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Entrepreneurship studies Chapter 2: Entrepreneurship studies Chapter 2 Cosmopoint International University College, School of Business 200 Business Opportunities: Business !pportunities "hat is a Business !pportunity# $ %usiness opportunity is said to e&ist 'hen( )here is a possi%ility of offering a ne' product or service in a particular mar*et+ )he product or service fulfills the demands and preferences of the customers+ "here the product can %e used to solve their pro%lem+ Business Opportunities: Business !pportunities "hen and "hy is there a need to offer a product or service in a particular mar*et( "hen# Changes in Environmental ,actors -olitical and .egal Economic Social )echnological "hy# Because Environmental ,actors effect customers/ demand for particular product or service+ Business Opportunities: Business !pportunities )he -rocess of Identifying, Evaluating and Selecting a Business opportunity+ Identify the needs and 'ants of customers+ Scanning 0e&amining1 the environment and evaluating of self 0entrepreneur1 and the community+ Screening 0-rocess of evaluating1 of %usiness opportunities+ Selecting a %usiness opportunity -reparing a Business -lan+ Business Opportunities: Identify the needs and 'ants of the customer 2uman needs and 'ants $ need is something that is %asic in life, for e&ample 'e need food, clothing and shelter+ But as human 'e also have 'ants that is, there is a desire or craving something that is far %etter than %asic items+ "ants are shaped %y ( !ur life style .evel of Education -urchasing po'er -ersonality of the person Business !pportunities Business Opportunities: Business !pportunities 2uman needs and 'ants 2uman needs and 'ants are unlimited and are of all types+ Society affluence lead to increase to human 'ants and needs 3ore %usiness opportunities arises+ )hus entrepreneurs must ta*e this opportunity to provide products and services Entrepreneurs must %e sensitive to changes in customers/ needs and 'ants in order to %e a'are of ne' %usiness opportunities+ Business Opportunities: Scanning the environment and evaluating of self and the community+ Environmental Scanning 0ES1 ES can lead to an idea that can %e converted into a %usiness opportunity+ )'o approaches are used and 'hat are they# Scan the environment %y micro perspective Scan the environment %y macro perspective ,rom the macro perspective for e&ample the agricultural sector can offer %usiness opportunity in forestry, fishing, plantation, and livestoc* %reeding+ Business !pportunities Business Opportunities: Scanning the environment and evaluating of self and the community+ Environmental Scanning 0ES1 But from micro perspective every industry can offer specific %usiness

opportunities+ ,or e&ample in the case of forestry an entrepreneur can %e involved in( .ogging 3anufacturing of veneer ply'ood -rocessing of sa'n tim%er 3anufacturing of furniture+ 3a*ing 'ooden doors and frames+ Business !pportunities Business Opportunities: $nother approach of scanning the environment is %y loo*ing at the follo'ing factors( Structure of the population, income and tastes+ E&amine the import and e&port information of a country+ Study and e&amine types of local resources and technological %rea*through+ E&amine the Industrial lin*ages+ E&amine the development pro4ects %y the pu%lic and private sectors+ 5e'spaper and maga6ines local and foreign as a source of %usiness opportunities Business !pportunities Business Opportunities: $nother approach of scanning the environment is %y loo*ing at the follo'ing factors( E&amine 'hat the local issues and social pro%lems E&amine 'hat ne' government policies and regulation have impact on small %usiness+ Business !pportunities Business Opportunities: Self Evaluation Besides Environmental scanning one is to do a self evaluation to identify 'hat s*ills, e&perience is availa%le in an entrepreneur that can %e used in %usiness development and engagement+ S*ill competency, e&perience, *no'ledge that match the %usiness opportunities+ Business !pportunities Business Opportunities: )he factors that need to %e considered are as follo's( E&perience 7no'ledge and Competency S*ills ,inancial Status and situation Interest li*es and disli*es 5et'or*ing circle of friends and associates Cultural values and norms of the community+ Business !pportunities Business Opportunities: Screening of Business !pportunities By using the process of screening %usiness opportunities 'ill help the entrepreneur to select a %usiness opportunity that he or she can focus on totally and %e dedicated to it success+ )his process involves four factors as follo's( .egal 'ithin the la' of the country+ 3onopolistic -o'er and .evel of Competition+ Capital 8e9uirements must %e ade9uate to %usiness underta*ing 8is* factor .i9uidity .evel .oans Credit facilities for customers+ ,oreign E&change 8ate volatile or sta%le currency rate+ Business !pportunities