Self - Assessment Questions - 1

1. Identify the potential risks and rewards in establishing a business enterprise.

As with any business enterprise, there are many risks, but with these also comes reward. Some of the risks an entrepreneur might face when starting a business is they may have access to limited resources, limited funds and also the fact that their idea might fail and fall down around them. There is the obvious risk of loosing the capital they have put into the business which could've been savings, or a load or grant. On the other hand, if they manage to run things efficiently and effectively, they will embark upon great reward. They will feel fulfilled and ooze in self-confidence. As well as the vast array personal development rewards, they will also be rewarded financially. Success at business allows for financial independence. 

2. Explain how you might spot a gap in the market.

To spot a gap in the market, you must first establish a need. Once you establish something that people need, or something that solves a particular common problem, you then follow a certain number of steps. Firstly, you do some market research to determine whether somebody else has came up with your brilliant idea. Based on your findings you must look at things like:

• Is there a lack of this certain product that you could fill?
• Is there a huge demand from consumers?
• Could you differentiate yourself from competitors to fit into the market?

From here you can go a little further with questions like:

• Is this a short-term or long-term opportunity?
• What are the potential risks involved?
• Do the potential risks satisfy the potential reward?

Once you have sufficiently explored each of these questions and obtained positive results, I think it's safe to say you have spotted a gap in the market.

3. How might you seek help and advice, and from what sources?

There are a number of ways you could seek help and advice for your business. There are countless government schemes designed to help start-up companies with advice on sales, marketing, launch, IT skills, financial help and many other topics. Just some of these sources would be:

• Business Link
• The Princes Trust
• The Chamber of Commerce
• High-Street Banks