Unit 27: Report on Identifying and Evaluating Entrepreneurial Ideas

This report examines entrepreneurial opportunities, focusing on the implementation of a new business idea centered around biodegradable packaging. It begins by exploring various sources of entrepreneurial ideas and innovation, using the Virgin Group as a financial service provider example. Th...Read More

Unit 27
Identifying
Entrepreneurial
Opportunities
Table of Contents
INTRODUCTION ..........................................................................................................................3
Determine and evaluate different sources of entrepreneurial ideas and innovation providing
specific examples....................................................................................................................3
Explain the rationale and the market gap for a specific entrepreneurial idea using relevant
tools and techniques to support your choice...........................................................................4
Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea
................................................................................................................................................5
Interpret data appropriately to provide evidence of market potential....................................6

Apply a SWOT framework to collate evidence to support an objective assessment of a
specific entrepreneurial idea.................................................................................................10
Evaluate the competitive and market environments in which the idea will be launched to
assess potential viability.......................................................................................................11
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14
INTRODUCTION
Entrepreneurial opportunities are defined as a process in which goods and services of
business organisation are sold at high price. New start-up needs various opportunities by which
they convert their idea into reality. For this purpose, budding entrepreneurship need finance and
wealth (Al Mamun and Ekpe, 2016). In this report, Virgin group is a financial service provider
that gives fund to the newly start-up companies that helps them in implementing their ideas into
reality.
This report is based on different sources of entrepreneurial ideas along with examples. In
addition to this, Porter framework as well as SWOT analysis is also considered in this report.
After this, it defines various ways to get over from the risk that is connected with execution of
innovative and new ideas.

Determine and evaluate different sources of entrepreneurial ideas and innovation providing
specific examples
Every entrepreneur identifies opportunities for implementing new ideas in order to
achieve profit. In present context, it has been analysed that unique and specific goods and
services are required in order to gain a competitive advantage in the marketplace. New start-up
assesses the opportunities in order to gain more and more revenue and profit. In addition to this,
UK government provides a lot of opportunities to new companies in order to accomplish goal
and objective in the workplace. It assists them to become a successful entrepreneur in the market.
Therefore, Virgin Money provides financial services to the newly start-up company that helps
them in implementing its ideas into reality (Aloulou, 2016). The entrepreneur uses this finance
in an appropriate manner in order to achieve success in the market. For assessing opportunities,
STEEP model is used which is going to be discussed below:
Social: It is an important factor which provides opportunities to entrepreneur to bring
innovative products that helps in increasing the living standard of people in the society.
Biodegradable packaging is very necessary because people purchase those goods which do not
have a polythene packaging. The use of Biodegradable packaging helps the companies to attract
the customer in order to increase their sales.
Technology: Technology plays a very important role in every organisation. The
implementation of latest technology is necessary for producing unique as well as innovative
products and services. It is essential to provide specific and innovative products to its customer
in order to increase profitability and sales of the business organisation within a specified time
period. In assistance of this, through implementation of advanced technology entrepreneur can
reach to the number of companies within short period of time.
Environmental: It includes those factors which is according to the best interest of
society. The products provide by the business organisation should be eco friendly and does not
harm the environment. The use of Biodegradable products provides opportunities to
entrepreneur in order to achieve success in the marketplace. The idea of producing
Biodegradable packaging is well accepted at the marketplace because it does not impose
negative impact on the society.
Economical: It includes those factors such as interest rate, inflation rate, exchange rate
and many more. Economic factor imposes direct impact on business activities as well as their

decision for executing innovative ideas within the marketplace. For example, Currency rate
increase overall cost of importing products which imposes negative impact on the profitability. If
entrepreneur offer its services at affordable price it will attract many companies that helps in
increasing profitability as well as sales of the company.
Political: Political factor are those which imposes direct impact on operation of business
activities. It involves different element such ad government interferences, political stability,
taxation policy and so on. The political condition of UK is highly stable which helps
entrepreneur to get a good position in the marketplace.
Explain the rationale and the market gap for a specific entrepreneurial idea using relevant tools
and techniques to support your choice
Explanation of the Business idea
It is essential for entrepreneur to assess market trends and conditions before executing
new idea in the marketplace (Dheer, 2017). In addition to this, it is important to identify the
needs and wants of consumer in order to implement new idea in an appropriate manner. The
companies easily accept the idea of Biodegradable packaging which is new and innovative that
helps them in protecting the environment as well as reduce the cost. Along with this, it is
necessary for entrepreneur to identify gap analysis and concept of marketing which is going to be
discussed below:
Determination of opportunities: For the growth and development of company, it is
necessary for entrepreneur to assess those opportunities which helps them in implementing
innovative ideas. Through the use of Biodegradable packaging the entrepreneur can execute new
ideas that helps them in increasing profitability as well as productivity level.
Technological opportunities: In present context, Technology plays a very important role
in execution of new as well as innovative ideas at the marketplace. The use of latest technology
can change the attitude and behaviour of customer they choose unique good and services. By
the use of advanced technology in the production process of Biodegradable packaging , it helps
entrepreneur in accelerating profit as well as reducing cost. In assistance of this, they will
achieve a good position in the market during a short span of time.
STP Model:

The STP model is adopted by entrepreneurs to specify segmentation, targeting and
positioning of specific product in the market. STP model is adopted for producing of
biodegradable packaging which is mentioned below:
Segmentation: It consider different factors such as education, age, marital status, gender
and occupation for launching an innovative product in the market. The segmentation of customer
is based on geographical factor like state, city and country. In context of Biodegradable
packaging entrepreneur segment companies according to their size as well as location.
Targeting: It is essential for entrepreneur to assess market trends for implementing the
new plan. In addition to this, entrepreneur assess the needs and wants of companies in order to
target right customer that helps in increasing sales as well as profitability level.
Positioning: It focuses on making a positive image of goods and services in front of
customer (Kier and McMullen, 2018) It helps them in increasing the loyalty and trust of
customer which assists them to accomplish goal and objective within a given time frame.
Positioning helps entrepreneur to build a positive image of their good and services in the mind
of consumer that helps them in accelerating its sales as well as profitability level.
Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea
A market research is defined as the process of gathering, analysing and interpreting the
information regarding market and product of the company (Xie and Lv, 2016). In the present
scenario of John packaging, there is a survey conducted for knowing that people are aware about
the service of biodegradable packaging offered by this company -
Questionnaire
Name:
Gender:
Age:
Address:
Q1 Do you know what biodegradable packaging is.
Yes
No
Q2 What is the sustainability period of biodegradable packaging?

Short term
Long term
Q3 Will you choose biodegradable packaging over plastic packaging?
Yes
No
Q4 How can the cost of biodegradable packaging be reduced?
By choosing cost-effective raw material
By making modifications in the processes
Q5 Can biodegradable packaging help John packaging to make profits and money?
Yes
No
Interpret data appropriately to provide evidence of market potential
Q1 Do you know what biodegradable packaging is? Frequency
Yes 16
No 4
Q2 What is the sustainability period of biodegradable packaging? Frequency
Short term 14
Long term 6
Q3 Will you choose biodegradable packaging over plastic packaging? Frequency
Yes 17

No 3
Q4 How can the cost of biodegradable packaging be reduced? Frequency
Selecting cost-effective raw material 13
Applying modifications in process 7
Q5 Can biodegradable packaging help John packaging to make profits and
money?
Frequency
Yes 14
No 6
Q1 Do you know what biodegradable packaging is? Frequency
Yes 16
No 4

Interpretation – Biodegradable packing is used for packaging products and this does not harm
environment. This type of packaging is produced using biopolymers and these are molecules
which are present in living organisms such as proteins and cellulose (Kirkley, 2016) These can
be safely consumed and degraded in quick manner. From the above pie chart, it is concluded that
out of the 20 respondents, there are 16 people who know what the concept of biodegradable
packaging is. On the other hand, 4 respondents were there who do not know what biodegradable
packaging is and what are its benefits.
Q2 What is the sustainability period of biodegradable packaging? Frequency
Short term 14
Long term 6
Interpretation - The above diagram explains that from the total of 20 respondents, there
are 14 people who believe that biodegradable packaging has short term sustainability period
(Long and Dong, 2017). But other 6 people think that there is long term sustainability period of
this type of packaging.

Q3 Will you choose biodegradable packaging over plastic packaging? Frequency
Yes 17
No 3
Interpretation - It can be concluded from the above pie chart that people are definitely
going to choose biodegradable packaging over plastic packaging (Martin, and Wilson, 2016).
More than 70% respondents are saying that they will prefer biodegradable packaging.
Q4 How can the cost of biodegradable packaging be reduced? Frequency
Selecting cost-effective raw material 13
Applying modifications in process 7

Interpretation – It is explained from the above diagram that there are some ways of
reducing cost of biodegradable packaging. From 20 respondents, there are 13 who think that cost
of biodegradable packaging can be minimised by Selecting cost-effective raw material
(Nieto and González-Álvarez, 2016)On the other hand, 7 respondents think that Applying
modifications in process will reduce cost.
Q5 Can biodegradable packaging help John packaging to make profits and
money?
Frequency
Yes 14
No 6
Interpretation - It is analysed from the above diagram that biodegradable packing will
help John packaging in making profits and money (Nijssen, 2017) Form the total of 20

respondents, there are 14 people who think this new entrepreneurial idea will help this start up in
making profits and money.
Apply a SWOT framework to collate evidence to support an objective assessment of a specific
entrepreneurial idea
SWOT Analysis
SWOT analysis is defined strategic planning technique that is being undertaken by
organisations in order to identify their strength, weakness, threats and opportunities. It duly
allows entity to evaluate external threats and opportunities. The entrepreneur uses this
framework for assessing strength, opportunities. Weaknesses as well as threat of new business
which is offering Biodegradable packaging to companies. The SWOT analysis which is going to
be discussed below:
Strength: Before implementing innovative ideas, an entrepreneur assesses the need and
wants of consumer in order to satisfy them. In present context, companies emphasised on
providing the product to its customer which is not harmful for society. Also, they eliminate the
use of Polythene bags for packaging of products that helps entrepreneurs to attract the ample of
companies and accelerate their sales. The entrepreneur has a patent right for biodegradable
packaging that helps in reducing the licensing fees as well as accelerating profitability level.
Weakness: Every new product possesses some weakness while entering into the
marketplace (Saemundsson and Candi, 2017). Sometimes, entrepreneurs are unable to analyse
the weaknesses which is the primary reason behind the failure of new goods and services in the
marketplace. Therefore, R&D department of company organise the research to understand the
acceptance level of biodegradable packaging at the marketplace. It accelerates the cost of
entrepreneur as well as reducing profit level. Therefore, due to decreasing profitability level,
company did not accept the product. Also, this is one of the reason behind failure of product
and services in the marketplace.
Opportunities: The need of biodegradable packaging is increasing which provides
opportunities to the entrepreneur to build a superior position in the marketplace as well as retain
for a longer period of time. Therefore, company adopt those products which is eco-friendly that
helps in making a good position in the workplace.
Threat: A Large business organisation have an own patent right to manufacture
biodegradable packaging in order to reducing the cost. This will impose negative impact on the

implementation of new idea of entrepreneur thus it results in decreasing the sales level. In
assistance of this, decrease in oil price is one of the big threat which is occur in the future time
period. It has been analysed that government agencies of most of the countries are forcefully
imposing laws and legislations related to environment safety. In this entities are required to take
measures to use renewable and recycled resources. This is possible threat. For this entrepreneurs
are required to undertake use of recycled raw materials. This will allow them to take advantage
of government support.
Evaluate the competitive and market environments in which the idea will be launched to assess
potential viability
Porter's analyses
This framework is developed by Michael Porter in 1979 with the purpose of identifying
the level of competition in the marketplace (Whalen and Akaka, 2016). In order to implement
the new idea of manufacturing of biodegradable packaging increases the sales as well
profitability level which is going to be discussed below:
Threat of new entrants: Due to increasing the new entrant in the market it imposes
negative impact on the productivity of company. In addition to this, increase in competition
affect the performance of company in negative manner. In the manufacturing of biodegradable
packaging, an entrepreneur needs small quantity of investment which imposes threat for new
entrants. If the entrepreneur manufactures its product in bulk as well as provides discount to the
business in order to earn profit as well sustain in market for a longer time period.
Threat of Substitute : Substitute products is one of the major threat for the companies
that reduces its profitability level. It is very important for an entrepreneur to provide its
innovative ideas at low cost in comparison to competitors for achieving success in the
marketplace.
Bargaining power of supplier: There are a huge number of supplier who provide raw
material such as minerals at low cost in the marketplace. Therefore, the bargaining power of
supplier is low, and buyer have an opportunity to take raw material on low cost that helps in
accelerating profitability level.
Bargaining power of buyer: This power is totally based on how crucial a buyer for the
company. An entrepreneur can increase the huge number of its buyer by providing product and
services at low cost (Srivastava and Misra, 2017).

Competitive Rivalry: There are a huge number of competitors are available at the
marketplace that affect profitability of the company. In present context, the competitor of
biodegradable packaging is less and also an entrepreneur has the chances to build a good image
in the marketplace for a longer time period.
PESTEL Analysis
Political:
It has been analysed that government have introduced limited or less laws for industries
dealing in biodegradable sector. This is a significant opportunity as it not only ensures
government support but also ensure maximum space in respective market segment.
Economical:
There are many opportunities for biodegradable entity as tax rate relief, easy borrowing
rates are available for these types of companies in every country as nation support these business.
Social:
It has been evaluated that, customers have dynamically changing their shift towards
environment safety. Along with this their preferences are becoming more organic. This acts as
significant opportunity for respective company.
Technological:
Technology is changing dynamically, this increases competition and cost to implement it.
In present respective business there is not much need of updating of technology at high constant
rates and it automatically saves large cost that can be used in other operations.
Environmental:
Nowadays countries have great concern towards environment. Along with this,
government have made strict measures for companies to abide environmental laws. As this
industry deal in biodegradable thus, they are free from any strict government rules and penalties.
Legal:
There are significant numbers of relaxations that are being provided by entities in
biodegradable sector. By taking advantage of this respective company can ensure their maximum
growth.
Different ways to overcome form the risk of competition

 An entrepreneur can use cost leader strategy in order to provide products at low
cost in the workplace that helps in attracting large number of companies to go
through its services.
 An entrepreneur can adopt differentiation strategy that helps them in providing
unique products to its customer as well as reducing their risk level.
 Through advertising and other promotional strategy, an entrepreneur can attract a
huge number of customer and increasing sales as well as profitability level.
 With the assistance of high-tech digital technology and advanced advertisement
measures attention of large number of customers can be generated.
 Innovation acts as one of the most important tool that significantly aid in gaining
large satisfaction from customers while ensuring long term sustainability.
CONCLUSION
From the above-mentioned report, it has been examined that entrepreneur brings
innovative ideas in the market in an effective manner. In addition to this, STEEP model is
adopted by entrepreneur to analyse the effect of external environmental factors on the
implementation of new ideas. In assistance of this, Porter five force model is adopted to examine
the competition level in the marketplace.

REFERENCES
Books and Journals
Al Mamun, A. and Ekpe, I., 2016. Entrepreneurial traits and micro-enterprise performance: a
study among women micro-entrepreneurs in Malaysia. Development in Practice, 26(2).
pp.193-202.
Aloulou, W. J., 2016. Predicting entrepreneurial intentions of final year Saudi university
business students by applying the theory of planned behavior. Journal of Small Business
and Enterprise Development.
Dheer, R. J., 2017. Cross-national differences in entrepreneurial activity: role of culture and
institutional factors. Small Business Economics, 48(4). pp.813-842.
Kier, A. S. and McMullen, J. S., 2018. Entrepreneurial imaginativeness in new venture
ideation. Academy of Management Journal, 61(6). pp.2265-2295.
Kirkley, W.W., 2016. Entrepreneurial behaviour: the role of values. International Journal of
Entrepreneurial Behavior & Research.
Long, D. and Dong, N., 2017. The effect of experience and innovativeness of entrepreneurial
opportunities on the new venture emergence in China. Journal of Entrepreneurship in
Emerging Economies.
Martin, L. and Wilson, N., 2016. Opportunity, discovery and creativity: A critical realist
perspective. International Small Business Journal, 34(3). pp.261-275.
Nieto, M. and González-Álvarez, N., 2016. Social capital effects on the discovery and
exploitation of entrepreneurial opportunities. International Entrepreneurship and
Management Journal, 12(2). pp.507-530.
Nijssen, E. J., 2017. Entrepreneurial marketing: an effectual approach. Routledge.
Saemundsson, R. J. and Candi, M., 2017. Absorptive capacity and the identification of
opportunities in new technology-based firms. Technovation, 64. pp.43-49.
Srivastava, S. and Misra, R., 2017. Exploring antecedents of entrepreneurial intentions of young
women in India. Journal of Entrepreneurship in Emerging Economies.
Whalen, P. S. and Akaka, M. A., 2016. A dynamic market conceptualization for entrepreneurial
marketing: the co-creation of opportunities. Journal of Strategic Marketing, 24(1).
pp.61-75.
Xie, X. and Lv, J., 2016. Social networks of female tech-entrepreneurs and new venture
performance: the moderating effects of entrepreneurial alertness and gender
discrimination. International entrepreneurship and management journal, 12(4). pp.963-
983.