Identifying Entrepreneurial Opportunities Solution Assignment

IDENTIFYING
ENTREPRENEURIAL
OPPORTUNITIES

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
1. Background information about those sources that inspired your idea and what motivated
you personally in wishing to set up your own business..............................................................1
2. An introduction to your business idea and what it is, and who and where your potential
customers and target audience are...............................................................................................3
3. A competitor analysis that looks at the competitive marketplace. Look at failures and
successes. What you can do differently? Is this a growth area with low and medium risk........4
4. Gap analysis and how you are looking to close the gaps. What is the situation now and
what is the future? What are the objectives of this business idea and how do you wish to
achieve them?..............................................................................................................................5
5. Market research to support viability for your business idea and identify market potential
using a range of sources that could be both primary and secondary...........................................6
6. Why your business idea is viable and workable and how you qualify this belief. What are
the strengths and weaknesses? How will you overcome the risks and the potential
opportunities for growth and development in the future...........................................................11
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
An Entrepreneur is referred as an individual who has the ability or willingness to
develop, organize and manage a business by bearing all the risk factors involved with it. They
are the one who adapt innovative and creative idea by analysing the need of customers in order
to attain productivity and profitability of business. Risk and Innovation are the main factors of an
entrepreneurial venture. The present study will describe establishment of a new venture in
caffeine sector i.e., coffee hub, which has targeted majorly the age group 15-40 years by
providing coffee flavour with nuts and almonds which will keep them healthy. This study will
also explain a business idea and Drucker's model to determine various business opportunities.
Significance of gap analysis to analyse the competitive industry and various sources to identify
market potential will also be determined under this study.
MAIN BODY
1.
In the present era, to sustain in the competitive world it is very for an entrepreneur to
develop an innovative business idea which can be analyzed by examining the market needs.
Customers today wants to try something new everyday for which an entrepreneur requires to
create something new because customers focuses on advancement offered by a product for which
they are even ready to pay more(Alvarez and Barney, 2010) . An Entrepreneurial opportunity
could be defined as a situation in which goods and services are sold at higher prices. For
entrepreneurial venture an entrepreneur examines all possible opportunities and threats by
optimal use of resources for attainment of high profits. In regard of the present venture i.e.,
Coffee Hub majorly focused to provide high quality of products and services in an affordable
price, in order to grab customers attention. Effectiveness and efficiency must work together, as
they help an organization in adapting optimum resources so that the market growth could be
enhance without and problem. As it can be seen, that the modern world is full of tension and
stress which is affecting an individuals professional and personal life. The idea of opening this
new venture i.e., Coffee Hub in United Kingdom got motivation and encouragement from the
population residing there ( Morris, and et. al., 2012). It was very difficult for the company to
enter the competitive industry as they launched this venture by creativity and innovation which
enabled this entrepreneurial venture to survive in the competitive market. Withal, Peter Drucker
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the father of management studies abstracted that economic activity is the commitment of present
resources to expectation of future which includes uncertainty and risk. Coffee Hub requires
appropriate modification and alteration for its development and success so it implied peter
Drucker 7's model in their business operations, which are explained as follows:
The Unexpected: A business becomes successful only if it has the capability to face
several failures and risks. It is a platform which provides various opportunities for growth but
sometimes there are possibility of unexpected failures which cannot be ignored or denied by the
business. This element is useful for Coffee Hub it will enable the firm to acknowledge the
changing activities of market on the basis of which it can create unique position in the
marketplace (Ananth, Ramesh and Prabaharan, 2010).
Industry and Market Disparities: It refers to differences between various industries and
markets. Both these elements are dynamic in nature, as in the modern environment the
preferences and needs of customers keeps on changing. The food and beverage industry is one
of the fastest growing sector in the economy, so it encourages Coffee Hub to introduce this
venture. In order to foster the growth of sales and satisfaction among st customers, coffee hub
should always be updated with the changes in the market by introduction of new technology and
trends going in the present environment.
Incongruities: It refers to incompatibility between two objects. This element act as a
deviation between what the firm is and what it ought to be. Here two factors are considered i.e.,
price of the product and demand of the product. These factors directly affects the functioning of
the company (Autio, E and et. al., 2014) . This scenario encourages Coffee Hub to analyze the
market by conducting effective research which will help in getting the accurate scenario of the
market. The individuals working in coffee hub can take an initiative to determine the market
trend which can be done by collecting feedback, complaints and reviews so that the proficiency
of the firm could be enlarged.
Process Vulnerabilities:It is known as the main source of the company, by this it
explains that the individuals working should be more oriented towards task rather than the
designed situation. AS there is high level of competition in food and beverage sector, it act as a
main reason for pushing Coffee Hub to identify its willingness to fight against competitors
(Calhoun and et. al., 2010.) . So, it is important for Coffee Hub to analyze all the weak spots and
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correct them since sources of innovation comes from the internal environment than that of
external market.
Changes in perception: It refers to the way of understanding something. All the factors
which changes over time due to innovation in technology and improvement of social network are
considered under this element. In Coffee Hub majority of population drink coffee as it is
considered as energy giving drink. Thereby it aids Coffee Hub to initiate this new venture into
UK for which they have to understand the perception and mentality of individuals residing there.
New knowledge: It is referred as attaining knowledge regarding a new thing. It act as an
important element for innovation and creativity. Development of varied apps motivates the
company to introduce this venture by using latest technology and high quality products in order
to attain the competitive advantage (Alvarez and Barney, 2014) ..
Demographics: It includes age, income level, population, human capital, etc. All these
factors influence decision-making of an organization. In UK, coffee consumption is increasing
rapidly amongst adults and youths it influence Coffee Hub to start their venture in the market of
UK. To improve the overall performance Coffee Hub is required to examine all the opportunities
and take corrective actions.
However, the innovation model pf Peter Drucker permits the Coffee Hub to reach the
target customers in order to improve the profits and productivity in an advanced style.
2.
Entrepreneurial role occupies an important position in the market by providing various
employment opportunities to raise the standard of living of individuals and societies which adds
value to the brand image of the firm( Eckhardt, 2013). To attain and accomplish high profit
margins in an organization, business idea plays an important role in achieving organizational
goal as it is the first step performed by an entrepreneur for launching a new venture in the
market. Business idea refers to a structure which includes all the financial and non-financial
activities required to be performed by business and also gives guidance in optimal usage of
resources to maximize profits. The business idea in this sector was to provide coffee with flavor
of almond and nuts such that the individuals can have coffee and stay healthy at the same time.
Coffee Hub developed a business idea to analyze the current trends prevailing in the market and
willingness to achieve high level of productivity. The business idea of Coffee Hub is mentioned
as follows:
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Profile of Coffee Hub
Coffee sector was developed in UK as it is more dominant over Tea among-st the
population there ( Fuentes and et. al., 2010). It allows Coffee Hub to introduce a new flavor of
Coffee with almonds and nuts. This venture was focused towards building relationship with
consumers by providing products of good quality and giving effective services to add value to
brand image of the firm. Various products provide by Coffee Hub were cookies, dark pastries,
cappuccino, breads, etc. This coffee hub provided customers with a stress relieving environment
and soothing music i.e., where they can feel relieved from workload and stress.
What it is
Coffee Hub manufactures coffee with various flavor one of which is almonds and nuts.
This flavor helps customers in boosting their energy by having healthy drink. This coffee
contains large amount of nuts and almonds which helps in reducing the heart diseases and in
keeping them energetic (Garud and Giuliani, 2013).
Who
This Coffee Hub is majorly targeting the young generation to make them healthy as nuts
and almonds gives energy to an individual which will result in making him fit.
Where
Coffee Hub is located in the area where many colleges are there such that youngsters can
visit it in their lunch or spare time to have an aromatic freshly brewed coffee which will keep
them energetic and fresh (Sarasvathy and et. al., 2010)
3.
A competitive analysis refers to a process of identifying various competitors and
assessing their strategies to find out the weakness and strengths related to a product or service. It
plays an important role in marketing plan of a company. This evaluation helps the company in
establishing unique products and services in order to attract the target market. It is considered as
on of the best way company can make comparison between similar type of products. The current
trend prevailing in UK is of coffee culture. So it can be considered as best opportunity for the
company in expanding this sector. As there are many cafes in the streets so it has become trend
among office individuals too. The development of this sector is one of the pleasant way where
people can interact with each other in a soothing environment. Thus the emerging trend of coffee
among the individuals will increase the growth of Coffee Hub as it is adding some new flavors in
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the life of people living there. In the market, there are various competitors present namely Caffè
Nero, Costa Coffee, etc. Costa is the first prominent British chain of coffee that is used to control
coffee making process (Chang and Chen, 2015). It is ranked as the nations favorite coffee shop
which is followed by Starbucks. Both these competitors are also successful in the market.
Nowadays as customers are taste conscious for which they are ready to pay the maximum, it will
act as a benefit for Coffee Hub as they are providing tempting coffee with new tastes. Addition
of new flavor in the coffee is unique itself as rather than taste it makes an individual to eat
healthy also. In the beginning the company will sell the product at low costs and high quality
which will help in attracting customers. Use of this strategy will lead to capture the market and
will help in attaining the competitive advantage.
4.
Gap Analysis refers to a process of identifying the gap which occurred between the present state
and where the business wants to reach in future (Tontini, G. and Dagostin Picolo, 2010). This
analysis is very essential for an organization as it helps in identifying the actual position of where
the company is standing in the competitive market. A new venture of UK i.e., Coffee Hub's
major focus was to provide tempting and delicious taste which makes an unforgettable place in
the mind of customers. There are many factors through which the company can attain standard
competitive advantage and enhance profitability. The gap faced by Coffee Hub from that of
competitors is the use of technology, as the companies which are already existing are well aware
with the use of technology as they are using it. The other gap faced was in terms of quality, as
the already existing firms are aware with the taste and preferences of customers. For measuring
this gap the company will use Mckinsey 7s Framework as this model is useful for determining
expectations of company. This model is categorized into Hard elements (strategy, structure and
system)and Soft element (staff, skills, style and shared values) . The explanation of McKinsey's
model is described as under:
Strategy: It is referred as a plan of action developed by an organization to gain the competitive
advantage. A strategy will be developed be Coffee hub in order to stay competitive in the market
which could be attained by clearly stating the vision and mission of the organization.
Structure : It represents a way dividing a business unit in an arranged manner such that
information could be easily accountable. An effective structure must be followed by Coffee hub
in order to building brand image of the company (Yuan, 2013) .
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System : It refers to a process of company which discovers the day-to-day activities of
business. The system of Coffee Hub will be responsible for determining the willingness of
employees while facing risk.
Shared Values : These are known as various norms and standards which are followed by
a company that guides employee behavior. Coffee Hub is required to set such guidelines which
enables an employees to maintain a proper work environment.
Staff : It represents the number and type of employees required by an organization and in
what ways they are recruited and trained. Coffee hub is required to train their employees in
order to perform best of their ability and should provide rewards to the employees according to
their performance.
Skills : These are referred as various knowledge and abilities which helps an employee to
perform well in an organization. IN order to develop skills of employees, Coffee Hub can
provide adequate training on regular basis on how to use various technologies. This training will
result in making employees more efficient(Renko and et. al., 2015.) .
Style : It refers to the way in which company is managed by senior level managers. The
style used by Coffee Hub is democratic style because this style treat employees as most
important part of organization and they are involved in decision making also.
5.
Data collection refers to a systematic process of gathering and measuring the data collected from
respondents so that present and future trends could be understood easily and will lead to
accomplishment of objective. Data can be collected through Primary and Secondary sources. For
this data collection, the sample size of 50 respondents has been taken by targeting youngsters and
adults of UK.
Primary Data for Coffee Hub
1. Are you interested in drinking coffee? Frequency
 Yes 30
 No 20
Mean 25
Median 25
6

Mode 10
Yes No
0
5
10
15
20
25
30
Frequency
30
20
Interpretation: From the above graph, majority of respondents like coffee.
2. How frequently do you drink coffee? Frequency
 Daily 15
 Weekly 10
 Monthly 20
 Never 5
Mean 15
Median 15
Mode 10
7

Daily Weekly Monthly Never
0
2
4
6
8
10
12
14
16
18
20
Frequency
15
10
20
5
Interpretation: From the above graph, people generally prefer coffee once in a day.
3. Why do you drink coffee? Frequency
 For taste 15
 As habit 10
 To stay awake 10
 Other 15
Mean 12.5
Median 12.5
Mode 10
8

Interpretation: it can be analyzed that out of 50 respondents 15 respondents drinks coffee for
taste, 10 respondents drinks it as habit, 10 respondents drink coffee to stay awake and remaining
15 respondents drinks coffee for other reasons.
4. How many times do you drink coffee in a
day?
Frequency
 1 time 15
 2 times 10
 more than two 25
Mean 17.5
Median 17.5
Mode 10
9
For taste As habit To stay awake Other
0
2
4
6
8
10
12
14
16 15
10 10
15
Frequency

1 time 2 times more than two
0
5
10
15
20
25
Frequency
15
10
25
Interpretation: From the above graph, out of 50 respondents 15 respondents drinks coffee once
in a day, 10 respondents drinks it for two times a day, and remaining 25 respondents drinks
coffee for more than two times.
5.Where do you prefer to have coffee? Frequency
 At home 25
 At coffee shop 15
 Others 10
Mean 12.5
Median 12.5
Mode 5
10

At home At coffee shop Others
0
5
10
15
20
25
Frequency
25
15
10
Interpretation: From the above graph, out of 50 respondents 25 respondents prefer to drink
coffee at home, 15 respondents prefers to drinks at coffee shop, and remaining 10 respondents
drinks it at various places.
Secondary Data
These are known as already existing data which might be available in newspaper, magazine or
social media. These data does not involves much time as it is readily available . With the help of
social media and news article Coffee Hub can determine various opportunities for its growth and
development (Hills and Hultman, 2013) .
6.
In order to enhance the viability of business it is essential for every business to identify its
strengths, weakness, opportunities and threats to analyze its productivity in the market. In
context of Coffee Hub, various strengths, weakness, opportunities and threats are analyzed to
determine its position (Popp and Holt, 2013)
Strengths:
 Coffee trend in UK.
 Affordable pricing
 effective sitting area
Weaknesses:
 Increased cost
 Dependability on weather conditions
Opportunities:
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 Can expand its network
 Can explore the product segment by introducing something new.
Threats:
 Huge competition in the market.
 Economic situation of the country
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CONCLUSION
From the above study it can be analysed that every entreprenuerial venture involves
innovation and creativity to sustain in the market and in leading the profitability ratio. Business
idea is required to be prepared so that proepr steps could be taken which can help in achieving
organisational goals. In the present study, McKinsey model has helped in evaluating the gap of
in performance of the firm and a competitive analysis has been performed to increase the volume
of sales. Rather than this a SWOT analysis has helped in analysing the willingness of the firm by
using various opportunities to meet all threats of an organisation.
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REFERENCES
Books and Journals
Alvarez, S. A. and Barney, J. B., 2010. Entrepreneurship and epistemology: The philosophical
underpinnings of the study of entrepreneurial opportunities. Academy of Management
annals. 4(1). pp.557-583.
Ananth, A., Ramesh, R. and Prabaharan, B., 2010. Service quality gap analysis in private sector
bank-a customer perspective.
Calhoun, A. W., and et. al., 2010. Multi-rater feedback with gap analysis: an innovative means to
assess communication skill and self-insight. Patient education and counseling. 80(3).
pp.321-326.
Eckhardt, J. T., 2013. Opportunities in business model research. Strategic Organization. 11(4).
pp.412-417.
Fuentes, M. D. M. F., and et. al., 2010. Prior knowledge and social networks in the exploitation
of entrepreneurial opportunities. International Entrepreneurship and Management
Journal. 6(4). pp.481-501.
Sarasvathy, S. D., and et. al., 2010. Three views of entrepreneurial opportunity. In Handbook of
entrepreneurship research (pp. 77-96). Springer, New York, NY.
Tontini, G. and Dagostin Picolo, J., 2010. Improvement gap analysis. Managing Service Quality:
An International Journal. 20(6). pp.565-584.
Yuan, H., 2013. A SWOT analysis of successful construction waste management. Journal of
Cleaner Production. 39. pp.1-8.
Renko, M., and et. al., 2015. Understanding and measuring entrepreneurial leadership style.
Journal of Small Business Management. 53(1). pp.54-74.
Hills, G.E. and Hultman, C., 2013. Entrepreneurial marketing: Conceptual and empirical
research opportunities. Entrepreneurship Research Journal. 3(4). pp.437-448.
Popp, A. and Holt, R., 2013. The presence of entrepreneurial opportunity. Business History.
55(1), pp.9-28.
Chang, W. L. and Chen, S. T., 2015. The impact of World Café on entrepreneurial strategic
planning capability. Journal of Business Research. 68(6). pp.1283-1290.
Garud, R. and Giuliani, A. P., 2013. A narrative perspective on entrepreneurial
opportunities. Academy of Management Review. 38(1). pp.157-160.
Alvarez, S. A. and Barney, J. B., 2014. Entrepreneurial opportunities and poverty
alleviation. Entrepreneurship Theory and Practice. 38(1). pp.159-184.
Autio, E and et. al., 2014. Entrepreneurial innovation: The importance of context. Research
Policy. 43(7). pp.1097-1108.
Morris, M. H and et. al., 2012. Framing the entrepreneurial experience. Entrepreneurship theory
and practice. 36(1). pp.11-40.
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