Presented to Sir Mushtaq khan Presented by Nimra irshad BSIT 4 TH Topic Entrepreneurship

Entrepreneurship –The process of seeking businesses opportunities under conditions of risk example: vocational courses Blue nail polish Microsoft

Entrepreneur One who accepts the risks and opportunities of creating, operating and growing a new business Someone who engages in entrepreneurship

What Is a “Small” Business? –A business that is independent (not part of a larger business) and that has relatively little influence in its market. Example: Microsoft corporation

Small Business Owner Does not always have growth of the business as a primary entrepreneurial goal Example: DELL computers Bob Knosp

Importance of Small Business The Importance of Small Business in the Economy –Job creation –Innovation –Contributions to big business

Job creation New jobs are also being created by small firms specializing in international business Small businesses certainly create many new jobs each year Entrepreneurial business success more than business size, accounts for most new job creation

Examples Small coffee coperation in Rawanda, 400 employee are there When Pizza hut, Kmart, Kfc, Taco Bell turns into global resturants

Innovation History has shown that major innovations are as likely to come from small businesses as from big businesses For example, small firms and individuals invented the personal computer and the stainless – steel razor blade, the transistor radio and the photocopying machine, the jet engine and the self developing photograph

They also give us the helicopter and power steering, automatic transmissions and air conditioning, cellphone, and the 19 cent ballpoint pen. Today, says the SBA, small business supply 55% of all “innovations” introduced into the American marketplace.

Example Invention of handheld device used for Gypsum

Contributions to big business The majority of dealership selling Fords, Toyotas and the Volvos are independently owned and operated. Small businesses provide big businesses with many of the services, supplies and raw materials they need. For example: Microsoft

Popular Areas of Small-Business Enterprise Major small-business industry groups: –Wholesaling –Finance and insurance –Services –Retailing –Construction –Manufacturing –Transportation

Wholesaling Small business owner often do very well in wholesaling A wholesale business buys products from manufacturers or other producers and then sells them to retailers Wholesalers usually buy goods in bulk and store them in quantity at locations that are convenient for retailers.

They also serve fewer customers than other providers usually those who repeatedly order large volumes of goods About 8% of businesses with fewer than 20 employees are wholesalers

Example Wholesalers in grocery industry, buy bulk food from companies like Del Monte and campbell.

Finance and insurance Financial and insurance businesses also comprise about 10% of all firms with fewer than 20 employees.

Example Local state farm mutual offices are small businesses state farm itself a insurance company but its local offices are run by independent agents in turn agent hire their own staff, run their own offices as independent business. They sell various state farm insurance products and earn profit from the premium paid by their clients.

Transportation Some small firms about 5% of all companies with fewer than 20 employees do well in transportation and transportation related businesses. Such firms include local taxi and limousine companies, charter air-plane services and tour operators

Manufacturing More than any other industry, manufacturing lends itself to big business and for good reason. Because of the investment normally required in equipment, energy and raw materials, a good deal of money is usually needed to start a manufacturing business.

Example Henery ford start a car company from scratch

Economy of scale Research has shown that manufacturing costs often fall as the number of units produced by an organization increases The relationship between cost and production is called an economy of scale Small organizations usually cannot compete effectively on the basis of economies of scale.

Construction About 10% of businesses with fewer than twenty employees are involved in construction. Many construction jobs are relatively small, local projects, local construction firms are often ideally suited as contractors.

Services They require few resourses, service businesses are the fastest- growing segment of small- business enterprise. 37.6% of all businesses with fewer than twenty employes are services Small business services range from shoeshine parlors to car rental agencies, from marriage counselling to computer software etc

Example Clinical services to companies Great clips

Retailing A retail business sells directly to consumers products manufactured by other firms There are hundreds of different kinds of retailers, ranging from wig shops and frozen yogurt stands to automobile dealership and department stores Retailing accounts for 22.7% of all businesses with fewer than 20 employes

Example Launched whole food

Entrepreneurial Characteristics –are resourceful. –are concerned for good customer relations. –desire to be their own boss. –can deal with uncertainty and risk. –are open-minded. –rely on networks, business plans, and consensus. –have different views on how to succeed, to automate a business, and when to rely on experience or business acumen.

Starting and Operating a New Business –Conveys a description of the business strategy for the new venture and how it will be implemented –A business plan should address: The entrepreneur’s goals and objectives The strategies that will be used to obtain them The implementation of the chosen strategies

Starting the Small Business Starting from Scratch –Disadvantage: Higher risk of business failure –Advantage: Avoids problems of an existing business Questions to Be Answered: –Who and where are my customers? –How much will those customers pay for my product? –How much of my product can I expect to sell? –Who are my competitors? –Why will customers buy my product rather than the product of my competitors?