Notes of Opportunity Identification and Product selection as taught in Course of Business Intelligence and Entrepreneurship in Engineering B.tech , Business BBA and to other courses .

1. Unit II Opportunity / Identification and
product selection
Opportunity
Business opportunity means a good or favourable change available to run a specific business
in a given environment at a given point of time.
Ideas are not same as opportunities Ideas are free and last for ever whereas opportunity is
short lived and require work.
Qualities of opportunity
TYPES OF SITUATIONAL FACTORS
Product or service is still not in existence
Product or service is already in the market but failed to satisfy the customers – so need
to be improved
EMERGENCE OF OPPORTUNITY / Opportunity Search
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2. when people decide they have certain needs and want to be satisfied, or when people
discovered a problem of some kind that can be helped by a product or service.
The presence of unfulfilled needs and want and/or problems alerts the entrepreneur to
the potential opportunity.
The entrepreneur later creates a business that is able to fulfill the needs or want and/or
solve the problem.
OPPORTUNITY IDENTIFICATION
Opportunity identification is a process that involved the search for and discovery of
business opportunities
Observing Changes in Environment
Changes in the environment give rise to needs and wants and/or problems, and an
opportunity emerges
Important environment forces to observe include :
1. Economic forces
2. Social forces
3. Technological advances
4. Political and regulatory statues
Recognising Needs and Wants
Opportunity occurs whenever there is a need and want to fulfill. The term “needs” refer
to basic needs that the consumer must have in order to live while the term “wants”
refers to a personal desire for something that is more than a basic need.
Recognise Problems and find solutions.
Problems can be recognized by observing the challenges that people encounter in
their daily lives. Solution to the problem represented a business opportunity
The entrepreneurs selected their products or projects based on:
Their own or partners’ past experience in that business line;
The Government’s promotional schemes and facilities o�ered to run some specific
business enterprises;
The high profitability of products;
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3. Which indicate increasing demand for them in the market?
The availability of inputs like raw materials, labour, etc. at cheaper rates;
The expansion or diversification plans of their own or any other ongoing business known
to them;
The products reserved for small-scale units or certain locations
Feasibility Analysis
Feasibility analysis is the process of determining whether a business idea is worth
pursuing.
Timing of Feasibility Analysis
Conduct a feasibility analysis is early while thinking through the prospects for a new
business. The idea is to screen ideas before lot of resources are spent into it.
Components
Product/Service Desirability
The idea is that before a prospective firm rushes a product or service into development, it
should be confident that the product or service is what its prospective customers want.
Business concept should be developed.
Concept is one page description of Business
It is distributed to people and feedbacks are recorded.
It should include Product features , intented coustomers , benefits to customer.
Example:
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4. Industry/Target Market Feasibility Analysis
It is an assessment of the overall appeal of the industry and the target market for the
proposed business.
An industry is a group of firms producing a similar product or service.
A firm’s target market is the limited portion of the industry it plans to go after.
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5. There are three primary issues that a proposed business should consider:
Industry attractiveness : The degree to which environmental and business trends are
moving in favor rather than against the industry .
market timeliness :
First Mover(launching new product to market) , no competition ,demand
uncerainity.
or Second Mover(imitating first mover) , learns form mistake of first mover.
Later mover (launches product after long time has been achieved.) low risks.
identification of a niche market.
identify needs and requirements that are poorly addressed by other firms
Organizational Feasibility Analysis
It is s concerned with determining whether the business itself has su�cient skills and
resources to bring a particular product or service idea to market successfully.
Focuses on Non Financial resources
There are two primary issues to consider in this area:
Management prowess: management has requisite passion and expertise to launch
the product?
Resource su�ciency:availability of labs?Quality Labour?Government
support?Proximity to suppliers?
Financial Feasibility Analysis
The most important issues to consider at this stage are:
Total start-up cash needed : Total cash needed to prepare busineess to make first
sale?Overestimate and not underestimate.
Financial performance of similar businesses:Estimate the proposed start-up’s financial
performance by comparing it to similar, already established businesses.
Overall attractiveness of the proposed venture. Steady and Rapid growth for
5-7years?High % of recurring revenue?Funds to finance growth?
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