ENTREPRENEUR REVEIWER
OPPORTUNITY SCREENING •Resources Required
- In this stage, it is important to come up with a list of a
few very promising opportunities, which could be
scrutinizing in detail.
Personal Screen
- it is considering the preferences and capabilities of an
entrepreneur by asking whether he/she is willing to
undergo circumstances and sacrifice for his/her business.
Through this the entrepreneur will know when to pursue
an opportunity.
Risk-Return Grid - simplest way to know if the business
opportunity is worth pursuing for.
12Rs of Opportunity Screening
•Relevance (vision, mission & objectives)
- The opportunity must be aligned with what you have as
your personal vision, mission, and objectives for the
enterprise you want to set up.
•Resonance
- The opportunity must match the values and desired
virtues that you have or wish to impart. Reinforcement of
Entrepreneurial Interest - How does the opportunity
resonate with the entrepreneur's personal interests, talents,
and skills.
•Revenues
- In any entrepreneurial, it is important to determine the
sales potential of the products or services you want to
offer.
•Responsiveness
- If the opportunity that you want to pursue addresses the
unfulfilled or underserved needs and wants of customers.
•Reach
- Opportunities that have good chances of expanding
through branches, distributorships, dealerships, or
franchise outlets in order to attain rapid growth are better
opportunities.
•Range
- Opportunities can potentially lead to a wide range
possible product or service offerings, thus tapping many
market segments of the industry.
•Revolutionary Impact
- The opportunity will most likely be the "next big thing"
or game-changer that will revolutionize the industry.
•Returns
- Low cost production but sold at higher prices will
definitely yield the highest returns in investment and the
high profile recognition in the industry.
•Relative Ease of Implementation
- Will the opportunity be relatively easy to implement for
the entrepreneur or will there be a lot of obstacles and
competency gaps to overcome.
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- Opportunities requiring fewer resources from the
entrepreneur may be more favored that those requiring
more resources. The lower the number of resources
required the better.
•Risks
- Some opportunities carry more risks that others, such as
those with high technological market, financial, and
people risks. The lower the risk the better.
Pre-Feasibility Study
- To ascertain the viability of the opportunity. Factors that
are contained in a pre-feasibility study:
•Market Potential and Prospects
- It is based on the estimated number of possible customer
who might avail of the product or service.
- It would help narrow down your estimation to the
relevant population or target customers in the area where
you want to operate your business.
>Factors in making the final choice in what to buy:
1. Purchasing power or disposable income
2. Proximity or accessibility to goods or services
3. Individual desires and preferences a
4. Age or generational grouping
5. Social, cultural, or ethnic background
6. Peer group preferences
7. Gender
8. Season of the year
9. Personal identification with trend setters
10. Educational attainment
11. Technical proficiency and product of expertise
12. Motivational impetus
13. Lifestyle preferences
14. Susceptibility to certain advertising and promotional
appeals, and many others.
>Segmenting the Market
- It is determining the target market using a set if
demographics (e.g., gender, age, place of residence,
income class, etc.)
>Assessing competition
- This process would determine how saturated the market
is in the give area of coverage.
- There must be a comparison made with closest
competitors in order to assess one's strengths and
weaknesses
>Estimated Market Share and Sales
- The entrepreneur should assess is the potential market
share he/she can attract.
- This should determine what slice or share of the targeted
market segment he/she wants to carve out. Without a very
definite product formulation or service proposition, this
requires some "educated guessing" or intuitive
insightfulness.
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•Technology Assessment and Operations Viability
- Through this process, the entrepreneur would be able to
determine whether the product or service offering will
meet customer demand or not.
4 target customer expectations affecting the scale and
complexity of an enterprise's operations:
1. Quantities demanded - this would determine the
needed capacity of operations.
2. Quality specifications demanded - this would dictate
the following:
a.) quality of input or raw materials
b.) quality assurance process in transforming input to
output
c.) quality output meet the operations, standards set
d.) quality outcomes for the customers who will be
looking for specific results.
3. Delivery Expectations - knowing how much, how
frequent, and when to deliver to customers.
4.Price expectations - The selling price of the product or
service would evaluated by the customers according to the
value they would receive (in terms of quality, delivery,
and quantity) and this value added should be matched
against competitors.
•Investment Requirements and Production/Servicing
Costs
-The entrepreneur needs to determine how much money
is needed.
3 Investments that need to be funded:
1. Pre-Operating Cost - it refers to the cost related to the
preparation for the launch of the business or the expenses
before the business operates.
Ex: Pre-Feasibility study, Market Research, Feasibility
study, product and operational development, and initial
promotional cost.
2. Production/Service Facilities Investment - it refers to
the long-term investments for the actual business
establishment.
Ex: Land, buildings, machinery, equipment, computers,
software, furnitures, vehicles, renovation, and rent
3. Working Capital Investments
-it refers to the operating expenses including:
a. Employee salaries, wages, and benefits
b. Rent and lease expenses
c. Utilities
d. Transportation
e. Fees and licenses
f. Commissions
g. Office Supplies
•Financial Forecast and Determination of Financial
Feasibility
-the entrepreneur should now be able to proceed in
constructing his/her enterprise's financial forecast for the
business.
Financial forecasts- refer to the monetary transactions
that the business is expected to engage in.
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-It calls for the creation of the FOUR CRITICAL
FINANCIAL STATEMENTS:
1. Income Statements - it measures an entrepreneur's
performance in terms of revenue and expenses over a
certain period.
-the entrepreneur must subtract the estimated cost of
goods sold corresponding to the forecast sale.
Cost of goods sold - refers to materials, labor costs, and
overhead of making a product.
Formulas:
Revenues – Expenses = Income or Profit (or Loss— if
the expenses is higher than the revenue. The value is
always negative)
Gross Sales — Cost of Good Sales = Gross Profit/Margin
Gross Profit/Margin — Operating Expense = Operating
Profit/Margin
Operating Profit/Margin — Taxes = Net profit after taxes
2. Balance sheet
-This has to look at three things:
•Assets - represent all the investments in the enterprise
including the initial investments that you considered the
pre-feasibility study.
•Liabilities - represent the enterprise’s debts to suppliers,
to banks, to government, to employees, and other
financiers.
•Equity - represents the investors’ investments in the
stock of the business.
Formula:
ASSETS = LIABILITIES + EQUITY
3.Financial Ratios and Measurements
Formula:
In getting the payback period:
In getting the return on sales:
In getting the return on assets or return on investment:
FEASIBILITY STUDY
-it is an analysis of a proposed project to determine if it is
feasible or not.
-It is done for bigger project that entail millions of pesos
worth of investment
-it is more comprehensive compared to pre-feasibility
study
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The entrepreneurs should consider the ff.:
-More in-depth study of market potential to ensure that
the business proposal will reach the forecasted sales
figures
-proof that the product or service being offered has the
right design, attributes, specifications, and preferred
features.
-proof that the entrepreneur and his/her team have the
necessary experience, skills, and capabilities to maximize
the venture’s chances of success.
-legal visibility
-more detailed costing on the different assets and more
justification for the production and operating expenses.
-more thorough analysis of the technology and its
sustainability.
OPPORTUNITY SEIZING
-In this stage, the entrepreneur must determine the critical
success factors that enable other players in the same
industry to succeed while, at the same time, be vigilant
about the factors that cause other businesses to fail.
CRAFTING A POSITIONING STATEMENT
a.) Analyzing the products or services from possible
competitors in the market place is the goal of this part.
b.) It is advised to look at other competitors in the
marketplace to get details such as major buyer attributes
that make the competitors’ products attractive that should
give the entrepreneur an idea.
c.) Customer profiling will come to the picture—their
characteristics and traits, behavior and usage pattern,
preferences and dislikes.
d.) The entrepreneur will be able to come up with each of
the competing products’ Main Value Proposition [MVP]
and work on his own positioning through the process of
questioning the ff.:
1.) What are the main customer segments?
2.) What are the different product attributes and features
of each of the competitors?
3.) What are the existing marketing practices of the
various competitors?
4.) What are the market where preferences of the
consumers when it comes to the products being offered?
Best example of this is when we were tasked to interview
or observe our store’s possible competitors and list down
their Sales, packaging, marketing, weakness, strengths
etc.
CONCEPTUALIZING THE PRODUCT OR
SERVICE OFFERING
-A concept is an idealized abstraction of the product or
service to he offered to the preferred market of the
entrepreneur.
-The ff. options or directions may be considered to come
up with the product or service concept:
1st: Create a concept similar to winning products in the
marketplace and ride the obvious market trends.
2nd: Fine a market niche that has not been filled by the
competitors.
3rd: Conceptualize a product in a positioning category
where the participants are rather weak.
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4th: Conceptualize a product that would change the way
customers think, behave, and buy, thus making existing
products “obsolete” and “old fashioned.”
DESIGNING, PROTOTYPING, AND TESTING
THE PRODUCT
a.) Designing means that the entrepreneur must render
and translate the concept into an actual product/service.
(Physical & real dimensions or measurements) This
entails building a prototype or sample of the product
b.) There is an actual testing of the product or service by
potential customers through surveys, focus group
discussions etc.
c.) In this process, the product/service must be ‘perfect’
as it goes through the process mentioned above while the
product/service is continuously subjected to testing and
improvement.
d.) The entrepreneur must assess how much resources are
available in order to seize the opportunity and what kind
of organizational set-up will work best for this kind of
opportunity
IMPLEMENTING, ORGANIZING, AND
FINANCING
a.) The entrepreneur must begin with the end in mind, or
his or her desired end results, for the chosen
entrepreneurship.
End results - refers to the final outcomes of the business,
such as highly satisfied customers, huge sales realized,
large profit generated, etc.
b.) Important choices must make by the entrepreneur to
achieve desired end results:
1st: Choose the correct technology, the one that would
produce the output that would meet the quality
specifications of the customer.
2nd: Choose the right people who can perform the
technical and the managerial functions necessary to
realize the desired end results.
3rd: Design the operating workflow that would assure the
effective, economical, and efficient production of the
output.
4th: Specify the systems and procedures that would
govern the enterprise, motivate and discipline the work
force, and satisfy the customers
5th: Design the organizational architecture that would
allow the people to function at their best.
c.) The entrepreneur must be diligent in taking the
necessary steps toward determining the required
resources which includes people resources, physical
resources, and peso or money resources.
MARKET RESEARCH
- Entrepreneur should exert all the efforts to know the
market he/she wants to exploit to be able to determine
the customer needs and wants.
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BASIC QUESTIONS IN MARKET RESEARCH:
•WHY: Purpose and objective for conducting the market
research
•WHAT: Determines the scope and the limitations of the
market research to be conducted.
•WHICH: Determines which segment of the market must
be studied; thus must be the market segment that the
entrepreneur is eyeing
•WHO: Identifies who among the members of the
selected market segment will participate in the market
research.
•WHEN: Determines the tine and timing of the research.
•WHERE: Pinpoints the relevant location of the market
research.
•HOW: Determines the methodology to be used for the
market research
MARKET RESEARCH METHODOLOGIES:
• Sales Data Mining
-It is an analytical methodology that helps targeting
Marketing efforts, using the knowledge of who are the
Customers; which products and services they buy; when,
how and why these products are acquired.
{mindsource.pt}
- Identify Customers who consider certain product
attractive and capable of fulfilling their needs and
expectations. {mindsource.pt}
a.) The data recorded from observing can logically be
arranged chronologically otherwise known as data array
and can be further grouped into intervals of two, three, or
four. (Using time)
Example: data array
b.) The customers can also can be further classified
(Ex: male & female) and sub-classified (Ex: Age)
according to their characteristics.
c.) After arraying and classifying data, the researcher can
now do a frequency distribution and construct a frequency
table.
Example: Frequency distributions and relative
frequency distributions.
d.) The table above can be translated into graphs:
histogram (bar graph), frequency polygon (dots), and pie
chart.
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e.) Interpretation of data does not end with the table and graphs
mentioned above. Cross-tabulation is highly recommended
for the data will be more useful to the entrepreneur
because it will explain why some data fall at one end of
the distribution while others at the opposite end.
Example: Cross-Tabulation
FOCUS GROUP DISCUSSION [FGD]
-it is an interview by a facilitator of a small group of
people that normally last for an hour and a half up to three
hours.
- It is effective in extracting consumer and non-consumer
experiences regarding products, places, or programs.
- It can be used to address substantive issues such as:
• Understanding consumers' perceptions, preferences, and
behavior concerning a product category.
• Obtaining impressions on new product concepts
• Generating new ideas about older products
• Developing creative concepts and copy material for
advertisements
• Securing price impressions
• Obtaining primary consumer reaction to specific
marketing program.
-There are four decisions to be made in conducting a
FGD:
a.) Respondents selection:
• Definition of the respondents
• Classification of the respondents
• Screening of respondents
b.) Sample size
- The number of respondents per group should range from
6 to 8, depending on the skill of the facilitator and the
topic being discussed.
c.) Data gathering
• Selection and preparation of the venue and equipment
• Formulation of the discussion agenda
• Facilitator who is skilled in moderating and has the
ability to draw out significant insights from the
participants.
d.) Data analysis
• Integration of the information gathered
• Some observations on respondent behavior
• Listing of recommendations and report writing
OBSERVATION TECHNIQUE
- It is gathering data about customers in their natural
setting without having to interact or talk to them.
(Observing)
- The researcher has to simply observe people as they go
about their usual activity such as buying and using
products and services and assess how they behave.
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Advantage of Observation Research:
• It allows the researcher to see what customers actually
do rather that rely on what they say they do.
• It allows the researcher to observe customers in their
natural setting.
• It does not subject the researcher to the unwillingness of
customers or their inability to reply to certain questions.
• Some information are better gathered quickly and
accurately through observation.
Disadvantages of Observation Research:
• The researcher cannot get the reasons behind the
behavior.
• The researcher can only focus in the "here and now". It
cannot cover the past nor the future.
• The observation technique may border in the unethical
because the respondents have not agreed to be observed.
SURVEY RESEARCH
-It is the most preferred instrument for in-depth
quantitative research.
-In this method, the respondents are asked variety of
questions which are often about their personal
information, motivations, and their behavior.
- It can be conducted via telephone, personal (face-to-face
interview), and mail interview (printed or electronic mail)
Usage, Attitude, and Image (UIA) Survey
- most popular type of survey research in which is
intended to derive market awareness, market size and
share, product usage and preference, customer interest,
and customer image.
THREE CONCERNS IN PLANNING A SURVEY:
1.) Questionnaire Design
- It should be able to elicit all the necessary information
required in the research.
- Each question should be clear and definite
- Each question should cover one topic at a time.
- Each question should be presented in a neutral manner.
- Each question should be translated into the dialect that
the target respondents are familiar with.
2.) Sampling Technique
- It is classified into probability and non-probability
sampling.
Probability sampling - is where respondents are
randomly selected from a population such as in the lottery
method.
Non-probability sampling - this renders the
characteristic or the profile of a group that is difficult to
generalize.
3.) Sample size
The 3 basic sample size determinants:
a.)Data variability of a proportion - dispersion of the data
or how widely spread the data is from a central point.
b.)Confidence level in the estimation process - the higher
the confidence level desired, the bigger the sample size
needed; the current industry standard has 95% confidence
level.
c.) Error in the result of the estimation process - the less
error margin desired the bigger is the required sample
size.
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The Formula if the population is known:
The Formula if the population in unknown:
Where:
Z = confidence level
p = proportion of getting a good sample
1 – p = proportion or getting a bad sample
d = margin of error in decimal
n = sample size
DIY Survey: Steps in Conducting a Survey Research
1.) Develop the research objectives
2.) Determine you sample
3.) Choose the interviewing methodology
4.) Create your questionnaire
5.) Pre-test questionnaire
6.) Conduct interviews and enter data
7.) Analyze the data
CUSTOMER PROFILING
- It is to understand the customer through profiling.
METHODS OF CUSTOMER PROFILING:
DEMOGRAPHICS
In demographic classification, the customers were
categorize into the ff.:
1.) Age
2.) Income Classes
- Class A, high income class
- Class B, upper middle income class
- Class C, middle income class
- Class D, lower middle income class
- Class E, low income class
3.) Social Classes/ Reference Group - it often dictates
what is acceptable or unacceptable behavior
4.) Ethnic Backgrounds - it determines what they eat,
how they save and spend, and their level of conservatism
or progressiveness
5.) Religious Beliefs - same with ethnic backgrounds
6.) Occupations - it determine what kind of products or
services these people would buy
7.) Domiciles (habitat) - it is the area of residence and
environmental surroundings, oftentimes, define and likit
the choices available to customers.
PSYCHOGRAPHICS
-It defines the customer's motivation, perceptions,
preferences, and lifestyle.
•Motivation - roots of customer's wants and needs. It is
what makes or encourage them acquire or buy the product
or services. It provides drive for action
•Perceptions - the way a person chooses to receive or
interpret information (comes from our 5 senses) from the
external world. It defines exactly what a person will do.
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•Preference - It is what a customer prefers or the set of
likes and dislikes. It shape the customer's decisions.
•Lifestyle - it talks about what a people value most in their
lives.

TECHNOGRAPHICS
-It classifies people according to their level of expertise in
using a product or service.
-Products and service can range from general purpose to
highly specialized, customized, and technological goods.
Example:
Sport beginners might just want basic products.
Sports regulars may be looking for more sophisticated
equipment.
Sport professional would want the best of the best for
competition purposes.

APPLICATION OF CUSTOMER PROFILING

Two ways:
1st way: to develop a product or service to test out in a
market place.
a.) The customers most attracted to service or product can
then be profiled.
b.) after profiling, the next step is to find out how huge
this market is for exploitation purposes.
2nd way: to profile the different types of customers in a
given industry or areas as to their needs and wants.
a.) the entrepreneur could choose the customer group with
the best potentials.
b.) Products and services can be developed by the
entrepreneur to match this chosen group of customer

Market segmentation
- Customers with similar needs and wants, and similar
willingness and ability to pay can be group into one
customer segments.

Market Aggregation
- The entrepreneur prefer to deals in commodities like
rice, beard, and water to appeal to broader market.

Market Mapping
- It refers to grouping customers and products according
to certain market variables.
- The entrepreneur can use one or a combination of
demographics, psychographics and technographics to
create a market map.
- Products or services can be mapped according to their
relative positioning in the market based on certain
customer position.