Entrepreneur, Role and Characteristics, Challenges, Reasons of failure and Impact on country's economy

ROLE OF ENTREPRENEUR

·         An entrepreneur is one who has;

·         A new and unique idea for a new business

·         Invests some of its own investments and savings

·         Accepts the responsibility of management

·         Accepts the possible risk of failure

CHARACTERISTICS OF A SUCCESSFUL ENTREPRENEUR

·         Innovation

·         Commitment and self-motivation

·         Multi-skilled

·         Leadership skills

·         Self-confidence and ability to bounce back

·         Risk taking

MAJOR CHALLENGE FACED BY ENTREPRENEUR

Identifying successful business opportunity

A new idea can come from;

·         Own skills or hobbies

·         Previous employment skills

·         Franchising conferences and exhibitions

·         Small budget market research

 Sourcing capital (finance)

·         This tops in the difficulty level for entrepreneurs

·         Lack of sufficient own finance

·         Lack of awareness of financial support and grants available

·         Lack of keeping accounts

·         A poorly produced business plan

Determining a location

·         A good location costs more

·         It increases overhead expenses

·         Chances of success increase but break-even level increases too

Operating from home is the most common way but has following drawbacks

·         It is away from main business areas

·         It lacks status

·         It may cause family tension

·         It is difficult to separate personal and professional life

Competition

Unless the business idea is unique they have to face a very fierce full competition

Building a customer base

This can be done by

·         Providing personal customer care

·         Knowledgeable pre and after sales service

·         Providing one off customer requests that larger firms may be reluctant to provide

REASONS FOR FAILURES

Lack of record keeping

Lack of cash and working capital

They should

·         Construct a cash flow

·         Inject sufficient capital

·         Establish good relations with banks

·         Use effective credit control over customers’ account

Poor management skills

This mainly includes

·         Leadership skills

·         Cash handling and cash management skills

·         Planning and coordination skills

·         Decision making skills

·         Communication skills

·         Marketing, promotion and selling skills

Changes in the business environment

This may turn a venture from a successful one to a loss making enterprise

·         New competitors

·         Legal changes

·         Economic changes

·         Technological changes

COMMON TYPE OF ENTREPRENEURIAL BUSINESSES

·         Primary sector

Fishing, gardening etc

·         Secondary sector

Jewellery making, dress making,

·         Services sector

Hairdressing, car repairs, restaurants

IMPACT OF ENTERPRISE ON COUNTRY’S ECONOMY

·         Employment creation

·         Economic growth

·         Firm’ survival and growth

·         Innovation and technological changes

·         Exports

·         Personal development

·         Increased social cohesion