Opportunity Recognition Chapter 3

Describe the challenges and rewards of entering a family business. 3.1 Identify the importance of personal values and goals in choosing an entrepreneurial pursuit. Describe the challenges and rewards of entering a family business. List the benefits and drawbacks of buying a business. Describe how you can evaluate a business opportunity. Compare the advantages and disadvantages of starting your own business. Section 3.1 Understanding Entrepreneurial Trends

3.1 The ability to recognize new opportunities and to think creatively is essential for success in today’s market. Section 3.1 Understanding Entrepreneurial Trends

Opportunity What would I like to buy that I can’t find? Opportunity- based on what consumers want- not what you want What would I like to buy that I can’t find? What product or service would improve my life? What really annoys me? What product or service would help?

Use your Imagination What is one thing you would like to have more than anything else? What does it look like? What does it taste like? What does it do?

The Six Roots of Opportunity Problems that your business could solve

The Six Roots of Opportunity Changes in laws, situations or trends

The Six Roots of Opportunity Inventions of totally new products or services

The Six Roots of Opportunity Competition- If you can find a way to beat the competition based on price, location, quality, reputation, reliability, or hours, you can operate a very successful business

The Six Roots of Opportunity Technological Advances- Scientists may invent new technology, but entrepreneurs must figure out how to market it.

The Six Roots of Opportunity Unique Knowledge- You have unique knowledge of your neighborhood, your friends and your community.

Current Entrepreneurial Trends One way to identify business opportunities is to study current trends that provide opportunities for entrepreneurs. Section 3.1 Understanding Entrepreneurial Trends

Current Entrepreneurial Trends Internet businesses corporate ventures service businesses strategic alliances home-based businesses technology socially-responsible non-profit businesses outsourcing Section 3.1 Understanding Entrepreneurial Trends 13

Learning to Recognize Opportunity Entrepreneurial thinking is about generating ideas and recognizing opportunities. Section 3.1 Understanding Entrepreneurial Trends

Creativity and Innovation Creativity is the activity that results in innovation. innovation a new way of doing things Section 3.1 Understanding Entrepreneurial Trends

Idea Versus Opportunity You generate ideas by thinking creatively. Opportunities are ideas that have commercial potential. Section 3.1 Understanding Entrepreneurial Trends

Cost/Benefit Analysis Before making any investment, look carefully at two factors: Costs- money and time you will have to invest, and Benefits- the rate of return on your money or the advancement of your business or career.

Opportunity Cost The value of what must be given up in order to obtain something else

Creative Sources of Ideas To identify creative ideas: Observe the world around you. Watch for demographic changes. Be an avid reader. Consider your interests, hobbies, and work experiences. Consult outside sources of information. Section 3.1 Understanding Entrepreneurial Trends

Creative Sources of Ideas To identify creative ideas: Observe the world around you. Watch for demographic changes. Be an avid reader. Consider your interests, hobbies, and work experiences. Consult outside sources of information. Section 3.1 Understanding Entrepreneurial Trends

SWOT Analysis A way to evaluate a business opportunity is to explore its: Strengths- Your entrepreneurial ability and contacts Weaknesses- What you will face, from lack of money or training to lack of time or experience Opportunities- Lucky breaks or creative advantages you can use to get ahead of the competition Threats- Anything that might be bad for business, form competitors to legal problems.