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7/30/2019 Entrepreneur Unit 1
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Who is an Entrepreneur? Ship-
process, prise- organ An Entrepreneur is a person who
organizes and manages a businessundertaking, assuming the risk forthe sake of profit. Any person whostarts and operates a business is anentrepreneur.
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Entrepreneur:
Factors of Production
New Venture
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Eras ofEntrepreneur
Earliest period
Middle ages
17th century
18th century
19th
and 20th
century
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17th Century
Undertakers
Contracters
Eg. Soliders of fortune
Adventurers
Builders
Merchants Funeral directors
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18th Century
Richargs Cotillion
Entrepreneur Governments
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19th and 20th Century
Entrepreneur Manager
Planning
Controlling
Analysing interpreting
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Present Situation
Economist
Psychologist
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definitions
Knight 1921
Profits from bearing uncertainty and risk
Schumpeter 1934
carrying out of new combinations of firmorganization- new products, services, sources of
raw material
Cole 1959purposeful activity to initiate and develop a
profit oriented business
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Casson 1982 Decision and judgements about the co-
ordination of scarce resources
Gartner 1985 Creation of new organization
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Types of Entrepreneur
Necessity Entrepreneur
Work for invention only when there is a need.
Opportunistic Entrepreneur
look for oppor. Whether there is a need
of invention or not.
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Inventor and innovator
Inventor = person creates new thing
Innovator=brings something new in
business
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Dimensions of Entrepreneur
New Venture Creation
Resource- based theory
Intelligence Verses Business Success
Barriers to Entry
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Characteristics of Entrepreneur
Risk Taker
Businesses face risk. Entrepreneurs minimize risk through research,planning, and skill development.
limit to ever-expanding entrepreneurship
Perceptive
Entrepreneurs view problems as opportunities and challenges.
Curious
Entrepreneurs like to know how things work. They take the time andinitiative to pursue the unknown.
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Imaginative
Entrepreneurs are creative. They imagine solutions to problemsthat encourage them to create new products and generateideas.
Persistent
True entrepreneurs face bureaucracy, make mistakes, receivecriticism, and deal with money, family, or stress problems. Butthey still stick to their dreams of seeing the venture succeed.
Goal-settingEntrepreneurs are motivated by the excitement of staring a newbusiness. Once achieved, they seek out new goals or venturesto try.
Hardworking
Entrepreneurs need a great deal of energy to see a venture startand succeed. Yet they are not deterred by the long hours toachieve their goal.
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Self-confident
Entrepreneurs believe in themselves. Their self-confidence takescare of any doubts they may have.
Flexible
Entrepreneurs must be flexible in order to adapt to changing trends,
markets, technologies, rules, and economic environments.
Independent
An entrepreneurs desire for control and the ability to makedecisions often makes it difficult for them to work in a controlledenvironment.
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A skill is the ability to do something specific or to translate
knowledge into action.
Research Skills
Entrepreneurs need to identify what they need to know and use
research techniques to obtain it.
Gathering Information
Reliable and relevant sources of information may include
books
periodicals indexes and databases
the Internet
consul tants
professionals schoo ls
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Using Information
After information is acquired, it needs to be sorted into relevantdata that answers the entrepreneurs initial questions. Thesequestions may lead the entrepreneur to look at new ventures.
Management Skills
Management skills for entrepreneurs involve planning,
organizing, directing, and controlling. These are then appliedtowards their personal, financial, and material goals.
Planning
Entrepreneurs develop financial, production, and marketingplans that comprise the overall business plan.
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Organizing
Organizing the venture is vital. The key to this is time-management.
Directing
Entrepreneurs learn how to motivate their staff by
encouraging initiative and self-direction. This inspires asense of shared responsibilities to grow the business.
Controlling
Entrepreneurs need to develop budgets and keep accuratebookkeeping and accounting records.
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Entrepreneurial Skills
Relationship Skills
Running a business means building good relationships with staff,suppliers, and customers.
Staff Relationships
Employees need to feel that they are treated fairly, are rewarded fortheir efforts, and have their needs met.
Supplier Relationships
Communication is the most important relationship skill required to dealwith suppliers. They act as sources of information for the new business.Suppliers also require feedback to know how to improve their service.
Customer Relationships
In an entrepreneurial business, the customer is the boss and the keyto the business success. Therefore, the entrepreneur and his or herstaff must develop a positive relationship with the customer.
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An entrepreneur must develop a good business plan that
is feasible, marketable, and profitable. Key points are below.
Feasibility
Finances list the amount required
in a budget including the sourceof capital (bank, credit union, and so on)
Location explain the location outlining
the details (address, rent, taxes, and so on)
Licences and permits list the licences or
permits and state how to obtain them
Suppliers make a list of everything
required including the name of the
suppliers and their prices and terms
Staff describe staffing needs and ways to meet them
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Marketability
Entrepreneurs need to ask themselves the following questions about theirproduct, service, or charity:
Does your target market want this product? Prove it.
What is you competition? How much of the market do they ownalready? How will you take it away from them?
Are you competitively priced?
Is this a short-term venture? How long will it last?
What do you offer that no other product, service, or charity offers?Why would a customer pay money for what you provide?
Profitability
To expect a profit, an entrepreneur must ensure that revenue exceeds allcosts. Listing expected revenue and expenses can help to achieve this.