Identifying Entrepreneurial Opportunities: A Report

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IDENTIFYING ENTREPRENEURIAL
OPPORTUNITIES

TABLE OF CONTENTS
Introduction..................................................................................................................................................1
LO 1.............................................................................................................................................................2
P1 Determine and evaluate different sources of entrepreneurial ideas and innovation...........................2
LO 2.............................................................................................................................................................4
P2 Explain the rationale and the market gap for a specific entrepreneurial idea using relevant tools and
techniques to support your choice...........................................................................................................4
LO 3.............................................................................................................................................................6
P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea......6
P4 Interpret data appropriately to provide evidence of market potential................................................7
LO 4.............................................................................................................................................................9
P5 Apply a SWOT framework to collate evidence to support an objective assessment of a specific
entrepreneurial idea.................................................................................................................................9
P6 Evaluate the competitive and market environments in which the idea will be launched to assess
potential viability...................................................................................................................................10
Conclusion.................................................................................................................................................11
References..................................................................................................................................................12

Introduction
The entrepreneur role is to take the opportunities, threats and personal potential to transform the
opportunity into the business idea. The present study offers understanding on the new business idea and
gives the opportunity to evaluate the same. Approach of innovation, creativity and development abilities
will be presented. The learning for the frameworks will be supportive to develop the business venture
that includes products and service advantages, determining the target customers, industry understanding
and competitors in context with new entrants. The primary and secondary research techniques will be
studies for entrepreneurial idea and will create the assessment for knowing the situation whether the idea
is commercially viable or not in competitive scenario.
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LO 1
P1 Determine and evaluate different sources of entrepreneurial ideas and innovation
New business idea and innovation
Business organizations are created with the ideas of the innovation of the entrepreneur. In the absence of
innovation, it is not possible to plan and manage the new venture according to the fore coming
opportunities, due to this innovation is referred as the important element for the industries that are
developed and for the new startups also (Planing, 2018). The present study will relate to the information
about the new idea of bringing the start up by innovation. The idea is to bring the medium scale
restaurant in the central UK with the objective of considering the innovational dishes on the name ‘Sun
and Moon Restaurant’. The restaurant will bring the idea of attractive interiors and décor with
balconies corner. The focus shall be placed on the marketing strategies as per the internal and external
factor coming from different sources. The restaurant will be based on the theme of sun and moon and
architecture will be based accordingly so that customers can visit for the day and night time both.
There are different types of innovation but this type of innovation comes in incremental innovation that
helps in bringing the changes in the current products and services only. The overall efficiency and
productivity will be improved to meet the competitive objectives (Kim and Min, 2015). Therefore, in
this case of Sun and Moon restaurant, the incremental innovational model will be taken considering the
changes in architecture as well.
After considering the innovative business idea, it is important to consider the sources of change that will
act as the opportunity to the restaurant given by Drucker’s are as follows:-
The unexpected: It is known fact that the restaurant market is very big in UK therefore, it is important to
anticipate the products and services demands so as to get the unexpected success.
The incongruity: Before giving the business idea, discrepancies shall be determined with the target
customers along with considering their unmet wants and complaints.
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Process need: In this, the weakness point is to be identified and accordingly redesign or correction
should be done (Incremental Innovation, 2019). The restaurant should determine the waiting time and if
it is too long then the organization shall hire additional chef to raise their speed up time.
Industry and market structure change: The organization should consider the regulations and the change
that can be expanded. Therefore, firm shall take into account regulations of the restaurant industry
(Maravilhas et.al. 2018).
Demographics: The firm should overlook for the income levels, age, education and populations. In this,
organization can consider the combination of demographics with targeting and segmentation to really
meet the targeted wants of market.
Change in perception, meaning and mood: In restaurant industry, the mood and perception of the
individuals changes very frequently. Therefore, it is important to consider the culture of different places
in order to bring the idea of innovation successful (Incremental Innovation, 2019).
New knowledge: The technology has been increasing and brought the opportunities to the business and
due to this important attention has to be given by restaurant by having huge advertisement on various
online platforms.
On this context, by evaluating the all the sources the entrepreneur will have the opportunities to scale up
their new business operations using their skills, capabilities and knowledge along with considering the
threats such as high competition or price wars etc. The opportunities can also be taken through exploring
the creativity in the new restaurant by putting creativity techniques. There are different types of
techniques such as evolution, synthesis, revolution, reapplication and changing direction (Fjeldstad and
Snow, 2018). But as it is the restaurant, it will be appropriate to use the combination of methods like
evolution of idea by brainstorming and accordingly revolutionizing it on the small scale.
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LO 2
P2 Explain the rationale and the market gap for a specific entrepreneurial idea using relevant tools and
techniques to support your choice
The entrepreneurial idea is to bring the change in the restaurant so as to attract the large number of
customers towards it. The incremental innovation will take place considering various sources and
accordingly it is important to identify the customers that will be attracted for the restaurant present in
central UK. It is also important to understand the restaurant industry environment that whether it will
support the idea or not. On this context the use of tool Porter’s five force model has to be done.
Identifying customers
For achieving success for new idea, it is important to understand the needs. Presently, the customer
needs to have the healthy food with having pleasant friendly environment where they can feel fresh and
spend their leisure time. It means there need is good food plus good architecture. Restaurant marketing
manager on this basis will do the targeting based on behavioral, demographic or geographic
segmentation (Snyder et.al. 2016).
For ‘Sun and Moon Restaurant’ the targeted area will be youth and teenager who like to eat different
variety of food with good atmosphere. The segmentation will be demographic as their purpose is to
attract the audience from the age group 15 years to 35 years. The reason is that right population is using
the right products. The tangible feature of the restaurant is good location, good food and intangible
features is friendly and fresh environment that attracts the customers towards the restaurant.
Industry environment understanding
Generally industry does not accept the new entry easily as there are already big competitors playing in
the market. On this concern, the new restaurant has to consider the new entry threat or opportunity of the
Porter’s for restaurant.
For restaurant in UK, it can be opportunity of getting higher profits and there will be fewer barriers in
the industry. On the other side, threat to the competitors as their losses can be lowered down and more
competition can be presented. As per Porter, threat of new entrant defines the revolutionized manner of
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looking the individual a competition in the restaurant industry. New entry can also bring the threat of
restaurant as the risk of business loss because it requires huge capital as there are already competitors in
the market (The Strategic CFO, 2019). Moreover, if the restaurant does not work or earn profits the
major loss of investment will be there. Hence, for the restaurant, the competition, market share of other
firms and barrier to entry has to be analyzed to lower down the negative impact of new business.
Moreover, for identifying the gap, the analysis on restaurant industry life cycle shall also be conducted.
It includes five stages such as startup, growth, shakeout, maturity and decline. These stages can
complete for various time amounts, some can be years or months depending on the acceptance of the
product. Presently, the organization is at the innovation stage where the idea has been brought out and
changes had been presented. It is on the innovation phase because organization is looking for products
expansion with coming up of incremental innovation (Rennung et.al. 2016). It is generally possible that
organization should consider all the life cycle of the industry before bringing any new idea in their
organization.
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LO 3
P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea.
Gap analysis is the assessment that supports the business to determine the difference amount among
where they are presently and where they need to be in future. Gap analysis can be applied to assess the
organization variety from working firm and product placement to engagement of customer and potential
in market. It is important to first identify the gap in the market covering four key elements.
Identifying strengths: In this strength shall be identified by the organization by creating the list of
perceived strength. The restaurant strength is that it has central position in UK with attractive interior to
influence the teenagers. The organization can even take the honest feedback from the employees to
know their strengths (Tidd and Bessant, 2018). Further, professional test for aptitude can also be taken
in order to determine the strength the organization can expand in business environment.
Consider niche market: It is important not to think so big, when it comes for gap in the market.
Organization should make the market specific so that targeting can be done effectively. The niche shall
be big enough to take into account the sustainable growth of the new idea (The balance small business,
2019). Niche market is basically the great places to copy the market gap. If the organization has seen
that one industry has filled the gap the organization can similarly recreate the success in same industry.
For example: if Italian food has successful in food segment consider applying to the different variety of
food like Chinese etc.
Follow pending legislation: Many times food and restaurant industry goes for the high changes due to
legal evidence. The state, local or federal legislation create the gap in market as it will force the
respective industry to take the changes.
Identifying unsolved problems: It is important to solve the existing problem and it will be solve when the
restaurant boil a market gap down to the very essence (Ilonen et.al. 2018). It will support in solving the
present issue which result into more sell in the restaurant.
Therefore on the basis of above market gap analysis, organization target customer group is youth and
teenager and adult coming the age group 15 to 35 years. The strength has been given for attracting the
target audience, niche market has been consider as per targeting, laws that applies to restaurant has been
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considered and unsolved issues had also been presented. Moreover, concentrating on the market gap
supports the restaurant to avoid dividing in the market which is oversaturated already.
P4 Interpret data appropriately to provide evidence of market potential
The market potential for the new business idea can be interpreted through conducting the market
research. It is important to consider the primary research techniques that will support in producing the
effective products in comparison with the competitors in the niche market. Suitable data is important for
having the right picture of the market. There are basically different types of research method that are
useful for taking the decision for existing business idea refinement.
Questionnaire survey is the most common research technique that enables collection of large number of
information at very less cost. For instance: if the firm wishes to determine the potential market size then
it will help to carry out the research from 1000 customers for identifying the target market size.
Focus group: It involves small people group that are chosen according to target market (Sekaran and
Bougie, 2016). It allows discussion over services and products so that improvement scope can be
identified.
Qualitative research interviews: It is one to one interviews that involve open end questions in relation to
services, products and many more that enables the restaurant business to get modified ways for the
products given on the menu list together with services of restaurants.
By taking the qualitative interviews research technique for food and architecture is attractive and
outstanding. The potential customers said that the business plan is effective as all the elements related to
price, quality etc has been well explained and transformed into business functions. But there is
requirement of change in furniture and involving the employees for business decision making. Business
plan shall be communicated with the workforce for plan improvements. Target group taken is suitable
for getting the business success greatly.
Furthermore, trends changes in industry has been determined and therefore the change in interiors,
customer services, menu of food products and many more had to be taken place. The trends had been
determined through the use of big data technology where large number of information is collected and
stored in central database (De Mauro et.al. 2016). Irrespective of research, it is been determined that
resources and money is distributed in useful way. Suitable channels of marketing is also supportive in
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capturing the target market and moving the business on the right way according to plan of business. The
proper use of technology has to be done to make aware the customers about the refinement in the
business of the restaurant.
The internet forums are used for placing the advertisement and it should be done as it is easy and less
expensive form of advertisement. Social media is the most accepted channel of shopping and
advertisement for the organizations. The reason is that the audience which is targeted highly uses the
Facebook, Instagram at large scale (Park et.al. 2017). Further, the social media is simple in use and
every age generation makes use of it in order to connect with large audience. Organization can also
collect the feedback from the customer through Facebook and to know their responses towards the
services and quality of the restaurant on every aspect of refinement. Social media act as the medium of
bringing improvement in the business of the restaurant.
Moreover, the technique of research can be supportive in overcoming the market gap by the organization
with the target audience. The new entry of refinement business will also be effective as restaurant
industry is in niche market as many products are available in the market and large acceptance from the
audience has been received. Hence, it can be interpreted from the collected data that it is easy for the
restaurant to fill the market gap by bringing the refinement business plan.
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LO 4
P5 Apply a SWOT framework to collate evidence to support an objective assessment of a specific
entrepreneurial idea.
It is important for the restaurant to apply the SWOT analysis to know the assessment of entrepreneurial
idea.
Strength: As the position of the restaurant is in central UK the easy transportation and accessibility will
be there. The recent experience of the restaurant operation will be helpful in overcoming the challenges
faces in business refinement. The old experience of the owner can be supportive in creating the customer
relationship and vendor relationship as well. The restaurant understands the significance of offering
outstanding quality of food to be served to customers. The skilled members are already aware for the
market in similarity with restaurants and hotels that are of brands. The restaurant objective is to meet the
increased strengths of the human workforce so that high satisfaction to the customers can be met.
Influencing architecture of the restaurant in addition with the quality taste dishes will act as the unique
selling point for the business (Herliana et.al. 2018).
The objective of restaurant is to give homemade food at affordable cost and therefore price range kept as
$12 to $15 but the market investigation shows that the average price shall be approx $23 as per industry
standards and norms. It will help in gaining the competitive benefit together with giving seasonal dishes
as well. Suitable credit rating in restaurant running is supportive in getting useful credit terms in new
restaurant start.
Weaknesses: The major weakness is the low margins that impact the business operations and profits.
The skills of training and development are one of the complex tasks so that retention issues can be
controlled. Quality assessment in candidate’s selection and recruitment is also the main weakness for
impacting the satisfaction of customer. Further, online home delivery influences the physical stores sale
of the restaurant.
Opportunities: Less barriers of entry act as the opportunity to the business of the restaurant. The
business can also be extended towards the catering business also for getting market recognition. For
instance: customers will surely look the restaurant that has proper place of accommodation as well.
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These opportunities can be achieved through immense marketing research so that business idea can get
the success and competitive advantage can be achieved (Gartner et.al. 2017). The refinement will also
bring the talented staff towards the business and their qualified skills can be used in meeting the new
standards of the business.
Threats: There are numerous threats in opening the restaurant after refinement due to government
regulations like restaurant operations, employment laws, and protection laws for workforce, rules and
regulations with respect to food safety and quality that places the restrictions for carrying out the
business operations in useful way. For food and restaurant industry, the next threat is of operational cost
increase although sales are increasing but their maintenance is also needed. Raising the prices of
supermarket groceries and other items increases the cost of inputs restricts small restaurant growth.
Raising the health awareness had also reduced the sales of the restaurant because customers now are
health conscious and thinks homemade foods are good and healthy in food preparation.
However, from the above SWOT analysis it can be said that organization can take the refinement plan to
increase the sales of the business and to meet the competitive advantage. Strengths can be adopted to
meet the market gap and opportunities can be taken using strengths of the restaurant.
P6 Evaluate the competitive and market environments in which the idea will be launched to assess
potential viability
It is important for the business to evaluate the potential viability by considering the competitive market
environment. For ensuring the viability in the newer market after business refinement, there is need of
carrying out full assessment of the competitors for uncovering the several factors that are mentioned
below:-
Discover who is competing for the customer: In this organization has to consider the several
alternatives of the same products or alternate opportunity of the spending for the customers. In this
restaurant shall take into account the same industry competitors by consistently making efforts to have
watch on new and existing customers (Ansoff et.al. 2018).
Determine other factors of competing: The other competing factors such as technology and market
trends, stigmas and lack of awareness, regulations. To meet the changes, confirmation shall be taken for
adopting enough to have market sustainability.
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