This document discusses identifying business opportunities. It recommends collecting information on local resources, existing businesses, infrastructure, skills, and more. Good opportunities are viable, feasible, and sustainable. The food sector is used as an example, with opportunities classified based on natural resources, local industries, local demand, and export potential. Finally, it emphasizes that opportunities are location and time specific, and one must consider their qualifications, market factors, and feasibility before deciding on an opportunity.

2. 2
Business Opportunity Identification
By Dr. L. P. Panda

3. 3
O P P O R T U N I T Y
I D E N T I F I C A T I O N
ENTREPRENUER’S
BACKGROUND AND
INVESTMENT
EDUCATIONAL
QUALIFICATIONS
AND EXPERIENCE
LOCATION
AVAILABILITY
OF RAW
MATERIALS
MARKET
POTENTIAL
POLLUTION
CONTROL LAWS
AVAILABILITY
OF SKILLED
MANPOWER
GOVERNMENT
POLICY
INFRASTRUCTURAL
REQUIREMENTS
TECHNOLOGY
AND EQUIPMENT

4. 4
A good business opportunity is that which is a techno-economically and commercially
viable and feasible and environmentally sustainable proposition. Every entrepreneur
needs to identify a sound opportunity.
To identify an opportunity, one needs to:
(i) Collect basic information on local resource base, e.g. agriculture, forest and mines
(ii) Collect information on opportunity identification (OI) exercise done earlier (if any),
by DIC, banks, other financial institutions, etc.
(iii) Discuss the potential business opportunities with existing entrepreneurs
(iv) Discuss with VAT officials / about the inflow of goods
(v) Collect information on new major investment going to materialize in the area
(vi) Collect negative list of banned items for financing
(vii) List out poor performing industries
(viii) Collect information on skill base – especially on handicrafts, etc.
(ix) Collect information on availability of infrastructure like power, water and transport,
BUSINESS OPPORTUNITY IDENTIFICATION

5. 5
Example : Business Opportunity in Food Sector
The opportunities in the food processing sector may be classified on the basis of
the following parameters:
1. Natural Resource-Based Opportunities: such as the ones based on cereals,
cash crops, fruits and vegetables, agro-wastes, animals, marine-based,
processing of food products like cereals and pulses, fruit preservation, pickles,
honey, etc.
2. Local Industry Based: those dealing in supply of intermediary raw material,
ancillary job-work, recycling of industrial wastes, by-products, etc.
3. Local Demand Based: which may include products like bread, biscuits, flour,
spices, etc?
4. Export Based: Any local product, which is being exported; or resources
available locally to manufacture the items, which have good export
potential.
If you follow the above method, you will be ready with a large number of business
opportunities. However, please remember these opportunities are location and

6. 6
 Opportunities are location and time specific.
 An opportunity today may not remain an opportunity tomorrow. Or
an opportunity in a forest area may not hold good in the deserts of
Rajasthan, as the resource base will change.
 Moreover, one would also need to assess the viability and feasibility of
the opportunities before pronouncing them as business opportunities.
 An opportunity may be absolutely viable but may not be feasible if it
is mismatched. For example, setting up a large flourmill may be a
perfectly viable proposition; it may not be feasible to set up one in Sunder
bans for an illiterate rural or tribal man.
Business Opportunity : Important Facts

7. Needs to consider the following facts before deciding
upon an opportunity
 One’s Education
 Experience
 EDI / DST – NIMAT / Entrepreneurship Development Programmes
 Economic Background
 Investment Capacity
 Family Background
 Managerial Capabilities of the trainee
 Market Competition with other Producers / Size of Market
 Location of the Unit
 Availability of technology and process know-how
 Availability of raw material
 Availability of skilled workforce
 Availability of required infrastructure

8. Needs to consider the following facts before deciding
upon an opportunity
 Project cost
 Export potential
 Life-cycle of the product and future growth of the product
 Shelf-life of the product (highly perishable like milk or long-term like
 capital goods or consumer durable, etc,)
 Profitability of the product
 Degree of risk
 Gestation Period
 Government policy
 After ascertaining these factors, you should conduct a SWOT analysis of yourself vis-à-vis the
identified opportunity.
 If both match, you should proceed for a preliminary feasibility study through market survey.
It is advisable to zero in two to three opportunities to finalize one.

9. While deciding upon an opportunity, you should ask yourself?
 How comfortable are you with the technology? Will you be able to handle it?
 What is the situation of competition? How will you withstand the competition?
 Will you be able to muster enough resources (especially finance)? Will you be
able to manage investment from your own resources? If not, how do you plan to
get funds?
 How critical is the government support for your product?
 Is raw material easily available? If not, how will you manage regular supply of raw
material?
 Will you get adequate skilled manpower? If not, how will you manage?