ANSWER QUESTION NUMBER ONE (1) AND ANY OTHER QUESTION

Question 1

CASE STUDY (30MARKS)

LEAD AUTO INSURANCE

Lead Autos Insurance is an entrepreneurial business which provides auto insurance for car owners in Ghana. The company has many brands providing different needs so targeting different markets in the country. Lead Auto repairs cars on behalf of customers who are on the programme. This means that customers on the insurance programme do not have to pay anything but just call Lead Autos and their cars will be picked for repairs. The company has four different brands which are Lead 100%, which target customers who would like a 100% repair of all faults their car develops. Lead 50% target customers who would like a repair of selected parts of the car engine. Lead Commercial is the third brand which targets commercial vehicles and Lead Corporate which targets corporate institutions who would like to put their cars on the insurance programme.

Miss Ann is the young entrepreneur behind this business. She gained much of her skills in the auto mechanics industry in Ghana by acquiring experience as an apprentice at Suame Magazine. The business idea came about when the owner identified an opportunity which stem from the difficulty car owners faced in finding money to maintain their cars.

The need for such a service in Ghana was clear since many people faced such problem, and there was also no real competitor in the market. Funds needed to start such a business wasnt a problem since a lot of venture capitalist (VC) showed much interest to invest in the business, because of the product or service desirability. Even though there are substitutes for such a business model in Ghana, there are no direct competitors yet. Because of that, bargaining power of customers was medium and there was less rivalry among current industry players. Lead Autos compete by providing services that are unique from the traditional auto mechanics services in the country. This is what Miss Ann perceived as what the market really needs (something different from the traditional auto mechanics shops in Ghana).

Based on your understanding of the above case study, answer the following questions

1. What was the business opportunity Miss Ann found in the market? (5 mark)
2. Referencing from the case study, discuss four (4) reasons why you think the business idea Miss Ann developed passed the feasibility analysis she conducted. (12 marks)
3. Referencing from the case study, state and explain three (3) reasons why you think the Auto Insurance industry is attractive. (9marks)
4. Discuss what you think was the business (Lead Auto Insurance ) competitive strategy (4marks)

Question 2 (30 marks)

1. In developing a business idea the entrepreneur should understand clearly the difference between a business idea and an opportunity. Discuss the difference between a business idea and a business opportunity. ( 5mark )
2. Why is it important for an entrepreneur to match the business idea with an opportunity found in the environment? ( 10 marks)
3. State and explain with examples three (3) ways you can identify a business opportunity

(15marks)

Question 3 (30 marks)

1. What is industry analysis? (1mark)
2. Discuss why it is important for an entrepreneur to understand the industry his/her business found itself? (5marks)
3. State and explain six (6) areas industry analysis must cover. (24marks)

Question 4 (30 marks)

1. Explain with examples the four (4) criteria used in conducting a feasibility analysis of a new business idea. (10marks)
2. Most entrepreneurial firms whether they have been in business for several years or are start-ups have four main financial objectives. Making reference to an organization of your choice explain how the four (4) financial objectives are critical to the business success. (20 marks)