Entrepreneurial Determinants of Opportunity Recognition Among the Dairy Farmers Within Makueni County, Kenya

Abstract

In the process of entrepreneurship, recognition of opportunity being the first stage is an important and unique entrepreneurship element. Although different studies on entrepreneurial opportunity have been done, the dilemma in line with recognition of opportunity is still there and there exists disagreements amongst scholars on how one recognizes an opportunity and converts it into a new business venture thus making the studies inconclusive. The study aimed at establishing the entrepreneurial determinants of opportunity recognition in the dairy sector in Makueni County. The study was grounded on Kirzenian theory and institutional theory. For the research design, a descriptive research design was used. The study population included of all the players in dairy sector in Makueni County. Simple random sampling technique was adopted to sample 100 respondents from the 3000 which was the target population. Primary data was gathered directly from respondents using a questionnaire. The collected data was analyzed using factor analysis. The study found that the data collected can be reduced to four factors. These factors were prior knowledge, entrepreneurial cognition, social networks and entrepreneurial alertness. Out of the factors that were generated from the factor analysis is a factor that represented the dependent variable which was opportunity recognition. The results also showed that all the variables positively correlated with opportunity recognition i.e. prior knowledge positively correlated with opportunity recognition (r=0.253), entrepreneurial cognition also positively correlated with opportunity recognition (r=0.666). The results also showed that Social networks positively correlated with opportunity recognition (r=0.481) and also entrepreneurial alertness correlated positively with opportunity recognition (r=0.558). The study concluded that determinants of opportunity recognition in the dairy industry are classified into four factors, entrepreneurial alertness, social networks, entrepreneurial cognition, and prior knowledge and these four factors correlated positively with opportunity recognition. These results agreed with those of Hashemzehi et al (2013) who found entrepreneurs social network and alertness and prior knowledge of the entrepreneur to be determinates of opportunity recognition. The results were also line with Greccu (2014) who established networks formed within the entrepreneurs and the entrepreneur themselves were determinants of opportunity recognition. The findings also agreed with Wang, Ellinger and Jim Wu (2013) who identified some determinants of recognizing opportunity as social network and prior knowledge. Lim & Xavier (2015) also found entrepreneurial alertness, social network and prior knowledge and to be determinants of opportunity recognition.