Analyze the market to determine situations
// June 5th, 2009 // No Comments » // Business Plan Writing
“Every Business Opportunity must be subjected to a careful analysis and testing to determine its validity”
“All ideas should have a demonstrated need, a market and the ability to provide a return on your investment”
Some questions to be answered when assessing a business opportunity are …
Is the idea feasible in the market? Is there a demand? Can it happen? Can you bring together people and resources in time, before the opportunity disappears?
Entrepreneurs connoisseurs review all business opportunity starting its analysis with the customer and the marketplace in mind.
Analyze the market to determine situations in the industry in question, market size, growth rate, market capacity, market segment potential, cost structure, economic environment, time to reach the equilibrium point, the opportunity cost of , barriers to entry, exit strategies, etc..
Entrepreneurs can use the following two models to assess the business opportunity …
Model Assessment Questions
1. What is the need to meet or solve the problem? (Value Proposition)
2. Who will sell? (Target Market)
3. How to earn money? (Sample Return)
4. How to differentiate your business from existing ones? (Unique Sales Proposition)
5. What are the barriers to entry?
6. How many competitors are and what is its quality? (Analysis of Competition)
7. What is the size of the market in pesos? (Market size)
8. What is the speed of market growth or decline? (Market Growth)
9. What percentage of the market trying to cover? (Market segment)
10. What type of company is that? (Individuals or S.A.)
11. How much startup cost? (Costs Start)
12. What is the investment required and its source? (Need for Investment)
13. Do you plan to sell the company or make it public (stock market) in the future? (Exit strategy)
14. If investors agree, do get back? (Return on Investment)
We can take these questions to construct the second model that will be very useful for evaluating the business opportunity you’re considering. This model we call …
