Entrep 080646

RECOGNIZE A POTENTIAL
MARKET
MODULE 2
ENTREPRENEURIAL IDEAS
THE ENTREPRENEURIAL PROCESS
IDENTIFICATIO
CREATION OF N OF OPENING OF
ENTREPRENEU ENTREPRENEUR ENTREPRENEU
RIAL IDEAS IAL RIAL VENUE
OPPORTUNITIES
10/19/2023 2
ESSENTIALS IN ENTREPRENEUR’S
OPPORTUNITY SEEKING
This allows the entrepreneur to see things
ENTREPRENEURIAL
in very positive and optimistic way in the MIND FRAME
midst of difficult situation.
Entrepreneur’s driven passion, they

Entrepreneurial heart
are attracted to discover satisfaction in
flame
the act and process of discovery.
This refers to the ability of the entrepreneur of

being intuitive. This is also known as intuition.
ENTREPRENEURIAL
The gut game also means confidence in one’s
GUT GAME
self and the firm believes that everything you
aspire can be reached.
10/19/2023 3
SOURCES OF OPPORTUNITIES
CHANGES IN ENVIRONMENT
• Entrepreneurial ideas arise when changes happen in the external environment.
A person with an entrepreneurial drive views these changes positively. External
environment refers to the physical environment, societal environment, and industry
environment where the business operates.
1.1 The Physical environment includes

a. Climate – the weather conditions.
b. Natural resources – such as minerals, forests, water, and fertile land that occur in
nature and can be used for economic gain.
c. Wildlife – includes all mammals, birds, reptiles, fish, etc., that live in the wild.
1.2 The Societal environment includes the various forces like

a. Political forces – includes all the laws, rules, and regulations that govern business
practices as well as the permits, approvals, and licenses necessary to operate the
business.
b. Economic forces – such as income level and employment rate.
c. Sociocultural forces – customs, lifestyles and values that characterize a society.
d. Technological environment – new inventions and technology
10/19/2023 4
1.3 The Industry environment of the business includes:
a. Competitors
b. Customers
c. Creditors
d. Employees
e. Government
f. Suppliers
2. TECHNOLOGICAL DISCOVERY AND ADVANCEMENT
A person with entrepreneurial interest sees possibility of business opportunities

in any new discovery or because of the use of latest technology.
3. GOVERNMENT’S THRUST, PROGRAMS AND POLICIES
The priorities, projects, programs, and policies of the government are also
good sources of ideas.
4. PEOPLES INTEREST
• The interest, hobbies, and preferences of people are rich sources of entrepreneurial ideas, like
the increasing number of Internet Cafés at present could lead to the strong attachment of young
people to computers.
5. PAST EXPERIENCE
• The expertise and skills developed by a person who has worked in a particular field may lead to
the opening of a related business enterprise.
BUYERS
The buyers are the ones that pay cash in exchange for your
goods and services. One example is the influence of the price or
in the bargaining strategy. The buyer has a strong and
magnified bargaining power. The threat of its bargaining power
will be less if the following factors are noticed:
a. There are several suppliers available in the market.

b. The buyer has the potential for backward integration.
c. The cost of switching the supplier cost is minimal.
d. The product represents a high percentage of the buyer’s cost.
e. The buyer purchases large portions of the seller’s product or
services.
FORCES OF COMPETITION MODEL POTENTIAL NEW ENTRANTS
It is also known as the “five forces of A new entrant is defined as companies or businesses
competition”. An industry environment is a that have the ability to penetrate or enter into a
competitive environment. Regardless of what particular industry. For example, in the level of capital
product or services you have, competition is requirements, if the business requires huge capital,
always present. new entrants should decline to join the business. This
gives a threat to the business. This can be noticed if
there is the presence of the following factors:
10/19/2023 7
• a. Substantial capital requirement
• b. Strict government policy
• c. Difficulty in accessing distribution channels
• d. Economies of scale
• e. High cost of product differentiation
• f. High switching cost
3. RIVALRY AMONG EXISTING FIRMS
Rivalry is a state or situation wherein business organizations are competing with each other in
a particular market. For example, it depends on the marketing strategy of your competitor, like
giving freebies and special offers. The intensity of rivalry among existing firms is characterized
to the following factors:
• a. Diversity of rivals
• b. Number of competing firms
• c. Characteristics of the products or services
• d. Increased capacity
• e. Amount of fixed costs
• f. Rate of industry growth
4. SUBSTITUTE PRODUCTS
• Substitute is one that serves the same purpose as another product in the market. For
example, the consumers decide to use margarine as a substitute for butter. In case the
price of butter increases, preferably the consumer will gradually switch to margarine.
A substitute product can give a big threat in the industry environment if the following factors
are noticed:
• a. Switching cost is low

• b. Preferences and tastes of the customers easily change
• c. Product differentiation is highly noticeable
• d. The quality of substitute products dramatically improves
• e. The price of substitute product is substantially lower
5. SUPPLIERS
The Suppliers are the one that provide something that is needed
in business operations such as office supplies and equipment.
In an example where supplies and services being offered is
unstable the intensity of the threat is strong in this kind of the
competitive force in the industry. This can be noticed if there is
the presence of the following factors:
• a. The supplier has the ability for forward integration

• b. Suppliers in the industry are few, but the sales volume is high
• c. Substitute products are not readily available in the market
• d. The switching cost is very high
• e. The product or service is unique
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RECOGNIZE AND UNDERSTAND

THE MARKET
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RECOGNIZE A POTENTIAL

THE ENTREPRENEURIAL PROCESS

Entrepreneur’s driven passion, they

This refers to the ability of the entrepreneur of

1.1 The Physical environment includes

1.2 The Societal environment includes the various forces like

2. TECHNOLOGICAL DISCOVERY AND ADVANCEMENT

A person with entrepreneurial interest sees possibility of business opportunities

3. GOVERNMENT’S THRUST, PROGRAMS AND POLICIES

a. There are several suppliers available in the market.

FORCES OF COMPETITION MODEL POTENTIAL NEW ENTRANTS

3. RIVALRY AMONG EXISTING FIRMS

• a. Switching cost is low

• a. The supplier has the ability for forward integration

RECOGNIZE AND UNDERSTAND

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