Introduction to Entrepreneur and Entrepreneurship and Business Plan

Writing Business Plan, Marketing Research for the New Venture, Introduction to Entrepreneur and Entrepreneurship and Business Plan, Introduction to Entrepreneur and Entrepreneurship and Business Plan

To an economist, an entrepreneur is one who brings resources, labor, material, and other assets into combinations that make their value greater than before and also one who introduces changes, innovations, and a new order.

Entrepreneurship is the dynamic process of creating incremental wealth. The wealth is created by individual who assume the major risks in terms of equity, time, and or career commitment or provide value for some product or service. The product or service may or may not be new or unique, but value must somehow be infused by the entrepreneur by receiving and locating the necessary skills and resources.

Introduction to Entrepreneur and Entrepreneurship

Entrepreneurship is the process or creating something new with value by devoting the necessary time and effort, assuming the accompanying financial, psychic, and social risks, and receiving the resulting rewards of monetary and personal satisfaction and independence.

Characteristics of Successful Entrepreneur

  • Communication Skill
  • Ability to plan
  • Marketing skills
  • Interpersonal skills
  • Basic management skills
  • Leadership skills
  • Initiative
  • Creative
  • Profit potential
  • Information seeker
  • Quality conscious
  • Positive thinker
  • Self-determent
  • Self-motivated

Functions of Entrepreneur

  • Innovation
  • Risk bearing
  • Uncertainty
  • Organization building
  • Perceiving marketing opportunities
  • Purchase inputs
  • Marketing the products
  • Managing human relations with the firms
  • Industrial engineering  

The Entrepreneurial Decision Process

Though many individuals have creative new ideas, few can bring their ideas to the market and create new venture.

Millions of ventures are formed despite recession inflation, high interest rates, lack of infrastructure, economics uncertainty, and the high probability of failure.

Each venture is formed through a very personal human process that, although unique, has some characteristics common to all.

While some ventures result from specific circumstances many entrepreneurs follow the entrepreneurial decision process which helps to direct and show the direction from something to something. 

Role of Entrepreneurship in Economics Development

The role of entrepreneurship in economics development involves more than just increasing per capita output and income; it involves initiating and constituting change in the structure of business and society.

This change is accompanied by growth and increased output, which allows more wealth to be divided by the various participants.

Product-Evolution process: process for developing and commercializing an innovation

Iterative synthesis: The intersection of knowledge and social need that starts the product development process.

Ordinary innovation: new products with little technological change

Technological innovations: New products with significant technological advancement

Breakthrough innovations: new products with some technological change

Government as an innovator: A government active in commercializing technology

Technology transfer: Commercializing the technology in the laboratories into new products. 

Intrapreneurship

Intrapreneurship (entrepreneurship within an existing business structure) can also bridge the gap between science and the marketplace.

Existing businesses have the financial resources, business skills, and frequently the marketing and distribution system to commercialize innovation successfully.

Corporations recognizing these inhibiting factors and the need for creativity and innovation have attempted to establish an intrapreneurial sprit in their organizations.

Entrepreneurship

The third method for bridging the gap between science and the marketplace is via entrepreneurship. Many entrepreneurs have a difficult time bridging this gap and creating new ventures. They may lack managerial skills, marketing capabilities, or financial resources. Their inventions are often unrealistic requiring significant modification to be marketable.

Entrepreneurship is the most effective method for bridging the gap between science and the market place, creating new enterprises, and bringing new products and services to the market.

Ethics and Social Responsibilities of Entrepreneurs

The life of the entrepreneur is not easy. An entrepreneur must take risk with his or her own capital in order to sell and deliver products and services while expending greater energy than the average businessperson in order to innovate.

A managers attitudes concerning corporate responsibility are related to the organizational climate perceived to be supportive of laws and professional codes of ethics.

Entrepreneur tends to depend on their own personal value systems much more than other managers when determining ethically appropriate course of action.


Business Plan for a new Venture- introduction

A good business plan must be developed in order to exploit the defined opportunity this is very time consuming phase of the entrepreneurial process. An entrepreneur usually has not prepared a business plan before and does not have the resources available to do a good job.

Business Plan

What is Business Plan?

The business plan is a written document prepared by the entrepreneur that describes all the relevant external and internal elements involved in starting a new venture. It is often an integration of functional plans such as marketing, finance, manufacturing, and human resources.

If we think of the business plan as a road map, we might better understand its significance.

A business plan is a formal statement of business goals, reasons they are attainable, and plans for reaching them. It may also contain background information about the organization or team attempting to reach those goals.

Who should write the plan?

The business plan should be prepared by the entrepreneur, however, he or she may consult with many other sources in its preparations.

Scope and Value of the Business

The business plan may be read by employee's investors, bankers, venture capitalists, suppliers, customer's advisors, and consultants.

Each and every groups reads the plan for different purposes, the entrepreneur must be prepared to address all their issues and concerns. In some ways, the business plan must try to satisfy the needs of everyone; where as in actual marketplace the entrepreneur's product will be trying to meet the needs of selected groups of customers.

There are three perspective that should be considered in preparing the plan.

First is the perspective of entrepreneur, who understands better than anyone else the creativity and technology involved in the new venture.  The entrepreneur must be able to clearly articulate what the venture is all about.

Second is the marketing perspective. Too often, an entrepreneur will consider only the product or technology and not whether someone would buy it. Entrepreneur should try to view his or her business through the eyes of their customer. 

Third, the entrepreneur should try to view his her business through the eyes of the investor. Financial projection is required.

The business plan is valuable to the entrepreneur, potential inventor, or even new personnel, who are trying to familiarize themselves with the venture, its goals, and objectives. The business plan is important to these people because

Helps to determine the viability of the venture in a designated market.

Provides guidance to the entrepreneur in organization for planning activities.

Serves as an important tool in helping to obtain financing.

Writing Business Plan

The business plan could take hundreds of hours to prepare, depending on the experience and knowledge of the entrepreneur as well as the purpose it is intended to serve. It should be comprehensive enough to give any potential investor a complete picture and understanding of the new venture and will help the entrepreneur clarify his or her thinking about the business. 

Introductory Page: This is the title or cover page that provides a brief summary of the business plan's contents.

Executive Summary:  This section of the business plan is prepared after the total plan is written. About two or three pages in length the executive summary should stimulate the interest of the potential investor. This is very important section.
Etc…

Marketing Plan

It describes about market condition and strategy related to how products and services will be distributed, priced, and promoted. Marketing research evidence to support any of the critical marketing decisions strategies as well as for forecasting sales should be described in this section specifies forecasts for products or services are indicated in order to project profitability of the venture.

Marketing Research for the New Venture

Information for developing the marketing plan may necessitate conducting some marketing research. Marketing research involves the gathering of data in order to determine such information as who will buy the products or services.

What is the size of potential market, what price should be charged, what the most appropriate distribution channel is and what the most effective promotion strategy is?

Marketing research may be conducted by the entrepreneur or by an external supplier or constant. There are also opportunities for entrepreneurs to contact their local colleges or universities to identify faculty who teach marketing and are willing to have external clients for student's research projects

There are different stages J
  • Defining the purpose or objectives
  • Gathering data from secondary sources
  • Gathering information from primary sources
  • Analyzing and interpreting the results

Characteristics of marketing plan

The marketing plan should be designed to meet certain criteria. Some important characteristics that must be incorporated in an effective marketing plan re as follows.
  • It should provide a strategy for accomplishing the company mission or goal
  • It should be based on facts and valid assumptions. It must provide for the user of existing resources. 
  • Allocation of all equipment's, financial resources, and human resources must be described.
  • An appropriate organization must be described to implement marketing plan.
  • It should provide for continuity so that each annual marketing plan can build on it, successfully meeting longer-term goals and objectives.
  • It should be simple and sort, a voluminous plan will be placed in a desk drawer and likely never used. 

Steps in Preparing Marketing Plan

  • Defining the business situation
  • Defining the target market opportunities and threats
  • Considering strengths and weaknesses
  • Establishing goals and objectives
  • Defining marketing strategy and action programs


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