Unit 4 Entreprenurial Skills

Unit 4:
Entrepreneurial Skills
Entrepreneur means the person who provides a service to society. In easy
words, you can say that entrepreneurs are the businessman. This does not
mean only big businessmen, an entrepreneur can be a small businessman too.
Their new idea of a product makes them different from the rest people.
Identify Various Types of Business Activities

A business enterprise is an endeavour to utilize economic resources and other
inputs to provide goods and services to customers and consumers in exchange
of money or other goods and services. The major types of business enterprises
are:
Types of business:
i. Service Industry: This enterprise provides intangible products like
professional expertise, skills, advice or training. This industry also
provides hospitality and medical services, e.g., hotels, restaurants and
multi-speciality hospitals and clinics.
ii. Manufacturing Industry: This industry utilizes crude products or other
raw materials with the intension of transforming them into a new
product.
iii. Merchandising: This business deals with wholesale buying and selling
of commodities. It sells a product without changing its existing form.
The business model is buying at a certain price in bulk quantity and
selling at a higher price.
iv. Hybrid Industry: This is where an industry combines its conventional
business model with other models in technology. Various components to
generate the same, but improved result. E.g., a restaurant combines
ingredients in preparing a fine meal (manufacturing), sells a cold bottle
of wine (merchandising), and fills customer orders (service).
Types of Businesses around Us

i. Sole Proprietor: You are the sole owner of your business and solely
responsible for its profit and loss. You start your business with your own
invested capital and you are alone the sole management of your
venture.
ii. Partnership: These models are made up of two or more people who
share all issues of profits, losses and decisions related to the venture.
iii. Company: This refers to a joint stock company where a number of
people invest capital (joint stoke) and are commonly known as
shareholders. They jointly share the profits as well as the financially and
legal liabilities of the firm. There are two forms namely:
a) Private Limited: - Where the joint owners are family relations or
closely related
b) Public Limited: - Where Stocks are sold in the market where
anybody can buy them.
iv. Franchises: - It involves using the business models of another
successful organization to create your own shop, restaurant or bakery.
E.g., Dominos Pizza Hut, Mac-Donald.
Entrepreneurship and Society

Entrepreneurs run their businesses in a market. The market has people who
buy products and services and people who sell them also. When people are
buying and selling from each other, it is helpful for everyone because everyone
involved makes money. This is how entrepreneurs help in growing the area
and society they live in.
What do entrepreneurs do when they run their business?
1. Fulfil Customer Needs

Demand means a product or service that people want. Entrepreneurs find out
what people want. Then, they use their creativity to come up with a business
idea that will meet that demand.
2. Use Local Materials

Entrepreneurs use the material and people available around them, to make
products at low cost.
3. Help Society
Entrepreneurs have a positive relationship with society. They make profits
through activities that benefit society. Some entrepreneurs work towards
saving the environment, some give money to build schools and hospitals. This
way, the people and area around them becomes better.
4. Create Jobs
With the growth of a business, entrepreneurs look for more people to help
them. They buy more material, and from more people. The also hire more
people to work for them. In this way, more people have jobs.
5. Sharing of Wealth
Wealth means having enough money to live a comfortable life. As
entrepreneurs grow their business, the people working for them and in related
businesses also grow. He have more money to live a better quality life.
6. Lower Price of Products

As more entrepreneurs sell the same product, the price of the product goes
down. For example, when more mobile phones were getting sold in India, the
cost of the phone became lesser.
Bharti, the Jewellery Queen (A Story)
Bharti is a young woman from Bihar. Many girls in her area like to wear
earrings. She buys jute from a farmer and makes earrings from that. Her
business is called Manavi Natural Handicrafts. She sees that most women in
her village do not work. So, she hires two women to help her. As her orders
increase, she buys more jute. She hires three more women to work for her.
The farmer, and the women working for her now earn more money.
Qualities and Functions of an Entrepreneur

Qualities of an Entrepreneur
1. You must believe in yourself. You should be CONFIDENT and take business
decision.
2. Keep TRYING NEW IDEAS. Like, Oh! That idea did not work. But, it is okay.
3. Running business is difficult. But, you need PATIENT because success will
come soon.
4. You need to have CREATIVE and different solution to the problem.
5. Take responsibilities of mistakes and work to make it better.
6. Take DECISIONS AFTER THINKING about whether they are good or bad for
your business.
7. WORK HARD because it is good for the company.
8. DO NOT GIVE UP. Stay positive because everything will be fine.
Functions of an Entrepreneur
1. MAKING DECISIONS An entrepreneur makes decisions every day. This

includes what to produce or sell, how much and where to sell.
2. MANAGING THE BUSINESS An entrepreneur plans the future of his or her

business. He/she arranges for raw material, hires people for work and tells
everyone what to do. They also check if the plan is being followed.
3. DIVIDE INCOME The entrepreneur divides the business money to any

groups .He/she spends money to buy material, pays rent of the building and
salaries to people.
4. TAKING RISK Risk is the chance of something going wrong. An

entrepreneur takes risks against fires, lost items and theft.
5. CREATE A NEW METHOD, IDEA OR PRODUCT An entrepreneur is always

trying new things. He/she does this to increase their importance and income.
Myths about Entrepreneurship
Misconceptions
1. The misconception is that every business idea needs to be unique or special.
2. The misconception we have is that a person needs a lot of money to start a
business.
3. A misconception we have is that only a person having a big business is an
entrepreneur.
4. A misconception we have is that entrepreneurs are born, not made.
Entrepreneurship as a Career Option
A career is a line of work that a person takes for life. There are two ways a
person can earn a living.
1. Self-employment
2. Wage employment
A person who becomes an entrepreneur goes through a career process. This

process is as follows:
1. ENTER
When an entrepreneur is starting, they are just entering the market to do
business.
For example, Sanjana is starting a small grocery store in a locality.
2. SURVIVE
There are many entrepreneurs in the market. The entrepreneur has to remain
in a competitive market.
For example, there are many other grocery stores in the area. Yet, Sanjana’s
store survives the competition and does well. She also expands the store to
two more floors.
3. GROW
Once the business is stable, an entrepreneur thinks about expanding his or her
business.
For example, after five years, Sanjana has opened a chain of four more
grocery stores in the same city. In the next two years, she plans to expand to
tow other cities.

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Unit 4:

Identify Various Types of Business Activities

Types of Businesses around Us

Entrepreneurship and Society

1. Fulfil Customer Needs

2. Use Local Materials

6. Lower Price of Products

Qualities and Functions of an Entrepreneur

1. MAKING DECISIONS An entrepreneur makes decisions every day. This

2. MANAGING THE BUSINESS An entrepreneur plans the future of his or her

3. DIVIDE INCOME The entrepreneur divides the business money to any

4. TAKING RISK Risk is the chance of something going wrong. An

5. CREATE A NEW METHOD, IDEA OR PRODUCT An entrepreneur is always

Entrepreneurship as a Career Option

A person who becomes an entrepreneur goes through a career process. This

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