Exploring Business Opportunities Assignment
-Ramachandran T, Section A, PGBE Batch 17, EDI
1. How will you identify viable business opportunities? Describe in detail steps involved in the process. The existing business opportunities can be identified through the following steps:
Step 1: Preparation of personal profile
Step 2: Development of Opportunity selection(OS) Framework
Step3: Generation of ideas
Step 4: Snap investigation of ideas
Step 5: Evaluating in terms of OS framework and shortlisting of ideas
Step 6: Pre-feasibility studies
Step 7: Opportunity Selection
Preparation of personal profile:
Personal profile describes the basic details of the person such as his education, work experience, his area of interest and personality. It is also necessary that the individual highlights his objectives of establishing the enterprise, his current investment preparedness, level of risk taking attitude and his personal considerations.
Development of OS Framework:
The development of OS framework mentions the following: * Investment * Technological Sophistication * Managerial / Organizational Needs * Market and competition * Sector Preference * Govt. Intervention/ dependence * Implementation time * Profitability * Degree of risk and its form * Location * Personal Considerations * Taboos/Religious sentiments * Life Style – Trader in Agra * Relative Importance of Money – Restaurant in Ahmedabad * Amenability to takeover by children * Speculative Orientation – Eye on land & building
Generation of Ideas:
The ideas can be generated from the following sources: * Natural resources * Existing/anticipated industries * Market-driven * Service sector scanning * Extension/modification of present work content * Creative effort and * Other ways

Snap Investigation of Ideas:
Reading material and journals relevant to the opportunity must be read. The investigation should answer what exactly is the product or services, its application, possible scales of production/operation, project cost corresponding to a given scale of production/operation, market, unit sale price, degree of technological complexity, expected annual turnover and expected profit margin.
An information sheet on a given idea should be arrived and that should have the estimates of the above mentioned.

Evaluation in terms of OS framework and short listing of ideas
Evaluation can be done after the snap investigation of ideas. The viability can be assessed in terms of the OS framework done. But however, it is not an ideal evaluation as there is always a room for intuitive judgment and gut feeling.
There can also be some answers found for the questions like whether there can be learning and grip over the business; what are the key determinants of success and risk factors.
At this stage, one can, often, ill-afford the cost of a comprehensive project-investigation. So, you attach considerable importance to well-meaning judgment of persons supposedly knowledgeable about a given opportunity. You should, of course, cross check such judgment. Pre-Feasibility Study The purpose of this study is to satisfy regarding the viability of the project, without incurring too much cost/effort on the exercise. This is an optional stage because, in the course of initial evaluation or shortlisting,that collected enough information or carried out sufficient/enthusiastic about the shot-listed idea that you go in for a full-scale feasibility study. It depends on the circumstances
Opportunity Selection This is the most critical point in the whole OIS process the culminating point. Until now, it was exploration, elimination, information-gathering and analysis. But after this it is upon investigation and the opportunity is selected.
2. a) What are the Sources of Business Ideas? The various sources of Business ideas are as follows: 1) Natural Resources
It is logical to look for ways of converting natural resources into profitable enterprises. Following are gamut of natural resources: * Forest * Horticulture * Agriculture * Agro-Waste * Marine Or Aqua * Mineral * Live Stock * Wind * Sun * Human
So, while identifying opportunities based on natural resources, it would be beneficial for you to pay attention to the following: (i) Exploitation- Feasibility (ii) Resources-quantification and life (iii) Resource specification (iv) Resource stability (v) Critical infrastructure (vi) Commodity/Trading dimension (vii) Legal dimension (viii) Other dimension

2) Existing/Anticipated industries
The existing industries might give ideas of the following: * Similar project * Raw material for existing industry * Further processing of output of existing industry * Capital goods for existing industry * Project based on waste or by-product of existing industry * Packaging material for existing industry * Project based on skills/technology developed
While identifying opportunities based on existing industry, one is advised to keep the following in view: * Outlook For Existing Industry * Ancillary-Parent Industry Syndrome * Captive Arrangements * Nature Of Decision-Making * Projects In The Pipeline * Motivated Feed-Back * Look Beyond Local Industries For Market * Well-Entrenched Non-Local Supply Industries 3) Demand-driven or Market-driven Opportunities
Technological advancement, constant upgradation of transport and communication facilities and growing globalization, all these combine to make opportunity identification, a market-centred process. Under the market-driven approach, market itself becomes the basis for opportunity identification. The following methods are popular: * Trade-flows * Industrial / services / consumer products * Kerala coconut / rubber products

* import substitution * Import data, particle boards / toys, consumer * Goods, mosquito racket / glass beads * growth products * healthcare products & services, processed foods, entertainment products and innovative products like; courier services, plastic water tank, sachets, ro plants, rte vegetables

* Product positioning/differentiation * Product features / applications / price & quality * Groundnut - roasted / vacuum packed, coated * (detergent powder), coconut hair-oil loose to * Bottle, namkins, vicks vaporub, mosquito spray / * Vapouriser * exports * Follow ‘others’ ready-made garments, diamond, leather products * Limitations of Indian sources: gn aflatoxin, spirits, mango, sugar, large diamond, basis for imports: pollution, not-grown / manufactured, low labour cost, overseas market details (www.cbi.nl, trade fairs) 4) Service sector Scanning
Service needs of an existing industry present an excellence avenue for local entrepreneurs. These are the needs for which one prefers a local arrangement. The list of the needs is truly long and includes fabrication, paint, insulation work, lift and shift transport and so on. There is a prevailing trend in the large scale sector to farm out service contracts rather than make permanent investment in physical facilities and/or manpower. The demand-supply statistics on service enterprises are woefully inadequate.

5) Extension/modification of present work-content
Thus is a popular and natural approach for identification, particularly in the context of small ventures. It assumes the following forms: * Skill-based self-employment such as Carpenter, electrician etc. * Marketing to production such as traders, salesmen * Managing or working in a similar enterprise such as supervisor, chemist, engineer (atul-dyes and intermediates)

6) Creative effort

The following are some patterns of creative opportunity identification: * Development of problem-solving through products/service like aqua guard, domestic flour mill * Exploitation of new technology or material to meet a widely felt need like vending machines, PVC footwear, soya milk * Creating a demand for a psychological product like mood ring, cease fire
2. b) List out the errors commonly made by entrepreneurs in identification of opportunities
The errors commonly made by entrepreneurs in identification of opportunities are : * Lack of ownership * Catch the first bus * Inaccurate information * Ahead of times * Unwillingness to step back
2. c) What information sources you will use to make a market survey of your consumer product?
The sources of information can be any of the following: * Market related * Technical analysis * Financial feasibility * Business opportunity identification * Govt. policy & procedure
It is useful to refer to a ready list of * Over 700 industries reserved for small scale sector * Opportunities in the nature of low-technology/low-investment ideas * Over 300 ideas for mini/micro enterprises * Nearly 200 service-enterprise ideas

3. a) Expand the following:
ONGC – Oil and Natural Gas Corporation
CAGR – Compound Annual Growth Rate
DRDO – Defense Research and Development Organization
CII – Confederation of Indian Industry
FICCI – Federation of Indian Chamber of Commerce and Industry
MSME – Micro Small and Medium Enterprises
MOFPI – Ministry Of Food Processing Industries
UNIDO – United Nations Industrial Development Organization
KVIC – Khadi and Village Industries Commission
CFTRI – Central Food Technological Research Institute
IREDA – Indian Renewable Energy Development Agency
CSIR – Council of Scientific and Industrial Research
NHAI – National Highway Authority of India
WTO – World Trade Organization
BARC – Baba Atomic Research Centre

3. b) List out natural resources used to identify business opportunities and give three business ideas on each natural resource.
Forest Resources * Major forest produces like Timber, Wood, Bamboo, Rubber etc. * Minor forest produces like Honey, Medicinal and Aromatic plants, Natural Fibers, Minor Oil Seeds, Tree leaves and bark
Opportunity: Designer furniture; Herbal cosmetics and Forest tourism
Horticulture
* Business Opportunities based on inputs, outputs and waste/ by-products. * Inputs like nutrients, insecticides, nursery plants, irrigation facility, tools and equipments. * Outputs like fruits, vegetables, wastes and by- products
Business Opportunities in processing of fruits, vegetables and by-products; Floriculture and value-added products like dry flowers, extraction of oils, flower based pharma and nutra compounds, natural dyes and pot porri (a mixture of dried, scented flowers, leaves, seeds, stems & roots of flowering plants)
Agriculture
* 70% population depends on wide variety of agriculture operations * Agriculture produces like paddy, wheat, oil seeds, sugarcane, cotton, pulses etc. offers huge opportunity in primary and secondary processing, storage, transportation, etc. * Inputs like certified seeds, fertilizer, pesticides, irrigation facilities, agricultural implements, consultancy and services like soil and water testing, agronomy, hydrology, etc
Agro Waste * Agro waste such as paddy husk, straw, wheat straw, sugarcane bagasse, cotton stalk, groundnut husk etc. offer vast opportunities for processing and converting into commercial and industrial products * Business opportunities depend on the availability and quality of agro waste in a given location

Marine and Aqua * Long coastal line offers wide and varied business opportunities based on marine coastal line * Products such as salt, gypsum, marine chemicals, sea weeds, fish and marine animals offer vast industrial opportunities. * Tourism related business opportunities such as water sports, diving, surfing, boating, etc. are commercially exploited.
Mineral
* India has vast resources of minerals such as coal, iron ore, bauxite, mica, lime stone, marble and granite stone, soap stone, graphite, mineral oil and gas etc. * Each mineral depending on available quantity and quality offers business opportunities in mining, processing, transportation and other logistics * Mining equipments, tools, testing laboratory, safety equipments and gadgets, prospecting services etc offer huge opportunities
Live Stock * Livestock includes poultry, cow, buffalo, goat, sheep etc. * Poultry Farms, Dairy Farms, Raising other animals, Slaughter house, animal feeds etc. offer huge opportunities as it is always in short supply. * By-products such as bones, leather, horns and huffs, animal hair, blood etc. also are of commercial importance
Wind/solar Renewable Energy
Renewable sources of energy are very important for green environment. * Wind power generation is possible where sufficient wind velocity is available to run wind mill. * Opportunities are in construction, erection, installation, repairs and maintenance of wind mills. * Solar energy offers opportunities to generate electricity and run gadgets such as PV Cells based water pumps, lighting, battery chargers, roof top power generation, lantern, solar hot water systems and dryers etc
4. a) Draft out your personal profile with justification. How it is useful to identify opportunity? 1. | Name | : Ramachandran T | 2. | Education | : B. Tech (Electrical and Electronics Engineering) | 3. | Work experience | Shift Team Leader in Coated Glass Manufacturing Plant at Saint-Gobain Glass India Limited (25 months) | 4. | Other Academic / Practical Interests | Manufacturing and Tourism | 5. | Personality | Hard-working. Dynamic. An upper middle-class background. Parents and close relatives are either job-holders or professionals. Initial financial assistance and moral support assured by parents. But cannot expect support either in terms of term-loan tie-up, market- entry or emergency financial assistance. | 6. | Objectives for establishing an enterprise | To earn a lot of money. There is optimism that if he works hard and makes sacrifices now, he will reap a good harvest in a few years. | 7. | Investment Preparedness | Own fund of Rs.15 lacs can be committed to business | 8. | Attitude to Risk-taking | Low risk attitude | 9. | Personal Considerations | Wants to set it up in / around the city where he lives - Partnership based on the skills of the partner |

4 b) List three names of

[i]Export Promotion Councils * Electronic & Computer Software Export Promotion Council * Gems & Jewellery Export Promotion Council * Handloom Export Promotion Council
[ii]Financial Daily * The Economic Times * The Financial express * Business Line
[iii]Journals on Trade and Industry * Business Today * Fortune India * India today
[iv]Industries Associations * Internet Service Providers Association Of India * Indian Small Scale Paint Association * Silk Association Of India
[v]Chambers of Commerce * The Cochin Chamber Of Commerce & Industry * Indian Merchants Chamber * Gujarat Chamber Of Commerce And Industry
[vi]Institutions/organizations helping entrepreneurs * City and Industrial Development of Maharashtra Ltd. Mumbai (CIDCO) * Pondichery Industrial Promotion Development and Investment Corp. Ltd. * Madras Export Processing Zone
[vii]Trade Fairs * Emat International * Electronica India * IITF India International Trade Fair

5. a) Explain the following terms:
Breakeven Point:
Break-even point (BEP) is the point at which cost or expenses and revenue are equal: there is no net loss or gain, and one has "broken even." A profit or a loss has not been made, although opportunity costs have been "paid," and capital has received the risk-adjusted, expected return.

Payback period:
Payback period in capital budgeting refers to the period of time required to recoup the funds expended in an investment, or to reach the break-even point.

Scalability:
Scalability is the ability of the business to grow and accommodate that growth.

5. b) Would you prefer to use Primary information or Secondary information in preparing a Project Profile? Why?
The information universe contains many different types of information. Some of this information is characterized as primary information, whilst some is characterized as secondary information.
· Primary Information is first-level literature such as journal articles, conference papers, and theses. It also includes direct data, theories, or artifacts.
· Secondary Information reflects upon, analyses, criticizes or reports upon the primary literature. It includes review articles, textbooks, and some databases
For our project profile to be of a good standard, we should ensure that we strike an effective balance between primary and secondary sources. Relying too much on one type of resource may create problem in our business.

5. c) Indicate whether the following items are:
(a) Cost of Project
(b) Means of Finance
(c) Fixed Cost
(d) Variable Cost (e) None of these. You may write your answer against each item as a, b, c, d or e.

Sr.No. | Item | Answer (a, b, c, d or e) | 1 | Promoter Funds | B | 2 | Land | A | 3 | Telephone expenses | D | 4 | Tuition fees paid for brother’s education | E | 5 | Business Inauguration expenses | A | 6 | Loss of stock due to rain water damage | E | 7 | Security deposit to landlord | A | 8 | Raw Materials | D | 9 | Trade mark renewal fees | C | 10 | Packing material consumed | D |