BMP6043 Identifying Entrepreneurial Opportunities Level 7

TASK 1

P1 Determine and evaluate different sources of entrepreneurial ideas and innovation

There are various sources which can gives a entrepreneurial ideas because there is always a need that needed to make some changes. In bookish language, these ideas that has already started a business requires some innovation and that innovation can be revealed by the customer's survey and interviews. Whereas in actual the ideas is of a business is generated derive through observation and the thought that can has some economical value to the people and entrepreneur. These sources of ideas can be as described as follow -

Customers - As in every business the customer is a prime person who should be satisfied from the product cause if the end user is satisfied than then they will also raise the sales. That's why they are most fruitful source of ideas when it comes to open Gourmand & Globetrotter the customers are the priority for this. Because there was a lot of people who are seeking for some different kind of flavours that's why the cafe is offering food from beyond the limits(Dimov, 2011).

Competitors - Competition is also a factor which increases sales because there are so many existing restaurants which are offering the similar types of eatery but Gourmand and Globetrotter is going to launch with some extinguish items that can dramatically drive the sales.

Looking at the past and future - While one is about to open a restaurant they should observe others what they have done before because the mistakes they had made, that can be avoid to occur and put a business in pitfalls. Present requirements and future expectations aid to expand a business(Ekpe, Mat and Razak, 2010).

Macro environment factors

Macro environment factors are those which impacts on a business externally that are as follows-

Legal factors - Legal factor is the most important criteria to be followed. Because getting a license for Gourmand & Globetrotter is crucial before starting the service if license is not approved by the UK Government then the business will be illegal and the entrepreneur is also liable to pay the penalty. So it is essential to follow the legal structure for the business.

Social factors - Social factors are those which makes an impression on the society and business both. Because human beings are lives in a society so there some religions and they has some rules that they have to be follow. So, business should has some ethics that does not violate customer feeling. For example, in restaurant the products raw material should be according to their belief and there must not be any kind of product which can harm anyone. Another aspects of social factor is word of mouth, if a business has a good image then that will attract more customers(Foo, 2011).

Technological factors - Technology is a helping hand for business cause it makes so many things accessible within a touch. Putting a business on internet brings numerous customers and also creates a goodwill.

Economical factors - The economical factors affects the innovtion because a business needs funds to grow and operate smoothly but if the economy is low then then business cannot survive in the market.

Environment factors - People is aware about environment and the business which keeps safe environment the public supports to the firm.

Sources of innovation opportunities can be define as -

• The Unexpected - A good entrepreneur should always looking for the opportunities in the market that can give new direction to the restaurant.
• The incongruity - It considers things as what it is and what it should be that can make things more better than before.
• Process need - process need is about to identifies the weaknesses and redesign them in a meaningful way.
• Industry and Market Structure Change - There are some regulations that changes with time so the entrepreneurs should watch these regulations.
• Demographics - The business depends on the population, income levels, educaitons, perception and age so it should innovation the products according to the requirement to sustain in the market.
• Changes in Perception, Meaning, and Mood - The polulations changes over time and their perceptions and moods also changes and that impacts a business and there is always a scope for innovations.

Types of innovation

1. Process innovation - Process innovation refers to a new or important improvement in production to deliver the final product.
2. Product innovation - Product innovation is to introduce an item or services which is new or has some innovative features to use.
3. Incremental innovation - Incremental innovations is a sequence of small improvements or updated techniques applied in a company for an existing products, services, process and methods.

Difference in innovation and inventions

invention defines creation of a product or services for the first time whereas the innovations is an amendment in the existing goods and services according to requirements.

TASK 2

P2 Rationale and the market gap for a specific entrepreneurial idea

When a new business is going to be enter in the market with Gourmand & Globetrotter which is a restaurant that provide special cuisines in London. at that time there is a need to fix a market gap in order to increase customer's buying nature. There are some specific tools which are required to conduct market research that can introduce a business effectively. There is a need to identify the gap from where an entrepreneur can take advantage with skills and resources. To take an advantage of these gap one should explore itself to new and interesting people with experiences and ideas. One questions arises while finding out the gaps is, where to look for gaps, so there are some pinpoints where a person can get the gaps, that can be noticed in terms of -

• Trends and new technology - There are lots of trends and technology because of that new opportunities are popping up in the market, one should keep an eye on the changes and analysed that what kind of impact the business would face(Heinonen, Hytti and Stenholm, 2011).
• Make the a world topical - If one can observe the surrounding then they will notice that there is a loads of creativity, everyone is enhancing the opportunities with their fanciful work. Because imagination opens a doorway of fascinating trends. Gourmand & Globetrotter is a restaurant where everything happens before anywhere else, because it will be going to be a trend setter not a follower. It is going to furnish the availability of the foods and beverages with innovative recipes that no one has(Quan, 2012).

Marketing segmentation

Before launching a new food product one should analyse the market requirement which refers to identify the customer's needs. There are different demands of customers and regarding food they definitely has some versatility and to know their taste it conducted a marketing research on segmentation basis that are as follows -

Demographic segmentation - Demographic segmentation divides market on the basis of demographic variables like age, gender, martial status, income religion, race, occupation, nationality, etc. because there are various people whose food habits are depends upon their religions. Similarly people always spend according to their income and occupation so the Gourmand & Globetrotter must have the affordable and planned menu according to the targetting customers.

Geographic segmentation - Geographic segmentation studies about the population which is living in the particular geographic] area because the people who are living in that area has specific requirements according to the climate. In restaurant international food is serving for the people, there may be different kinds of people are staying in that region(Renko, Shrader and Simon, 2012).

Behavioural segmentation - In behavioural segmentation the research is dependent on the purchasing nature of population, lifestyles, attitudes, thoughts, preferences, choice and decision making. Because if the people are having a lavish lifestyle then they would not worried about the money the only thing matters for them is the brand and quality. They people who comes in middle class are having some preferences so they may be can't afford the luxury things but they can spend a small amount of their income on food. Those who are food lover are matters a lot for restaurant business because they wanted to eat the unique kind of flavours that indulge them.

Industry life cycle: It is the normal stage that a industry goes through during the course of its life cycle in the market. An industry life cycle is divided in to five categories such as:

Early stage phase: In this phase, product may be alternate option which makes a place for it in the company.

Innovation phase: In this, an organizor can expand their product with innovative style in order to increase profitability of the company.

Cost phase: It mainly refers to the consolidation of an industry. Few business are naturally eliminated this is because they are not able to grow along with the industry or developing cash flows in the negative way.

Maturity phase: At this stage, company's revenue from the various products becomes the main focus of an organisation.

Decline phase: It is marked by minimising revenue as the demand change to other product in the industry.

According to the above concept it has been analysed that Gourmand & Globetrotter multinational cuisine restaurant need to follow industry life cycle in order to increase its market demand in London. Therefore, there is need to improve their phases in different ways.

TASK 3

P3 Present data needed to support gap analysis in the evaluation

Gap analysis is qualitative and quantitative comparison of a company's present performance which means to recognize actual present state with the potential performance which is the target state. Its core principle is to recognize the requirement and find out the solutions. It addresses two points that is :

• Performance
• Potential

Gap analysis is a 360 degree analysis that performs strategic or operational levels in inward and outward environment and one can run a company in a direction through various processes or departments. After passing through the first phase of analysis performance versus potential one can be able to see the results are exceeding the expectations(Short and et. al., 2010).

Conducting Gap Analysis

The gap analysis is conducted to be big brand but if so many things are tried to be tackle at one time then the resource will get stretched(Tang, Kacmar and Busenitz, 2012). So it would be better if an individual considers anyone of these host factors like :

• Sales number
• Customer contentment
• Retention rates
• Transportation times
• Manufacturing costs
• Marketing returns
• International expansion

Once the area is isolated then that factor is enough to make an impact.

Identify states

Once an entrepreneur selected the focused area then the first step is to identify both the of the area to identify where is the performance and what are the expectations in future. For an example,

• sales channels as focus
• peculiar nodes as the channel
• at present what the sales performance
• industry average potential

The states goes through three iterations that are :
[source : Gap Analysis: A Template for Connecting Potential with Performance, 2017]

• Current performance
• Potential state
• Gaps

Describe the gap

After the identification of the gaps the second step is to describe the gap for better understanding the reason behind their occurrence(Vaghely and Julien, 2010). If a business is ahead of target then it is a good time for the business to analyse the what exactly done to attain the target. If there are several ways to utilize the same principles in other areas of a restaurant. It is essential to going through from this step because a well performing business can also be optimized. To describe a gap there is a pattern that should be followed such as :

• Gap - where the gap find.
• Gap description - Record every bit of information that are contributing to gap. These gaps can be quantitative or qualitative.
• Why - The reason for gaps why they came in existence.

Bridge the gap

The final stage is brainstorming to know all the possible solutions to recover gap and the reasons behind it(Wang, Ellinger and Jim, 2013). These solutions must be specific and should has a direct impact on the problem which has analysed in the previous stages. As the entrepreneur is creating an exhaustive solutions to the gap description summery, they are enable to think in wider context and position the practical implementation. While hypothesize the probable solutions one should keep in mind that the implementation can be costly in terms of time, money and human resources (Wood and McKinley, 2010).

P4 Interpret data appropriately to provide evidence of market potential

Marketing research is essential to sustain in market fro long duration because a business person enjoy the longevity and why not they invests so much energy in it. The market research pinpoints the target market, consumer problems and realistic competitors. Marketing research cab be carried out from various stages during the pre - launch and post - launch. Because if an individual is having a good knowledge about the marketplace then they are able to begin an astonishing business in competitive environment(Block and Wagner, 2010). There are some techniques of marketing research such as -

Primary Research: It refers to the methodology in which collection of data are done through in direct way other than taking the subject matter from secondary source. According to this there are number of measures like, survey, interviews and questionnaire with the help of which an individual can attain their objectives and goals. With the help of primary research entrepreneur of Gourmand & Globetrotter will provide clear and correct data that can implement the same in their thoughts.

Secondary Primary Research: It is a type of research that has already been gathered, organized by other individuals. It involves in reports and few studies by government agencies, trade associations or other business entity in the industry. For the small businesses with low fund, mostly, research is mainly secondary because it can be attain in a faster way and it is more affordable than the primary research. Therefore, it can costly for this restaurant and they need to invest more money if they want to apply this research it can be more costly as compare to primary research.

Theme 1: What are you main reasons for going out to restaurants ?

Interpretation - As per the above graph, it has been evaluated that 10 respondents out of 30 are going restaurants to go out. 10 respondents to eat good food and remaining 10 also goin restaurant for they do not want to cook in their home.

Theme 2: For which kind of special events do you go to restaurants ?

Theme 3: Will you satisfied with the food quality provided by Gourmand & Globetrotter restaurant ?
Interpretation - As per the above graph it has been analysed, 10 people go to restaurants for birthday celebration. 11 people go to restaurants for celebrating their anniversary. At last 9 respondents out of 30 go to restaurant for celebration of new year.

Interpretation - As per the above graph, it has been identified that 15 people will satisfied with the food quality of product provided by Gourmand & Globetrotter restaurant, and 15 respondents are not satisfied with the food quality of restaurants.

TASK 4

P5 Apply a SWOT framework to collate evidence to support an objective

SWOT analysis is a useful tool for brainstorming and strategic planning. It is used to analyse the strength, weaknesses, opportunities and threats within external environment of business. It takes the advantage of new business opportunities, trends, technology and competition advantage to attain its objectives. For illustration, Gourmand & Globetrotter restaurant is a new entrant in the market and therefore, it has so many large era where it stand through identifying the existing weaknesses of hospitality industry(Ekpe, Mat and Razak, 2010).

Strength

• Gourmand & Globetrotter restaurant is a new entry in the food and beverages so people are easily attracted towards it.
• It has multiple choices in the food so people can get whatever they want from across the boundary.
• This restaurant will be situated at a place where people can easily reach because location should be accessible by everyone and that is the most prominent aspect to increase the sales(Foo, 2011).
• The plan to get the more customer is that there would be a different criteria for every customer so that every consumer can enjoy the feast according to their income.
• The relish meal plan is affordable for its customer with some coupons and vouchers.

Weaknesses

• Gourmand & Globetrotter is offering a new kind of cuisine in the market including specialised food plan from diverse country culture but there are only French or Spanish people in the country.
• It is going to be open soon but weak marketing or lack of influencing strategies can drop its opening expectations.

Opportunities

• The entrepreneur wanted to enter in the market with a bang because it has when it creates a major impact on customers mind.
• A huge range of international food.
• It make a place among every kind of consumer segment.

Threats

• Gourmand & Globetrotter is a new entry and there are already a huge pool of restaurants.
• Fear of loosing investment and time.
• Creating a brand image in new market is very difficult in the presence of giants.

P6 Evaluate the competitive and market environments

When one is conducting an in -depth investigation about the competition and market environment regarding a business in that situation it is allowed to peep in to the competitors strength and weaknesses which can help a business person to analyse and evaluate the strategies that are going to be implement(Heinonen, Hytti and Stenholm, 2011). Because it will improve the the state in competition advantage. When Gourmand & Globetrotter is looking for the competition in the market then it analyse the expectations what its rivals are serving to their clients and what it expects to be. This will provide a data from where it can book a place in the market. After that one should conduct a research to know that about the rivals and their service methods and satisfaction level of customers. As a businessman knows the information then they should prepare the marketing strategies through advertisement, sales brochures, newspaper, etc., for a grand opening so the people can know about the restaurant.

When the business has been opened one should analyse its annual report in order to evaluate the its potential sales and actual sales on the basis of previous year to get the information about the business progress.

Regarding the market environment there are such variable which are used to evaluate the viability of the business idea like market size, targeted customers , trending trajectory. It is hard to gauge the market size and demand but having a sense about potential market size and demand for investing time and money in a venture is good. It is easy to observe the people who are talking about Gourmand & Globetrotter restaurant by tracking the SEO and social media websites (Quan, 2012).

It is always a good practice to know about competitors because every business is starving to increase the sales more. One should know about competitors before getting start because that will give a less surprise in order to see up and down graph of the firm. It is also essential to find information regarding their potential customers and are they able to purchase the products.

Competitive market - Competitive market can be define as -

Substitute goods - The customer can purchase the things which are less than in price but similar to kind of product which is selling by one firm.

Demand - The things which are fulfils the needs of people that is called demand because they are bound to purchase the things when needed.

Target audience - Target audience refers to the people for whom the product or services are entered into the market.

Market environment

Macro environment - Macro environment can be refer as external environment that can influence on the business that can be refer as PESTEL factors.

Micro environment - Micro environment can be define as the internal environment of the firm that impacts on a firm it can be refers strength, weaknesses, opportunities and threats.

CONCLUSION

The above report is about identification of entrepreneurial opportunities that includes what are types of opportunities are exists in the market while launching a new idea of business. The idea of business is about to launch a new restaurant in London that is named Gourmand & Globetrotter which is offering a international food and beverages. It includes macro environment sources and opportunities, marketing segmentation, market research, gap analysis, evaluation methods SWOT analysis.

REFERENCES

• Block, J.H. and Wagner, M., 2010. Necessity and opportunity entrepreneurs in Germany: Characteristics and earnings differentials.
• Dimov, D., 2011. Grappling with the unbearable elusiveness of entrepreneurial opportunities. Entrepreneurship Theory and Practice. 35(1). pp.57-81.
• Ekpe, I., Mat, N.B. and Razak, R.C., 2010. The Effect of Microfinance Factors on Women
• Entrepreneurs' Performance in Nigeria: A Conceptual Framework. International Journal of Business and social science. 1(2).
• Foo, M.D., 2011. Emotions and entrepreneurial opportunity evaluation. Entrepreneurship Theory and Practice. 35(2). pp.375-393.
• Heinonen, J., Hytti, U. and Stenholm, P., 2011. The role of creativity in opportunity search and business idea creation. Education+ Training. 53(8/9). pp. 659-672.
• Quan, X., 2012. Prior experience, social network, and levels of entrepreneurial intentions. Management Research Review. 35(10). pp.945-957.
• Renko, M., Shrader, R.C. and Simon, M., 2012. Perception of entrepreneurial opportunity: a general framework. Management Decision. 50(7). pp. 1233-1251.
• Short, J.C and et. al., 2010. The concept of "opportunity" in entrepreneurship research: Past accomplishments and future challenges. Journal of Management. 36(1). pp. 40-65.
• 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.
• Vaghely, I.P. and Julien, P.A., 2010. Are opportunities recognized or constructed?: An information perspective on entrepreneurial opportunity identification. Journal of Business Venturing. 25(1). pp. 73-86.

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