Day in day out, entrepreneurs the world over are on the lookout for entrepreneurial opportunities. Entrepreneurial opportunities are favourable conditions that create the need for a good or service or business. Entrepreneurial opportunities come in various forms. They can be in form of new goods or services, new production processes, new distribution channels, new ways of organising or new markets.
It is crucially important for entrepreneurs to make a distinction between an entrepreneurial idea and an entrepreneurial opportunity. An idea is merely a thought or notion. It may not satisfy the qualities of an opportunity. An entrepreneurial opportunity has four essential qualities that distinguish it from from a mere idea. The four essential qualities are durability, attractiveness, timeliness and ability to create value for customers. The distinction between an idea and opportunity is critical point because, a business may fail notbecause the entrepreneur that started it didn’twork hard, but because there was no real opportunityin first place. Take the the example of pet insurance in Zambia, this business may fail because there might be no real real opportunity to begin with.
There are various ways in which entrepreneurs can identify or discover entrepreneurial opportunities. These ways include solving a problem, observing trends and identifying gaps in the market.
Solving personal problems or other people's problems is one way of identifying an entrepreneurial opportunity. Tom Stemberg started Zoots, a drying cleaning company after his suit was lost by dry cleaning company and he founded Olly Shoes after the frustrations he went through shopping for his children's shoes. Similarly, Ukrainian American entrepreneur Jan Koun founded WhatsApp after facing challenges trying to communicate with his back home in the United States while he was Argentina. Back home, David Nama of Dana Holdings founded his first venture way back in the mid 1980s in a quest to solve the problem of shortage of cooking oil and Fisho Mwale founded Yalelo to solve the problem of shortage of fresh fish in Zambia. In the same vein, E-busaka a Lusaka based firm was formed to solve the problem of uncollected garbage around the city of Lusaka.
Another way of spotting entrepreneurial opportunities involves observing trends in the environment. These trends could be political, economic, social or technological trends. Political trends such as government policy, political stability, regulatory changes, ease of doing business provide a basis for entrepreneurial opportunities. The New Dawn Government's decision to increase the Constituency Development Fund (CDF) from K 1.6 million to K28.3 has led to many entrepreneurial opportunities across Zambia's 156 constituencies. Many new ventures have been founded to take advantage of opportunities brought about by the increase in CDF. The New Dawn Government is also trying to remove rigidities or bottlenecks that hinder entrepreneurial activities in the country in order to foster entrepreneurial activities in the country.
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Economic trends such as state of the economy, inflation rates, interest rates, exchange rates, unemployment rates and economic growth rates are also sources of entrepreneurial opportunities. Some startups are founded when the state of the economy is strong and others when the state of the economy is weak. During recessions when the economy is weak startups that help people to save money or make extra cash are likely to succeed. The likes of Uber and Airbnb were founded during the world economic meltdown to help people make extra cash. If these two companies were founded during a boom, their chances of succeeding would have been minimal.
Social trends such as urbanisation, population growth rate, population mobility, population distribution, population structure and lifestyle provide a basis for entrepreneurial opportunities. Lusaka and the Copperbelt provinces are most urbanised and populous provinces among Zambia's ten provinces. Urbanisation creates potential for economies of scale that make certain opportunities possible.Social trends alter how people and businesses behave and set their priorities.These trends provide opportunities for new businesses to accommodate the changes.Opportunities in urban areas like Lusaka, Kitwe and Ndola tend to lead to better performing new ventures than opportunities in rural areas such as Kaputa, Mafinga and Kalabo.
Entrepreneurs should keep their ears and eyes wide open with respect to technological trends. Technology makes things cheaper, faster and better.
Technological factors enable people to allocate resources in different and potentially more productive ways and allows people to engage in self-employment. Zambian entrepreneurs are using various social media platforms such as Facebook (Meta), WhatsApp, Instagram and TikTok to conduct their business. Technology facilitates entrepreneurship by:
–Introducing new and better products, services & processes
–Increasing the speed at which businesses are launched.
–Reducing the cost of starting a business
–Reducing the cost of doing business
–Reducing entry barrier
–Enhancing competitive advantage.
It is incumbent upon entrepreneurs to be aware of new technologies such as ChatGPT, artificial intelligence, blockchain, robotics, drone technology, metaverse, virtual reality, nanotechnology, machine learning and deep learning and find ways of harnessing them. Advances in technology frequently create business opportunities. Once a technology is created, products often emerge to advance it.
Finding a gap in the marketplace is another approach to identify entrepreneurial opportunities. A gap in the marketplace is often created when a good or service is needed by a specific group of people but doesn’t represent a large enough market to be of interest to incumbent retailers or manufacturers. Gaps in the marketplace represent potentially profitable business opportunities which existing and prospective entrepreneurs should exploit. Daisy Rock Guitars, a company that makes guitars just for women was started in 2000 by American entrepreneur Tish Ciravolo after her realisation that there were no guitars on the market made specifically for women. Similarly Zambian entrepreneur Monica Musonda started Java Foods in 2012 to fill the gap of locally produced noodles.
After identifying opportunities, entrepreneurs need to evaluate the opportunities before exploiting them. Whether, the venture will be successful or not depends on a number of factors such as creativity, prior experience, cognitive factors or social networks of the entrepreneur.
