Entrep 2

• Major sources of opportunity:

  • Entrepreneurs take note of interesting trends in the environment
  • Consumers are reliable sources of opportunity information
  • Problems in the environment
  • Problems encountered by co-entrepreneurs
  • New trends and development in the environment
• Minor sources of opportunity:

  • Feedback from Business Retailers, Wholesalers, Manufacturers, and Technical People
  • Entrepreneurs should carefully assess the opportunity through estimation of Opportunity Length, Capitalization, Threats, Profitability
  • Entrepreneurs should think in advance how they will position the product or service in the market and showcase its unique selling proposition
• Developing a Business Plan:

  • Formulate a business plan after spotting and assessing opportunities for the market
  • A business plan details Marketing, Operational, Human resource, Financial, Strategic Direction, and Tactics of the business
  • The business plan guides the entrepreneur in calculating needed resources, obtaining these resources, and running the business sustainably
• Determining the Capital Needed:

  • Calculate resources needed to establish the business
  • Apply careful calculation in computing the complete set of resources needed
  • Include only real needs in venture creation
  • Consider allowances
• Running the Business:

  • Use allocated resources for the new venture
  • Critically observe all aspects of the business plan from operations, marketing and sales, human resources, finance, and strategy implementation
  • Have a control and monitoring system
• Opportunity Spotting and Assessment:

  • Evaluate the identified opportunity
  • Conceptualize and measure the opportunity
  • Identify the perceived value of the opportunity to the company and customers
  • Conduct cost-benefit analysis including risk analysis
  • Match the opportunity with the entrepreneur's skills and objectives
  • Scan the strengths and weaknesses of competitors
• Scanning the Marketing Environment:

  • Understand the macro-environment, micro-environment, and internal environment
  • Recognize various opportunities and understand the arena where the future business will operate
• Macro-environmental Sources:

  • STEEPLED: Sociocultural, Technological, Economic, Environmental, Political, Legal, and Demographic factors
  • Industry trends
  • New discoveries or knowledge
  • Futuristic opportunities
• Micro-market:

  • Consumer preferences, interests, and perceptions
  • Competitors
  • Unexpected opportunities from customers
  • Talents, hobbies, skills, and expertise
  • Irritants in the marketplace
  • Location
• Methods of Generating Ideas:

  • Focused group discussion (FGD): Moderator leads an open, in-depth discussion with a group to gather insightful ideas for a new product or service
  • Brainstorming: Participants share creative ideas with rules like no destructive criticism, accepting wild ideas, preferring more ideas, and allowing improvement of others' ideas
  • Brainwriting or Internet Brainstorming: Similar to brainstorming but done in writing or online
  • Problem Inventory Analysis: Participants are given an inventory of product or service problems to analyze
• Seizing the Opportunity:

  • Opportunity Seizing is the final step in opportunity spotting and assessment, where entrepreneurs push through with the chosen opportunity
  • Entrepreneurs should dedicate effort and full dedication for the success of the new venture
  • Innovation is the process of positively improving an existing product or service, a key driver for economic growth
  • There are three types of innovations based on the degree of distinctiveness: Breakthrough Innovation, Technological Innovation, and Ordinary Innovation
• Types of Innovations:

  • Breakthrough Innovation: Establishes platforms for future innovations, examples include the internet, computer, or airplane
  • Technological Innovation: Advancements of existing products or services, examples include wifi, laptop, and jet airplane
  • Ordinary Innovation: Commonly originating from market analysis and technology pull, examples include improving packaging, adding a step in service delivery, or augmenting a product or service
• • Test Marketing Stage: Validates work from previous stages, measures success in commercialization based on actual sales results
• Stages of Idea Development:

  • Idea Stage: Entrepreneur determines feasible products/services that suit the opportunity, conducts market evaluation for acceptance by the market and benefits to consumers
  • Concept Stage: Acceptable product/service undergoes consumer acceptance test with initial reactions from the primary target market and distribution channel
  • Product Development Stage: Entrepreneur leverages information from prospective customers, conducts consumer panel to critique actual product/service and compare with competitors
• Socio-cultural factors:

  • Represent a general view of a locality's tradition, customs, beliefs, norms, and perceptions
  • Affect how a person of the locality behaves and reacts to marketing and selling activities
• Technological factors:

  • Composed of innovations of an existing technology or an invention of a new one
  • Entrepreneurs should always be up-to-date with technology changes as they improve products or services
• Economic factors:

  • Play a vital role in marketing as they directly affect any business venture
  • Include income, expenses, and resources that can influence business income
• Environmental or ecological factors:

  • Should be given importance in conducting a business, especially in the context of human-induced calamities
  • Help determine if a business complies with environmental standards and is suited to local weather conditions
• Political factors:

  • Induced by government policies and administrations
  • Can have a strong effect on businesses
• Legal factors:

  • Related to political factors and involve government laws and regulations
  • Can restrict or allow business activities
• Ethical factors:

  • Serve as an entrepreneur's guide on how to be ethical in running a business
• Demographic factors:

  • Characteristics of the people in the target market