ENTR501: Identifying Entrepreneurial Opportunities Analysis Report

This report analyzes the entrepreneurial opportunities for "Rainbow Dessert Scoops," a small firm offering a variety of desserts. The report begins by identifying and evaluating different sources of entrepreneurial ideas and innovation, including STEEP factors and Drucker's seven sources of innovation. It then explains the rationale and market gap for the business idea, utilizing segmentation techniques such as behavioral, demographic, and geographic segmentation, along with tangible and intangible resources. The report applies Porter's Five Forces model to assess the competitive environment and presents data to support gap analysis. A SWOT framework is employed to collate evidence for an objective assessment of the business idea. Finally, the report evaluates the competitive and market environments, providing a comprehensive analysis of the firm's potential for success.

Identifying Entrepreneurial
Opportunities

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Determine and evaluate different sources of entrepreneurial ideas and innovation.........1
TASK 2............................................................................................................................................4
P2 Explain the rationale and the market gap for a specific entrepreneurial idea using relevant
tools and techniques...............................................................................................................4
TASK 3............................................................................................................................................7
P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial
idea.........................................................................................................................................7
P4 Interpret data appropriately to provide evidence of market potential...............................9
TASK 4..........................................................................................................................................11
P5 Apply a SWOT framework to collate evidence to support an objective assessment of a
specific entrepreneurial idea.................................................................................................11
P6 Evaluate the competitive and market environments.......................................................13
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

INTRODUCTION
An entrepreneur inspires from a situation and they have the ability to convert their ideas
into the viable business. As being an innovator they can sale their conceptual products and
services on a higher price to gain profit. Entrepreneur opportunities are basically the situations
through which new goods, services, and processing methods can be introduced for availing
benefits. “Rainbow Dessert Scoops” is providing various flavours of sweet dishes which assists
to gain competitive advantage. It offers a huge pool of ice creams, candies, chocolates and
sweets for everyone. There are several shops for all of these desserts but it also offers home
made chocolates and sweets along with the innovative variety of ice creams. As it is a small firm,
therefore it needs to prepares a report which underpins, different sources of ideas, market gap,
data to support the innovation, SWOT and competitive analysis (Gonzalez and Solis, 20112).
TASK 1
P1 Determine and evaluate different sources of entrepreneurial ideas and innovation.
“Rainbow Dessert Scoops” is a small firm which provides a variety of ice – creams,
chocolates and sweets. Although, this is not a new idea to provide the desserts but it is still
unique because the retail shops are offering fixed flavours. The people loves the dark and white
chocolates but fruit flavours are not available. So the idea originated with this that they should
also try some new flavours which are prepared with fruits, dark and white chocolates along with
the liquor in a few products.
Role of the ‘entrepreneur’
The entrepreneur seeks the opportunities in the existing situations in the market as the
“Rainbow Dessert Scoops” generate and idea to run a business in the marketplace. But in order
to run a firm effectively they plays a vital role to recognise the threats of the business. As the
other retailers are also offering the same kind of the chocolates and ice – creams but they find out
the ways to over come the hurdles by providing the different items. Thus, the entrepreneurs
should have the capabilities to manage the resources such as funds and human resources that
assists to attain the goals and objectives (Grégoire and Shepherd, 2012).
Sources of entrepreneurial ideas - There are several sources which are the reason of the
“Rainbow Dessert Scoops” innovative ideas and that are as follows -
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STEEP Factors – These factors are the external factors that are beyond the control of
the firm but, have a significant impact on the functionality and operations. The aspects are
known as social, technological, economical,environment and political. Hence, these elements are
described below -
Social factors – It depends on the culture and value of the country where the business is
going to be launched. Besides, these core values the business activities are also influenced by the
income of the people because if they are having a high income, then they can purchase the lavish
products. In the United Kingdom, people have the luxury life so they can easily purchase edible
products from “Rainbow Dessert Scoops”. The firm is offering a broad range of desserts that's
why people persuades to pay higher price due to the availability of distinct items. (Alvarez and
Barney, 2010).
Technological Factors – It is the most essential thing for any business because the buyers
wanted to be get the things easily. Therefore, they don't wanted to stand in billing queues that's
why “Rainbow Dessert Scoops” needs to adopt the technology to provide the customer
satisfaction. The firm has a computerized billing system that assist to the pay the bill frequently
to avoid the delays in customer service. The customers can also place their orders through social
media websites and phone messages message. In addition, the firm can also supply the
customized gift packs on the orders in the nearest place. The customer can make a phone call, or
drop a message on the its social website's webpage such as Facebook page or Instagram.
Through adopting this technology they can improve the business otherwise, the absence of the
technological can impact badly on the organization.
Economical factors – These are the factors which affects on the firm's activities such as
supply of the raw materials. The economical condition of a country influences the business
which refers to the change in tax rates, per capita income, inflation rates. Hence, if there is rise
in the disposal income of the citizens then the firm can perceived to offer premium price of the
chocolates and ice-creams to gain the market opportunities that can enhance the profit (Dimov,
2011).
Environment factors – It is the most crucial aspects because the government of the
country has established a policy for the business organization.Environment factors – It is the
most crucial aspects because the government of the country has established a policy for the
business organization. As there are various fruits that can be used to give a new flavour to the
2

chocolates and ice – creams which is also beneficial for health can be offer on the premium
prices. People attracts towards the healthy and environmental friendly products easily that's why
it is attain the profit. But on the other side according to the rule, they have to keep the
environment clean and safe. Therefore, “Rainbow Dessert Scoops” needs to preserve the
atmosphere as they should not use the cheap material for the packing of the ice-creams and
chocolates. If they avoid the government regulations then they need to pay for it, and the
business will also suffer with its image.
Political factors – It is the most influential aspect of the business as Brexit is the biggest
political issue across the world. But it favours the small organization development. Brexit is
helping to SME (Small and Medium Enterprises) to develop and support the economy of the
country. Therefore, “Rainbow Dessert Scoops” is can establish with political support and gain
the profitability (D’Este, Mahdi and Neely, 2010).
Drucker’s 7 sources of innovation – According to Peter Drucker there are seven
sources of innovation that are mentioned below -
1. The Unexpected – There are various things in the market that can shape an innovation it
can be the failure or success of a product. If people are looking for a new flavour of the
chocolate then, “Rainbow Dessert Scoops can innovate a new combination of fruits and
nuts.
2. Incongruity – This refers to the difference between what is and what should be done to
for an innovation. As there is a gap between the customer expectation and the products
offering by the companies. In order to fill this gap the firms needs to analyse the
customer needs and then develop the products which can fulfil their requirements.
3. Process Need – It can be define to change in the procedures of the company. As the
customer are waiting to long for the order. It is weak process of the billing that needs to
modification in order to attain the profit. Hence, the store needs to innovate such process
which can reduce the completion time of the task.
4. Industry and market structure change – There are some policies and regulations which are
beneficial for the innovation and at that time entrepreneurs can take the advantages of
such government policies.
5. Demographics – “Rainbow Dessert Scoops” can get impacted due to the changes in the
demand of the products. For an example, the people who are purchasing the products can
3

be differ in their age and income level. Through recognising the demand of the products
they can go in a new direction which can enhance the business. The people who have
higher income they can purchase unique products which can satisfy their desires. In order
to achieve the satisfaction level of such kind of customer the entrepreneurs needs to
innovate the products.
Changes in Perceptions – People can change their point of view with technology because they
are connected with the different people. They can change their perception for a product or a
brand. That's why these changes opens the door for the business to innovate the products (Siegel
and Renko, 2012).
New Knowledge – This is always beneficial for the business organisation because there are
several scientific discoveries. through adapting these techniques and knowledge firms can
effectively increase the business.
TASK 2
P2 Explain the rationale and the market gap for a specific entrepreneurial idea using relevant
tools and techniques.
“Rainbow Dessert Scoops” needs to attract the customer to increase the sale of the
desserts items. As it is the only thing which can help it to sustain in the marketplace. But, before
introducing the chocolates, ice-creams, sweets in the market the firm needs to identify the
customer's requirement. As it is the major source which can increase the profit of the business.
Therefore, the firm can divide the market in three segments to investigate about the needs of the
people. Thus, segmentation is mentioned below -
Behavioural segmentation – It is based on the perceptions, lifestyle and status of the
people. If the people are living a luxury lifestyle then they can easily spend their money on
chocolates and ice-creams. “Rainbow Dessert Scoops” can target such people who have luxury
lifestyle (Hansen and Shrader, 2011).
Demographic segmentation –This is based on the age, race, religion, family size and
income of the people. It is essential for the “Rainbow Dessert Scoops” to identify the
preferences of the children, adults and old age people. After knowing the choices of different age
4

groups the store can provide them the chocolates, ice-creams and sweets according to their
requirements.
Geographic segmentation – It will help to identify the requirements of the products in a
particular regions and according to the density of that location. If there are more children in a
particular location than “Rainbow Dessert Scoops” have a possibility to raise the demand of
the desserts (Hitt and Irel, 2011). Thus, segmentation provides a support to the analyse the
requirement of the product and to earn profit and goodwill in the marketplace.
Tangible and intangible resources
In order to run a business in an effective way there is a need of tangible and intangible
resources and that are mentioned below -
Tangible resources : It is the first and foremost requirement of “Rainbow Dessert
Scoops” because it needs a land and building to develop a business. After that it needs some
human resources and machinery which conduct the operations such as baking and billing of the
chocolates (Alvarez, Barney and Anderson, 2013).
Intangible resources – “Rainbow Dessert Scoops” also needs to have a logo of the firm
which creates an identity of the firm among the potential customers. Another intangible assets of
the business is its goodwill can be earn by the satisfying the customer needs through its ice-
creams, chocolates and home made sweets.
Porter’s Five Forces model – This model was established by Michael Porter. It has five
forces that impacts on the organization. These elements are described below -
5
Illustration 1: Porter’s Five Forces

(Source : Porter’s Five Forces, 2018)
Bargaining power of buyers – It makes a huge impact on the business of “Rainbow
Dessert Scoops” because there are several retail stores which are selling similar kind of
chocolates and ice-creams. Therefore, the customer can bargain for the product price else they
can switch the products with others (Kohlbacher, Herstatt and Levsen, 2015). Customers are
supreme who can decrease the selling cost of desserts which is not good for the business. On the
other hand side, if business is dealing with a huge volume of customers then it can attain higher
profitability. Otherwise, less customer can put the firm into downfalls.
Bargaining power of suppliers – If a business is dealing with only one supplier then
they can push “Rainbow Dessert Scoops” to raise the supply cost. But if there several suppliers
then they do not have the power to increase the cost (Mitchelmore and Rowley, 2013). This time
“Rainbow Dessert Scoops” has the power to switch the suppliers and it will be loss of the
supplier but company can earn benefits.
Threat of substitution – It implies that customers seeks to change the retailers who are
providing the same products. Therefore, it is necessary for “Rainbow Dessert Scoops” to
improve the process and innovate the desserts through adding some new flavours. So that their
customer can sustain for a long time. This is crucial because people can substitute a products and
firm with others as substitutes are readily available in the market.
Threat of new entry – There is always a possibility that others can find a loop whole in
“Rainbow Dessert Scoops” and they can come in the market with opportunities. They are
always watching to failure of the firm to occupy the market with such innovative ideas. In order
to conduct a business in an effective way there is a need to apply the new concepts and
technology which can enhance the profitability of the business.
Competition : There are several firms who are selling similar products and gaining
profit. But different chocolates, ice-creams and sweets can owes the marketplace. This will gain
the competitive advantage in the market environment and acquire a position among the rivals.
“Rainbow Dessert Scoops” needs to adopt the new technology and innovate the new concepts
to achieve the profit (Bloom and Smith, 2010).
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TASK 3
P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial
idea.
“Rainbow Dessert Scoops” is needed to conduct a research to recognise the marketplace
. So it is investigating with the use of Primary research which presents a fresh information by
interviewing the potential buyers of the firm in a particular region.
Q1 Do you like to eat chocolates?
A. Yes
B. No
Q2 According to your opinion which is the most favourite deserts ?
A. Chocolates
B. Ice-creams
C. Sweets
7
Yes NO
0
5
10
15
20
25
Chocolates Ice-creams Sweets
0
5
10
15

Q3 How do you place an order for ice-creams and chocolates?
A. Online tools
B. Booking through phone
Q4 According to your views does sugar free chocolate, ice-creams and sweets are good for
health?
Yes
No
Q5 Do you like to purchase gift of chocolates on different occasions?
A. Agree
B. Disagree
8
Yes NO
0
5
10
15
20
0
5
10
15
20
12
18
Online tools
Booking
through phone

Secondary research – It refers to the information which is gathered by primary research
methods to support the analysis. The secondary research can be conduct through online surveys,
polls and forums to recognise the opinions of the people.
P4 Interpret data appropriately to provide evidence of market potential.
Q1. People likes to eat chocolates
Particulars No. of Respondents
Yes 25
No 5
Total 30
Mean 15
Median 15
Mode 0
Interpretation – As it can be seen in the above table that there are average 15 percent
respondents are voted in the “yes” as they likes chocolates among the 30 respondents. It specifies
that everyone likes the chocolates and they would like to get try some new flavour that is
provided by the “Rainbow Dessert Scoops”. There are less people who do not like the
chocolates but it has a large potential market to sale the chocolates with innovative ideas.
Q2. Most favourable deserts
Particulars No. of respondents
Chocolates 15
Ice-creams 10
9
Agree Disagree
0
5
10
15
20
25

Sweets 5
total 30
mean 10
median 10
Mode 0
Interpretation – From the above figure, it is clear that out of 30 respondents average 10
percent people likes dessert because they all have different choices. Some of them likes
chocolates and ice-creams but a few percentage like to eat the sweets. It may be possible that
they have some health issues that's why they avoid the desserts or they are more fitness freak so
that they ignores to have the desserts. That's the entire area of chocolates and ice-creams is
captured by the young generation only.
Q3 Method used for ordering chocolates.
Particulars No. of respondents
Facebook
Webpage 20
Telephonic 10
total 30
mean 15
median 15
Mode 0
Interpretation – As the “Rainbow Dessert Scoops” is offering a huge range of
desserts and it also provide a facility to place the order from Facebook webpage and Telephone.
There are average 15 percent customers who are taking the advantage of this facility because it
saves their time. There is one more facility which is providing by them, they can order
customized sweets and chocolates for their special occasion that can be birthday, Christmas,
Easter and so on. It is saving their time that's why they likes this facility to order their favourite
desserts.
Q4 Sugar free chocolate, ice-creams and sweets is good for health
10