Evaluating Entrepreneurship Opportunity Identification Factors

This assignment delves into the complexities of entrepreneurial opportunity identification, examining the roles of valence and activation influences in shaping entrepreneurs' perception and selection of opportunities. The provided references offer insights from various studies on entrepreneurship theory and practice, highlighting the importance of understanding these factors for effective business decision-making.

Identifying Entrepreneurial
Opportunities

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Different sources of entrepreneurial ideas and innovation................................................1
TASK 2............................................................................................................................................4
P2 Rationale and market gap for specific entrepreneurial idea..............................................4
TASK 3............................................................................................................................................7
P3 Present data to support gap analysis in evaluation of entrepreneurial idea.......................7
P4 Interpret data appropriately to provide evidence of market potential.............................10
TASK 4..........................................................................................................................................11
P5 SWOT framework to collect evidence to support an objective assessment....................11
P6 Competitive and market environment in which idea launched to assess potential viability
..............................................................................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Identifying entrepreneurial opportunities can be referred as a concept which define that
individual conduct market analysis to acknowledge problems and various issues. This give rise to
idea of opening a new business by using distinct resources and skills that a businessperson has to
generate profit. Food on Flame is new start- up venture which is established to target the area
where hostels and professional people are living and transporting from place to another for job.
Online and offline restaurant both facilities are provided to people to purchase products
according to their needs and demands (Kohlbacher, Herstatt and Levsen, 2015). Different
entrepreneurial ideas and innovation are described in this report. Marketing gap and competitive
analysis are tactics which are used by person to have complete information about conditions of
market. Along with this, interpretation and SWOT framework is conducted to support objective
assessment. Hence, market environment and competitive helps individual to assess potential
viability to launch ideas.
TASK 1
P1 Different sources of entrepreneurial ideas and innovation
Entrepreneur role is to conduct market evaluation to identify opportunities and threats.
Along with this, it is fundamental to assess personal abilities and skills of an entrepreneur which
help them to convert possibilities into business idea. Innovation can be termed as the process of
translating an invention and idea into a better service which create product value among
consumer. This is fundamental for entrepreneur to undertake the innovation while developing a
business idea as Peter F. Drucker has also mentioned its worth.
Business idea is aspect which is formulated in minds of individual with help of market research
to asses opportunities which can be converted into reality.
Sources of Business Idea:
R&D and External Technological Developments: Market research is appropriate
technique which entrepreneur of Food on Flame uses to assess market opportunities and
effectiveness of business idea.
Existing products and geographical market: This is another source which is used by
entrepreneur to acknowledge taste and preference of people.
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Customers and suppliers: Food on Flame is restaurant whose clients are professional
people and students.
Peter F. Drucker's innovation factors which includes 7 sources of ideas which are stated
beneath:
Incongruity: This aspect defines that each and every organisation consist of certain
product and services. Before implementation of activities, it is essential that entrepreneur assess
gap of transforming opportunity into business idea; thereby also analyse effectiveness of idea.
Process Need: It is another tactic which specifies that business planner acknowledge
need of innovation in system to attain objectives. Besides this, information technology and
marketing team is given responsibility to inform public about firm (Mathias and Williams,
2017).
Industry & Market Structure Needs: Restaurant sector has large number of firms which
provide variety of food items to people. Food on Flame need to have some innovative idea to
attract large number of customers. For this, residential area which has adequate number of
hostels and professionals is appropriate for firm.
Demographics: Gender, age, race, population and level of income are various
components which entrepreneur need to consider while operating or initiating for business. It is
essential that appropriate decisions and selections are made to deliver adequate facilities and
things to people.
Changes in Perception, Meaning and Mood: Buyer's taste and preferences determine
products purchased and required by them to fulfil their demands. Food on Flame need to provide
variety of items and make changes in technologies to deliver appropriate things to people.
New Knowledge: Entrepreneur require to have information on various areas and field
which help them to conduct and regulate business operations in appropriate manner. For utilising
market opportunities and translate into business idea adequate information and skills is required
by individual (Mueller and Shepherd, 2016).
Unexpected: Business environment is dynamic, so business planner responsibility is to
identify opportunities and innovate activities to grab attention of large number of people.
STEEP factors: Different market and basic factors exists in the market that affect
business enterprise and their distinct outcome. This is essential for Food on Flame to conduct
STEEP factors in regard of develop an understanding about the market and targetted consumer.
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These components needed to be assessed by entrepreneur to organise business and activities in
according to situations of market are stated below:
Socio-cultural Factor: Gender, belief, behaviour, cultural, taste and various other tactics
of people are assess by businessperson of Food on Flame to deliver appropriate items to people.
Food for Flame is small firm which is started by businessperson to provide home food to
students and professional people which are living away from their home town for either
education or job.
Technological Factor: Online tools and latest equipment are used by Food on Flame to
produce innovative and creative things and provide adequate food products to customers.
Entrepreneur has good cooking skills and able to deliver appropriate things to clients.
Economic Factor: Food on Flame provide items at reasonable rates to attract large
number of customers and make them purchase things according to their demands and taste. This
helps entrepreneur to attract large number of people which benefits firm to enhance sales and
profitability.
Ecological Factor: Entrepreneur of Food on Flame require to design adequate
infrastructure and utilise resources to conduct operations effectively and establish appropriate
position in market. Latest tools which are environment friendly and don't use harmful
components which are harmful for people are used by chef.
Political Factor: Laws and legislations of government of sited country are considered by
entrepreneur to formulate strategies and policies; thereby make system function legally
(Ramoglou and Tsang, 2016). Entrepreneur of Food on Flame have taken license and register
firm under government to make system function legally.
Type of Innovation: Distinct innovation methods and techniques are essential to
undertake to categorise the business ideas accordingly by an entrepreneur. These are different
innovation which small businesses makes are as follows: Product: Entrepreneur require to design items and provide creative things to attract large
number of people by providing them products different from competitor firm. Process: Businessperson need to use latest tools and equipment to utilise funds and
deliver appropriate things to customers.
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 Incremental vs. Big Bang Innovation: Small modification which are made in items to
enhance quality are incremental innovations; while large product developments to give
creative things to people (Ramoglou and Zyglidopoulos, 2015).
Food on Flame is small restaurant which is involving product innovation type while
developing their enterprise as they provides adequate food items for students and professional
people which live away from home for either their studies or job. Variety of products are offered
at reasonable rates to attract large number of people.
Difference between Invention and Innovation:
Innovation Invention
 This concept define that fresh ideas
made by individual, are modified and
altered to create disruptive products and
services in respect to taste and
preferences of people.
 New methods, technologies, equipment
that are used by entrepreneur to utilise
resources and save energy to deliver
creative and unique things to
customers.
 It is novel tactic which includes
activities conducted by person to
formulate idea, concept and thing which
doesn't exist in market before.
 For making inventions, individual
require to have adequate scientific skills
and knowledge to produce new items in
respect to problems that are present in
market (Renko and et. al., 2015).
Difference between product or business idea:
Product Idea Business Idea
This aspect define that businessperson makes
changes in items and modify to provide
innovative and creative things to clients.
Marketplace has large number of opportunities
which are identified by entrepreneur to convert
them into business idea. This help
businessperson to utilise their knowledge,
resources to gain adequate revenue.
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TASK 2
P2 Rationale and market gap for specific entrepreneurial idea
Market gap is tactic which helps businessperson to identify opportunities by assessing
requirements of people which remain unachieved. In order to craft focus group, manage their
potential of consumer, managing cost effective strategies, an enterprise so as Food on Flame
need to specify their target consumer.
Need to identify specific customer types for target idea: Food on Flame is restaurant
which is a new start-up to provide appropriate items and services aiming on students and
professional which are living in other place for education and job.
Market Segmentation: It a is tactic which defines that marketplace is distributed to
formulate heterogeneous group of people which are similar in respect to demands and
preferences. Hence, these are different forms of segmentation which are stated below (Suddaby,
Bruton and Si, 2015): Behavioural Segmentation: This aspect classify on the grounds of buying behaviour of
customers depending upon their knowledge, attitude, money availability, lifestyle and
various other tactics. Food on Flame is a restaurant which require to develop a unique
menu and food items in respect to taste and preferences of people. Demographically Segmentation: Age, religion, race, gender, education, income and so on
are components which determine businessperson of Food on Flame to target appropriate
customers by providing them adequate things at suitable prices. Geographic Segmentation: This is another segmentation method which classify consumer
on the basis of their region such as country, state, city. Urban and rural are various other
aspects which specifies that customer's taste and preferences varies with each other.
Along this, climate and size of population also affect on sales and profitability of Food
on Flame.
Tangible & Intangible features and benefits of a product or service
Tangible Intangible
This aspect defines tactics which are visible
that is product which have physical existence
It is another aspect which specifies components
that people feel and are not having any physical
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and are purchase in respect to their features
and attributes.
presence (Baggen and et. al., 2015).
Food items are tangible things which are
purchased by consumers according to their
demands.
Computer technology, software and many other
services which are provided by entrepreneur to
fulfil demands of customers.
Industry Environment: This is macro environment factor which defines that each and
every sector that is telecommunication, hospitality, IT, retail and many other include extensive
organisation area. It is essential that entrepreneur conduct market survey to acknowledge needs
and requirements of people which are used to execute Food on Flame into new venture which is
economic and feasible.
Porter's Five Forces Model: It can be termed as the framework or tool which is
optimised to analyse the external environment and market competition. This is efficient tool
which help entrepreneur to identify market opportunities and threats. It is essential that
businessperson have complete information about competitors. Along with this, they even require
to anticipate demands of people and construct relations with suppliers.
Threat of New Entrants: This aspect define that industry which are profitable have new
firms which are established to gain appropriate profit. Government construct barriers to restrict
entry and exit of company in respect to profit and loss situations (Davidsson, 2015).
Bargaining Power of Suppliers: It is factor which determine that administration require to
have adequate material; so that funds are utilised efficiently and business operations are
conducted effectively. It is essential that business person maintain relations with suppliers and
order items in according to demands of people. Large number of suppliers defines that
entrepreneur have capability to choose in respect to prices; while if there are limited than firm
don't have options.
Bargaining Power of Buyers: Customers purchase items and services in according to
their taste and preferences. This impacts on sales volume of company which depend upon variety
of products and its features provided by business person. If there are large number of sellers, than
they will buy things in according to their demands and prices. While, if there is single seller than
people have no option and have to purchase products.
Threat of Substitutes: This tactic define that products which are similar and provide same
kind of needs are substitute things. It is essential that business person manufactures creative and
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innovative items which are different from competitor is able to grab attention of large number of
people (Foo, Uy and Murnieks, 2015).
Competition rivalry: Entrepreneur require to acknowledge rival firms and their offerings
to design system and use appropriate techniques. It is essential that appropriate items and
services are delivered in market to attract large number of people by providing things in
according to their taste and preferences.
Approaches to competitor analysis to entrepreneurs and small firms: Competitive
analysis can be refer as the strategic assessment of weaknesses and strengths of present and
potential rivalries. Entrepreneur even require to acknowledge current and potential competitors
to conduct operations properly. Management is responsible for to constructing the plan and
design items innovative and creative manner to target customers and adequate market (Gielnik
and et. al., 2015).
Industry life-cycles: These are various stages which product and services passed in
respect to their market position and goodwill. Introduction: It is beginning phase which defines that entrepreneur converts market
opportunities into business idea to generate adequate profit and utilise resources and
skills. Market research and survey are appropriate technique which helps businessperson
to identify needs and demands of people. Growth: This is important step which specifies that company provide adequate things and
facilities to customers. Competitive advantage is established which help entrepreneur to
attract large number of people; thereby enhance sales and profitability. Maturity: This stage define that management uses latest technologies and equipment to
manufacture creative and innovative things. Along this, they even require to promote
items to attract customers by giving them adequate products and services (Hatak and et.
al., 2015).
 Decline: It is last phase which require that businessperson require to conduct activities
and deliver items at reasonable prices of Food on Flame as the restaurant [provide cheap
and affordable services along with wide variety.
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TASK 3
P3 Present data to support gap analysis in evaluation of entrepreneurial idea
Businessperson can assess actual and future opportunities by conducting market research.
This help them to identify needs and demands of people which are used as benchmarks to design
system and use appropriate tools and equipments.
Different investigation techniques used by individual to assess new business ideas are:
Primary sources: Food on Flame is new venture which is started by entrepreneur to
identify market opportunities and construct business idea. Questionnaire is technique used by
entrepreneur to take feedback from people about problems and requirements. (Hmieleski, Carr
and Baron, 2015).
Secondary sources: This is another technique which includes newspaper, magazine,
internet to analyse appropriate information about trends and demands of market. Food on Flame
is start- up which require to have complete data about competitors.
New technologies for audience research and analysis: Internet is appropriate technique
which helps entrepreneur to attract large number of customers by providing them information
about Food on Flame.
Gap analysis: This tactic defines that entrepreneur conducts market research which helps
them acknowledge requirements of market which are used as future opportunities. It is essential
that needs and demands of people are acknowledged by Food on Flame to utilise funds and
purchase appropriate tools and equipment are purchased to conduct operations effectively and
deliver appropriate food items in market (Karimi and et. al., 2016).
Here are outlined a proper questionnaire as an example through which the data is being
accumulated which have been mentioned as below:
Questionnaire
Name:
Email:
No. of Respondents: 60
Contact No.:
Q.1 Is Food on Flame developing more efficient food and better menu?
Yes 45
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No 15
Q.2 Are you satisfied with standard result service of Food of Flame?
Yes 35
No 20
Can’t say 5
Q3 What are more major drawing Food on Flame features?
Outcomes 15
Prices 25
Suitability 20
Q.4 Does price charged for numerous services and products of Food on Flame unaffordable?
(a) High 25
(b) Low 20
(c) Moderate 15
Graphical Presentation
1.
(a): Yes (b): No
0
5
10
15
20
25
30
35
40
45
50 45
15
Respondent in %
2.
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(a): Yes (b): No (c): Can't say
0
5
10
15
20
25
30
35
40
35
20
5
Respondent in %
3.
4.
10

25
20
15
(a): High
(b): Low
(c): Moderate
P4 Interpret data appropriately to provide evidence of market potential
Primary and secondary sources of data collection are used by entrepreneur to have
complete information about market conditions and competitors. Questionnaire, survey and
interview are primary techniques which are used by businessperson to identify problems and
various other things that are used for constructing business idea. These are interpretation which
are described beneath:
Here are interpretation of accumulated information which is provided in the below opting
distinct central tendency:
1.
Total 60
Mean 30
Median 30
Mode 0
Interpretation: As per the portrayed statics, median value is 30 which is equal to the
mean value. This present the increment and development of opportunities of growth in the
competitive industry.
2.
Total 60
Mean 12.5
Median 12.5
Mode 0
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Interpretation: The associated mean value is 12.5 which present the satisfied consumer
better brand recognition and equalise median value.
3.
Total 60
Mean 22.5
Median 22.5
Mode 15
Interpretation: As per this, mean value is high which present distinct respondents statics
who are satisfied with services of consumer.
4.
Total 60
Mean 17.5
Median 17.5
Mode 10
Interpretation: According to the data, mode value is identified 10 which present
numerous services and product perspective. Therefore, mean present value of cost which was
agreed in the huge extent of trade.
TASK 4
P5 SWOT framework to collect evidence to support an objective assessment
Macro environment is external tactic used by individual to identify and create
opportunities to start a new business and innovate things. Entrepreneur conduct market research
to have complete information about government policies, economical conditions, technological,
socio-cultural factors; thereby assess their impacts on business.
SWOT Analysis : SWOT analysis is appropriate technique which defines that
entrepreneur uses this tool to have complete information about strengths and weakness of firm.
Along this, opportunities and threats are identified to design system and use adequate
technologies. Along this, competitor analysis is tactic which benefits entrepreneur to identify
rival firm's offerings (Kirzner, 2015).
Strengths Weaknesses
 Food on Flame is unique idea as it  Entrepreneur have shortage of funds
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provide wide range of food service in
affordable cost which is able to grab
attention of people easily.
 Target customers are students and
professional people which don't have
time to make food and require to get
food items in according to their home.
and required resources to use
adequately. Restaurant don't have good
market reach and customer base which
impact on sales and profitability.
Opportunities Threats
 Mobile application and latest
technologies which are used by small
firm to provide appropriate facilities to
people.
 Online websites and tools are used to
give facility to people to purchase food
items and order online.
 Government of UK support new firms
and provide them assistance to launch
new business to enhance number of
items and services for people that can
jeopardise the market of Food on Flame
through supporting rivals.
 Rival firms which have good market
image and reputation.
P6 Competitive and market environment in which idea launched to assess potential viability
Entrepreneurs of a business organisation are needed to have some effective skills and
abilities through which they can launch outlets in more effective manner. As per Peter F.
Drucker's innovation factors, SWOT analysis can help business owners to determine internal
strengths and capabilities of them. In addition to this, it will aid them in analysing future threats
and opportunities present at external environment of market which may affect business in a high
manner. Therefore, to analyse such factors, management of companies can create modifications
in business so that competition can be gained (Hatak and et. al., 2015).
Competitive Market: It is significant for firm to consider competitor in regard of
developing rivals in regard of developing consumer's service accordingly. Various items are
available in the food industry that Food on Flame need to compete in which few are discussed
here:
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 Substitute Services: In competitive trade, numerous usage will be available. Therefore,
organisation need to build advantages, several pricing and promotion methods that are
adopted. Target Audience: Company is focusing over healthy and wide variety of food products to
provide their consumer.
 Demand: Healthy and better services and food products are needed to target to create less
influence. Thus, individual will easily attract to meet certain demand outcome to meet
high market share.
CONCLUSION
As per above report, it can be concluded that identifying entrepreneurial opportunities is
important tactic which help individual to formulate business idea. It is necessary that
entrepreneur is able to utilise their skills and knowledge to transform money and start a new
venture to generate adequate profit. STEEP factors, Drucker's 7 source of innovation are used by
person to have adequate data for gap analysis and examine entrepreneurial data. Along this,
SWOT analysis and industry analysis is done by businessperson to acknowledge system abilities
and market conditions. These are various techniques which help entrepreneur to have complete
and accurate information about competitors and market.
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