Business Opportunities: Innovation & Customer Needs

• For-profit businesses aim to maximize profits, while not-for-profit businesses focus on fulfilling a social mission or cause.

Sources of Business Opportunity

• Innovation: Creating new products, services, or processes. Example: Dyson's bagless vacuum cleaner.
• Research and Development (R&D): Systematic investigation to discover new knowledge, leading to new or improved products/processes. Example: Pharmaceutical companies investing in R&D to develop new drugs.
• Technological Development: Advancement in technology creating new opportunities. Example: The rise of e-commerce due to the internet.

Changing Customer Needs

• Income: Changes in income levels affect demand for different goods. Higher income may increase demand for luxury goods.
• Taste and Fashion: Shifts in consumer preferences. Example: Increased demand for sustainable fashion.
• Change in Price of Substitute Goods: If the price of a substitute good decreases, demand for the original good may decrease.
• Change in Price of Complementary Goods: If the price of a complementary good increases, demand for the original good may decrease.
• Changing Population and Population Structure: Demographic shifts create new needs. Example: An aging population increases demand for aged care services.
• Changing Expectations About the Future: Consumer confidence impacts spending. If people expect an economic downturn, they may reduce spending.
• Entrepreneurship: Identifying and acting on new business opportunities.
• Global Markets: Expanding business operations internationally.
• Market Opportunities: Identifying gaps in the market.

Personal Motivations for Starting a Business

• Make a Profit: Earning financial gain.
• Desire for Independence: Being one's own boss.
• Fulfill Social Need: Addressing a community issue.
• Fulfill Market Needs: Providing products or services that are in demand.

Goals in Business

• A 'goal' is a desired outcome or achievement.
• Goals provide direction, focus, and a measure of success.

SMART Goals

• Specific: Clearly defined. Example: Increase sales by 15%.
• Measurable: Quantifiable. Example: Track sales monthly.
• Achievable: Realistic and attainable.
• Relevant: Aligned with the business's mission.
• Time-bound: With a deadline. Example: Within the next year.

Common Financial Goals

• Increase Profit: Generate more revenue than expenses.
• Increase Sales: Sell more products or services.
• Expand the Business: Growth through new locations, mergers, or acquisitions.
• Expand Market Share: Increase the percentage of total sales in a market.
• Increase Return on Investment (ROI): Improving the profitability of investments. ROI = (Net Profit / Cost of Investment) x 100
• Improving Performance: Becoming more efficient or effective

Common Social Goals

• Community Service: Contributing to the well-being of the local community.
• Social Justice: Promoting fairness and equality.
• Provision of Employment: Creating jobs.
• Ecological Sustainability: Minimizing environmental impact.

Business Concepts

• A business concept is an idea for a new business
• It defines what the business will do, its target market, and its competitive advantage
• The relationship between business concept and sources of business opportunity is that opportunities help develop business concepts

Strategies for Developing a Business Concept

• Talking to family and friends.
• Conducting market research.
• Visiting displays and trade shows.

Intellectual Property Protection

• Copyright: Protects original works of authorship.
• Trademarks: Protects brands and logos.
• Patents: Protects inventions.
• Design Rights: Protects the visual appearance of a product.
• Domain Names: Protects a businesses online identity

Market Research

• Market research is the process of gathering, analyzing, and interpreting information about a market.
• Three Steps:
• Identify information needs.
• Gather relevant data.
• Analyze and interpret the data.

Feasibility Study

• A feasibility study is an assessment of the practicality of a proposed project or system.
• Includes:
• Assessment of the market.
• Consideration of operations.
• Analysis of commercial feasibility.
• Appraisal of owner’s management ability.
• Analysis of why similar business ideas have failed.

Contribution of Business to the Economy

• Tax (company and income): Revenue for government services.
• Employment: Providing jobs.
• Economic Growth: Increasing production and consumption.
• Exports: Selling goods and services to other countries.
• R&D: Driving technological advancements.

Contribution of Businesses to Social Wellbeing

• Social wellbeing is the overall welfare of a society, including health, happiness, and prosperity.
• Employment: Provides income and purpose.
• Innovation: Improves quality of life.
• CSR: Corporate Social Responsibility demonstrates ethical operations.

Methods of Fostering a Culture of Innovation and Entrepreneurship

• Direct assistance/support: Providing resources and guidance.
• Grants: Financial assistance. Example: Government grants for startups.
• Tax incentives: Reducing tax burden. Example: Tax breaks for R&D.
• Business Mentorship: Guidance from experienced professionals.
• School-based education programs: Teaching entrepreneurial skills.

Explore business opportunities arising from innovation, R&D, and technological advancements. Understand how changing customer needs, including income, taste, and substitute goods, influence market demand and create avenues for new ventures.