(Solved) Identifying Entrepreneurial Opportunities - Assignment

Identifying Entrepreneurial
Opportunities

Table of Contents
INTRODUCTION...........................................................................................................................1
P1. Determine and evaluate different sources of entrepreneurial ideas and innovation.............1
P2. Rationale and market gap for a specific entrepreneurial idea using relevant tools and
techniques....................................................................................................................................3
P3. Present data needed to support gap analysis in the evaluation of market potential..............5
P4. Interpret data appropriately to provide evidence of market potential...................................7
P5. Apply a SWOT framework to collate evidence to support an objective assessment of a
entrepreneurial idea.....................................................................................................................9
P6. Evaluate the competitive and market environments in which the idea will be launched to
assess potential viability............................................................................................................10
CONCLUSION..............................................................................................................................10
References......................................................................................................................................12

INTRODUCTION
Entrepreneurs play important role in weighing up the opportunities, personal capacities
and threats for translating an opportunity to the business idea. Entrepreneurs focus on
thoughtfully examining themselves and business opportunities and then translate them into
business and becomes successful corporate innovator or start up entrepreneur. The report is
based on the pitch presentation which will be presented to financial investors. The pitch
presentation will lead to provide background to the sources of inspiration and market research
that have undertaken by the entrepreneur.
This pitch report will include evaluation of various sources of entrepreneurial ideas and
innovation. Explanations of rationale and market gap for specific entrepreneurial idea will be
done using relevant tools and techniques. Data will be presented in order to support gap analysis
in evaluation of specific entrepreneurial idea and it will be interpreted as well to provide
evidence of market potential. The SWOT framework will be applied and also evaluation of
competitive and market environment will be done.
P1. Determine and evaluate different sources of entrepreneurial ideas and innovation.
There are various sources through which entrepreneurs get their business idea from, and
then they translate it into successful business idea. Individuals can get entrepreneurial ideas and
innovation ideas from the external and macro environmental. The entrepreneurial ideas can be
identified from the STEEP factors, which is explained as follows:
 Social: This element of external environment may take into account social aspects which
generally describes the society as a whole. Increasing use of social media among
youngsters can also be the sources of entrepreneurial ideas (STEEP Explained- Foresight
Cards. 2019).
 Technological: Various advances and changes in technological aspects of macro and
external environment can lead to bring out the innovative and entrepreneurial idea. For
example, emerging new technologies, changes in rate of progress, techniques used in
business, etc.
 Environmental: The business ideas can be developed by considering this aspect of the
external environment. For example, changes or developments in the environmental
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factors and ecosystem can create opportunities which can translated into successful
business ideas.
 Economical: This element of external environment can also help the individual for
identifying any innovative and entrepreneurial ideas. Individuals can properly assess how
customers will react to the changes in the economical aspects of the environment and
translate that into business idea. For example, shifts in economic landscapes which leads
to rapid development of the emerging markets.
 Political: Understanding political and legal aspects of the external and macro
environment can also help in identification of opportunities which can be translated into
business ideas. For example, changes in rules and regulations can create opportunity to
grow and develop business in the specific area or sector (Batraga and et.al., 2018).
The sources of entrepreneurial ideas and innovation can be evaluated with the help of Drucker's
7 sources of Innovation, which is explained as follows:
1. The unexpected: Market place is considered as the primary area to look for the
opportunity. One needs to continuously study the market for gaining entrepreneurial idea
and innovation. The best source for entrepreneurial ideas and successful innovation can
be identified from the unexpected success or failure. One can learn from the success and
failures as well, thus, this is considered as the source of entrepreneurial idea and
innovation.
2. Incongruities: There exists a discrepancy between what it is and what it should be. And
this can be considered as the one of the source of entrepreneurial idea as it helps in
developing wildly innovative and successful business ideas (Carraher, 2018). People can
look for entrepreneurial business ideas from incongruity and it may take place in
customers, their issues, complaints and various unmet wants which can provide hints in
developing innovative business ideas.
3. Process Need: This may involve identification of company's weak spots of the process
and finding ways for correcting and redesigning them. This source is considered as the
task oriented as sources of ideas and innovation comes from within the existing capability
and way of doing business.
4. Industry and market structure change: One can also identify the ideas for
entrepreneurial start-ups from the market and industrial changes. For example, when
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some product line increases or shrink and even when regulations change, one needs to
have continued watch on this for identify the entrepreneurial ideas out of it.
5. Demographics: The entrepreneurial ideas can be generated by constantly seeing the
changes occurring in the population, their income levels, age ranges and even education
and human capital.
6. Changes in perception, meaning and mood: The entrepreneurs can also identify the
innovative and start-up ideas by paying attention to the changes happening in population.
The way people view life, where people take their meaning from and also how people
feel regarding things has changed and modified and people can consider this for
capitalizing it.
7. New Knowledge: The entrepreneurial ideas can be identified from the technological
revolution (The 7 Sources Of Innovative Opportunity, 2012). The technology is
developing and which leads to bring various opportunities which can be opened up by
entrepreneurs for translating it into business ideas.
P2. Rationale and market gap for a specific entrepreneurial idea using relevant tools and
techniques.
The business and entrepreneurial idea that has been chosen is Mediterranean restaurant
and bar. The unique and innovative idea that can attract great number of customer is its unique
Cocktail drinks and its unique American-Swedish menu that have the touch of Asian influence as
well. The name of the new start-up business is “Eternity Restaurant and Bar”.
The rationale behind choosing this business idea is that restaurants and hotels have high
demands and the overall hospitality industry is growing on rapid pace (Ćirić, Lalić and Gračanin,
2016). The food and beverage industry is innovative and unique, and the unique restaurant
concept can be considered as the best start-up idea. Starting up restaurant that have unique and
new food items and cocktail drinks can get many benefits and opportunities for the entrepreneurs
and thus, this idea has been chosen.
Goals and objectives of the entrepreneurial ideas is:
 To keep gross profits margin at approximately at 50%.
 To gain financial success that covers the total start-up investment by the end of second
year.
 To improve the inventory turnover upto 200 turns by the next year.
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 To increase sales to more than £234,500 by the end of third year.
Identifying Customers
In order to get successful and effective outcomes or results, one needs to identify the
customers group. It is greatly important for understand the need for identification of customer
types and groups for targeting the new business idea. “Eternity Restaurant & Bar” will put target
on behavioural, demographic and geographical segmentations. The business will put special
focus on targeting local people and tourists and people who actively seeks restaurants. Special
focus will be on the young adults having 15 K to 50 K income and who are looking for the great
time and great food and beverage. The general demographic segmentation of “Eternity
Restaurant & Bar” are females and males age of 18 to 50 having some or all of the University
education. In addition to the local are people, the restaurant will also serve the party loving
people from the neighbouring cities and tourists as well.
Tangible and intangible features
The tangible and intangible features and benefits of products and services of “Eternity
Restaurant & Bar” will lead to attract customers and also leads to satisfy them. The menu
contains various different types of food items and beverages. It contains various traditional food
items such as Bangers and mash, Shepherd's pie, Steak and Kidney Pie and many more. These
food items are differentiated from the use of fresh and organic ingredients. The speciality of
“Eternity Restaurant & Bar” is that everything is made form fresh and organic ingredients and it
is also prepared on daily basis (Davidsson, 2015). The staff and server that are hired have
extensive experience and knowledge of managing restaurant activities and operations. They will
also be provided with three-weeks training and it will be ensured that they provide benchmark
customer services.
Understanding the industry environment:
Entrepreneurs aim at analysing its competitors and markets to identify the opportunities
and threats available in the industry from the perspectives of new entrant. This important to
understand the restaurant industry environment to identify the likely success of “Eternity
Restaurant & Bar”. Porter's Five Forces model can be used for effectively analysing the
attractiveness of the industrial environment from the new entrant perspective and it is given as
follows:
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Threat of Substitute: There are many restaurants in the UK that provides quality food and
innovative cocktail beverages. But,“Eternity Restaurant & Bar” offers American-Swedish menu
having touch of Asian influence which is unique and rare in UK markets. Therefore, the threat of
substitute is relatively low.
Bargaining Power of Suppliers: This force of the environment is comparatively low for the
Eternity Restaurant & Bar. This is because the entrepreneur buys what is best of every supplier
and provides good quality food.
Bargaining Power of Customers: This force of the environment is very strong as customers
will not have to incur any extra cost for selecting another place to dine. With the help of internet
and social networking sites, customers can get information regarding the prices, quality and
offers, and they can change their preferences and choice whenever they want (Gaglio, 2018).
Threat of Existing Competitors: This force of the environment is relatively high as many
restaurants offers great quality food items, cocktail beverages and great services. The restaurant
industry of UK is intensively competitive having large number of players.
Threat of New Entrant: This force of the environment is high due to there are low entry
barriers are present in the restaurant industry. Product differentiation is also difficult in the
restaurant sectors as everyone provides good quality food and effective services.
From the Porter's analysis, it can be concluded that “Eternity Restaurant & Bar needs to
focus on making use of effective advertising and promotional efforts to attract customers as their
bargaining power is high in the UK markets. The restaurant industry has low entry barriers but
there are high cost for keeping the customers and capturing effective market share.
P3. Present data needed to support gap analysis in the evaluation of market potential.
Primary research techniques to investigate of new business idea
The market research helps in providing valuable information to identify and analyse
market opportunities and probable pitfalls for the new business ideas. In the primary research,
new data or information is collected directly by the entrepreneurs by making use of different
techniques, such as:
 Interviews,
 Surveys (online surveys through emails),
 Questionnaire,
 Focus groups,
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 Conducting product and service test.
In order to conduct the primary research, entrepreneur has chosen the questionnaire
technique that can help in identifying various opportunities and challenges in the potential and
target markets (Gray and et.al., 2019). The questions will be asked using the sampling technique
and target will be tourists and local people.
Questionnaire for conducting primary market research:
1. How do you often go restaurants in a week?
 Once a week.
 Two or three times a week.
 Very rarely.
2. Are you satisfied with the food quality offered at restaurants?
 Yes, totally satisfied.
 Yes, partially satisfied.
 Not satisfied at all.
3. Are there anything that you would like to have at restaurants?
 Food needs to be prepared from fresh and organic ingredients.
 Hygiene and cleanliness needs to be maintained.
 Healthy and dietary food items needs to be there in the menu.
4. What kind of ambiance and environment do you like at restaurant?
 Family and friendly environment.
 Soothing ambience with soft lights and low music.
 Live singers and reggae bands.
5. What will be your preferences in the hard drinks' menu at restaurants, kindly give
your opinion....
Secondary research techniques to investigate of new business idea
Entrepreneur aims at conducting secondary market research which refers to collection of
important information regarding the needs of customers and put it together to get better
understanding of business. The secondary research can be collected from the already published
information from various sources such as books, internet, online statistics, magazines, statistical
reports and market research magazines, existing studies and surveys, newspaper reports,
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government published data and published company reports (How to Conduct Market Research
for Your New Business, 2019). There are two methods for conducting the secondary research i.e.
quantitative and qualitative. In order to conduct the market research for the new restaurant idea,
online statistical and market research magazines will be referred.
P4. Interpret data appropriately to provide evidence of market potential.
The results and outcomes of market research procedure are then analysed by comparing.
The information which entrepreneur have collected with the original set goals when planning the
market research is compared with the performing SWOT analysis. Results and findings of the
research is coupled with effective strategies from the SWOT analysis and these leads to aid and
help entrepreneur for deciding further course of action regarding the market potential.
The goal and objectives of conducting the primary market research us to effectively
understand the target customers in relation to all dimensions: emotionally, rationally, socially,
economically and culturally (Henning and Akoob, 2017). For collecting the data from the
secondary research, new techniques and technologies were used. Big data was used for assessing
the market trends. Internet forums and social media sites were used for testing the market
response.
Gap Analysis:
The primary market research was conducted through the questionnaire and 10 samples
were taken including local people and tourists. The primary market research results are
interpreted as follows:
1. People often go restaurants in a week.
 The research results suggests that out of 10 people, 5 people often go to restaurants in a
week. 3 people said that they prefer to go to restaurant once a week. Only two people
answered that they rarely prefer going to restaurants.
2. Satisfaction level with the food quality offered at restaurant.
 The questions were asked to total 10 people and out of them, 7 people said that they were
partially satisfied with the quality of food. 2 people said that they were totally satisfied
and 1 was not satisfied at all.
3. Things that needs to have at restaurant.
 5 people answered that they wanted to have proper cleanliness and hygiene in the
restaurants. Whereas, 4 people agreed for preparation of food items form the fresh and
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organic ingredients. Only 1 people suggested that he would like to have healthy and
dietary food item in the menu.
4. Ambiance and environment at the restaurant.
 Out of total of 10 people, 6 people agreed for having live signers and reggae bands at the
restaurants. 2 people said that they would like to have soothing ambience with low music
and soft lights. Family and friendly environment was suggested by rest of 2 people.
5. Preferences in hard drinks' menu.
 Champagne margarita was the choice of 5 people out of total 10 people. 3 people said
that they would prefer having imported wines and whiskey in the menu, whereas, 2
people said that they would prefer having cocktails and mock-tails.
Primary research results and Gap analysis
From the primary market research results and outcomes, it can be concluded that there
exist a gap in the business idea and market potential. According to research results, it can be seen
that target customers like to have live singers and reggae bands at the restaurant ambiance and
environment, which was missed in the business restaurant idea. This gap can be closed by
recruiting singers and reggae bands for the “Eternity Restaurant & Bar”. The another gap that
was identified from the market research result is that people would like to prefer “Champagne
margarita” and “Imported wines and whiskey” in the menu of hard drinks' (Nguyen and et.al.,
2018). Thus, entrepreneur can close this gap by providing these mentioned drinks and meeting
the needs and wants of customers. The entrepreneur also needs to focus on maintaining
cleanliness and hygiene in the restaurant and bar as it was another special concern of customers.
Secondary research results from the published journal and articles
According to How to Conduct Market Research for Your New Business, (2019), the
restaurant and hospitality industry in the UK has undergone a period of significance growth and
development. Eating out is considered as the favourite and is most popular leisure activity for the
people of UK. In the year 2017, total expenditures from the customers on the cafes and
restaurants has reached approx to 88 billion British pounds. The number of businesses in this
industry is steadily rising and contributes approx 17.9 billion British pounds. From the statistics,
it is identified that total revenue from the UK restaurant industry is 37.7 billion GBP. There are
almost 86.6 K restaurants in the UK. Therefore, from the secondary research results, it can be
concluded that there is rapid growth and success in the restaurant industry.
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P5. Apply a SWOT framework to collate evidence to support an objective assessment of a
entrepreneurial idea.
As per the above market research it has been analysed that restaurant industry is growing
from last many years as per secondary data collection and on the basis of above, the strength,
weaknesses, opportunities and threats can be analysed by using SWOT analysis, which are as
mention below:
Strength:
 Eternity Restaurant and Bar provides the best quality of American- Swedish food
products which none of the other restaurant offer in UK.
 The customer service of the firm is best and also provide 24 hours service because of
having family- friendly style ambience (Nguyen and et.al., 2018).
 Initially, the company also offer different discount coupons that helps to attract wide
range of customers towards it.
Weaknesses:
 Due to having small occupancy, the customers may have to wait for long which can be
considered as a weakness for the firm.
 Eternity Restaurant and Bar did not spend high amount of money for the promotion of its
new products and as a result, it may affect the sales of the restaurant in negative way.
 Lack of expertise and training also affect the productivity of the employees in negative
way and it directs affect the goodwill of the restaurant in market.
Opportunities:
 By offering new American -Swedish products will provides a new platform for the
restaurant to gain high market share in the local area.
 Using advance and new promotional technique will help a restaurant to establish new
market in further areas and can be easily reached to new customers as well.
Threats:
 Eternity Restaurant and Bar faces High competition from other brands because they have
strong customer base
 Sudden change in the preference of the customer may also affect the business financial
performance in negative way and it directly affects the goodwill in a market (Gaglio,
2018).
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P6. Evaluate the competitive and market environments in which the idea will be launched to
assess potential viability.
As per the market research which includes primary and secondary data that clearly reflect
that the restaurant industry is grows from last many years, such that, trough primary data
collection, it has been evaluated that variety of people prefer to enjoy meals and try to have new
food products, specially youngsters. That is why, as per primary research, the idea is quite viable
and by introducing new American- Swedish products to the customers will increases the chances
of making good reputation in market. Apart from this, it has been analysed from the competitive
analysis, there are so many brands in UK which provides new food products with high rates, but
Eternity Restaurant and Bar will provide new product in low rates with different discount that
helps to stay in the competition and also attract wide range of customers towards it (Gaglio,
2018).
Therefore, as per the market statistical data of restaurant industry, it has been analysed
that people change their preference as per new trends and by analysing the same, quoted
restaurant will also provide new and innovate products to their customers in order to meet the
demand. As the industry in growing and there is a wide scope as well. Moreover, through
secondary data, it has been evaluated that it is the growing industry and also provide different
opportunity to every individual in order to stay ahead, in the same way, Eternity Restaurant and
Bar also introducing new products that attract specially youngsters and make the idea quite
viable (Carraher, 2018). Therefore, it has been evaluated that the entrepreneurial idea of
introducing new American-Swedish products in Eternity Restaurant and Bar with Cocktail is
quite viable and also helps to stay competitive in market as well.
CONCLUSION
The above conduct report is based on the presentation pitch of the new business idea. The
unique business idea can be identified from various sources of external and macro environment.
Entrepreneurial ideas and innovative business ideas can be identified from different sources such
as the unexpected success or failure, incongruities, process needs, changes in the market and
industry, demographics, new knowledge and changes in perception, meaning and mood. The
STEEP model can also be used for identification of innovative and entrepreneurial ideas.
Rationale is also given in the report and its market gap for the chosen entrepreneurial idea using
relevant tools and techniques. Porter's five forces model is being used for identifying the market
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gap. For the entrepreneurial ideas target customers are identified using through the demographic
and behavioural segmentations. The tangible and intangible features of the new business ideas
are also discussed. Primary and secondary data is presented and interpreted to support the gap
analysis in the evaluation of market potential. Further, SWOT framework is applied to collate
evidences for supporting the objective assessments of the unique business ideas. Lastly,
evaluation of competitive and market environment is done in which unique idea will be launched
for assessing its viability.
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References
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In International Conference on Applied Human Factors and Ergonomics (pp. 261-273).
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In International Journal of Arts & Sciences Conference at Harvard University.
Ćirić, D., Lalić, B. and Gračanin, D., 2016. Managing innovation: Are project management
methods enemies or allies. International Journal of Industrial Engineering and
Management (IJIEM). 7. pp.31-41.
Davidsson, P., 2015. Entrepreneurial opportunities and the entrepreneurship nexus: A re-
conceptualization. Journal of Business Venturing. 30(5). pp.674-695.
Gaglio, C. M., 2018. Opportunity identification: review, critique, and suggested research
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Gray, B. and et.al., 2019. Internal factors influencing effective opportunity identification in a
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Henning, S. and Akoob, K., 2017. Motivational factors affecting informal women entrepreneurs
in North-West Province. The Southern African Journal of Entrepreneurship and Small
Business Management. 9(1). pp.1-10.
Nguyen, Q. and et.al., 2018. Understanding customer satisfaction in the UK quick service
restaurant industry: The influence of the tangible attributes of perceived service
quality. British Food Journal. 120(6). pp.1207-1222.
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How to Conduct Market Research for Your New Business. 2019. [Online]. Available through:
<https://evoma.com/business-centre/how-to-conduct-market-research-for-your-new-
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