Unit 27 Identifying Entrepreneurial Opportunities

TASK 1

P1 Determine and evaluate different sources of entrepreneurial ideas and innovation

In accordance with today's modernisation and technological advancement, every individual prefer unique and stylish products to differentiate themselves from rest of the crowd. In this scenario, there are may individuals in UK which are initiating new ideas and concepts to launch a new business within marketplace. Government in UK is very supportive and provides financial aid to the people which are interested in initiating their own business rather than working as an employee. Due to this, competition among individual is increasing and they are coming up with new & innovative ideas to impress government as grants and financial aids to individuals in UK will only be provided if government appreciates their business idea. In this respect, government is paying special attention towards young graduates which are willing to start their own businesses and posses new innovative ideas to satisfy the customers of UK in a more desired manner (Wang, Ellinger and Jim Wu, 2013). As government is actively supporting new business, it is important for individuals to check the feasibility of business. To run a successful business, it is important for business owner of Foodie Flavor to acknowledge different sources which helps in initiating different innovative ideas to set up a business. As per Drucker there are seven sources of innovation which are mentioned below:

• Unexpected: This source of innovation emphasize on the fact that new ideas and concepts take place unexpectedly. As analysing market is the best way to grab opportunities, it is vital for business owners to analyse market and try new experiments to develop innovative products. These new experiments may acts as a source of innovative idea for an individual.
• Incongruity: Sometimes people innovate to resolve incongruities that takes place within market. Ideas to tackle these incongruousness can act as a source of innovation for an individual. For example, as people are becoming health conscious, people can start cafe and restaurants which prepare healthy food and drinks.
• Market structure change: Changes in structure of market sometimes results in innovation. Government regulations and preference of people changes from time to time due to which existing products become outdated. This also acts as a source of innovation as people innovate new ideas and concepts to earn revenue and maintain livelihood.
• Necessity: It is considered as a mother of innovation. There are several cases where people innovate new ideas to satisfy the demands of people & society as no substitute product is available to cater the needs. Needs always force people to come up with bright ideas which can appropriately fulfil existing needs. (Gruber MacMillan and Thompson, 2013)
• Demographics: The lifestyle and purchasing behaviour of people can also acts as a source of innovation. Lifestyle needs are variable and changes from time to time. Fulfilling them is a vital aspect, this motivate people to adopt new concepts.
• Changing perception: Change in perception of people for the available services and products gives birth to innovation. In today's scenario, every people like to eat fast food but as health awareness is increasing, people are shifting their preference towards healthy substitutes. This acts as a source of innovation for Cage and Catering service to offer oil free fast food and healthy drink to customers.
• New knowledge: New and advanced knowledge is a good source of innovation. As technology is getting advanced and people are becoming more active & knowledgeable, they try to innovate existing facilities and services to save time, efforts and money.

M1 Detailed evaluation of Drucker's 7 sources of systematic innovation providing specific examples.

According to Drucker a successful innovative practice is based upon knowledge and hard work of an individual. Drucker initiate systematic innovation as a technique to exploit and grab new opportunities. According to him there are seven sources which are associated with innovation which assists in initiating new ideas and concepts. These different sources are categorised as external and internal aspects associated with an enterprise. Sources of innovation such as Change in market structure, changing perception, new knowledge, necessity, demography and unexpectedness results in introduction & initialisation of new concepts. Feasibility of these ideas determine whether a business is profitable or not. For example, According to the changing perception of people, Foodie Flavor is going to introduce oil free nutritious food along with healthy drinks. Here change in preference and choice of people acts as a source of innovation for business owner.

D1 Critically evaluate the benefits and drawbacks of different sources that can lead to the identification of entrepreneurial ideas

Benefits & Drawbacks: These different sources of innovation provides a right direction to entrepreneurs regarding the industry in which they can setup their business by gaining considerable profit. These sources helps in analysing different aspects related with a single scenario which allows business owners to achieve merits while innovating. Drawback is that sometimes these sources of innovation results in unexpected outcomes and failures due to which feasibility of business deceases and business owner faces loss of revenues.

P2 Explain rationale and market gap for a specific entrepreneurial idea using relevant tools and techniques

Market gap is an opportunity for business owners to produce and sell products which are not available yet. These unavailable products are widely in demand but due to their unavailability consumer was unable to access them. This allow entrepreneurs to formulate new ideas & incorporate them into reality to gain personal benefits and cater the needs of market. In case of Foodie Flavor which offers nutritious food items and healthy drinks to customers, market gap can be analysed through various tools such as Mckinsey 7s, Fishbone, Burke-Litwin casual model, Nadler-Tushman and SWOT. Here Mckinsey 7s is explained in detail:

Mckinsey 7s: This modal helps in identifying the potential gaps that takes place within business. Beside it, this tool of analysing market gap evaluates the areas where optimization will results in boosting performance of business. This model of market gap align departments and process at the time of acquisition (Renko, Shrader and Simon, 2012). It will help Foodie Flavor in examining the impact on business due to changes that take place in future. In this tool, elements are partitioned as soft and hard elements.

Hard elements

• Strategy: It involves action plan which will be adopted by Foodie Flavor to achieve competitive advantage against rivals. For ex, Foodie Flavor has formulated a strategy to offer occasional discounts to customers which will helps the cafe in expanding customer base .
• Structure: Organisation structure adopted by Cafe is flat. This means all staff members will be given equal chance to share their opinion regarding the food and drink menu company is providing. This will helps in satisfying the demands of clients on the spot which will increase their satisfaction level.
• System: To save their time and efforts Foodie Flavor is using technically advanced machines which allows them to prepare and process food & drinks in minimum time. As due to busy life style, people prefer fast services.

Soft elements

• Shared value: These are beliefs and traits adopted by a company which gain attention of customers. Foodie Flavor is planning to introduce activities like charities and free food distribution to needy people. This will promote their positive image in market.
• Style: Foodie Flavor will adopt cross-culture leadership style which benefits them in gaining large customer base. Cafe will offer special food items of different religions, this will increase their customer base.
• Staff: To fill service gap, C&C can hire trained and skilled employees which are capable to serve customers in efficient way.
• Skills: Workers working for Foodie Flavor needs to be professional, responsible and must posses strong communication skills. This will helps them in catering the requirements of clients in a desired way.

M2 Justify how specific entrepreneurial idea fills a market gap using different techniques for gap

Entrepreneurial idea chosen by business owner of Foodie Flavor is to offer oil free nutritious food and fresh drinks to customers. This idea is unique and posses capability to fill market gaps. Most of the citizens in UK prefer fast food while they meet their friends, families or during normal outings. But these people are also aware of the side-effects which happens while consuming unhealthy fast food such as obesity, Diabetes, high blood pressure and cholesterol. The best way to fill this gap is to produce food and drink while considering the nutrition level. The innovative idea adopted by Foodie Flavor to provide oil free and health food by adding more vegetables and eliminating excess of cheese, beef and pork benefits in satisfying the demand of customers. Due to this, rather than eating conventional fast food, people will prefer to eat items offered by Foodie Flavor (Suddaby, Bruton and Si, 2015). In this way market gap associated with fast food can be filled.

D2 Critically evaluate a specific entrepreneurial idea based on appropriate interpretation

Most of the products associated with fast food contains a lot of spices, unsaturated oil, excess of cheese and meat. Sometimes vegetables and fruits used in preparing eatables & drinks is not fresh due to which it adversely impact the health of people. But the items offered by Foodie Flavor is well nutritious and capable to pass every test associated with healthy food. Drinks offered by cafe are freshly prepared and includes different flavours. As most of the food offered by Foodie Flavor is oil free, people of all age will be willingly buy it. This shows business will be feasible and rule market for a longer time of period.

P3 Present data needed to support gap analysis in the evaluation of a specific entrepreneurial idea.

Gap analysis is conducted by entrepreneur while introducing a new business idea in marketplace. This benefits in ascertaining if current performance of business entity is according to the expected future performance. In relation with launching of Foodie Flavor, there are several aspects which needs to be considered by entrepreneur. These are explained below:-

A questionnaire is prepared to acknowledge the opinion and view of different individuals regarding the services and items offered by Foodie Flavor. To fill this questionnaire, marketing manager of Foodie Flavor has randomly selected a sample of 50 people out of total population in England.

Theme 1: Foodie Flavor provide effective services

Theme 2: Facilities preferred by customer

M3 Justify specific sources and methods of data collection and how data collection chosen and how data relates to identifying market potential.

Basically there are two methodologies to gather data and information i.e. primary and secondary research. Primary research helps in collecting raw data and information which is not published or accessed by any other individual. It involves surveys, questionnaire, direct and telephonic interviews. Secondary research is carried out by using data which is collected through primary research (Tang, Kacmar and Busenitz, 2012). Information available through newspaper, academic journals,Pamphlets, published books and magazine are considered while conducting secondary research. As Foodie Flavor is a new start up and acknowledging behaviour of customer regarding service is important, company has used primary method of data collection. Under primary research, Company has prepared a questionnaire. This helps the marketing manager of Foodie Flavor in understanding the requirements of people in a proper way. According to the opinion of people, company can incorporate changes to improve their sales.

D3 Analyse specific sources of data to provide justified business objectives and identify market potential

To achieve their business objectives, Foodie Flavor have prepared a questionnaire which includes several questions regarding the products and services offered by company to the customers. The response of customers helps manager of Foodie Flavour to formulate new strategies which will help the company to increase their sales along with earning revenues and profits. This will helps company in achieving their business objective in specified time.

P4 Interpret data appropriately to provide evidence of market potential.

From above mentioned data following interpretations can be concluded:

• In food and beverage sector, competition is very high as different brands offer unique and affordable food items and drinks. Therefore, Foodie Flavor needs to identify the requirements of customers before introducing their food items.
• To attract the attention of large population, company can provide occasional discounts to everyone and regular discount to loyal customers.
• Good relation with supplier is a must for Foodie Flavor so that all the needed resources can be collected within required time.
• Company is focusing on the needs of customers. This helps them in gaining competitive advantage over other firms and sustain positive image of company within market.
• Company is providing affordable and healthy products. 

Q1) Are you aware with innovative products provided by Foodie Flavor ?

Q2) What kind of facilities you generally want more?

Q3) The price rates fixed by Foodie Flavor according to the facilities provided are effective or not?

Q4) Are you satisfied with the customer services offered by the company?

Interpretation of the above data:

Theme 1:

Interpretation 1: It has been interpreted from statistical data, that individuals are aware of the products and services offered by Foodie Flavor. Company can use social media to promote their business.

Theme 2:

Interpretation 2: It has been interpreted from statistical data,

Theme 3:

Interpretation 3: It has been interpreted from statistical data, people are willing to pay the prices which are fixed by the company as are satisfied with the services and profucts offered by them.

Theme 4:

Interpretation 4: It has been interpreted from statistical data that people are highly satisfied by the services offered by Foodie Flavor.

In today's advances world, it is important that entrepreneurs needs to consider all possibilities where clients can switch to alternative Cafe to buy products and services. They should function in a way which best suites the requirements of people so as to retain them for large time period.

P5 Apply a SWOT framework to support an objective assessment of a specific entrepreneurial idea.

SWOT analysis is a technique by which a company acknowledge its strength and available opportunities. Foodie Flavor can take advantage of this analysis to identify their strong points and future opportunities. Also, SWOT helps Foodie Flavor in eliminating the weakness and potential threats which can harm their business.

P6 Evaluate competitive and market environments in which the idea will be launched to assess potential viability.

Market analysis is a systematized way of analysing the market. Marketing analysis helps to formulate the strategy for the business. Foodie Flavor cafe is new and products which they offer are unique. For them to analyse the market is curial. It will detect the current and future risk.

Competitive environment: Dynamic external environment where competitors compete. The more seller in the market of similar products the more competition owners avails. Pull down the competition they decided to introduce oil free food and healthy drinks.

• Demand: Interrelationship between price of the product and the quantity demanded are known as demand. The demand of Foodie Flavor will accelerate. It can't decline as the company offers contrary product.
• Substitute goods: Price of one product effects the demand of another product is refers to substitute goods. So, to safeguard the demand they don't have any substitute in market. They introduce the oil free products (Austin, Stevenson and Wei-Skillern, 2012).

Market environment: Marketing environment influences the micro-macro environment. It surrounds the business and marketing operation. These are the external factors by which Foodie Flavor business is influence.

• Micro environment: Micro factors directly attendant to businesses. To analyse the micro environment these factors analysed suppliers, customers, market intermediaries and competition. Supplier are those who provide the raw-material, customers for whom the product are offered, market intermediaries are the distribution channel and competitor are players in the same market. Foodie Flavor is new business for them analysis of supplier and customer are required (Sánchez, 2013). As competition vanished because they offers unique product.
• Macro environment: It is a broad environment. So to analyse macro environment analyst analyse PESTLE. Political, Economical, Social, Technological, Legal and Environmental factor. Foodie Flavor is about to launched so they analyse social, legal and technological factors only. Social factors influences new businesses as well. They have analyse the taste and preferences and the demographic structure of the industry. They have to up-to-date with technologies introduced in the market. If business are not updated with techniques then business will fail. Legal factors influence the business whatever laws and regulation are imposed have to be followed.

M4 Critically evaluate a specific entrepreneurial idea in the context of the marketplace and competition.

Nutritious food and healthy drinks offered by Foodie Flavor is a potential substitute for fast foods. Fast food contains a lot of unhealthy ingredients which Foodie Flavor is going to substitute with healthy vegetables and nutritious spices. Due to this demand of these products will be increased and company will be able to earn huge revenues and profits. As cafe is new in market and it is a small start-up external factors which are covered in PESTLE will not have considerable impact on business (Tumasjan and Braun, 2012). Micro environmental factors will have considerable impact as relation with supplier and customer posses an impact on revenues of business.

D4 Valid conclusions and justified recommendations on how a specific entrepreneurial idea can be developed, managed and sustained.

Idea of providing healthy drinks and oil free food can be developed by incorporating all the healthy ingredients such as vegetables and fruits in eatables by eliminating oily stuff. This can be managed by acknowledging the response and opinion of customers from time to time. As needed improvements can be carried out by understanding the demand of customers. To sustain business and reputation of cafe in market company needs to formulate efficient tactics and strategies like preparing different food menus which specifies nutrition level specifically. This will help Foodie Flavor to sustain its position (Davidsson, 2015).

CONCLUSION

From above mentioned report, it is concluded that it is important for an entrepreneur to acknowledge the feasibility of business before introducing it within market. There are different sources of innovation which motivate an individual to introduce new concept. Relevant business ideas helps in filling market gap and allow firm to gain competitive advantage over rival firms. Aspects like SWOT and potential viability of business helps in analysing internal and external factor which influence business and revenues. Are you worried about cheap assignment help at an affordable budget? Contact our experts. 

Read also:
CW2 Strategik Marketing of Bristol Cars Limited

REFRENCES

• Grégoire, D. A. and Shepherd, D. A., 2012. Technology-market combinations and the identification of entrepreneurial opportunities: An investigation of the opportunity-individual nexus.Academy of Management Journal.55(4). pp.753-785.
• Tang, J., Kacmar, K.M.M. and Busenitz, L., 2012. Entrepreneurial alertness in the pursuit of new opportunities.Journal of Business Venturing.27(1).pp.77-94.
• Suddaby, R., Bruton, G. D. and Si, S.X., 2015. Entrepreneurship through a qualitative lens: Insights on the construction and/or discovery of entrepreneurial opportunity.Journal of Business venturing.30(1). pp.1-10.
• Renko, M., Shrader, R. C. and Simon, M., 2012. Perception of entrepreneurial opportunity: a general framework.Management Decision.50(7). pp.1233-1251.
• Boyles, T., 2012. 21st century knowledge, skills, and abilities and entrepreneurial competencies: A model for undergraduate entrepreneurship education.Journal of Entrepreneurship Education.15. p.41.
• Wang, Y. L., Ellinger, A. D. and Jim Wu, Y. C., 2013. Entrepreneurial opportunity recognition: an empirical study of R&D personnel.Management Decision.51(2). pp.248-266.
• Gruber, M., MacMillan, I. C. and Thompson, J. D., 2013. Escaping the prior knowledge corridor: What shapes the number and variety of market opportunities identified before market entry of technology start-ups?.Organization Science.24(1). pp.280-300.
• Austin, J., Stevenson, H. and Wei-Skillern, J., 2012. Social and commercial entrepreneurship: same, different, or both?.Revista de Administração.47(3). pp.370-384.
• Sánchez, J.C., 2013. The impact of an entrepreneurship education program on entrepreneurial competencies and intention.Journal of Small Business Management.51(3). pp.447-465.
• Tumasjan, A. and Braun, R., 2012. In the eye of the beholder: How regulatory focus and self-efficacy interact in influencing opportunity recognition.Journal of Business Venturing.27(6). pp.622-636.
• Davidsson, P., 2015. Entrepreneurial opportunities and the entrepreneurship nexus: A re-conceptualization.Journal of Business Venturing.30(5). pp.674-695.
• Fisher, G., 2012. Effectuation, causation, and bricolage: A behavioral comparison of emerging theories in entrepreneurship research.Entrepreneurship theory and practice.36(5). pp.1019-1051.
• Audretsch, D., 2012. Entrepreneurship research.Management Decision.50(5). pp.755-764.
• Arentz, J., Sautet, F. and Storr, V., 2013. Prior-knowledge and opportunity identification.Small Business Economics.41(2). pp.461-478.
• Teece, D. J., 2012. Dynamic capabilities: Routines versus entrepreneurial action.Journal of management studies.49(8). pp.1395-1401.

UPTO51%

Avail The Benefit Today!

To View this & another 50000+ free

Enter Email

Submit