An Entrepreneurial Opportunity - Case Study Example

Entrepreneurial Opportunity Student’s Name Course Instructor Date Entrepreneurial Opportunity Definition of Entrepreneurial Opportunity In as much as there may not be a standard way of defining a business opportunity, there are a number of underlying key terms that are used in describing an entrepreneurial opportunity. An entrepreneurial opportunity is a business opening that has the capability to yield economic benefits to the owner if it is executed within the required time frame. Therefore, an entrepreneurial opportunity will only yield the required economic value if it is executed early enough before it is taken up by other entrepreneurs. This is only when the venture will have the capacity to yield the required economic benefits to the owner. In other words, what defines an entrepreneur is the ability to spot an opportunity before others and take the risk to exploit it early enough to be able to give forth the required economic benefits (Scarborough 2012, p. 112). Ways of Identifying Business Opportunity Identifying and Filling the Gaps in the Market An entrepreneur will be able to discover lucrative opportunities by trying to find and fill various gaps in the market. The nature of gaps may be varied depending on how they did arise. For instance, the success of Seattle Ace was through identifying the existing gap and designing the best framework of exploiting that gap. According to Chris Mohney, recession killed the big hotels in New York. Therefore, there was a gap that was yet to be filled. Calder-wood identified this opportunity and designed the way to exploit the available opportunity. The fact that this hotel offered services whose cost starts from less $100 attracted a lot of customers. This venture attracted a lot of customers because the hotels that had been eliminated were offering services and products that were quite costly. When Calder-wood spotted the opportunity, he designed a facility offering first class services at a fairly low price. This is what kept this hotel flooded throughout the year. Therefore, the entrepreneur was able to fill perfectly the gap that was created when recession hit the big hotels in New York. Just like Calder-wood did, business gaps can be quite varied. The nature of these gaps depends on various factors including the industry, the environment, etc. What is important is for an entrepreneur to realize that unmet need. It then becomes the responsibility of the entrepreneur to exploit it. For an entrepreneur to successfully exploit opportunities, he needs to be a risk taker (Kirby 2002, p. 77). This is what separates an entrepreneur from any other person doing business. This is because many people identify business opportunities, but few go ahead and take the necessary risk and invest in that particular venture. Solving a Problem Another way through which entrepreneurs identify opportunities is by solving the current problem. From the story of Seattle Ace, one can easily realize that there was a problem in the market. Consumers could not get the required services at affordable rates. Therefore, consumers were left to live with a lot of dissatisfaction. Dissatisfaction in the sense that their needs were not met appropriately due to market inefficiencies. This is exactly what Calder-wood later comes to capitalize upon. The design of this hotel is specifically guided by the prevailing market for the products he is offering. He takes advantage of the existing market complexities. This is quite amazing. By providing the required solution to the market, he is in a position to realize the economic benefits that existed in this market. Having capitalized on this problem, he sets the pace that could be so hard to be matched by other competitors. This is what sets Calder-wood as an entrepreneur. The problem that was present in Calder-wood’s pathway is just one of them. There are other kinds of problems that an entrepreneur can easily identify in the market. The problems deal with issues related to consumer satisfaction in terms of both pricing and product quality. When an entrepreneur realizes that there is a level of dissatisfaction, he is supposed to immediately devise how to solve the prevailing problem (Kirby 2002, p. 85). All these steps that are supposed to be undertaken by the entrepreneur are perfectly in line with the meaning if identifying business opportunities. For instance, the timing element is quite critical if one is to perfectly utilize the available opportunities. Timing enables one to have a cutting edge over other competitors. By the time other competitors realize the potential that is in a business venture, the entrepreneur will be so many steps ahead of them. Carefully Observing and Analysing Trends Market opportunities are harnessed from the prevailing trends in the industry. Trends provide critical information in relation to the products one is supposed to engineer. Trend analysis helps one to discover what consumers will be in need of a specific timing in the future (Clarysse & Keifer 2011, p. 41). This will be based on the changing way of life and other environmental indicators. Calder-wood and his colleagues were able to successfully understand the trends in the hotel industry. They realized trends were the main drivers to the kind and nature of innovation that they were to come up with. From the article, it is clear that Calder-wood has completely mastered the trending in terms of lifestyle change. This is what keeps him ahead of competitors. The other four hotels he came up with have also met the customers’ needs. This indicates that Calder-wood has been able to master the change in consumer needs. With this knowledge, it becomes a bit easier to develop a product that will not only meet the needs of the customers, but exceed their expectations. When an entrepreneur is able to exceed the expectation of consumers, the business will continue being profitable since the consumers will be enjoying the consumer surplus (Harnish 2002, p. 21). This is what has kept Calder-wood’s hotels flooded when other hotels in the same region in the same region are almost going without customers. At the same time, trends are not just limited to lifestyle. There are many other dimensions that must be analysed because in one way or another, they have an impact on the nature of consumer demands. Other changes that must be analysed include political, technological, social, environmental, economic, etc. All these have the capacity to create an opportunity for an entrepreneur to exploit profitably. For instance, changes in technology can be a platform for an entrepreneur setting up a business to align himself in a way such that the realization of the technological advancement will find a specific product for the consumers. This is one factor that will keep that particular entrepreneur ahead of others. By the time other competitors are gaining ground in the market, he would have already the major share of the market. What makes it quite difficult for such a consumer to be matched is the fact that when other competitors will be striving to overtake him, he will be profitable enough to achieve other opportunities in the market. Conclusion Entrepreneurship is a fascinating venture. Most people who have transformed the world economy started as simple entrepreneurs who were so enthusiastic to achieve results. They were willing to risk as much as they could so as to achieve their dreams. An example is Calder-wood who risked $2 million to begin his venture. The passion in doing all this was very overwhelming. Nevertheless, it did not stop with Calder-wood. Many other entrepreneurs have achieved quite a lot by following the same path of risk taking. This has revolutionized the economy of many countries. This is because through entrepreneurship, jobs are created, taxes are paid, the standard of living of people is uplifted, etc. This provides enough incentive to make all nations change their economies by investing in entrepreneurship. References Clarysse, B. & Keifer, S 2011, the Smart Entrepreneur: How to Build for a Successful Business, Elliot & Thompson, New York, p. 39-51. Harnish, V 2002, Mastering the Rockefeller Habits: What You Must Do to Increase the Value of Your Growing Firm, Gazelles Inc., New York, p. 18-24. Kirby, D 2002, Entrepreneurship, McGraw Hill, New York, p. 73-92 Scarborough, N 2012, Effective Small Business Management, Prentice Hall, New Jersey, p. 101- 138. Read More