UNIT 1: PERSPECTIVE OF ENREPRENEURSHIP

TITLE OF THE LESSONS 4:

● Business Opportunities

DURATION: ​4 Hours

INTRODUCTION:
There are many business opportunities for an individual with creative mind. All
business starts with an idea, and it is said that creativity, through innovativeness and
the capacity of bringing businessman and an entrepreneur.
A smart entrepreneur may decide to have small or large business, but it is
important to follow the process of identifying and evaluating the various options in
generating ideas that can be transformed into a profitable business endeavor.

Suitable techniques and procedure:

▪ Practical Exercise/Question
▪ Discussion and Explanation of the Lesson
▪ Additional Readings
▪ Self-Assessment
▪ Key Takeaways

OBJECTIVES:
● identify the factors to consider in evaluating the business potential of an idea

DISCUSSION AND EXPLANATION OF THE LESSON:

The Search for Business Opportunity
In selecting a business, option should not be based on luck and immature thinking, but
a thorough evaluation and systematic process.
In discovering business opportunities, the following factors on resources have to be
evaluated:
 1. Markets. This refers to the quantity of prospective buyers, competitors, the
price, and the quality of goods and services that have to be studied.
Business opportunities occur in areas where consumer satisfaction is
weak or incomplete.
2. Individual Interests. Business curiosity of individuals should match
business opportunities. For example, if one is a good cook, he could enter
in the food business.
3. Capital. This serves as the fuel that retains the business operational. The
availability of funds should be suitable the type of business to establish.
4. Skills. The entrepreneur should have the appropriate skills in the business
he is going to undertake.
5. Suppliers of inputs. It is important that there are fixed suppliers of raw
material and other inputs to the business.
6. Manpower. The achievement of any business also depends on the
competence of its employees.
7. Technology. Entrepreneurs should be aware of the existence of
technology to expand their products or services, or introduce new
innovations in the market.

Among the productive resources, people are the most significant because they
are the ones who establish and manage the other productive properties 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:
o Defining the problem
 o Making a preliminary investigation
o Planning the research
o Gathering the data
o Analyzing the data
o Reaching a conclusion
o implementation and evaluating decision

Through Market Research, the entrepreneur can be directed in identifying the

profitable markets, new market opportunities, saleable products, , available resources,
business risks, trends in consumer tastes and preferences, better marketing strategies,
proper business location, the strengths and weaknesses of competitors , and realistic
objectives.
Location of the business is a key factor in business success, 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 render 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 or
a product re cycle. According to Fajardo, products have their own life cycle. t is
compo5ed 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 ire cycle, particularly as sales volume and profit.
Introduction. If consumer awareness and acceptance of product are low, launch
through the use or marketing activities which take the profit low due to cost or
development and marketing activities.
Growth. To meet the growing demand, product distribution s expanded. Sales
rise rapidly as product becomes popular.
Maturity. Sales are still rising, but rate of increase declined. At the latter part, a
sale reaches its peak, while profit begins to fall.
Decline. There is a sharp fall in sales, while profit curve becomes almost flat or
horizontal. There is also a decline in the number of competitors. The only survivors are
in 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 product life
cycle.
Venturing into a business project demands a sensible and clear choice as to
which area or business concern to deal with. In the selection process, one has to start
with focusing on a particular business sector.
1. The service-based business. Common examples or service-based
businesses are consultancy, barber shops, repair shops, beauty parlors, care
giving, designing works, rendering professional services, such as engineers,
dentistry, medica doctor, and others where there is no need to manufacture
something
2. Trading or product-based business. It is a buy-and-sell business that can
happen in your storehouse, showroom, or any other structureless
environment. Selling includes a lot of customer exchange and requires a
great deal of determination on the entrepreneur’s 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 making
hand-painted T-shirts or ceramic vases and now, the most widespread is
candle making, which can be done in your home.
4. License business opportunities. If you had some problems in launching a
product or service, it is a good idea to look for licensed business opportunities.
Franchising is a business format somehow very alike to licensed business
operations.
5. Distributorship. This is where an independent entrepreneur, company, or
individual come in into an arrangement or contract to offer, sell, or distribute a
specific product, but is not allowed to use the manufacturer's trade name as part
of its on-trade name. In the Philippines, distributors represent 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 or 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 pre-agreed
price.
 9. Vending machine routes. These are placed in various places or locations.
The entrepreneur needs to have a substantial capital outlay as he had to pay for
the vending machine, including the stocks to be vended.
What is ideation?

• Business starts with ideation.

• Ideation should be the first asset of anybody who seeks to be an entrepreneur.

Ideas that are value a business should be the one that has a market today and in
the future. This could be a product, a service, and the like, which could be in any of the
following types.

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 most common method of developing ideas is as follows:

● Recognizing the need
● Improving an existing product
● Recognizing trends
● Be aware of everything
● Questions and assumptions
● Naming it first, the develop it

Entrepreneurial Creativity
Innovation, creativity, and entrepreneurs are inseparable. Creativity is an vital
part of innovativeness, the starting idea of a process, which is skillfully managed, and
carries an idea into innovation.
Environmental Stimulants to Creativity
a. Freedom
b. Good Project Management
c. Sufficient Resources
d. Encouragement
e. Various Organizational Characteristics
f. Recognition
g. Sufficient Time
h. Challenge
 i. Pressure
j. Outside Organization

SUGGESTED READINGS:

✔ Macatanghay, Leah Alvino, Entrepreneurship, Don Bosco Press Inc., 2015

✔ Asor, Ph.D., Entrepreneurship in the Philippine Setting, REX Publishing, 2009
✔ Hisrich, R., Peters, M., & Shepherd, D. (2009). Entrepreneurship
✔ (8th ed.). Irwin, PA: McGraw-Hill

Reflection/Learning Insights

● Entrepreneurs are often thought of as general assets to be cultivated, motivated,

and remunerated to the utmost possible extent. Great entrepreneurs have the
capability to change the method we live and work. If successful, their innovations
may progress standards of living, and in addition to generating wealth with
entrepreneurial ventures, they also create jobs and contribute to a growing
economy