Needs and Wants: Business Opportunity

Everyone has his or her own needs and wants. However, these needs and wants are considered differently by us.
We have different concepts of the things that we need and we want. However, it is important to be able to identify and
classify as to which are our needs and wants as knowing this may present a good business opportunity.

Generating Ideas for your Business

You can also generate sound ideas for your business by considering different
factors such as the kind of people that you want to cater, their needs and wants,
lifestyle, culture and tradition, and social orientation that they belong.

1. Examine the existing goods and services.

Are you satisfied with the product/service? What do other people who use the product/service say about it? How can
it be improved? Improving an existing good or service may generate a good business opportunity for you.

[Link] the present and future needs. Look and listen to what customers, institution, and communities are missing
in terms of goods and services.

[Link] how the needs are being satisfied. Needs for the products and services are referred to as market demand.
To satisfy these needs is to supply the products and services that meet the demands of the market.

[Link] the available resources around you. Observe what materials or skills are available in abundance in your
area. A business can be started out of available raw materials by selling them in a raw form and by processing and
manufacturing them into finished products.

[Link] magazines, news articles, and other publications on new products and techniques or advances in technology.
The internet also serves as a library where you may browse and surf on possible businesses.

Selecting the Right Business Idea

According to Bautista (2014), when you identify many business opportunities, you cannot pursue
all of them because of limited resources. You need to choose the best idea by following a step-by-step
selection process. First, screen all your ideas and reduce them to five options. Next, narrow those five
down to two. Finally, pick the single most promising business idea.
Bautista (2014) stated that in screening your ideas, examine each one in terms
of the following factors:
o How much capital is needed to put up the business?
o How big is the demand for the product/service? Do many people need this product/ service and continue to need
it for a long time?
o How is the demand met? Who are processing the products/ services to meet the need (competition or demand)?
How much of the need is now being met (supply)?
Do you have the background and experience needed to run this particular
Scanning the Market
Ed Crowley (2007) defined market scanning as the process of continually and actively monitoring the external
environment in order to identify customer needs, anticipate competitive actions, and, identify technological changes
which will provide new market opportunities or market disruptions.
The following list from Jobber Academy (n.d.) provides a non-exhaustive overview of the different factors one must
consider in the Market Scanning. These factors are known as the PESTLE factors:

Political factors usually involve things that impact your business from a government or legal standpoint. Some
examples are:
o Income Tax and other taxes
o Minimum wage laws
o Union influences
o National and local policies

Economic factors are financial fluctuations that are typically out of your control.
Social factors refer to the cultural norms and attitudes of your targeted demographic and that of your employees,
partners, competitors, etc.

Technological factors have a direct impact on the cost of doing business and the efficiency of your business. Falling
behind on technological trends, using outdated equipment or software, and examining the technological barriers your
business faces to enter a new market all fall within this category.

Legal factors will directly influence the company's operations of your service business right now. Some legal factors
can also determine your final cost of doing business and impact demand for your company's services. These legal
factors include:
o Consumer protection laws
o Various insurance laws and mandates

Environmental factors refer to anything that can impact your business from an ecological or environmental standpoint.
This part of the analysis will matter mor for some industries than others.

THE SWOT ANALYSIS

The SWOT analysis was created in the 1960s by business gurus, Edmund P.
Learned, C. Roland Christensen, Kenneth Andrews, and William D. Book in their book titled, "Business Policy,
Text and Cases."

Strengths and Weaknesses: These refer to the internal factors, and these are the
resources and experiences readily available to the business proponent.

Opportunities and Threats: These are the external forces that affect a company,
an organization, an individual, and those outside their control.

Schooley (2019) cited Billy Bauer, managing director of Royce Leather, and noted that pairing external threats with
internal weaknesses can highlight the most serious issues a company faces. "Once you've identified your risks, you
can then decide whether it is most appropriate to eliminate the internal weakness by assigning company resources to
fix the problems, or to reduce the external threat by abandoning the threatened area of business and meeting it after
strengthening your business," said Bauer (Schooley, 2019).

Porter's Five Forces of Competitive Analysis

The Five Forces of Competitive Analysis was developed in 1979 by Michael E.

Porter of Harvard Business School as a framework or a guide for assessing and evaluating the competitive strength
and position of a business organization.

The Five Forces

1. Supplier Power – Suppliers can raise prices if there are only a few of them, their product
is unique, they are large and strong in the market, or if it is costly for buyers to switch to
another supplier.
2. Buyer Power – Buyers can push prices down when there are only a few buyers, when a
buyer is very important to the supplier, or when switching to another supplier is easy and
inexpensive.
3. Competitive Rivalry – A market becomes less attractive when there are many competitors
offering similar products. But if competitors are weak or unable to meet customer needs,
the opportunity becomes more attractive.
4. Possibility of Substitution – If customers can easily switch to alternative products, the power of suppliers decreases
and the market becomes less attractive.
5. Possibility of New Entrants – When entering the market is easy, more businesses will
join, dividing profits. But if there are strong barriers to entry, existing businesses can
maintain higher profits
MARKET RESEARCH .
Market research is essential for business success because it provides important
information about customers, competitors, and the overall industry. It helps business owners
check if a business idea is feasible before investing time and money. According to Entrepreneur
Asia Pacific, market research is necessary for solving marketing problems and creating strategies
like market segmentation and product differentiation.
Market research uses two types of data:
1. Primary Sources – Information gathered firsthand through:
• Surveys - In survey research, the researcher selects a sample of respondents from a population and
administers a standardized questionnaire to them.
• Experiments - This is an experiment where the researchers manipulate one variable, and control/randomizes
the rest of the variables.
•Observational research - Observational research (or field research) is a type of correlational (i.e., non-
experimental) research in which a researcher observes ongoing behavior.

2. Secondary Sources – Information already collected by others, such as:

1. Public documents
2. Books
3. Journals and magazines
4. Demographic data
5. Existing research and online sources
SAMPLING
Sampling is used when gathering primary data through surveys, interviews, or observations.
Instead of studying an entire population—which is costly and time-consuming—you select a
smaller group (sample) that represents the whole. This helps entrepreneurs understand their
target market more accurately and efficiently.
1. Random Sampling Methods - Everyone in the population has an equal chance of being selected.
 Simple Random Sampling – choosing individuals randomly from a list.
 Stratified Sampling – dividing the population into subgroups and sampling from each
group randomly.
 Systematic Sampling – selecting every nth person from a list (e.g., every 20th).
 Multistage Sampling – selecting samples in several stages, reducing the size each time.
[Link]-Random Sampling Methods.- Selection is based on convenience or judgment, not equal probability.
 Judgment Sampling – researcher picks participants based on expertise or judgment.
 Convenience Sampling – choosing participants who are easiest to reach.
 Quota Sampling – dividing the population into groups and selecting a sample from each
based on a set proportion.
 Snowball sampling - where initial participants refer or nominate other eligible
participants through their social networks. It is also called referral or chain sampling.
DATA PROCESSING
Data processing begins after collecting information from your sample. According to Lumen
(n.d.), data analysis involves inspecting, cleaning, transforming, and modeling data to highlight
useful insights, form conclusions, and support decision-making. This process can take many
forms and uses different techniques depending on the field—whether in business, science, or
social sciences.
Data Processing Cycle
 1. Input – Collecting and preparing data.
2. Processing – Manipulating data based on set instructions.
3. Output – Presenting results (printed or displayed).
4. Interpretation – Understanding what the data means.
5. Feedback – Comparing results to goals for improvement.
6. Storage – Saving processed data for future use.
Steps in Business Data Processing
1. Editing – Identifying and extracting only the needed data.
2. Coding – Organizing data systematically for computer processing.
3. Data Entry – Inputting data into software.
4. Validation – Checking and ensuring data accuracy and quality.
5. Tabulation – Arranging data into tables or formats for easy analysis.
Business Plan
A business plan is a written document that outlines the future of a business. It explains the nature
of the business, marketing and sales strategies, financial background, and projected profits and
losses. It is useful for attracting investors, hiring key employees, gaining new business,
managing suppliers, and guiding the company’s direction.
According to Entrepreneur Asia Pacific (n.d.), a good business plan follows generally accepted guidelines for both
form and content. There are three primary parts to a business plan:
o The first is the business concept, where you discuss the industry, your business structure, your particular
product or service, and how you plan to make your business
o The second is the marketplace section, in which you describe and analyze potential customers: who and
where they are, what makes them buy and so on. Here, you also describe the competition and how you'll
position yourself to beat it.
o Finally, the financial section contains your income and cash flow statement, balance sheet and other
financial ratios, such as break-even analyses. This part may require help from your accountant and a good
spreadsheet software program. Breaking these three major sections down even further, a business plan
consists of seven key components:
1. Executive summary
2. Business description
3. Market strategies
4. Competitive analysis
5. Design and development plan
6. Operations and management plan
7. Financial factors

Why is a Business Plan Important?

According to Jared Lindzon (2019), a business plan is essential because it allows entrepreneurs
to clearly define their goals and monitor progress as the business grows. It should be the first step
when starting a new venture. Business plans also help attract investors by showing whether the
business is on the right track and worth funding.
Lindzon (2019) explains that business plans usually contain key details—such as market and
competitive analysis, customer segmentation, marketing strategies, operational plans, cash flow
projections, and long-term growth plans—which increase the chances of business success.
Although creating a business plan may take time, it is crucial for guiding and strengthening a
small business.
Though it may sound tedious and time-consuming, business plans are critical to success. To outline the importance
of business plans, here are 10-reasons why you need one for your small business.
[Link] help you with critical decisions. Building a business plan allows you to determine the answer to some of the
most critical business decisions ahead of time.
[Link] iron out the kinks. Putting together a business plan requires entrepreneurs to ask themselves a lot of hard
questions and take the time to come up with well-researched and insightful answers
[Link] avoid the big mistakes. According to the Small Business Administration, only about half of small businesses
are still around to celebrate their fifth birthday.
4. To prove the viability of the [Link] businesses are created out of
passion, and while passion can be a great motivator, it's not a great proof point.
5. To set better objectives and benchmarks. Without a business plan, objectives often become arbitrary, without
much rhyme or reason behind them.
n't) coming together over time.
6. To communicate objectives and [Link] you're managing a
team of 100 or a team of two, you can't always be there to make every decision yourself.
[Link] provide a guide for service providers. Small businesses typically employ contractors, freelancers, and other
professionals to help them with individual tasks like accounting, marketing, legal assistance, and as consultants.
[Link] secure financing. If you're planning on pitching to venture capitalists, borrowing from a bank, or are considering
selling your company in the future, you're likely going to need a business plan.
[Link] better understand the broader landscape. No business is an island, and while you might have a strong
handle on everything happening under your own roof, it's equally important to understand the market terrain as well.
10. To reduce risk. Entrepreneurship is a risky business, but that risk becomes significantly more manageable once
tested against a well-crafted business plan.

Questions Every Business Plan Should Answer

Keira Abbamonte (2018) stated that as a rule, business plans are very tactical.
They outline clear steps and goals to take your business from idea to growing company.

o Why are you in business? Talk about your mission. What drives you and the business— beyond revenue
and profits?
o What does the market look like? Discuss who your potential customers are, and what pain points they
have that only you can solve. Analyze your competition— their business, their performance, and their
weaknesses. How does your business idea fit into the market in relation to them?
o What will you do? Detail how your business is different from what's out there.
Explain what you'll offer, how you'll solve customer problems, and how the market will respond to your
business. How will the industry change when you
o How will you grow? This is where you'll specify financials, projections, and where you expect the company
to be in the future. You should also include plans for how the business will scale. Who will you need to hire
and what will their responsibilities entail?
o What do you need? Finish with your ask. Talk about what you need (financial investment, a loan, a
partnership, etc.), how you'll use it, and what you're offering in return (equity, collateral, etc.). Where will that
investment take your business?

Answering those five questions helps to clarify what your business is and why you and your company are uniquely
qualified to take the current market by storm. That helps potential investors, partners, and employees understand the
value of working with you. Whether you're asking the audience for time, money, effort, or something else, they're
more likely to buy into your venture if there's a clear-cut path from plan to operations to profit. Answering the
questions above helps draw that path and answer the most important of all questions: What's in it for me?