Jatiya Kabi Kazi Nazrul Islam University

Trishal, Mymensingh.

Assignment on: Question of 1st Three Chapter

Course Name: Entrepreneurship Development and Small Business Management
Course Code: HRM-302
Submission Date: 3 December, 2022
Submitted to
Razuan Ahmed Shuvro
Associate Professor
Dept. of Human Resource Management
Jatiya Kabi Kazi Nazrul Islam University

Submitted by
Team: 4 (Seahawks)
Students of
Dept. of Human Resource Management
Jatiya Kabi Kazi Nazrul Islam University
 Table of Content
Serial Name Roll Question
No:
1. Farzana Aktar Zarna 20133035 1. What Is Entrepreneurship?
2.Characteristics of
entrepreneurship

2. Abu Sufian 20133033 3.Functions of entrepreneurship

4.Importance of
entrepreneurship
3. Md. Nur Uddin 20133030 5.Classification of
Entrepreneurship
6.Classification of Entrepreneur

4. Md. Fuad 20133037 7.Characteristics of an

entrepreneur
8.Qualities of an entrepreneur

5. Md. Tanvir Hasan 20133035 9.Definition of Small businesses

10. Characteristics of Small
business
11. Small Businesses Importantce

6. Omar Faruk Rifat 20133029 12.Definition of environment

Definition of environment

7. Foyjur Rahman 20133032 13.Environment for

Bhuiyan Entrepreneurship

8. Md. Samiul Islam 20133031 14.Difference between

entrepreneur and manager

9. Md. Safaat Jamil 20133036 15.Reason Behind Failure of

Small Business
 1. What Is Entrepreneurship?

Ans: Entrepreneurship refers to the process of creating something new and bearing any of its
risks, adding value with the view of making the profit.
It’s an innovation process that means to initiate something.
In the field of economics, the term entrepreneur is used for an entity which has the ability to
translate inventions or technologies into products and services.

2. Characteristics of entrepreneurship
There are some important characteristics of entrepreneurship as follows:
1.Innovation Process;
2.High Achievement Motivation;
3.Transformational Process;
4.Organization Building Activity;
5.Rewarding Activity;
6.Wealth Creating Process;
7.Social Decision making;
8.Managerial Skills & Leadership.

1.Innovation Process: An innovation process is a set of steps between an idea's conception and
its implementation. It is a streamlined process that is managed in a way that reflects a company's
structure and innovation goals.
2.High Achievement Motivation: People who are high in achievement motivation are good at
delaying immediate gratification and instead focus on longer-term goals. They also like having
control over the tasks they work on, so they can feel a sense of personal satisfaction when they
do a good job. So, to become a successful entrepreneur, one must have high achievement
motivation.

3.Transformational Process: Transformational entrepreneurship refers to a capability and an

intended action towards creating change in the life of an entrepreneur and organization which
contributes to societal changes and is characterized by the emergence of a new qualitative
dimension of possibilities
4.Organization Building Activity: Entrepreneurship is an organization building activity. It’s
a managerial skill to create new organizations. To create new organizations, a person should
have the intension to create something new, to start up & this is called entrepreneurship.

5.Rewarding Activity: Entrepreneurship is rewarding and therefore, people engage in

entrepreneurial activities. This reward can be monetary or non-monetary.
Monetary rewards motivate employees to perform at their best and strive to achieve both
company and individual goals. Company owners and managers should make sure that rewards
are achievable and that product quality is not sacrificed.
Examples: Giving Bonus, contests for cash prizes, profit sharing and piece rates, pay rises etc.
Non-Monetary incentives are non-cash perks or benefits provided by an employer to an
employee.
Examples of non-monetary incentives include extra time off, work flexibility, and experiential
rewards.

6.Wealth Creating Process: Entrepreneurship is a wealth creating process. One cannot create
wealth by just earning more money. You have to invest your savings to create a parallel stream
of income. This process of investing your saved money to grow your wealth by choosing
investments that align with your financial goals is called wealth creation.
7.Social Decision Making: Entrepreneurship is that form of social decision making performed
by economic innovators. Entrepreneurship is an act of economic activity engaged in innovation.
social orientation of entrepreneurship as it is involved with social good and welfare.
8.Managerial skills and Leadership: These skills are very important for an entrepreneur.
Management and leadership skills are often used interchangeably as they both involve planning,
decision-making, problem-solving, communication, delegation, and time management. Good
managers are almost always good leaders as well.
 3. Functions of entrepreneurship:

Innovation: Innovative entrepreneurship is the practice of establishing creating new business

ideas intending to generate profit, assist their community and accomplish company goals.
Innovative entrepreneurs develop business models to identify to meet the needs of an
organization and improve their competitiveness in the market.
Taking initiative: A sense of initiative and entrepreneurship is the ability to turn ideas into
action through creativity, innovation, and risk-taking, as well as the ability to plan and manage
projects.
Organizing resources: Organizing involves assigning tasks, grouping tasks into departments,
delegating authority, and allocating resources across the organization. During the organizing
process, managers coordinate employees, resources, policies, and procedures to facilitate the
goals identified in the plan.
Opportunity and prospects:
Entrepreneurial opportunity is the point at which identifiable consumer demand meets the
feasibility of satisfying the requested product or service. In the field of entrepreneurship, specific
criteria need to be met to move from an idea into an opportunity.
Risk taking: Risk-taking in entrepreneurship is the process of identifying, evaluating,
mitigating, and trying out potential opportunities and strategies that may help you build or grow
your business but could also lead to personal or professional loss.
Technology transfer and adoption:
Technology transfer is the movement of data, designs, inventions, materials, software, technical
knowledge or trade secrets from one organization to another or from one purpose to another. The
technology transfer process is guided by the policies, procedures and values of each organization
involved in the process.
Decision making:
The entrepreneurial decision-making framework depicts two interlayered processes that happen
concurrently and synergistically when entrepreneurs are faced with making a decision: the
physical decision-making process of RPD and the mental decision-making process of EM.
Public relations:
Public relations are a valuable tool in the promotional mix. Unlike paid marketing programs such
as advertising your business, public relations are focused on earned media and can take
advantage of unpaid communication channels. Public relations are about managing perceptions –
how people think about your business.
 4. Importance of entrepreneurship:
Assist in economic growth: Entrepreneurs are important to market economies because they can
act as the wheels of the economic growth of the country.
By creating new products and services, they stimulate new employment, which ultimately results
in the acceleration of economic development. So public policy that encourages and supports
entrepreneurship should be considered important for economic growth. 
A large number of new jobs and opportunities are created by entrepreneurship. Entrepreneurship
creates a huge amount of entry-level jobs that are very much important to turn unskilled
jobholders into skilled ones. It also prepares and provides experienced workers to large
industries. The increase in the total employment of a country largely depends on the rise of
entrepreneurship. So, the role of entrepreneurship in creating new job opportunities is huge. 
By bringing innovation to every aspect of businesses, entrepreneurial ventures enhance
production utilizing the existing resources in the most effective ways. Entrepreneurs develop
new markets by introducing new and improved products, services, and technology. Thus, they
help generate new wealth and add more to the national income. So, the government can offer the
citizens more national benefits.
Promotes innovation: Through the right practices of research and development, entrepreneurs
bring new innovation that opens the door of new ventures, markets, products, and technology.
Entrepreneurs have a role to play in solving problems that existing products and technology have
not yet solved. So, by producing new products and services or bringing innovation to existing
products and services, entrepreneurship has the potential to improve peoples’ lives.
The ripple effect: A Ripple Effect when referring to business is stating when one action can
ultimately indirectly affect the company as a whole. For instance, in the above-mentioned
example, the pebble or stone is indirectly affecting the shore by creating waves against the shore.
Promotes industrial research: Along with producing new business ideas and thinking out of
the box, entrepreneurs also promote research and development. They cultivate their ideas, shape
them into a new form, and turn them into a successful business endeavor. 
Entrepreneurs are a special kind of people; they are always working to discover new ideas and
improve existing ones. But their impact extends beyond their own companies and ventures: when
an entrepreneur develops a new product, service, or idea, others often follow (and sometimes
even further refine the ideas).
Innovation and industry are accelerated through the combined action of entrepreneurs. They can
motivate each other, share ideas and inspiration, and share planning to establish new industries.
The change of the existing industrial climate opens the doors for others at the same time. 
Therefore, we see that the importance of entrepreneurship to the economy is multi-functional.
Social changes: Entrepreneurs change or break the tradition or cultures of society and reduce the
dependency on obsolete methods, systems, and technologies. Basically, entrepreneurs are the
pioneer of bringing new technologies and systems that ultimately bring changes to society. These
changes are associated with improved lifestyle, generous thinking, better morale, and higher
economic choice. In this way, social changes gradually impact national and global changes. So,
the importance of social entrepreneurship must be appreciated. 
At Duke, the Innovation and Entrepreneurship Initiative has a special program aimed specifically
at Social Innovation. The program is “building upon and extending the strengths of the university
to create a transformational learning environment to inspire, prepare, and support entrepreneurial
leaders and scholars to turn knowledge into action in pursuing innovative solutions to the world’s
most pressing problems.” 
For example, one of the most recent projects of the initiative is the Duke-UNICEF Innovation
Accelerator, which is focused on entrepreneurship for menstrual health and hygiene for women
and girls in vulnerable communities in three African countries.

5. Classification of Entrepreneurship
There are many types of Entrepreneurship. Here, the types of entrepreneurship classified by
Hans Scholl hammer in 1980 are briefly discussed below.

1. Administrative Entrepreneurship:
Administrative entrepreneurship refers to the adoption of certain techniques or strategies in
managing the organization, which helps the organization improve and maximize its efficiency
and sustain in the environment or competitive marketplace in the long run. It is a combined effort
of general management and technical area to improve and develop better products and
techniques than the existing ones.
Some of the examples of Administrative entrepreneurship are R&D, total quality management,
job redesign, management by consensus, pension scheme for old age by government etc.

2. Opportunistic Entrepreneurship:
Sometimes due to changes in the environment or situation there is raised a need for many things
in the market. By identifying that opportunity many take various relevant steps to exploit it that
help them improve things around them is called opportunistic entrepreneurship. For example,
during COVID-19, though numerous companies faced crisis, many started various businesses
related to Covid-19, including PPIs, ventilators, masks, vaccines, Covid-19 detection technology,
disinfectant sprays etc.

3. Acquisitive Entrepreneurship:
Acquisitive entrepreneurship is the type of entrepreneurship that learns from other competitors. It
tries to acquire new values and achieve the level of their competitors. This is done so that the
business can be kept sustainable in the competitive market, by understanding and figuring out the
competitors’ technical capabilities. The highlighted point is that some failure never set them back
instead helps them to develop a new skill that they can use further to figure out things coming up
in time. For example, Walt Disney, FedEx.

4. Incubate Entrepreneurship:
It is a sort of entrepreneurship that deals with the creation and fostering of fresh ideas that
emerge in an individual's mind and then implementing them within a company or organization.
Like, Companies in the technology industry promote emerging technologies in a wide range of
products and forms differentiation among all the categories of the product in the marketplace.

5. Imitative Entrepreneurship:
The practice of imitating or duplicating an established business model and establishing a new
one in a similar way under a franchise agreement is known as imitative entrepreneurship. In this
entrepreneurship people just adapt to the techniques, ideologies, and technology being given or
used by others in this situation rather than taking the risks associated with a new thought. For
example, Walton Bangladesh has introduced its motorbikes, refrigerators, televisions and other
electronic appliances in Bangladesh not being the original inventor of those products.

6. Classification of Entrepreneur

Entrepreneurs can be classified into different categories based on nature, gender, place, size,
generation etc. Here, the types of individual entrepreneurs are discussed below.

1. Technical Entrepreneur:
A technical entrepreneur is one who uses an altered form of already-existing technology to
produce a product or provide a service. A particular technology's potential developments are seen
by technical entrepreneurs. These business owners might start a venture to make money off of
their inventions and discoveries. Their key strength is their technical knowledge. For example, A
garment manufacturer probably makes a change to his spinning machines to make them work
faster and more effectively.
2. Innovative Entrepreneur:
An innovative entrepreneur is a business person who finds new applications for an existing
product by incorporating new features. Innovation is defined as new working methods, a new
market, a new supply of materials, a new management style system or a new strategy, in the
present or future environment. Hence, an innovative entrepreneur is someone who decides to
carry out existing activities in a novel manner that benefits customers. For example, some
smartphone companies are constantly creating new applications for customers by adding new
features to their smartphones.

3. Drone Entrepreneur:
Drone entrepreneurs are those who refuse to adopt and use opportunities to make changes in
production. They will not change the method already introduced. They will only follow
traditional methods. They may even suffer losses but also, they will not be ready to make
changes in production.

4. Imitative Entrepreneur:
This kind of entrepreneur establishes an already-existing business and enhances it. Although they
won't have any original ideas of their own, they will be managing a company that does have
some excellent original ideas.
They will copy a previously established firm or hold a franchise for a well-known business.
However, these business owners work hard to increase their sales and strive to be the best in their
particular area or region. The emergence of business endeavors by imitative entrepreneurs
making them suited for developing or underdeveloped regions. By introducing technology,
information, and skills from developed nations, these people effectively improve the system of
poor or backward nations with little resources and helps these areas' economic development.

5. Fabian Entrepreneur:
An entrepreneur who adopts a generally pessimistic approach when implementing new
technologies in the workplace is known as a Fabian entrepreneur. They try as hard as they can
not to use the most recent technology since they don't feel comfortable using them. These
entrepreneurs believe that the available technology is sufficient to stay one step ahead of the
competition. They are also referred to as "old generation entrepreneurs" since they only use new
technologies when there is a significant risk to their business.

6. Forced Entrepreneur:
Forced entrepreneurs are those who initially had no intention of starting their own firm, but were
persuaded to do so by their current circumstances after understanding that there was no other
way to get out of it. For example, when a graduate can't find a job, he might start an enterprise to
survive.
 7. Characteristics of an entrepreneur
The Word Entrepreneur is derived from the French word “Entreprenerd” which means “to
undertake”.
Entrepreneur is an economic agent. Entrepreneur is a person or groups of people who has main
task to determined kinds of work he done. Who has to take initiate that create value and
profitable tendency?
J.A Mill (1848) advocates for using the word entrepreneur in the sense of an organizer who is
paid for his non- manual type of work.
J.B. Say (1824) defines entrepreneur as "an economic agent who assembles factors of
production, sets price of produce in such a way that ensures the cost and profit, re-accumulates
capital and possesses administrative and productive knowledge".
Entrepreneur is a person who is action oriented and highly motivated to take risk and to achieve
such a goal that brings about a change in the process of generating goods or services or
reinitiates a progress in the advent of creating new organizations. Therefore, experts have
projected entrepreneur from different conceptual viewpoints. The characteristics that encompass
the concept of entrepreneur are listed below:
1. An economic agent: Entrepreneur is perceived as an economic agent who assembles
materials for producing goods at a cost that ensures profits and re-accumulation of
capital. He is also understood as a change agent who brings about changes in the structure
and formation of organization, market and the arena of goods and services.
2. Risk taker: Entrepreneurs always have capacity to taking all types of risk. Because they
are profit centered that’s why they try to take risk of all time.
3. Profit maker: Always tendency for profit and growth this concept of making profit by
initiating a business. Their views are centered on making profit by initiating a business.
4. Achievement Motivator: This concept of entrepreneur by calling him "a person with a
strong desire for achievement". Entrepreneurs are action oriented, highly motivated
individuals". Therefore, entrepreneurs have to have a deep-rooted need for achieving
their goals.
5. Capital provider: Entrepreneur is a person who operates a business by investing his/her
capital. They perceived entrepreneur as the founder of an enterprise who assembles
necessary resources for the operation of the enterprise.
6. Innovator: The entrepreneur should be always innovative to satisfy various demands of
the customers for this purpose an entrepreneur should start or undertake the risk & try to
innovate goods & services. Innovation is a never-ending program.
7. Hard worker: A successful entrepreneur is one who is willing to work hard from the
beginning of his Expertise. An entrepreneur with his hard work can retain the business
for a longer duration.
8. Sincerity: The success of an entrepreneur totally depends on the sincerity of an
entrepreneur. If a person is sincere about his business, he will move heaven to earth to
make it successful.
9. Determinant the nature of the people: Entrepreneur is the person or group of persons
who performs the task of determining the kind of business to be operated. Therefore,
entrepreneurs promote diversified and distinct types of business in a society.
10. A reward receiver: Entrepreneur is a person who creates something new of value by
devoting time and efforts and in turn receives monetary and personal rewards like,
monetary reward, non-monetary reward, personal satisfaction, recognition, and
independency.
11. Self-reliance: A successful entrepreneur wants to follow his own routine, policies &
procedure. He does like to be guided by others. He is acting as his own master & making
his responsibility for all his decision. He does not like to work for others or under the
supervision of any other person.
12. Highly optimistic: A successful entrepreneur is always optimistic about his future & he
is never disturbed by the present problem.
13. Planning and organizing ability: A successful entrepreneur are much more depends
upon good planning & systematic work above all he must have the ability to bring all the
scattered resources required for production.
14. Maintain public relation: A successful entrepreneur might have good relationships with
the customer to gain their continued support good relation.
15. Communication skill: Communication skills the secret of a successful entrepreneur.
Good Communication skill enables to put their points effectively with clarity.
 8. Qualities of an entrepreneur
Entrepreneurship is the result of entrepreneurial quality of entrepreneurs. What makes
entrepreneurs success is still a debate. Experts have listed a long list of qualities relating to
general, mental, economic, social and personal traits of entrepreneurs. These are accepted
qualities for an entrepreneur, which are discussed below:
1. Self Confidence
i. Confidence is the reliance on self that one could do something. It is a belief on own
ability. Like, ‘I can do it’.
ii. Independence is the sense that makes a person able to run the self and takes decision
independently.
iii. Individuality is like be a different from others that’s why followers attracted on you
and must be a dynamic.
iv. Optimism is the driving force of all initiatives. It is the state of hope and aspiration
that people rest on self to walk in future.
1. Task or Result Oriented
i. Need for achievement is a desire to excel or to succeed in competitive situation
ii. Profit orientation must have a tendency to make a profit. Do not be an open for all. At
the end of the making profit to the main priority of business or organization.
iii. Take initiative like always try to be think unique from others and something new that
have created value.
iv. Must have an energetic person and hard worker but not only hard worker but also a
smart worker.
2. Risk Taker
i. All entrepreneurs are risk takers. They take their ventures in an uncertain
environment of future. As we know ‘no risk, no gain’.
ii. Always try to take challenge
3. Leadership
i. It is the process of influencing and directing the task related activities or to lead group
of people.
ii. Always try to both people and production-centered behavior.
iii. Leaders should be able to get along well with others.
4. Originality
i. Innovativeness is the quality of adding or discovering new utility with the old product
or process or system.
ii. Creativeness is the work of art, that is, skillful and imaginative use of something new
to produce.
iii. Flexibility that means entrepreneurs have open minded and always ready to adopt
new things and to understand problems of their subordinate.
5. Future Oriented
 i. Entrepreneurs are hunters of fortunes into future.
ii. “Never look back” is the guiding principle for all entrepreneurs.
iii. Foresightedness is the ability to see what one’s future needs are likely to be, that
means pre-planned for future.
iv. Perceptiveness that means entrepreneurs are things differently and find things what
others cannot.

9. Definition of Small businesses

Small businesses are corporations, partnerships, or sole proprietorships which have fewer
employees and/or less annual revenue than a regular-sized business or corporation

Chris et.al (2000) define, small business as those which are owned and controlled by one or a
few persons, with direct owner(s) influence in decision making and having relatively small share
of the market in the applicable industry.

In our campus there are many small businesses as like Hungarygi , Singra House etc.

Bangladesh Bank has reset the definitions of small and medium enterprises (SME) as per the
National Industrial Policy Order 2010

In manufacturing, small industry/enterprise would be those with assets worth Tk 5 to 100 million
(defined as above) and/or 25 to 99 workers.
In service industry and in business, small enterprises will be those which employ 10 to 25 and
have assets (defined as above) worth Tk 500,000 to 10 million.
 10. Characteristics of Small business
Ownership: They have a single owner. So, it is also known as a sole proprietorship.
Management: All the management works are controlled by the owner.
Limited Reach: They have restricted area of operation. So, they may be a local shop or an
industry located in one area.
Labor Intensive: Their dependency on technology is very little because they are dependent on
labors and manpower.
Flexibility: Because they are small, they are open and flexible to sudden changes, unlike large
industries.
Resources: They utilize local and immediately available resources. They do better utilization of
natural resources and limited wastage.

11. Small Businesses Important

Both big and small companies, firms and industries have functions that they carry out according
to the nature of their respective businesses. What is different is only the scale at which they
operate.
The importance of small business is undeniable. Although small businesses are smaller, as the
name suggests, they serve several important purposes.

1. A Foundation for Large Businesses

Most things start small and are built upon. The same goes for businesses. The goal for any
business owner is to have their goods and services reach as many people as possible.
A small business is a starting point for the company to grow eventually. Once the foundation is
laid, the sky is the limit!
2. Resources for Large Businesses
Small businesses benefit from larger ones because they provide goods, services, raw materials
and resources needed by the big companies, firms, factories, and industries to further carry on
with their work.
Small businesses also help in outsourcing. When large companies or firms outsource services,
they often look to small businesses or industries for the same.
One of the reasons for this is cost efficiency. The outsourcing services provided by smaller
companies also the larger businesses to hire them to take on small jobs or tasks in an overall
project.
3. Independence
Small businesses provide independence to their owners. Small business owners can make their
own decisions with little to no interference from others.
Such autonomy allows for flexibility in decision-making, the number of working hours and risk-
taking. It also allows for rapidity in any changes and improvements that need to be made.
For example, a small business owner selling baked goods from home can bring about a change in
her menu when she feels the need for it without having to go through tedious paperwork and
several approvals at various stages.
This independence and autonomy are also why people often choose to start their own business
rather than work a job.
4. A New Beginning
For young, ambitious entrepreneurs, a small business is a new beginning. Those with special
talents or innovative products and ideas can apply them in an entrepreneurial setting to create a
business that allows them to apply their skill and earn an income through it.
Social media has become a great platform to advertise products and gain more publicity and
customers. The past two decades have seen great progress in technology and innovation.
Social media apps such as Facebook and Instagram allow small businesses to reach millions of
people rapidly, making marketing a lot easier, especially for those with limited resources.
Establishing a small business from home is a great way for one to step into the business world,
understand business functions and learn what it takes to play the money game.
5. Employment Opportunities

5.1. Percentage of Employment: Small businesses help create new jobs. According to the
International Labor Organization (an agency of the United Nations), small businesses account for
over two-thirds of the jobs worldwide. This means that they are responsible for the majority of
job creation.
In India, small businesses fall under the regulation of the Ministry of Micro, Small and Medium
Enterprises. Micro, Small and Medium Enterprises (MSME) make up around 40 percent of jobs.
According to the latest National Service Scheme Report (73rd NSS Report), around 11.10 people
work in the MSME sector.
In the United States, a small business has less than 500 employees. According to this parameter,
the employment percentage of small businesses in the US is around 62-64 percent.
Thus, it is safe to say that although small businesses may be smaller in scale, their contribution to
job creation is quite large.

5.2. Creating Meaningful Jobs

Small businesses not only provide job opportunities but rather create meaningful jobs.
Meaningful jobs go beyond just making money. They allow the employees to feel value and a
sense of purpose in what they do.
Meaningful jobs created by small businesses have positive real-world impacts. These jobs range
from health care to education. This impact also incentivizes employees to take on further
meaningful work and motivates them to perform better.
Creating meaningful work, known as ‘Good Work,’ has been an important area of study for
Industrial and Organizational Psychologists for many years.
6. Communication
Small firms and companies make communication among employees easier. Due to the small
number of employees, employee-to-boss and employee-to-employee communication are quicker,
unlike in large businesses.
Quick communication helps the company make faster decisions and make necessary
improvements which ultimately prevent any future losses that might have taken place due to
miscommunication and mismanagement.
7. Community
A positive and healthy work environment is of utter importance for companies if they wish to
keep their employees happy, productive and motivated. This has been a major goal for both
small and large businesses.
There has been a positive trend of small businesses and large corporations focusing beyond the
monetary benefits of their paid employees on other non-monetary incentives, such as job growth,
extra leaves, and flexible working hours.
In the case of small businesses, the smaller number of employees proves to be an added benefit.
Small businesses can easily foster a sense of community due to their small size, making their
employees feel like they are part of something larger and more meaningful than their work and
salaries.
8. Importance to the Local Economy
A local economy is an economy that relates to a particular geographical area, often used in the
residential area we are a part of.
A small business set up in a certain area is referred to as a local business of that area as it
becomes linked to the people and the economy there in several ways.
A small business set up in a local area benefits the people and economy of that place both
directly and indirectly.

8.1. Local Taxes

Small businesses pay local taxes to the government to carry out their economic activities and
earn profits. The government uses the tax dollars for the growth and development of the local
area and the community members.
With an increase in revenue of a business, it will pay taxes at higher rates, and thus the
government will be able to spend even more money. In this way, local businesses indirectly
spend money on local communities.
8.2. Local Employment
A direct way small business tends to impact the local economy is by creating employment for the
local community members.
When small companies, local restaurants and small-scale industries are established in an area, the
demand for employees and workers is generated. Often, employers look to the locals of the area
for employees.
Local workers are the people that live in that area. A small business firm may not have the extra
money to spare on the additional cost of the transportation of labor and raw materials. So, the
company can save on transportation costs of the labor force by hiring locals.
Hence, this becomes a two-way street where the company gets cheap labor, and the people of the
local community receive employment opportunities.
8.3. Innovation
Financial success in the global economy and its cut-throat competition depends on several things.
One of these is innovation. Originality and innovation in the goods and services businesses
provide set them apart.
Such innovation is often dependent on the local community itself and is something the big
corporations and their employees may be unable to provide.
For example, someone looking to start a small business of traditional Rajasthani handloom and
cloth would ideally set up their business in Rajasthan. This is because producing such an
authentic and intricate handloom and cloth requires a community of workers who are experts at
the craft.
Hence, many small businesses tend to be set up not only based on convenience or the presence of
raw materials but also on how easily the right workforce can be obtained to enable innovative
ideas to be executed in the best way possible.
9. Healthy Competition
Small businesses are important in fostering a sense of healthy competition among companies.
When a small business is set up in a particular area, other small businesses and companies view
this as a source of competition.
Competition among businesses and companies acts as motivation for improvement.
Improvement in relations with current buyers, connecting with potential customers, studying
other businesses to formulate their marketing strategies, improvement in the small business
administration, and quality control are just some of the measures taken by small businesses in a
competitive environment.
10. Economic Growth
Economic growth is the increase in the value of the goods and services produced in an economy.
The increase in the value of these goods and services increases the country’s overall wealth.
The economic growth of a country is generally measured in terms of its GDP, the Gross
Domestic Product. A country’s GDP is the total value of all goods and services produced over a
given period, usually one year.
10.1. So How Do Small Businesses Help Economic Growth?
Just as big businesses help increase the economic growth of a country through the production of
goods and services, small businesses help the growth of an economy in the same way.
The Small Business Association (SBA) report claims that small businesses account for almost 44
percent of the GDP of the United States.
Although a single large business may generate higher revenue through its business functions and
production, small businesses continue to contribute in large amounts to the total GDP of a
country as well.
As revenue generated by small businesses contributes directly to the economic growth of a
nation, factors such as the creation of new jobs, a focus on local communities, payment of taxes,
and gradual expansion all indirectly help the small business achieve financial success on an
individual level and help the economy grow as a whole.
 12. Definition of environment
Environment is the conditions, circumstances etc. affecting a person's life (Oxford Advanced
Learner's Dictionary). It consists of the actors and forces that affect the success and sustaining of
people and organization (Kotler and Armstrong, 2001).

Factors/components of Environment that affect Entrepreneurship

1. Capital: Capital refers to the funds/money available to a business for use in day-to-day
operations.  It is the lifeblood of every business because it is enabling the business to
cover day-to-day cost. A low level of working capital may result in a business is failure.
2. Experienced entrepreneurs: The key success of entrepreneurship is needed experience
entrepreneur, it includes knowledge, Leadership, Communication, Ability to learn,
Opportunities, and especially creativity and innovation.
3. Skilled Labor force: A technically skilled labor force is another important
environmental factor conducive to entrepreneurial activity. Skilled labor force has an
ability to solve problems and efficiently adapt to changes in an ever-evolving world.
4. Suppliers: Good access to suppliers has likely had a positive impact on the decision to
start an entrepreneurship. Quality of products depends on raw materials, which provide
suppliers.
5. New markets: This factor is particularly important when the entrepreneurial activity has
local rather than national or international in scope or when customers are geographically
concentrated. Environmental support for having entry into the new market or customers
is a primacy for the entrepreneurship in any country.
6. Government Policy: Taxation rates, licensing policies, and other government activities
can have a positive or negative’ impact on entrepreneurship. For example: government
policy of south Korea.
7. Proximity of Universities: It is a popular Relief that universities are the source of
technical spin-off companies, but this is the exception, not the’ rule.
8. Receptive population: The receptive population is blessing for a country. Bangladesh is
not receptive population country. Bangladesh is an overpopulated country. So, in our
country, this factor is puzzled for our entrepreneurship.
9. Availability of Land: Land refers to all factors of production which come from nature.
Land resources, specifically, are raw materials in the production process, such as trees,
oil, and metals. So, without available of land entrepreneurship face big problem.
 13. Environment for Entrepreneurship

The word “Environment” can be defined as a sum total of all the living and nonliving elements
and their effects that influence human life.
Environment is the conditions, circumstances etc. affecting a person's life (Oxford Advanced
Learner's Dictionary). It consists of the actors and forces that affect the success and sustaining of
people and organization (Kotler and Armstrong, 2001).
Entrepreneurship environment refers to the various facets within which enterprises- big, medium,
small and others have to operate. The environment therefore, influences the enterprises are
political, social, economic, national, legal forces, etc. At last we can say that Environment
consists of the factors and forces that affect the success and sustaining of people and
organization

14. Difference between entrepreneur and manager

Entrepreneurs Start Companies, Managers Run Them. Entrepreneurs are the dynamic force
behind the planning and launching of novel business ventures. They are involved in all aspects of
their business throughout its lifespan, beginning with the raw startup stage, when the business is
little more than an idea. The main difference between entrepreneur and manager is their role in
the organization.
An entrepreneur is the company owner, while a manager is the company’s employee.
Entrepreneurs take risks, particularly financial ones, while managers are not susceptible to such
business-related risks. This blog will cover the significant differences between entrepreneur and
manager.

What is an Entrepreneur?
The entrepreneur is someone who, individually or collectively, establishes a company, sets the
objectives, and makes strategic decisions about the goals, management, administration, and
control of the company or companies, while taking up its commercial and legal responsibilities.
The term generally applies to upper management, including executive directors, board members,
board directors, etc. They are usually the “majority shareholders” or those who own multiple
investments or are business owners. The work of entrepreneurs can include/may not be limited to
that of an owner, capitalist, or financier. They can be managers or administrators too.

What is a Manager?
A manager manages an organization, institution, company, or part of it. The manager’s role is to
use the resources at his disposal as efficiently as possible to obtain the maximum possible benefit
from them. In other words, maximize your organization’s or assigned area’s productivity.
In corporate setups, a manager is usually an employee; they earn a defined annual salary for
managing daily business operations. The general responsibilities of managers center around
ensuring that the company’s daily operations run smoothly. This does not mean they must
perform all the specific tasks themselves; instead, they ensure that the department or units they
supervise deliver results.
Difference Between Entrepreneur and Manager.
Entrepreneur Manager

Job Rule Establishing a company Running daily operations

Status in the Owner Employee

organization
Job Focus Entrepreneurs focus on thinking big, Managers are responsible for carrying
tapping unexplored territories, and out business plans as directed and
bringing change meeting the defined targets
Monetary Benefits The profit obtained from business Salary earned for managing daily
management business operations
Motivation Organizational achievements work as Power and perhaps compensation
motivation for entrepreneurs

Decision Making An entrepreneur’s decisions are driven by A manager’s decision-making is

inductive logic, courage, and calculative, as they are based on
determination deductive logic, information gathering
and advice
Creativity The main driving force of an entrepreneur A manager maintains the current state of
is creativity and innovation affairs but is prompted to get innovative
and think out of the box
Specialization Any enterprising individual can become Managers are trained to perform a set of
an entrepreneur. They do not need to be tasks. They are specialists in their
specialized in any particular trade. domain.
Entrepreneur and Manager are not interchangeable terms. However, management tasks are an
essential part of the functions of an entrepreneur. While entrepreneurs are managers, not every
manager is an entrepreneur.

Why do some businesses succeed when others fail? In reality there are common mistakes that
kill many small businesses before they ever get off the ground. Discuss below:

1.Growing too fast: While growth is desirable, overexpansion is a serious error. Wanting to be
the first to market with a new product, taking on added overhead will bring harm for business.
Set realistic goals and expand only as needs dictate.
2.Overspending: Many new entrepreneurs burn through their startup capital before their cash
flow is positive. This often happens because of misconceptions about how business operates.
3.Lack of reserve capital: Be prepared for unexpected increases in the costs of things like
utilities, materials, and labor. Make sure to keep enough reserve cash to carry through tough
times and seasonal slowdowns.
4.Poor choice of location: Don’t let a cheap lease tempt you into choosing the wrong location.
Consider competition (how many similar businesses are located nearby?) and accessibility (is the
area well served by freeways, public transportation, and foot traffic?).
5.An inadequate business plan: A well thought-out business plan forces to think about the
future and the challenges to face. It also forces to consider financial needs, marketing and
management plans, competition, and overall strategy.
6. Ineffective marketing: Customers can’t do business with entrepreneurs if they don’t know
where are they. It doesn’t cost a lot to advertise and promote your business through online
marketing, social media, email, local search, and more.
7.Underestimating the competition: Customer loyalty must need to earn it. Watch business
competition and stay one step ahead of them. Always serve the best for customer satisfaction.
 15.Reason Behind Failure of Small Business
Why do some businesses succeed when others fail? In reality there are common
mistakes that kill many small businesses before they ever get off the ground.
Discuss below:

1.Growing too fast: While growth is desirable, overexpansion is a serious

error. Wanting to be the first to market with a new product, taking on added
overhead will bring harm for business. Set realistic goals and expand only as needs
dictate.
2.Overspending: Many new entrepreneurs burn through their startup capital
before their cash flow is positive. This often happens because of misconceptions
about how business operates.
3.Lack of reserve capital: Be prepared for unexpected increases in the costs
of things like utilities, materials, and labor. Make sure to keep enough reserve cash
to carry through tough times and seasonal slowdowns.
4.Poor choice of location: Don’t let a cheap lease tempt you into choosing the
wrong location. Consider competition (how many similar businesses are located
nearby?) and accessibility (is the area well served by freeways, public
transportation, and foot traffic?).
5.An inadequate business plan: A well thought-out business plan forces to
think about the future and the challenges to face. It also forces to consider financial
needs, marketing and management plans, competition, and overall strategy.
6. Ineffective marketing: Customers can’t do business with entrepreneurs if
they don’t know where are they. It doesn’t cost a lot to advertise and promote your
business through online marketing, social media, email, local search, and more.
7.Underestimating the competition: Customer loyalty must need to earn it.
Watch business competition and stay one step ahead of them. Always serve the
best for customer satisfaction.
Reference:

 Entrepreneurial Development (S S Khanka)

 https://economictimes.indiatimes.com/
 https://www.tbsnews.net/economy
 Pictures are collected from different websites.