A business opportunity is a conducive set of circumstances which give rise to need for new services, products or business ideas. It can also be defined as a business plan that an investor wants to pursue after doing the risk and reward analysis. The entrepreneurial idea may be provoked by either internal or external factors in an organization. For one to realize that his or her idea is an opportunity it must pass the following test: must be attractive, timely, and sustainable and value adding to the consumer’s service or product. Accompany can identify an opportunity in the market through three ways, by observing the business trends in the market, trying to solve a certain problem in the market and filling a need gap in the market (Consult, 2009: para.3). When a company is identifying an opportunity it should look at what the existing businesses (in the market) are not offering to the consumers that it should be offering. It should observe some existing gaps in consumer satisfaction. The consumer behavior should be observed keenly in order to understand how value can be added to the existing products. When a company is evaluating an opportunity it has identified it should put into consideration the new products that it can offer that is closely linked with its core business. These products should fit well in its product line.
Another kind of opportunity that can arise to a business venture is coming up with different marketing mix of its products such as the target market and the market segmentation. This can enable the business to exploit new opportunities that may arise in the markets.
Case study Toyota Company
The Toyota Company was founded in 1933 in Japan and it is one of the largest motor vehicle producers in the world. In the 1990s the company was producing about five million vehicles annually which were about 9.7 percent of the global market of vehicles. Currently the company has opened production plants in different parts of the world and has considerably expanded the market for its brands. I will analyze various approaches the Toyota Company has used to identify opportunities in the market place which has led to development of new products (Psabilla, 2009: Para.4).
Finding a gap in the marketplace
Toyota Company discovered that the lower market segment had a great potential in increasing the sales of the company products. The company realized that buying and running cost for motor vehicles was very high for the lower head markets. Toyota noted that the market set up time considered vehicles to be made for only the cream in the society. With this discovery the firm saw an opportunity in this whole scenario. After the identification of this opportunity it decided to concentrate on this middle market. This provoked the company to put big investments in research and development. This was aimed at reducing the cost of producing automobiles and producing vehicles that could use small amounts of fuels (Life in motion, 2006: para.4).
The whole Toyota project became a success; this is because the company was able to come up with technology of producing vehicles at low cost; research and development department was able also to produce vehicles with low engine capacity that were economical in fuel usage. This became trend for the company which enabled her to come up with many brands of vehicles for the middle class people in the society. The production of cheaper automobiles by Toyota led to increased demand of its products. These vehicles enabled the company to expand its market share in the global motor industry. The number of vehicles demanded increased annually making the company to expand its production lines (Toyota, 2009: Para. 5).
The company has for a long time concentrated in manufacturing automobiles for the middle market which has enabled her to create a very strong brand. Toyota’s opportunity grew further due to the growing demand of these automobiles in the emerging economies. These are from Africa and Asia where demand for vehicles is growing because of continued economic growth and change in lifestyles.
The increased demand for Toyota automobiles has contributed to the continued growth of the company making the company to open production plants in different parts of the globe to cope with the growing demand. The two other major production plants are set in India and America.
The overseas production plants are meant to satisfy the local demand for automobiles and be able to utilize the raw materials found in these areas. This was a new strategy that was set by the company to fill the gap in these foreign markets. The plants set in the foreign countries are able to utilize the cheap labor in the locality hence reducing the company production cost. The company has been able to reduce the cost of its finished products that were first incurred in transportation of its products from Japan to the long distance markets. This strategy has enabled the company to reduce the operation cost for the company and these benefits are then tricked to the customers through production of low cost quality products which fits for the lower market.
Toyota has come up with different strategies that are meant to lower the cost of vehicle production, the company has developed different products and business ideologies like Kaiban and Kaizen, these ideologies are meant either to reduce the cost of production or to improve the quality of their products. When we look at the kaizen ideology which means continuous improvements we realize that the company tries to make automobiles that are economical in fuel use hence satisfy the target market.
In the above case we can conclude that this entrepreneurial approach to Toyota Company has been very successful and has increased the company productivity. This approach has not only been beneficial to the company but also to the consumers who can now enjoy cheap but quality products. It has also improved the face of the motor industry in the world.
This entrepreneurial approach in the recent years has helped Toyota develop new products in market. There is the world trend in the motor vehicles industry of producing automobiles which have improved safety, with low fuel consumption, and reduced transportation times. Toyota has observed this trend and also come up with such products in market.
Intelligent transportation systems
These are systems which are meant to add the aspect information communication to the automobiles and functioning of vehicles. There are various types of intelligent transportation systems such as car navigation, automatic communicating feedbacks to certain sources and the CCTV. Examples of these technologies (that have made the Toyota Company come up with new products) include:
These are radio modems fixed in vehicles which can send data within a short range. This data can then be received to communicate certain information in case of an accident or traffic hitches. This can help the traffic department or the emergency unit to respond immediately to any problem that may arise
The hybrid vehicle
This is where an electric propulsion system is added to the convectional car engine to enhance fuel efficiency than the normal model of vehicles and also better performance. The company has produced a model Toyota Pius which has been very successful hybrid model. These models of vehicles are meant to make the running cost for vehicles to go down making them more affordable (Nawaaz, 2009: para.3)
The world also has become sensitive to conservation of energy resources and environment. This trend has also seen the Company produce better automobiles that conform to these requirements. The firm has engaged in producing vehicles with low waste gases emission to reduce environmental pollution. This has been made possible by investing in the modern technologies in the production plant.
The two entrepreneurial approaches have helped the company to penetrate new market and expand its market share. They have also enabled the company to come up with a wide range of products that are able to fit in different market segments. This diversification has made her brand to grow and become stronger worldwide. The entrepreneurial approach of Toyota has been successful due to its strong market research which is aimed at providing products that are consumer driven.
Consult. Identifying business opportunities – establishing a business circle. 2009. Web.
Life in motion. Toyota marketing strategies for growth. 2006. Web.
Nawaaz, jahaleea. Toyota Pius. 2009. Web.
Psabilla. Toyota Motor Corporation company history. 2007. Web.
Toyota. Globalizing and localizing manufacturing. 2009. Web.