Ave Maria College

COLLEGE OF INFORMATION AND TECHNOLOGY

HEI Unique Institutional Identifier: 09077

GE 12- THE ENTREPRENEURIAL MIND

LESSON 3: SEARCH FOR BUSINESS OPPORTUNITY

A. THE SEARCH FOR BUSINESS OPPORTUNITY

In selecting a business, option should not be based on luck and immature thinking, but on a thorough evaluation and
systematic process. Start by developing long and short lists of potential business opportunities. Likewise, the resources,
skills, and technology available in the community are to be evaluated if these are not fully or efficiently utilized. In
discovering business opportunities, the following factors on resources have to be evaluated:

1. Markets. This refers to the number of prospective buyers, competitors, the price, and the quality of goods and
services that have to be analyzed. Business opportunities exist in areas where consumer satisfaction is weak or
incomplete.

2. Individual Interests. Business interest of individuals should match business opportunities. For example, if one is
a good cook, he could venture in the food business.

3. Capital. This serves as the fuel that keeps the business operating. The availability of funds should fit the type of
business to organize.

4. Skills. The entrepreneur should have the proper skills in the business he is going to undertake.

5. Suppliers of inputs. It is important that there are steady suppliers of raw material and other inputs to the
business.

6. Manpower. The success of any business also depends on the efficiency of its employees.

7. Technology. Entrepreneurs should be aware of the presence of technology to improve their products or
services, or introduce new innovations in the market.

Among the productive resources, people are the most important because they are the ones who organize and manage the
other productive resources such as money, materials, machine, and manpower. Other opportunity-seeking processes that
can guide a prospective entrepreneur as to what kind of business to establish are as follows:

1. Look at other successful businesses/entrepreneurs. Looking up at other entrepreneurs as a role model that could
be an inspiration, by doing what they have done or do it even better.

2. Respond to a problem area. The solution to a problem might be transformed into a business venture.

3. Home-Based Business Option. These must not be taken for granted, for there are some big businesses that
started as a small business at home.

4. Linkage of Resources. The entrepreneur can produce his own input instead of buying them.

The best way to evaluate business opportunity is through Market Research, which is defined as the study of all problems
in marketing a product.

The Steps in Market Research are:

 Defining the problem

 Making a preliminary investigation
 Planning the research
 Gathering the data
 Analyzing the data
 Reaching a conclusion
 Implementation and evaluating decision

Through Market Research, the entrepreneur can be guided in identifying the profitable markets, saleable products, the
strengths and weaknesses of competitors, available resources, business risks, trends in consumer tastes and preferences,
better marketing strategies, proper business location, new market opportunities, and realistic objectives
Location of the business is a key factor in business success. In selecting a location, the population, income, competitor,
government policies, peace and order, and others are being considered. This requires a market survey.

To be able to translate business opportunities into profits, the SWOT (Strength, Weakness, Opportunity, and Threat)
Analysis is applied. These are tools for evaluating the strengths, weaknesses, opportunities, and threats associated with a
particular product or service. In knowing this, the entrepreneur must be able to have an idea or a precautionary measure
even before the start of the business. Excellent knowledge about the life cycle of the products provides the entrepreneur
business opportunities to continuously start in business. The following are the description of the various stages of a
product life cycle. According to Fajardo, products have their own life cycle. It is composed of four stages: Introduction,
Growth, Maturity, and Decline. Some products have long product life cycle, while others have short. Here are the
descriptions of various stages of product life cycle, particularly as sales volume and profit.

 Introduction. If consumer awareness and acceptance of product are low, launch through the use of
marketing activities, which make the profit low due to cost of development and marketing activities.
 Growth. To meet the growing demand, product distribution is expanded. Sales rise rapidly as product
becomes popular
 Maturity. Sales are still rising, but rate of increase has declined. At the latter part, a sale reaches its peak,
while profit begins to fall.
 Decline. There is a sharp fall in sales volume, while profit Curve becomes almost flat or horizontal. There
is also decline in the number of competitors. The only survivors are those who specialize in marketing the
product. Once product is no longer profitable, it is eliminated from the market.

Entrepreneurs should be aware of the duration of each stage of the product life cycle. Fajardo had emphasized in his
book, Entrepreneurship that excellent knowledge about product life cycle provides entrepreneur business opportunities to
continuously stay in business.

Venturing into a business project demands a timely and clear decision as to which area or business concern to deal with.
In the selection process, one has to begin with cho0sing or focusing on a particular business by category or sector.

1. The service-based business. Common examples of service- based businesses are consultancy, barber shops, repair
shops, beauty parlors, care giving, designing works, rendering professional services, such as engineers, dentistry, medical
doctor, and others where there is no need to manufacture something.

2. Trading or product-based business. This is a buy-and-sell transaction that can happen in your storehouse, showroom, or
any other structure less environment. Selling involves a lot of customer contact and requires a great deal of persistence on
the entrepreneurs' part. An example of this is putting up a grocery store, bakery products, or general construction
materials.

3. Manufacturing business. This is a manufacturing or production based business by creating a product. Manufacturing
can be as simple as creating hand-painted T-shirts or ceramic vases and now, the most popular is candle making, which
can be done in your home.

4. Licensed business opportunities. If you find some difficulties in launching a product or service, it is a good idea to look
for licensed business opportunities. Franchising is a business format somehow very similar to licensed business
operations.

5. Distributorship. This is where an independent entrepreneur, company, or individual enters into an agreement or contract
to offer, sell, or distribute a particular product, but is not entitled to use the manufacturer's trade name as part of its own
trade name. In our country, distributor represents foreign companies who can sell products to dealers strategically located
all over the country.

6. Rack Jobber. This involves an agent or buyer entering an agreement with a parent company to market its goods to
various stores by means of strategically located store racks.

7. Wholesalers. These sell the product of manufacturers or producers to retailers and other distributors who have direct
dealings with the end users or customers.

8. Subcontracting. This is a familiar form of business format in the garments sector, as well as the shoe industry. This
involves signing up an arrangement with a major producer to complete a set of product components on a pre-agreed price.

9. Vending machines routes. These are placed in various places or locations. The entrepreneur needs to have substantial
capital outlay as he had to pay for the vending machine, including the stocks to be vended.

B. IDEATION

The beginning of a business endeavor is ideation. This should be the first investment of anyone who seeks to be an
entrepreneur; and to be called an entrepreneurial business opportunity, such idea has to be new, or not, should be
innovative. The best sources of ideas are the Consumers or the market in general, since they are the ones who are in need
for a certain product or service. For a creative person, ideas are in him in his mind, but for those deprived with creative
thinking; they can get ideas through reading books and talking to someone with creative thinking. There are some specific
sources like trade journals, trade associations, conventions, exhibits, trade shows and consumer shows, country
government affairs, and others.

Ideas that are worth a business should be the one that has a market now and in the future. This could be a product, a
service system, and the like, which could fall in any of the following categories

a. Need/want drives

b. Time-saving drives

c. Money savings

d. Unique or incorporating strong competitive advantages

e. Link to personal interest, preferably passion

The more idea a person produces, the more original and the better quality ideas one will find among them. When you
come across an idea, you should put it in writing. The most common way of developing ideas is as follows:

 Recognizing the need. Develop an idea or a product that can satisfy a need, and respond to the need by
establishing a business concern.
 Improving an existing product. The result of consumer dissatisfaction to the existing product could open the door
to introduce innovations or improvements.
 Recognize trends. Entrepreneurs should be able to recognize the opportunity to develop a product and set trends
that can make them leading entrepreneurs.
 Be aware of everything. There is no other way to know about what is happening around you, but to research and
read.
 Questions and assumptions. Anybody can question the relevance or quality of any product or services, provided
that there is an effort to improve the product.
 Naming it first, then, develop it. If you have the idea, study it and develop it to something that is worth a business.

Earlier, it is said that ideation is the beginning of a business. A wrong choice of idea could be the cause of business
failure, so ideas need to be evaluated if it can be profit potential. The following are some tips in evaluating ideas:

a. Do not let your idea follow money; let money follow your ideas. If the idea is clear and viable, there should be
clear options for the business out of the idea.

b. See yourself as a problem solver. Ideas should be a solution to an existing problem of the consumer or the
market in general.

c. Use research as a weapon against failure. This is an important fact in decision-making process; most business
failed because of lack of information.

d. Make sure your idea has longevity. An idea that is worth pursuing into a business is one which has a long-term
purpose and not only a fad.

e. Take a risk on your ideas. Venture into a business by using your own ideas. Test your idea against the past,
present, and future. The market needs and demands will not be far from what is happening in the past, so it is better to get
information about the past, present, and future.

f. Test your idea against the past, present, and future. The market needs and demands will not be far from what is
happening in the past, so it is better to get information about the past, present, and future.

g. Know the idiosyncrasies of your market. Know the needs of your market and all the factors that affect the
buying process. Your idea will depend on this.

Once you generate an idea, it has to be protected because it can make you a potential millionaire, like in the case of Bill
Gates. There are many ways of protecting your idea from being stolen or claimed by others, and losing the opportunity to
be known as the creator and the originator of the ideas. Aside from this, no company will pay you a royalty if idea
presented is not legally protected. The following are the ways of protecting your ideas:

a. Confidentiality Agreements. It specifically provides that a signer will not share the idea to anyone. This is a
typical agreement or contract where one should ask advise to a patents attorney or those with experience and expertise in
the intellectual property rights.
 b. Patents .These gives the inventor exclusive legal rights to exclude anyone else from manufacturing, selling,
importing, or using an invention during the life of the patent. The three general classifications are: Design, Utility, and
Plants Patents.

c. Trademarks. This is a word, name, symbol, or device used by manufacturers on merchants to identify their
goods and distinguish them from others sold in the market. This should be sed in conjunction with a business or a product,
otherwise, this will not be granted.

d. Copyrights. A copyright protects the creative works of composers, authors/writers, artists, and others. This is
the easiest form of protection for Intellectual Property.

C. ENTREPRENEURIAL CREATIVITY

Creativity, innovation, and entrepreneurs are inseparable. Creativity is an essential part of innovativeness, the starting
point of a process, which is skillfully managed, and brings an idea into innovation. It is considered as a characteristic that
is innate or inherent to every individual, but the social environment can influence both the level and frequency of creative
behavior. It is particularly important to understand the role the environment can play.

D. ENVIRONMENTAL STIMULANTS TO CREATIVITY

a) Freedom – a sense of control over one’s work ideas

b) Good Project Management- a manager serves as a good role model
c) Sufficient Resources – access to necessary resources
d) Encouragement – management enthusiasm for new ideas
e) Various Organizational Characteristics – a mechanism for considering a new ideas
f) Recognition – a general sense that creative work will receive appropriate feedback, recognition, and reward.
g) Sufficient time- time to think creatively about the problem
h) Challenge- a sense of challenge arising from intriguing nature of the problem
i) Pressure- a sense of urgency that is internally generated from competition as a personal sense of challenge
j) Outside Organization-from a general desire to accomplish something important

E. THE CONCEPT OF INNOVATION

Innovation is doing something different. It could be introducing either something new or different. Innovativeness
is a characteristic of an individual, tea, or organization. This is also the capacity to create ideas and develop them to usable
products or services.

IMPACTS OF INNOVATION

Efforts on innovation must have impacts- positive impacts. It must have a positive implication that is supportive
of organizational goals and objectives. The innovative accomplishment exists if the following happens:

1. Effecting a new policy- creating change or orientation or direction

2. Finding a new opportunities – developing an entirely new product or opening a new market

3. Deigning a new structure- changing the formal structure, reorganizing or introducing a new structure

4. Devising a fresh method- introducing a new process, procedure, or technology for continued use.

Within the organization, the orientation toward innovation must come primarily from the higher level of
management. The elements of innovation orientation are as follows:

a. Value placed on creativity and innovation in general;

b. An orientation toward risks;

c. A sense of pride in the organization and its members, and the enthusiasm about what they are capable of doing;
and

d. An offensive strategy of taking the lead towards the future.

 Ave Maria College
COLLEGE OF INFORMATION AND TECHNOLOGY
HEI Unique Institutional Identifier: 09077

NAME: ___________________________________ SCORE: _________________

PROGRAM & LEVEL: ______________________ DATE: __________________

ACTIVITY 3: “INNOVATE AND ELEVATE” BUSINESS PITCH PRESENTATION

Activity Outline:

1. Begin by summarizing the key concepts of business opportunity, ideation, and entrepreneurial creativity from the
provided content.
2. Explain the goals of the "Innovate and Elevate" competition: to apply these concepts and develop innovative
business ideas.
3. Team Formation (15 minutes):
4. Form teams of 3-4 participants each. If the group is large, you can have multiple teams.
5. Encourage diversity within teams to bring together different perspectives and skills.

Activity 1: Business Opportunity Brainstorming

1. Provide each team with a worksheet that outlines the factors to consider when evaluating business opportunities
(markets, interests, capital, skills, technology, etc.).
2. Instruct teams to brainstorm and write down at least three potential business opportunities based on these factors.
3. Emphasize the need for both creativity and feasibility.
4. Each team should select one opportunity to develop further.

Activity 2: Ideation and Business Concept Development

1. Instruct each team to choose one of the business opportunities they identified and create an innovative business
concept around it.
2. Encourage teams to consider the problem or need they are addressing, unique selling points, target market,
revenue model, and potential impacts.
3. Teams should also think about how to differentiate their concept from existing solutions.
4. Provide guidance and assistance as needed.

Activity 3: Business Pitch Preparation

1. Each team should prepare a business pitch presentation that includes:

2. A clear problem statements
3. Their innovative solution and its unique features
4. Target market and customer demographics
5. Revenue model and financial projections
6. Marketing and growth strategies
7. Any additional information they find relevant
8. Teams should practice their pitches within their groups and refine their presentations.