Which of the following is the main things to consider when evaluating a business opportunity?

Factors to consider when evaluating a business opportunityThe following are the factors to consider when evaluating abusiness opportunity.a.Personal consideration-These are the abilities andexpectations of an entrepreneur. They include thefollowing;Objectives-The entrepreneur should evaluate thebusiness idea to find out whether it is in line withhis/her objectives.Skills-Where a business requires certain specializedskills and those skills are lacking the idea may bedropped.

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Economics: Private and Public Choice

Gwartney/Stroup/Sobel/Macpherson

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Commitments-Where the business is likely tointerfere with the entrepreneurs other commitmentsit may fail.Interest-It is necessary to check whether theintended business will interest the entrepreneur ornot. If the entrepreneur will not enjoy running thebusiness, the idea should be dropped.b.Business consideration-These are external factors thatare likely to affect the operations of the business andthey include;i.Availability of market for the product-Anentrepreneur should assess the availability of customersbefore starting a business. Customers exist where thereis a gap/nich in the market.ii.Technology-The business should be evaluated in termsof whether there is an appropriate technology that canbe used in production. Factors to be looked intoinclude;a.-Appropriateness of the technologyb.-The cost of the technologyc.-The possibility of the business suffering in case thetechnology becomes outdated/obsolete.iii.Availability of raw materials and other resources-The raw materials and resources required should bewithin the reach and affordable to the entrepreneur.iv.Government policy-An entrepreneur should considerthe requirements of the government before starting abusiness e.g. the government may require certainbusinesses to be located in certain areas only.v.Amount of capital required-The capital required torun and maintain the business should be considered i.ethe source of capital.vi.Profitability of the business-Within a certain durationof time.vii.The break-even period-How long the business cantake to support itself.viii.Possibility of expansion i.e. the potential for growth ofthe business.ix.Impact of the business operations on the environments;some businesses lead to environmental degradation andshould be located in appropriate places/effect oncommunity and environmental health.x.Security-Availabilityof security should be considered.xi.Level of competition-This will help determine whetherthe business will survive or not.xii.The risks that the business will face.BUSINESS PLANThis is a written document that highlights the objectives of thebusiness and steps to be followed in order to achieve theseobjectives. It indicates where the business is, where it wants tomove to, how and when.

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Economics: Private and Public Choice

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What are the factors to consider in identifying business opportunities?