Identifying Entrepreneurial Opportunities

This project examines the viability of opening a fast-food restaurant called Krispy Chicken in Bloomsbury, London. It analyzes the market potential, competitor landscape, and potential risks. The project includes a SWOT analysis, gap analysis, and a detailed cash budget for the first year of operation. It also outlines strategies for overcoming competition and achieving long-term growth. Desklib provides past papers and solved assignments for students.

Identifying entrepreneurial
opportunities

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Main Body.......................................................................................................................................1
1.Determining and evaluating different sources of entrepreneurial ideas and innovation..........1
2. An introduction of business idea ...........................................................................................3
3. A Competitor analysis ............................................................................................................3
4. Gap analysis and strategies for filling those gaps ..................................................................5
5. Market research for supporting the viability of business idea and identifying market
potential ......................................................................................................................................7
6. Viability and feasibility of business idea and the reasons for believing in proposal.
Strengths and weaknesses ..........................................................................................................8
7. Strategies for overcoming risk of competition, for grabbing potential opportunities and
growth in the future ..................................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Entrepreneurship can be defined as the activity of process of setting up of a new business
by undertaking financial risk for the purpose of earning of profits (What is Entrepreneurship,
2019). The present project report will focus on a proposal of opening a restaurant called Krispy
Chicken in UK. The report will revolve around the sources that inspired this idea and motivation
for opening this restaurant. Information about the proposed restaurant, an analysis of
competitors, gap analysis will be covered here. Also, a market research will be conducted for
supporting the viability of the proposed idea. The report will show that why the idea is viable,
what are its strengths and weaknesses and what will be the strategies for overcoming the risk of
competition.
Main Body
1.Determining and evaluating different sources of entrepreneurial ideas and innovation
There are different sources of generating entrepreneurial ideas. The sources behind the
thought of opening of a restaurant called Krispy Chicken in UK are as follows:
 Person's interest and hobbies plays great role in determining and generating ideas for
its proposed venture. The interest or hobby is a set of activities that provides happiness
while doing it.
The strength of this source is enjoying what a person is doing helps in delivering its best.
Drawback is that not every hobby could be materialised or can be pursued.
 Conducting customer surveys could be the another source why opening up of Krispy
Chicken restaurant idea developed. For examples, Food blogs showed the demand and
requirements of customers regarding chicken dishes.
Customer surveys tells what are customers requirements and demand of product in
market. However, Surveys are mostly unrealistic and do not provide a reliable picture.
 Brainstorming is a technique of solving problem. It considers developing many ideas
and course of action and selecting the best one for the proposed project of starting the
restaurant.
The technique is useful as different possible alternative are formed by taking suggestions
from people etc., it leads to realistic formation of ideas. However, forming such alternatives
consumes lot of time as huge information has to be gathered (Acs, Szerb and Lloyd, 2017).
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 Mass media such as television, internet, magazines etc., is the signifiant source of
developing ideas, opportunities and information.
Generating ideas through mass media is a viable source as this features ideas of young
entrepreneurs sharing their experiences. However, stories of people sharing their ideas are just a
publicity stunt of some companies for advertising its brand name (Golovina, Merkulov and
Polyanin, 2017).
All these sources motivated graduate entrepreneur in developing idea of starting up a
business in food industry.
Peter Drucker's model for determining the sources of systematic innovation could be
utilised by the entrepreneur. An evaluation is done below:
Unexpected success or failure : Taking lessons from previous success and failure can
help entrepreneur in bringing innovation in its proposed plan. For example, McDonald's used its
previous failure in south-east countries where it served its standard products with less spices. It
made them to come up with more customized products that met the requirements of its target
market (Peter Drucker on the Seven Sources of Systematic Innovation, 2019).
The inconsistencies between what should happen and what actually happened : This
factor develops ideas in enterprisers' mind when things do not go as planned. It tries to fill those
gaps by innovative thinking and methods. For example, when organisations plans to have cost
efficiencies in its operations but it incurs huge expenses in carrying its activities of production.
This calls for innovation and this could be done by bringing the latest technology and trained
professionals in company which could improve productivity and reduce cost of operations.
Enterpriser could use this source for innovating its products and operations for making Krispy
Chicken a successful venture.
Deficiencies in process : The deficiencies which were are ignored and are taken for
granted provides the room for innovation. For example, production process in restaurant may
have shortcomings such as excess wastage while making dishes, it could be overcome by
thinking creatively by making chefs and other staff more competent through trainings.
Changes in market structure or industry which catch unawares of everyone: Intense
competition, ever changing preferences of customers asks for innovation. For instance,
Competition from rival firms forces entrepreneurs to continuously work on innovation.
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Changes in Demographics: Changes in proportion of population, their lifestyles forces
entrepreneurs to produce something new. For example, customers are becoming health conscious
nowadays, which compels restaurants to offers more healthy foods.
Changes in perception : Customers perception towards products and other subject
matter develops ideas for new entrepreneurs of producing something innovative. For examples,
perception of customers towards health and fitness have been capitalised and it has provided
growth to fitness industry.
New knowledge : Having new technical and non technical knowledge by entrepreneurs
helps them in bringing innovation in their ideas, products etc.
2. An introduction of business idea
What is it ?
The graduate entrepreneur has developed the idea of starting a fast food restaurant named
as Krispy Chicken. The menu of the restaurant will have chicken element in each of its servings.
Like, it will have four dishes, salads will have chicken pieces, chicken rolls, chicken gravy with
tortilla and crispy chicken wings, burgers. It will also offer variety of beverages.
Where is it ?
The restaurant is proposed to be set up in Bloomsbury, London. This place is chosen
because of convenience of place to people, crowd of young people, high student base area.
Potential and target audience ?
The entrepreneur wishes to open the restaurant in the student crowed area in London
which why it chose Bloomsbury. The target audience is college going students, young people.
The reason for opting this segment is that young people prefers fast food items. Also, people in
that place prefers non vegetarian dishes among which chicken dishes tops their list. Being a
young entrepreneur, it exactly knows what this segment specifically requires (Adekiya and
Ibrahim, 2016).
3. A Competitor analysis
The entrepreneur can conduct a competitive analysis by which competitiveness of the
market could be known.
Basis Subway in
Bloomsbury
Five guys Tortilla Russell
Square
Products Provides wide range of Specializes in burgers The restaurants serve
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vegetarian and non
vegetarian products.
and provide a range of
burgers.
tacos, Burritos and
salad.
No. of employees A franchise of subway
requires 10- 15
members. It has
around 17 staff
members. UK stores
has around 8600
employees.
Overall employees
number of Five Guys
are approximately
15000.
Has employee strength
of 100 in UK.
No. of branches 33749 restaurants in
world, 1700 stores in
UK.
Around 1000 stores in
US, Canada and UK.
It has around 30
restaurants in UK.
Organization structure It follows departmental
structure which is well
defined.
Hierarchical structure,
manager-subordinate
relationships exist.
It does not follow
hierarchical structure
but have a mixed
defined structure.
USP Fast service, ambience
and friendly staff.
Freshness in products,
avoids using of
microwave, frozen
foods.
Quality and taste of
authentic Mexican
food.
Marketing strategy Relies on its Global
branding and
advertises it through
digital media (Schaper,
ed., 2016).
Believes in word of
mouth marketing
strategy and do not
aggressively promotes
business.
It aggressively markets
its products on social
media, newspaper and
food magazine.
Krispy Chicken is offering chicken burger, chicken wings, salads, burgers and beverages
as its main component. The entrepreneur needs to have minimum of 20 staff members for
running a store efficiently. It must have well defined organisation structure which meets the
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business objective. And for beating competition and surviving peacefully, it must bring
innovation in its operations (Lebedeva and et.al., 2015).
Success of fast food industry: McDonald's, Five Guys etc. are one of the largest fast food
chains in UK. The quick delivery of products to customer, high preferences of people regrading
fast foods, location of stores, reasonable prices with good quantity of food, creative branding,
marketing, hitting right chords of people emotionally have led to the enormous growth of fast
food industry in UK.
Failure of industry: Strict health and Safety regulations, shifting preferences of people
from eating unhealthy food to organic and low fat food products, high taxes on core raw
materials, high restriction on divertissements content, high level of competition from global
industry are the main reasons for failure of this specific industry (Mugler, 2017).
What entrepreneur can do differently?
 The entrepreneur needs to serve more organic, fresh and healthy food to its customers.
 It can price its product relatively cheaper than its competitors for beating them.
 Unique marketing strategy for attracting customers such as allowing discounts, providing
excellent ambience and quality food to people.
 The Latest technology in communication system, in kitchen, in billing system would
increase the speed of delivery of services.
 Highly trained chefs would provide entrepreneur a competitive edge over others.
The industry is very competitive and involve huge risk of failure due to ever changing
preferences of customers, government's regulations, restrictions on advertisements, etc.
Therefore, to enter successfully in this market, a proper market research is necessary. This is not
only a one time process but being updated on customers requirements and competitor's position
would help the entrepreneur to survive peacefully in market (Porfírio, Carrilho and Mónico,
2016).
4. Gap analysis and strategies for filling those gaps
Gap analysis is a strategic method of determining gap between targets and the estimated
or anticipated results. The analysis also assess the strategies that could be applied for filling those
gaps. In simpler words, it is comparison of current performance of business with that planned
outlines prepared previously. An analysis is done below:
Basis Current condition Desired condition Action plan
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Products Serving non vegan
products
The market has a
demand of organic and
fresh food items
Addition of organic
food offerings in
menu.
Cost The product are priced
low.
It might become
hindrance in earning
huge profits in early
years.
A well pricing
strategies could be
used for setting right
prices.
Production process Frozen foods are used
in some dishes.
The customers want
highly freshen
products.
Avoiding microwave
and frozen foods
inputs, purchasing
fresh materials and
using them in
providing fresh dishes
to customers.
Technology The business idea
involve the latest
kitchen equipment and
technology in
operations (Jahangiri
and et.al., 2017).
However, business
demands For
increasing efficiency
operations, proper
integrated information
system is required
such as billing system,
order collecting
system, online
delivery etc.
Installing a
customized
management
information system
for better
communication in
restaurant.
Objectives of business: The entrepreneur has defined following objectives for its
business against which it has formed various strategies for achieving those objectives.
Business objectives of Krispy Chicken
Objectives Strategies
Customer satisfaction and gaining loyalty  By serving quality food and services.
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 By providing customised food products
and services.
 By making them feel that they are
precious in every way possible.
Attaining planned financial targets for a
particular period
 Controlling food cost, operating cost of
restaurant
 Serving products and services
consistently.
Establishing a reputation for Krispy Chicken  High class food products
 low prices
 minimum delivery time
 A strong and creative management
team
Stability and Longevity of business  Consistency in financial performances
 Updating regularly regarding customers
changing preferences.
 Coping with competition in terms of
management, employees, products,
technology, taste etc (Martínez-Fierro,
Biedma-Ferrer and Ruiz-Navarro
2016).
5. Market research for supporting the viability of business idea and identifying market potential
The entrepreneur has to conduct market researches for providing support to viability of
its idea. The data could be collected by entrepreneur by different sources that are given below:
Primary sources: The data collected by researcher on field is called as primary research.
There are different primary sources that are discussed below:
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 Customer survey : These surveys helps in obtaining critical information about customer
requirements, their demands, perceptions. These become the basis for entrepreneur in
giving a green signal to its idea. The surveys consist of various question like:
Do you prefer non vegan food over vegan item?
What are your expectations regarding fast food products?
What price are they willing to pay for a fried chicken wings?
These types of queries has helped entrepreneur in forming the base for identifying target
market of young people, students and their preference of having chicken filled quick foods.
 Observation : The entrepreneur has undertaken observation activity for determining the
demands of students, young people in Bloomsbury. It has observed other restaurants,
what they are serving, at what price, are there offerings enough satisfactory, what are
their strengths and where they lag behind etc. The observation provided outcomes that
young lads and students wants quick food that does not take much of their time at low
priced. Also, they want organic and freshness elements in food items. An overview of
competitors discloses that they are serving their at reasonably high prices which is
creating dissatisfaction amongst students. Also, their serving time is long due to proper
management of operations.
Secondary sources : Data collected by entrepreneur by the already established
and published books, articles, internet, literature, reports are called as secondary research. The
entrepreneur has gone through different blogs about fast food industry that supported the idea of
selling its product to young class of market. Various literature on market identification, market
positioning has been read by entrepreneur which supported its proposal. Cost leadership strategy
of marketing is one of established rule of marketing that is applied by entrepreneur in its
proposal. The planning is to enter in market with low priced food product is supported by this
rule of marketing. It has read many success stories of young entrepreneurs applying this strategy
in their proposals, how they materialised this rule etc. It would act as a promotional tool as well
as a strategy for facing competition from established restaurants for the entrepreneur (Market
Research: The Basics, 2019).
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6. Viability and feasibility of business idea and the reasons for believing in proposal. Strengths
and weaknesses
From the above collected data, it can be said that business proposal of entrepreneur is
viable as it meets the basic criteria of market condition and preparation of strategies for
developing something different from its competitors adds more to the viability of its business
idea.
For determining the feasibility of fast food restaurant start-up, a cash budget is prepared
for 12 months.
Particulars
initial
investme
nt
Janua
ry
Februar
y
ma
rch
Ap
ril
ma
y
Jun
e July
aug
ust
Septe
mber
Oct
ober
Nov
emb
er
Dec
emb
er
sales of food
Number of
customers 30000 33000
363
00
399
30
439
23
483
15
5314
7
5846
2
6430
8
7073
8
7781
2
855
94
average cost 30 30 30 30 30 30 30 30 30 30 30 30
Total
revenue
90000
0 990000
108
900
0
119
790
0
131
769
0
144
945
9
1594
405
1753
845
1929
230
2122
153
2334
368
256
780
5
sale of
beverages
Number of
customers 35000 40000
420
00
441
00
463
05
486
20.2
5
5105
1.26
25
5360
3.82
5625
5628
4.016
9062
5
5909
8.21
7751
5625
6205
3.12
8639
1406
651
55.7
850
710
977
average cost 20 20 20 20 20 20 20 20 20 20 20 20
Total
revenue
from
beverages
70000
0 800000
840
000
882
000
926
100
972
405
1021
025
1072
077
1125
680
1181
964
1241
063
130
311
6
9

Total
revenue
(cash
inflow)
16000
00 1790000
192
900
0
207
990
0
224
379
0
242
186
4
2615
430
2825
922
3054
910
3304
117
3575
431
387
092
1
Expenses
Accommoda
tion 15000 0 0 0
100
0 0 0 0 200 0 0 700 0
Running cost
of
Machineries 700 0 500 0 0 900 0 700 0 600 0 250 0
kitchen
equipments 500 400 250 200 350 400 100 200 150 750 500 400 300
Employees'
salaries 3500 3500
350
0
350
0
350
0
350
0 3500 3500 3500 3500 3500
350
0
Commission
of Supplier 3000 2500
220
0
450
0
400
0
300
0 2500 2600 3200 3500 4000
420
0
Selling and
Advertiseme
nt expenses 400 400 400 400 400 400 400 400 400 400 400 400
Miscellaneo
us expenses 1200 1400
140
0
100
0 800 700 1200 1300 1400 600 700 800
Total
expenses
(cash
outflow) 16200 8500 8550
770
0
107
50
100
00
770
0 8500 8150 9850 8500 9950
920
0
Net cash
flow 16200
15915
00 1781450
192
130
0
206
915
0
223
379
0
241
416
4
2606
930
2817
772
3045
060
3295
617
3565
481
386
172
1
10

owner's
capital 10000
grant 50000
Loan 90000
Opening
balance of
cash 150000
16620
0 1757700
353
915
0
546
045
0
752
960
0
976
339
0
1217
7554
1478
4484
1760
2256
2064
7316
2394
2934
275
084
14
Closing
balance of
cash 166200
17577
00 3539150
546
045
0
752
960
0
976
339
0
121
775
54
1478
4484
1760
2256
2064
7316
2394
2934
2750
8414
313
701
35
The above cash budget shows that entrepreneur would have a closing balance of 1757700
pounds at the end of month of January. This has been derived by deducting cash inflows
generated by sales from the cash outflows in the form of expenses incurred by business in staff's
salaries, selling and advertisements expenses etc. Likewise, the cash budget is prepared for the
period of 12 months.
SWOT analysis of business idea of opening up of Krispy Chicken
Strengths :
 Quick food items are highly preferred by college going students.
 Low priced products of Krispy Chicken.
 High quality food products with freshness.
 The Latest technology in operations and kitchen which makes management effective
(Cooper and Folta, 2017).
 Skilled chefs for preparing perfect and tasty dishes.
 Convenient location in London, a high student crowded area in Bloomsbury.
 Online delivery and quick service time.
Weaknesses:
 Offering only non vegan food items.
 Lack of practical knowledge of young entrepreneur.
Opportunities
 Entering into new market segments like adding vegan dishes, desserts etc.
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 Preparing more high protein products for attracting fitness conscious people.
 More innovation in food offerings for example creating a fusion dishes from different
culture.
 Highly differentiated marketing strategies by using social media for attracting large
customers.
Threats:
 Cut throat competition from local and international fast food chains.
 Extreme low prices may decrease the profitability.
 Governments regulations regarding health and safety standards.
 Ever changing requirements of customers (Shaykhutdinova and et.al., 2015).
7. Strategies for overcoming risk of competition, for grabbing potential opportunities and growth
in the future
Recommendations : As known by the above conducted competitor analysis, the
entrepreneur would face stiff competition from established and reputed restaurant chains,
therefore, it needs to formulate strategies for overcoming the risk of competition. The various
ways are discussed below:
Differentiation : Entrepreneur needs to make its products highly differentiated from its
competitors. This could include taste, price, the way it is served to people, quick service time. It
can make its products unique by collaborating two different culture and preparing a fusion dish
(4 Ways to Pull Ahead of Your Competitors in Business, 2013).
Cost leadership : As mentioned earlier also, entrepreneur has opted for cost leadership
strategy for handling its competitors effectively. This strategy would also help in entering into
target market easily (Cecora, 2018).
Serving as per customer's preferences : The target audience of entrepreneur's business
proposal demands non vegan food products that are very fresh and does not want frozen food
being microwaved and served. These preferences and requirements would help in satisfying
customers and gaining their confidence. Being updated as per market demands and moulding
services and products would mitigate the risk of competition in market.
Unique and effective marketing strategies would help in beating risk of competition.
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Targeting on competitor's weaknesses and innovating our products and processes helps in
overcoming the competition. For example, prices of subway, Mexican tortilla are relatively
higher. This could be materialised by entrepreneur by introducing yummy food with low prices.
The entrepreneur can grab opportunities available in market (Cañeque and Hart, eds.,
2017). Entering into market involves assessment of its environment that includes various factors
such as :
Internal factors : These factors includes entrepreneur's resources like funds, employees,
working environment, technical knowledge, any capability leading to a competitive edge etc.
External factors: These include macro environmental factor that affects the business
idea of entrepreneur. These are : political stability, laws and regulations related to fast food
industry, culture and ethnicity of population, environmental concern and technological trends in
this industry.
The entrepreneur could grow and develop its business by serving different segments of
market such as serving vegan food, adding more protein elements in its dishes for attracting diet
conscious people, regularly creating innovative dishes that are not served by any of its
competitor etc. Stability and long term profitability would be derived by serving consistently and
this would generate enough resources for entrepreneur to start more of its restaurants all across
UK (Agrawal, 2017).
The other recommendation is to make research more comprehensive by conducting it
through methods like personal interviews, detailed surveys, involving large sample size. This
would help the entrepreneur in gathering more reliable information upon which its business
strategies could be made more effective.
CONCLUSION
From the above report, it can be summarised that entrepreneurship is the process by
which people plans to start up a new venture. These skills help young graduates in starting
something of their own. The project concluded that entrepreneur conducted market research
which threw lights on the viability of its business idea in terms of target market, customer's
preferences such as non vegan fast food, quick service time, low priced , cost leadership strategy
for entering into market and for facing the intense competition. Further, a swot analysis was
conducted on Krispy Chicken which showed that this idea includes advanced technology in its
operations, based on the current trend of fast food industry, online taking orders and home
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delivery etc. It also highlighted few weaknesses of this business idea that it would serve only non
vegan section of market. This would restrict the entrepreneur in serving masses, hindering its
market share and profitability.
14

REFERENCES
Books and Journals
Acs, Z. J., Szerb, L. and Lloyd, A., 2017. The global entrepreneurship and development index.
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Adekiya, A. A. and Ibrahim, F., 2016. Entrepreneurship intention among students. The
antecedent role of culture and entrepreneurship training and development. The
International Journal of Management Education. 14(2). pp.116-132.
Agrawal, H., 2017. Entrepreneurship an Aspect. Journal of HR, Organizational Behaviour &
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Cañeque, F. C. and Hart, S. L. eds., 2017. Base of the Pyramid 3.0: Sustainable development
through innovation and entrepreneurship. Routledge.
Cecora, J., 2018. Cultivating grass-roots for regional development in a globalising economy:
innovation and entrepreneurship in organised markets. Routledge.
Cooper, A. and Folta, T., 2017. Entrepreneurship and high‐technology clusters. The Blackwell
handbook of entrepreneurship. pp.348-367.
Golovina, T. A., Merkulov, P. A. and Polyanin, A. V., 2017. Strategic vectors of the
development of the state support of youth entrepreneurship in Russia. Economic Policy. 5.
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Jahangiri, M and et.al., 2017. The Role of New Technologies in the Development of
Employment and Rural Entrepreneurship through Fuzzy Method.
Lebedeva, T and et.al., 2015. Intellectual provision of the innovative entrepreneurship
development. Mediterranean Journal of Social Sciences. 6(5 S3). p.303.
Martínez-Fierro, S., Biedma-Ferrer, J. M. and Ruiz-Navarro, J., 2016. Entrepreneurship and
strategies for economic development. Small Business Economics. 47(4). pp.835-851.
Mugler, J., 2017. The climate for entrepreneurship in European countries in transition. The
blackwell handbook of entrepreneurship. pp.150-175.
Porfírio, J. A., Carrilho, T. and Mónico, L. S., 2016. Entrepreneurship in different contexts in
cultural and creative industries. Journal of Business Research. 69(11). pp.5117-5123.
Schaper, M. ed., 2016. Making ecopreneurs: developing sustainable entrepreneurship. CRC
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Shaykhutdinova, G. F and et.al., 2015. Actual problems of youth entrepreneurship at the modern
stage. Journal of Advanced Research in Law and Economics. 6(2). p.378.
Storey, D. J., 2016. Entrepreneurship and new firm. Routledge.
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