Chapter 3 Opportunity Seeking PDF

CHAPTER 3 OPPORTUNITY SEEKING  Entrepreneurs are innovative opportunity seekers. They have an insatiable curiosity to discover new or different ideas and see whether these ideas will work in the marketplace. This is what separates entrepreneurs from the ordinary businessmen whose mai...

CHAPTER 3 OPPORTUNITY SEEKING  Entrepreneurs are innovative opportunity seekers. They have an insatiable curiosity to discover new or different ideas and see whether these ideas will work in the marketplace. This is what separates entrepreneurs from the ordinary businessmen whose main objectives is simply to earn profits  Entrepreneurs create value by introducing new products or services or finding better ways of making them. This may include innovation in terms of product design or adding new product features to existing ones. They may also tinker on improving their operational capability by employing new technologies that will bring them greater efficiency, better economies, and even enable them to reach  Entrepreneurs find business more often than others because of their whole being, meaning all their five senses plus that extra sixth sense, are all in a constant state of readiness to discover these opportunities. Some opportunities come from the entrepreneurs’ own personal interests, innate skills and talents, work experiences and exposures, contacts and connections, and more formal education and training.  3.1 PERSONAL SOURCES OF OPPORTUNITIES Figure 3.1 provides a summary diagram of the different personal sources of opportunities are given as real- life examples. The micro and small entrepreneurs were clients financed, trained, advised, and assisted by a foundation dedicated to the development and growth of MSMEs.  3.2 MACRO- ENVIRONMENT SOURCES The macro- environment refers to the “big or macro forces” that affect the area, the industry, and the market, which the enterprise belongs to. They influence how business should be conducted, how consumers will behave, how supply and demand will move, how different competitors would position themselves and how the cost of doing business will proceeds.  SOCIO- CULTURAL ENVIRONMENT The socio- cultural environment includes the demographics and cultural dimensions that govern the relevant entrepreneurial endeavor. taking this aspect into consideration helps the entrepreneur assess the trends and dynamics of the bigger consumer population, their beliefs, tastes, customs, and tradition. It looks at social structure and shifts in social status and behavior.  POLITICAL ENVIRONMENT The political environment defines the governance system of the country or the local area of business. It includes all the laws, rules, and regulations that govern business practices as well as the permits, approvals, and licenses necessary to operate the business. Specifically, it regulates the use of natural resources; the disposal of wastes; the taxation of income; the importation of goods and services; the accounting and reporting of business financial statements; public and private education and health programs; use of public funds, and other such  ECONOMIC ENVIRONMENT The macro- economic environment includes the purchasing power of households, the factors influencing supply and demand, costs, and revenues including such economic parameters as interest and foreign exchange rates that fluctuate with the movement of the market.  ECOLOGICAL ENVIRONMENT The ecological environment includes all natural resources and the ecosystem that includes all human beings, animals, plants, and minerals. There is a growing awareness in the world today that will make this factor more and more important for countries, industries, and business in the future.  TECHNOLOGICAL ENVIRONMENT In such cases, the entrepreneur is left with no choice but to invest in new technologies in order to keep up with competition. Technology does not only come in the form of advanced machinery or equipment, but it can also be in the form of new systems, new processes, or new products.  3.3 INDUSTRY SOURCES OF OPPORTUNITIES After the macro environment, the next biggest sources of opportunities are the industry and the market. The proper classification of what industry the enterprise is competing in is important if the entrepreneur’s intention is to define who are the relevant customers, who are the direct and indirect competitors, and what are the critical characteristics of the market as to the quality of products or service to be  PARTICIPANTS IN AN INDUSTRY: 1.Rivals or competitors in a particular types of business. 2.Suppliers of input to rivals as well as supplier of machinery and equipment, suppliers of manpower and expertise, and supplies of merchandise. 3.Consumer market segments being served by rivals or competitors. 4.Substitute products or services, which customers shift or turn to. 5.All other support and enabling industries. The most common way of defining an industry is according to product types or according to the functions of the product or service. Example: (Microsoft vs. Apple) (San Miguel Beer vs. Beer na Beer) (McDonald’s vs. Jollibee) Another way of defining an industry from its most basic raw material down to its various consumer application, otherwise known as product or value- added chain. The difference between the product and value- added chain in the Product chain focuses on the volume produced or converted at each link of the chain. Value- added chain focuses on the economic rather than the volume aspect of the chain.  3.4 MARKET SOURCES OF OPPORTUNITIES MARKET SOURCES OF OPPORTUNITIES CAN BE DISCOVERED FROM INCREASED OR DECREASED DEMAND AS WELL AS HIGHER OR LOWER SUPPLY.  3.5 MICROMARKET REFERS TO THE SPECIFIC TARGET MARKET SEGMENT OF A PARTICULAR ENTERPRISE. THESE ARE THE TARGET CUSTOMERS THAT REPRESENT THE IMMEDIATE CUSTOMERS OF AN ENTERPRISE, MEANING THOSE WHO ARE CURRENTLY BUYING THE GOODS OR SERVICES OFFERED BY THE ENTERPRISE AND ITS COMPETITORS. IT LIKEWISE PERTAINS TO A CLEARLY DEFINED LOCATION OR SPECIFIC CUSTOMER GROUP THAT AN ENTERPRISE  3.6 CONSUMER PREFERENCES, PIQUES, AND PERFECTIONS CONSUMER PREFERENCES, PIQUES, AND PERCEPTIOND CAN BE SOURCES OF OPPORTUNITES. CONSUMER PREFERENCES REFER TO THE TASTES OF PARTICULAR GROUPS OF PEOPLE.  3.6 CONSUMER PREFERENCES, PIQUES, AND BECAUSE PERFECTIONS OF THE MANY CHOICES THAT CUSTOMERS HAVE TO STRUGGLE WITH EVERY DAY, A PRODUCT OR SERVICE MUST BE ABLE TO WIN THE BATTLE FOR THE CUSTOMER’S MIND. FIRST, AWARENESS OF THE NEW PRODUCT OR SERVICE MUST BE GENERATED. THIS IS FOLLOWED BY AROUSING THE CUSTOMERS’ INTEREST TO BUY, GOING TO THE EVALUATION OF THE PRODUCT, AND FINALLY THE DECISION TO PURCHASE THE  3.7 NEW KNOWLEDGE, NEW INVESTORS, NEW SYSTEMS, NEW OPPORTUNITIES NEW INVENTIONS, NEW SYSTEMS AND WORK PROCESSES, NEW INISGHTS ABOUT THE HUMAN PSYCHE, NEW APPLICATION FOR OLD KNOWLEDGE, NEW REVELATIONS ABOUT HOW THE PHYSICAL WORLD WORKS, NEW INTERPRETATIONS, NEW COMBINATIONS BASED ON THE CONVERGENCE OF PREVIOUS TECHNOLOGIES, NEW OUTLOOKS ABOUT HOW LIFE SHOULD BE LED AND A HOST OF OTHER NEW THINGS ARE TREMENDOUS SOURCES OF  3.8 UNEXPECTED SOURCES OR FAILURES UNEXPECTED OCCURENCES IN BOTH THE EXTERNAL AND INTERNAL ENVIRONMENT OF THE ENTERPRISE INDICATE THAT SIGNIFICANT CHANGES ARE HAPPENING AND OPPORTUNITIES ARE SPROUTING.