Chapter 6 Opportunities, Ideas and the Enterprising Work Environment.

Chapter 6

Opportunities, Ideas and the Enterprising Work Environment

Which comes first?

Idea ??

Or

Opportunity??

Market-pulled entrepreneurship

• Identify problem

• Then see opportunity

Product-driven or service-driven

entrepreneurship

• Came up with an idea

• Then look for market opportunity

Many people see opportunities

but

Only entrepreneurs + enterprising people act on them

Following Market Trends

Market Trends

• Entrepreneurs:– Study trends– Identify potential changes in needs/wants– Seek out opportunities for new ventures

• Long-term changes = Trend• Short-term changes = Fad

• Entrepreneurs must learn to tell a fad from a trend

Assignment: Create a Fad

• A fad is a temporary, passing fashion or item. It often lasts no longer than a season or up to one year. Fads are usually inexpensive and therefore can become wildly popular in a short period of time. ie, soothers, butterfly clips, treasure trolls.

– This assignment asks you to design a fad. There are a few rules:

• The fad must be a new fad. To the best of your knowledge it cannot have been made before.

• It must be relatively inexpensive • It must be something that you believe people would actually buy • It must appeal to a section of society

Assignment: Create a Fad

• The assignment:• Draw a detailed, coloured sketch of your fad. If you wish,

you can actually make it.

• Write a complete description. Include colours and material needed to make it

• Outline your inspiration for this fad

• Predict how long you think this item will last.

• Due Date and Presentation to class:

Forecasting Trends

• predict future– must carefully analyse past events to predict future– organize data so one can see patterns– plot on a graph

– For example:• graph physical activity

– see a need for fitness centres, equip

• graph weight of people by age– see need for Weight Watchers

– See text p 121 for other examples

Current Global TrendsAnalyze chart on page 121

• What we can learn by analyzing this chart:

– World Population• Developing countries decrease from 20% to 10% by

2100

– More than 50% of world’s population is under 25• The number of young people entering the workforce in

the next 10 years is great than all people in current developing world’s work force.

More findings …

• 2150 Life expectance– males 86, females 92– today population over 65 is great than under 15– 2050 seniors 25% of population

• 3150 300B in world– unless smaller families– Food supply not enough

• 2025 66% live in towns and cities

Time-Series Forecast– plot past and present on chart– project info about the future

– growth trend - line slopes up – stable situation– declining trend - line slopes down

– straight line (Linear) Sloping up or down– curve Rate of increase/decrease– irregular Put in “line of best fit”

How to Conduct Research for your Business Plan

• If your initial research about the market supports the notion that you have a potentially successful business idea, you then need research to support the strategies and examples in your business plan.

• There are two types of research that you may use to create your business plan — primary and secondary

Primary research includes:

• Conducting surveys

• Handing out questionnaires

• Personally visiting your competitors and taking notes

• Asking questions of customers, potential customers, suppliers, employees, and even your own friends and family

Primary research includes:

• Conducting market research, such as focus groups

• Studying your own sales and customer records (for example, you can find sales patterns by reviewing what you sell to whom and when you make the most sales)

Secondary Research

• Involves utilizing all resources already available,

• including the Internet, business journals, trade associations, trade publications, business directories, local or national periodicals, and books.

• Local libraries and the Chamber of Commerce may have business records that can be helpful.

• A few secondary research sources include: – The Small Business Administration and their local and

regional offices – Small Business Development Centers – Business Stats online

Designing a questionnaire

• Find out as much as you can about:– your customer– your product– why people would purchase your product– why people would purchase your product

from you? What they are looking for in a supplier of this product.

Ask yourself …

• how could I improve the product, so people would buy?

• what would encourage a person to buy ____?• who would be willing to pay for ___ product/

service?• highest price point versus lowest price point?• which demographic (age range) should I be

targeting?

• The way you sequence your questions will help motivate respondents to keeping doing your questionnaire

• TITLE

1. Introductory statement explaining purpose

1. Personal information to validate survey data

1. Questions– exploratory in nature – use open-ended questions– specific info

» use multiple choice, » attitude scales 1-10» closed questions (yes/no)

2. Demographics» find out customer’s profile» age, education level, income

3. Thank you

Evaluating Your Ideas

Assignment

• Tell the class about your idea for your venture plan

Assignment

• Form groups of two

• Move desks beside each other

• Open textbook to page 134

• Interview each other, answering the questions

• Be able to report back to the class about your partner’s answers

Assignment

• Page 135 #1• Form a group of four students.• As a group: Each member must select a

different product or service idea from the list in the text.

• Individually: Using the questions under Cost, Opportunity Cost … (p134-5) answer each question.

• Regroup and share your results• Staple all together and hand in

The Enterprising Workplace

• Read pages 137 to 139

• Answer Question #2 p139