’t seen

6. Play a video game you haven’t played

7. Ask a friend for a recommendation

100% of these problems can potentially be solved with money. Let’s break it down.

Solution 1: Look on the internet. This one is a no brainer. The modern internet is riddled with advertising that pays to websites and the individuals running them. YouTube, Spotify, Pandora, etc. all have ads on them. And if Consumer doesn’t want ads? They can pay for the premium service. One way or another, they’re very likely to generate profit.

Solution 2: Go to a music shop. What better way to find new music than get a hard-copy? Many people still prefer vinyl or enjoy collecting cassettes or CDs and are willing to spend on some new tunes.

Solution 3: Check out a local concert or musical. Gotta spend money on those tickets.

Solution 4: Go to a local club or bar. Cover charge or no, if Consumer is looking to hear new music, they’re probably going to spend a while and buy a drink, maybe some food, most likely with some friends.

Solution 5: Watch a TV show or movie you haven’t seen. Oftentimes there are songs or artists featured in films or episodes of shows. And even so, plenty of options in this medium have their own soundtracks to listen to.

Solution 6: Play a video game you haven’t played. This one is pretty much the same as the movies and TV show solution, just with video games. Being a slightly different medium than movies however, video game soundtracks are much different to that of movie and TV show soundtracks, often featuring songs that can loop or be played on repeat without knowing the song ended.

Solution 7: Ask a friend for a recommendation. This one is a bit of a gateway to the other options. If you like what they recommend, you’ll be likely to buy some of the music they recommended.

And there you go. Six good solutions to a problem, all with the potential to make some profit.

At the end of the day, this exercise wasn’t what I expected it to be. I went in thinking this was more or less something you'd have in math class. But my surprise arrived when it wasn’t about how many cookies Jimmy would have after five were eaten. Instead, you solve a real life problem with real life solutions, and better yet, find the profit that can be made from said solutions. It’s a great way to think about sales and ways you can come up with a product to sell, but it’s also excellent for finding problems to profit off of that others aren’t. I guess that’s just the magic of selling things.