Introduction

Meaning of an Entrepreneur One who creates a new business in the face of risk and
uncertainty for the purpose of achieving profit and growth by identifying opportunities
and assembling the necessary resources to capitalize on them.

Characteristics of Entrepreneur

Desire to take initiative

Preference for moderate risk
Confidence in their ability to succeed
Self-reliance
Desire for immediate feed back

Benefits of Small Business

Create your own destiny

Make a difference
Reach your full potential
Earn impressive profits
Contribute to society and to be recognized for your efforts
Do what you enjoy and to have fun at it
Drawbacks of small Business

Uncertainty of income
Risk of losing your entire investment
Long hours and hard work
High level of stress
Complete responsibility
Difference between Entrepreneur and Manager
Entrepreneur
1 An entrepreneur sets up a new
enterprise or undertakes a venture
for action.
2 An entrepreneur assumes risk of
uncertainty involved in the
enterprise
3 The reward of an enterprise for his
risk bearing role is profits.
4 The entrepreneur applies innovation
from time to time in the enterprise
by adopting new technology.
5 An entrepreneur is his own boss and
enjoys an independent status as the
owner of the enterprise.
6 An entrepreneur needs qualities like
mission, creative thinking, risk
bearing ability.
Barriers of Entrepreneurship
Manager
A manager does not take a new venture
and renders services in an existing
enterprise
A manager does not assume or share any
risk involved in the enterprise.
The reward of a manger for rendering his
services is salary.
A manager simply keeps running the
enterprise on already established lines on
a routine basis.
A manager is a salaried person, he is
dependent on entrepreneur.
A manager needs distinct qualifications
such as knowledge of human behavior,
management theory etc.
 Lack of Market Knowledge
Lack of Technical Skills
Lack of business know how
Lack of Motivation
Lack of Time Management
Lack of attachment with business

Difference Between Entrepreneurship and Intrapreneurship

Entrepreneurship Intrapreneurship
1. An entrepreneur is an independent An intrapreneur is semi- dependent on
businessman the owner of the company
2. An entrepreneur himself raises the An intrapreneur uses the funds raised by
required funds his company
3. An entrepreneur bears full risks of An intrapreneur does not fully bear the
his business risk of the business
4. An entrepreneur operates from An intrapreneur operates within the
outside the organization organisation

Types of Entrepreneur

1) Innovate Entrepreneur
2) Technology Based Entrepreneur
3) Economic Based Entrepreneur
4) Market economy Based Entrepreneur
 1) Innovate Entrepreneur : Innovation means doing new things in a new way. It
is a way of production.

2) Technology Based : The use of new technology for the future growth
Entrepreneur of business.

3) Economic Based : Turn out of maximum at minimum cost is

Entrepreneur economic based entrepreneur.

4) Market Economy : It is based on market opportunities available to keep

Based Entrepreneur the organization constantly on the path of his
objective.

Entrepreneurial Motivation

Meaning of Motivation: means to induce people to act in a desired manner.

Objectives of Motivation

To attain a high level of efficiency.

To reduce employees turnover and absenteeism

To establish good relations.

To make good image of organization.

 To achieve the goals of the organization.

To satisfy needs of employees.

Problems in Motivation

Costly Effort

Trouble Making Employees

Motivation is an Internal Feeling

Opposition to Changes

Types of Motivation

Positive and Negative Motivation

Financial and Non-financial Motivation

Individual and Group Motivation

Entrepreneurial Training
 Meaning of Training: Training is the systematic instruction of staff at all levels in new
attitudes or new skills.

Methods of training

Individual Training In this a single person is selected for training

Group Training In this a suitable group of persons is selected for training.

Lecture Method- In this trainer communicates orally to train them and also
solve questions.

Demonstration Method- In this trainer give practical knowledge how to do it.

Meetings In this training involve a group of people who discuss the various
problems.

Principles of Training

Principle of need.

Principal of planning.

Principle of economy.

Principle of reward.

Principle of practical.

Principle of competition.

Franchising and the Entrepreneur

Franchising

Franchising is the door to expansion with minimal investment and minimal risk; to achieve
maximum outcome for any business.

Benefits of Franchising

Business system
Management training and support
Brand name appeal
Standardized quality of goods and services
National advertising program
Financial assistance
Proven products and business formats
Centralized buying power
Site selection and territorial protection
Greater chance for success
Drawbacks of Franchising

Franchise fees and profit sharing

Strict adherence to standardized operations
Restrictions on purchasing
Limited product line
Unsatisfactory training programs
Market saturation
Less freedom

Ownership
 There is no one best form of ownership.
The best form of ownership depends on an entrepreneurs particular situation.
The key to choosing a form of ownership understands how each forms
characteristics affect an entrepreneurs specific business and personal
circumstances.
Factors to Consider

Tax considerations
Liability exposure
Start-up capital requirements
Control
Managerial ability
Business goals
Management succession plans
Cost of formation

Forms of Ownership

Sole Proprietorship
Partnership
Corporation
S Corporation
Limited Liability Company
Joint Venture

The Corporation

A separate legal entity from its owners.

Types of corporations:

Domestic - a corporation doing business in the state in which it is

incorporated.
Foreign - a corporation chartered in one state and doing business in another
state. formed in another country but doing business in the United States.
Publicly held - a corporation that has a large number of shareholders and
whose stock usually is traded on one of the large stock exchanges.
Closely held - a corporation in which shares are controlled by a relatively
small number of people, often family members, relatives, or friends.

Advantages of the Corporation

Limited liability of the stockholders

Ability to attract capital
Ability to continue indefinitely
Transferable ownership

Disadvantages of the Corporation

Cost and time of incorporating

Double taxation
Potential for diminished managerial incentives
Legal requirements and regulatory red tape
Potential loss of control by founder(s)
Identification of New Opportunities

Selection of a Project

1. Project Cost
2. location or Site
3. Technology
4. Raw Material
5. Cheap labor Supply
6. Equipment
7. Marketing

Selection of a Product

1. Import Restrictions
2. Past Experience
3. Degree of Profitability
4. Facility of Concessions
5. Category Under Which Product Falls
6. Market of the Product
7. Product License
8. Ancillary Unit and Service Unit to the Major Industry

Checklist for Choosing Ideas of New Product

A. Fit with your Skills and Experience

B. Fit With the Market
 C. Fit with the Enterprise

What to do when Your Idea is rejected?

Give up and select a new idea.

Listen carefully, understand what is wrong, improve your idea and your
presentation, and try again.
Detailed Guidelines to Launch an Industry

1. Selection of Industry
2. Factory Accommodation
3. Registration
4. Machinery
5. Raw Materials
6. Finance
7. Technical Know-how
8. Standardization
9. Marketing
10. Export
11. Inventions
12. Training
13. Problems
14. Voluntary Organizations

What Is Law

-The collection of rules imposed by authority.

- Law is a rule of civil conduct, prescribed by the supreme power of a State

commanding what is right and prohibiting what is wrong.
Contract Law

An agreement creating and defining obligations between the parties.

Employment Law

Employment law covers all rights and obligations within the employer-employee
relationship -- between employers and current employees, job applicants, or former
employees

Important employee rights include:

Right to privacy
Right to be free from harassment.
Right to a safe workplace.
Right to fair wages for work performed.

Consumer Law

Consumer Law consists of regulations and statutes that seek to create a more equitable
balance for a buyer in the marketplace.

Sales Law

Law that regulates the transfer of business assets so that business owners cannot dispose of
assets in order to avoid creditors.