Entrepreneurship Development Program- American Center

Business Idea Screening Template

Sample

First Screening
Name of the Business Idea: __________

Statement/Question Answer Insights/opinion

Low Potential Moderate High

Potential Potential

-1 0 +1

Part 01: Strength of the Business Idea

i Ability to solve the problem or Weak Moderate High

fill the gap

ii Timeliness of entry to the market Not timely Moderate High timely

timely

iii The uniqueness of the idea Not unique Moderately Highly

unique unique

iv The degree to which the idea Substantial Moderate Minor or No

requires customers to change changes req: changes req: changes req:

their basic practices or behavior

v The extent to which the idea” Low Medium High

adds value” for its buyer or end-
user

Part 02: Marketing Aspects

i Number of competitors in the Many Few Non

target market

ii The growth rate of competitive Little or no Moderate Strong

firms in the target market growth Growth growth

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iii Average net income for firms in Low Moderate High
the target market

iv The degree to which customers Satisfied Neither Unsatisfied

feel satisfied by the current satisfied nor
dissatisfied
offerings in the target market

v Identification of the target Difficult to May be able Identified

market identify to identify

vi The growth rate of the industry Little or no Moderate Strong

growth Growth growth

vii Ability to create barriers to entry Unable to create May or may not Can create
be able to create
for potential competitors

viii The purchasing power of Low Moderate High

customers

ix Ease of making customers aware Low Moderate High

of the new product or service

x The growth potential of the Low Moderate High

target market

Part 03: Operational Aspects

i Competencies in the operational Low Moderate High

technology

ii Strength of the supply chain- Poor Moderate High

Material

iii Ability to find the required Low Moderate High

workforce

iv Cost of production (compare to High Similar Low

industry average)

v Competencies on R&D and Low Moderate High

Innovations

vi Ability to maintain the required Low Moderate High

quality and standard

vii Ability to find a proper location Low Moderate High

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viii Ability to keep the optimal Low Moderate High
capacity

ix Technical know-how Low Moderate High

x Flexibility to the operational Low Moderate High

changes

Part 04: Managerial Aspects

i Passion for the business idea Low Moderate High

ii Self-confidence Weak Moderate Strong

iii Experience in the industry No experience Moderate Experienced

experience

iv Prior entrepreneurial experience None Moderate Extensive

v Knowledge and skills related to No Moderate Have

the business

vi Depth of professional and social Weak Moderate Strong

networks

vii Creativity among management Low Moderate High

team members

viii The extent to which the proposed Weak Moderate Strong

business meets the founder’s
personal goals and aspirations

ix Time availability to commit with No or not much Moderate Have

business operations

x Support of the family members No or not much Moderate Have

Part 05: Financial Aspects

i Initial capital investment High Moderate Low

ii Number of revenue drivers One Two to More than

Three Three

iii Ability to meet the BEP Very Hard Moderate Easy

iv Payback period of similar Not fair Moderate Fair

businesses

(Compared to investment)

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v Cost of capital of initial Very high Moderate Fair or Low
investment

vi Financial risk Very high Moderate Fair or Low

vii Ability to meet the expected Very Hard Moderate Easy

turnover

viii Ability to achieve the expected Low Moderate High

gross profit

ix Ability to achieve the expected Low Moderate High

net profit

x ROI of similar businesses Not fair Moderate Fair

Part 06: Other

i National/Government support Low Moderate High

ii Global support Low Moderate High

iii Potential to enter into the global Low Moderate High

trade

iv The complexity of the approvals High/Unnecessary Moderate Fair

and licensing process

v Tax benefits Low Moderate Many

vi Other

Source: Compiled by the author based on literature

Note: Use the same template for evaluating all the ideas. Otherwise, the overall potential
cannot be compared.

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