ENVIRONMENTAL FACTORS AFFECTING NEW BUSINESS

Submitted to : Mrs. Seema Faculty, USM,KU

SUBMITTED BY: SHRUTI BAJAJ(39) ANKUSH KATHURIA(36) AYUSH DAWAR(40) MONIKA SHARMA

Search for business ideas

Business opportunity ,may be defined as an attractive project idea which an entrepreneur accepts as the basis for his investment decision. Two major ingredients: Growing markets Optimum return on investment

Criteria for evaluating ideas

Well matched with the promoter Favorable and growing market Government regulations Risk Raw material

Market assessment
Refers to systematic collection, recording and analysis of data. Two types: formal and informal assessment. Important because the idea should be viable in a competitive and dynamic marketplace. Effective evaluation tool to determine whether or not an entrepreneurial idea is a potentially successful one.

Feasibility study should include the following elements: Detailed production description Identification of the target market Description of where the product will be distributed Price determination Promotion plans

Sources of information
Four major sources: Personal interests or hobbies Work experience, knowledge and skills Products and services currently available External environment

Modalities of information collection

Process of analyzing and materializing the information collected after a business opportunity has been identified with a clear understanding of the particular sector of business. Gives a clear understanding and scope of the opportunity to start a feasibility study.

Approaches for selecting idea

Environmental scanning Creativity and creative problem solving Brainstorming Focus group Role of intuition

Entrepreneurial Environment
Entrepreneurship environment refers to the various positive and negative constraints within which various enterprises are required to operate. Positive impact - existence of factors facilitating growth Negative impact factors adversely affecting emergence and growth of entrepreneurship. Characteristics of Environment: 1. Dynamic 2. Uncontrollable and External 3. Affect the business in varying degrees 4. Poses threats and offers opportunities

Types Of Environmental Factors

factors

external

internal

micro

macro

Internal environmental factors

Also known as controllable factors Provides basic purpose of an enterprises existence and operations. Establish the internal environment within which the different departments of the firm operates in an interrelated manner. Critically dependent on line and staff relations, industrial relations, job design team spirit, etc..

 Various determinants: Mission and vision of the org. Corporate culture and value Governance standards and codes Quality control system Control system of the organization

External factors
Also known as uncontrollable factors. Not in the hand of the organization. High impact on entrepreneurial decision making. Divided into two categories: micro external entrepreneurial environment macro external entrepreneurial environment

MICRO ENVIRONMENT

EXTERNAL ENVIRONMENT

MACRO ENVIRONMENT

Micro external environmental factor

It includes the following factors Input providers Customers Competitors Employees