Entrep: Chapter 2 Opportunity Seeking, Screening, and Seizing

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Entrepreneurial mind frame
see things in a very positive and optimistic light
Entrepreneurial heart flame
the entrepreneur is not easily disheartened, but is rather driven to persevere even more
Entrepreneurial gut game
this refers to the ability of the entrepreneur to sense without using the five senses
Macro Environmental Sources (SPEET)
• Socio-Cultural Environment • Political Environment • Economic Environment • Ecological Environment • Technological Environment
Industry Sources
• Rivals or competitors • Suppliers of input • Consumer market segments • Substitute products or services • All other support and enabling industries
Market Sources
• Increased or decreased demand • Higher or lower Supply • Threat of Price War
• Specific target market segment of a particular enterprise
Consumer Preferences, Piques, and Perceptions
• Preferences refer to the tastes of particular groups of people • Consumer perceive the product • Arousing the customers’ interest to buy
Opportunity Screening
• The Personal Screening (Three Questions) • The Pre-Feasibility Study • The Feasibility Study
Market Potential and Prospects
based on the estimated number of possible customers who might avail the product or service
Segmenting the Market
Using a set of demographics (e.g., gender, age, place of residence, income class, etc.) will be the most basic approach in determining the target segment.
Assessing Competition
This process would determine how saturated the market is in the given area of coverage.
Estimating Market Share and Sales
Entrepreneur should assess the potential market share he or she can attract
Technology Assessment and Operations Viability
• Quantities Demanded • Quality Specifications Demanded • Delivery Expectations • Price Expectations
Quantities demanded
This would determine the needed capacity of operations.
Quality specifications demanded
Dictates the quality of input, quality assurance of the process transforming input to output
Delivery expectations
Knowing how much, how frequent, and when to deliver to costumers.
Price expectations
The selling price would be evaluated by the costumer.
Investment Requirements and Production/Servicing Costs
• Pre-operating Costs • Production/Service Facilities Investment • Working Capital Investment
Pre-Operating Costs
These are the costs related to the preparation for the launch of the business.
Production/Service Facilitate Investments
Long term investments for the actual business establishments
Working Capital Investments
includes the investment needed to operationalize the business, composed of cash, accounts receivable, and inventories
Financial Forecasts and Determination of Financial Feasibility
• Income Statement • Balance Sheet • Financial Ratios and Measurements
Income Statement
Measures an enterprise performance in terms of revenue and expenses over a certain period
Balance Sheet
Assets= Liabilities + Equity
Income Statement
Revenues - Expenses = Income or Profit (loss)
all the investments in the enterprise including the initial investments
represents the enterprise debts to suppliers, to banks, to government, to employees, and other financiers
Stockholders' equity
investors' investments in the stock (or shares) on the business
investors' investments in the stock (or shares) on the business
Five Important Planning Choices
• Choose the correct technology • Choose the right people • Design the best possible operating workflow • Specify the systems and procedures that would govern the business enterprise • Design the organizational structure