Entrepreneurship | Form One Business Studies | Secondary School

i. Creation of employment- jobs are created which help in absorbing people who would otherwise have been jobless
ii. Formation of capital- Profit earned may be used to expand the business, even to start other businesses or used as wages for employees
iii. Raising standards of living- wages and salaries paid to employees enable them to acquire goods and services
iv. Encourages the use of local resources- makes it possible to use/exploit local resources
v. Improving infrastructure- businesses existence in the economy makes the government establish or improve infrastructure
vi. Savings on imports- Local entrepreneurs are able to produce goods and services that are a substitute to imports
vii. Promotion of technology/promotion of innovation, research and development
viii. It contributes to government revenue- Taxes and fees paid by entrepreneurial ventures constitute part of government revenue

a) Desire to achieve- wishes to excel and has the drive to succeed while competing with others
b) Ability to solve problems- struggle with determination to get solutions even under difficult situation
c) Risk taker- They take viable business ventures even when they are not sure of the returns
d) Initiative - is aggressive in implementing ideas well ahead of other businesses so that he/she can be ahead of them
e) Time consciousness- uses time wisely and avoid wasting it
f) Creativity and innovation- able to generate new ideas and know when to implement them
g) Persistence and patience- should not give up when challenges arise
h) Decisive- have strong problem, solving and decision making skills

- It indicates among other things:
a) The products to produce/sell
b) Who the business will sell to (market)
c) Where the business will be located

Sources of Business Ideas

i. Newspapers
ii. Shows and exhibition
iii. Magazines and journals
iv. Hobbies
v. Vocational training and experience
vi. Surveys and market research
vii. Listening to what people say
viii. Identifying a market gap (niche)
ix. Copying/improving an existing business
x. Engaging with other people in a discussion

- A business idea becomes a business opportunity if it is viable
- A business opportunity is a favourable chance that an entrepreneur accepts for investment and exists where there is a gap in the market.

1) In availability of products
2) Poor quality products
3) Insufficient quantities
4) Business Resources
5) Unaffordable prices
6) Poor services

Evaluating a business opportunity

- Assessing whether the identified opportunity is viable or not
Factors to consider when evaluating a business opportunity

i. Availability of market for the product
ii. Technology - availability of technology to be used in production.
iii. Availability of raw materials and other resources
iv. Government policy - consider the requirements of the government before starting a business
v. Amount of capital required
vi. Profitability of the business
vii. The break-even period - How long the business can take to support itself
viii. Level of competition
ix. The risks involved in starting the business

- A written document that highlights the objectives of the business and steps to be followed in order to achieve these objectives. It indicates where the business is, where it wants to move to, how and when.

a. Name of the business
b. The product to be sold or produced
c. Personnel to manage the business
d. Amount of finance and other resources required
e. The market to be served (customers)
f. Types of employees required
g. Projection (level of achievement in future in terms of profit)
h. Summary of the plan.

1. Mistakes can be identified and avoided
2. Business strengths and weaknesses can be identified where necessary actions taken early enough for the weaknesses identified.
3. Financial institutions such as banks may require business plan for financing considerations
4. Helps determine on the resources required and plan how and where to use them.
5. Helps an entrepreneur assess the progress and any deviation from the original and intended plan can be corrected in good time.
6. Helps the entrepreneur to be fully aware of the market she or he plans to operate in, understand important trends and know who her/his competitors are and their strengths and weaknesses.
7. Upon communication to employees, it can be a motivating factor to them.
8. It highlights the room needed to accommodate any changes when necessary.

- Conditions or factors which may encourage or discourage entrepreneurship
i. Government policy - favourable government policies encourage entrepreneurship while unfavourable government policies discourage entrepreneurship
ii. Infrastructure - Availability of good infrastructure tends to encourage people to set up businesses while poor infrastructure tends to discourage them
iii. Levels of education and skills - Relevant and appropriate knowledge and skills are necessary if the business has to succeed
iv. Availability of markets - Adequate markets encourages existing entrepreneurs to continue producing and also encourage/attract new ones to venture into business.
v. Availability of resources - Appropriate resources are necessary for starting and smooth running of a business e.g human, capital, technology
vi. Cultural and social beliefs and attitudes - These are norms, values and beliefs of a given community.
vii. Competition - Businesses will do well if they are able to complete favourably.
viii. Political stability - political stability gives conducive atmosphere for businesses to start and thrive.
ix. Natural factors - natural factors influence the type of businesses that are carried out in an area especially agricultural activities

- A business is considered as being successful if it makes consistent profit and experiences progressive growth in the scale of its operations

(i) Right choice of business
(ii) Proper managerial skills- in activities such as hiring, assigning duties, supervising, training and motivating employees.
(iii) Proper location/availability of customers - convenience of business to employees.
(iv) Adequate finance/capital
(v) Lack of competition
(vi) Commitment to business
(vii) Proper financial management