Business Ideas and Opportunities
Senior 4 · Entrepreneurship
Business Ideas and Opportunities
Lesson 4 of 4
25 min
After a month of keeping idea notebooks, the five members of a school entrepreneurship club in Rwamagana have five ideas: tree-tomato juice, a phone-repair stall, a poultry unit for eggs, a cinema evening in the school hall, and selling second-hand textbooks. They have Frw 400,000 from a school competition prize and can run only one business. Each member argues for his or her own idea. (Illustrative case: the club and figures are invented.)
Think about it: how can a group choose fairly, so that the decision rests on evidence rather than on who argues loudest?
Definition
Evaluating a business idea: judging an idea systematically against clear criteria, such as demand, profit, cost, skills and risk, to decide whether to pursue it and, when there are several ideas, which one to choose. The aim is to reject weak ideas cheaply, before money is spent.
| Step | Purpose | Tool |
|---|---|---|
| 1. Screen | Remove ideas that fail a basic condition | Yes or no questions |
| 2. Compare | Rank the ideas that remain | Weighted scoring matrix |
| 3. Analyse the best idea | See its internal and external position | SWOT analysis |
| 4. Check feasibility in detail | Test market, technical, financial and legal aspects before starting | Feasibility study |
Each idea must pass every screening question; a single "no" removes it, however attractive it looks. Typical questions: Is it legal and ethical? Can we raise the capital it needs? Do we have, or can we quickly gain, the skills? Is there evidence of customers?
The club's cinema evening fails: showing films to a paying audience needs the right to show them, which the club cannot afford. The other four pass.
Definition
Weighted scoring matrix: a table in which each idea is given a score (for example 1 to 5) on each criterion, each criterion is given a weight that shows how important it is (the weights add up to 1, or 100%), and each idea's weighted score is the sum of weight × score:
Here is the weight of criterion , is the idea's score on it, and is the number of criteria. The idea with the highest is preferred.
Worked example 1: a weighted scoring matrix
The club agrees five criteria and their weights, then scores three of the remaining ideas from 1 (poor) to 5 (excellent). For "capital needed" and "risk", 5 means little capital and low risk, so that a high score is always good. (Illustrative scores.)
| Criterion | Weight | A: Tree-tomato juice | B: Phone repair | C: Poultry for eggs |
|---|---|---|---|---|
| Demand | 0.30 | 4 | 4 | 3 |
| Profitability | 0.25 | 4 | 3 | 4 |
| Capital needed | 0.20 | 3 | 4 | 2 |
| Fit with members' skills | 0.15 | 5 | 2 | 3 |
| Risk | 0.10 | 3 | 4 | 2 |
Check the weights: .
Idea A:
Idea B:
Idea C:
Decision: A (3.85) ranks first, B (3.45) second and C (2.95) third. The matrix does not make the decision for the club, but it makes the reasons visible: if members disagree, they must argue about a weight or a score, which can be checked, instead of about the idea as a whole.
Tip
Agree the weights before you score. If a group sets the weights after seeing the scores, people choose weights that favour their own idea. In an exam, always show the check that the weights add up to 1, and show each multiplication.
A SWOT analysis looks at the idea from inside and outside. Strengths and weaknesses are internal: things the entrepreneur controls. Opportunities and threats are external: things in the market and the wider environment that the entrepreneur cannot control but must respond to.
The SWOT turns into actions: use the strengths to take the opportunities (contracts with schools); fix the weaknesses before they become threats (apply for the food-processing approval; agree a dry-season price with fruit farmers in advance; keep a cool box for power cuts).
Definition
SWOT analysis: a tool that lists the Strengths and Weaknesses (internal) and the Opportunities and Threats (external) of an idea or business, so that the entrepreneur can build on strengths, correct weaknesses, take opportunities and guard against threats.
| Part | Questions it answers |
|---|---|
| Market feasibility | Who are the customers, how many, what will they pay, and who are the competitors? |
| Technical feasibility | What equipment, raw materials, premises and skills are needed, and are they available? |
| Financial feasibility | How much start-up capital is needed, where will it come from, what is the break-even point, and when will the business make a profit? |
| Legal and organisational feasibility | Which registration, licences, quality approvals and tax obligations apply? Who will do what? |
| Social and environmental feasibility | Is the business acceptable to the community, and what are its effects on the environment? |
Only when every part gives an acceptable answer should the entrepreneur commit money. If one part fails, the idea is changed or dropped, which is the loop back to stage 1 of the entrepreneurial process (Unit 1).
Worked example 2: do the weights change the decision?
A member who likes idea B argues that capital is the club's biggest problem, so its weight should rise from 0.20 to 0.35, with demand falling from 0.30 to 0.15. Recalculate A and B.
New weights check: .
Interpretation: even with the new weights, A still leads (3.70 against 3.45). When a ranking survives a reasonable change of weights, the decision is robust and the club can be more confident in it. If a small change in weights had reversed the order, the club would need better evidence before choosing.
Warning
Common errors. (1) Mixing directions: scoring "capital needed" so that 5 means a lot of capital rewards the most expensive idea. (2) Weights that do not add up to 1. (3) Putting external factors (such as competitors) under weaknesses: a weakness is something inside the business. (4) Treating the highest score as proof: the matrix is only as good as the evidence behind each score.
Skillshare, "Conduct a SWOT Analysis for Your Small Business". Soap maker Holly Rutt works through a SWOT for her own business. Notice which points she puts inside (strengths and weaknesses) and which outside (opportunities and threats).
Practice
Key points
Further reading
Sources and credits
Written by Ganzaa: the Rwamagana club case, the scoring matrix, the SWOT grid, the tables, the worked examples and the practice items. The club, scores and figures are illustrative (2026).
This lesson adapts CC BY-SA material and is shared under CC BY-SA 4.0.
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