What Is Entrepreneurship? By: Jaleesa Meredith

Differences between Employees and Entrepreneurs  Most Americans earn money by working a business  A business is the buying and selling of products/services  All employees do not own a business, they work for others  Some people start their own business and work themselves  Entrepreneurs often are owners and employees  After expenses and taxes have been paid that’s the profit  Success/failure is the owners responsibility

Think Like an Entrepreneur  Employees notice (and often promote) employees who think entrepreneurially.  Never stop learning.  If you give starting a business a try, you’ll learn valuable skills.  Entrepreneurs do three important things: listen, observe, and think.

Big and Small Business  “big bus.” – having more than 100 employees, selling than $1 million worth of products or services in a year  Small businesses run must of the world  Baby-sitting and a neighborhood restaurant are small business  Principles involving in running a large company and small are the same

A Business Must Make a Profit to Stay in Business  Make profit to stay “in business”  Amount of money coming in must be greater than the amount of money required to pay the bills  Ventures do lose money after start-up  Businesses who aren’t profitable will close and won’t have money to pay the bills  Closing a business is nothing to be ashamed of  If the venture isn’t making money/profit, you may be in the wrong business  “creative destruction” – Joseph Schumpeter

Profit Is the Sign that the Entrepreneur Is Adding Value If a business is making profit, then clearly the entrepreneur is doing something right. Profit is usually a sign that the owner has added value to the “scarce” which is limited resources. Resources are items that can be used to make something else or to fill a need. Examples: Oil is used as fuel. Wood is used to make a house, table, and/or paper.

The Economic Questions  What should be produced?  How will it be produced?  Who gets to have what is produced?

Voluntary Exchange This exchange is between two owners/parties. You don’t have to trade but you can if you’re interested. Voluntary exchange is when parties trade money for a product or service because they believe it will benefit them in the long run.

Benefits of Free Enterprise People benefit from free enterprise when a business lowers their prices, so that the consumer can get what they need at a lower price. This stirs up competition for the businesses, as they want profit too. Depending on the resource, the business can get customers, lower the price, and still make a profit.

Entrepreneurs View Change as Opportunity Automobile manufactures usually find it hard to see change as an “opportunity”. Since everyone has an automobile, they can’t send the “change” message out to everyone and still benefit from it. Whereas small businesses can because they have a small networking system and it won’t be as difficult.

Why Be an Entrepreneur? Disadvantages Advantages  Business failure  Obstacles  Loneliness  Financial insecurity  Long hours/hard work  Control over time  Creative, fulfilling life  Opportunity to create great wealth  Control over compensation  Control over working conditions  Self-evaluation  Participation in an international community  Opportunity to help one’s community

Ownership Is the Key to Wealth Being an entrepreneur can better your life. Depending on how you operate your business, you can move up the ladder to success in no time! In the corporate world, some people’s salary isn’t just profit. It’s also stocks. Basically, you become part-owners.

Living a Life You Will Love Once you become an Entrepreneur, you will gain wealth, influence many people around the globe, and have control.

Vocabulary  Business The buying and selling of goods and services in order to make a profit  Capital Money or property owned or used in business  Capitalism The free-market economic system; anyone with the “capital” is free to start a business  Economy The financial structure of a country or other area that determines how resources and wealth are distributed  Employee Person hired by a business to work for wages, salary, or commission  Entrepreneur Person who organizes and manages a business, assuming the risk for the sake of the potential return  Free enterprise system Economic system in which businesses are privately owned and operate relatively free of government interference  Profit The sum remaining after all costs are deducted from the income of a business  Resource Supply of something; a source, either natural or intellectual  Voluntary exchange Mutually agreed-on business transaction