DSW 0323

INTRODUCTION TO
ENTREPRENEURSHIP SKILLS
CONTENTS
i. Definition of the concepts
ii. Income generating activities (IGA)
iii. Resources required in developing IGA
iv. Entrepreneurship
CONTENTS
i. Definition of the concepts
ii. Income generating activities (IGA)
iii. Resources required in developing IGA
iv. Entrepreneurship
I.Definition of the concepts:

?
1. Entrepreneurship
2. Profit
3. Loss
4. loan
5. Credit
6. Credit institutions
7. Income
8. Income generating activity
I. Definition of the concepts:
1. Entrepreneurship
 Entrepreneurship is the process of
creating something different with value by
devoting the necessary time and effort,
assuming the accompanying financial,
social and psychological risks and
receiving the resulting rewards of
monetary and personal satisfaction.
 I. Definition of the concepts:
Entrepreneur
• is someone who initiates and
actively operates an
entrepreneurial venture (EV) or
income generating activity (IGA)
I. Definition of the concepts:
2. Profit is a financial benefit that
is realized when the amount
of revenue gained from a
business activity exceeds the
expenses, costs and taxes needed
to sustain the activity.
I. Definition of the concepts:
Profit gained goes to the
business's owners, who may or
may not decide to spend it on the
business.
Profit is calculated as total
revenue less total expenses.
I. Definition of the concepts:
3. Loss is the decrease in net
income that is outside the
normal operations of the
business.

What causes losses?

I. Definition of the concepts:
Some examples of the causes of loss
• Sale of an asset for less than its carrying
amount,
• Write-down of assets
• loss from lawsuits.
• A write-down is used to describe a reduction
in the book value of an asset due to
economic or fundamental changes in the
asset
I. Definition of the concepts:

4.Loan is the lending of

money by one or more
individuals, organizations,
and/or other entities to
other individuals,
organizations etc.
I. Definition of the concepts:
The recipient (i.e. the
borrower) incurs a debt, and is
usually liable to pay interest on
that debt until it is repaid, and
also to repay the principal
amount borrowed.
I. Definition of the concepts:

5. Credit is a contractual
agreement in which a borrower
receives something of value
now and agrees to repay the
lender at some date in the
future, generally with interest.
I. Definition of the concepts:
Credit also refers to an accounting
entry that either decreases assets or
increases liabilities and equity on the
company's balance sheet.
Additionally, on the company's income
statement, a debit reduces net income,
while a credit increases net income.
 • What’s left over: Assets minus
Equity
liabilities
• Any debt your company owes others
Liability
• Something of value your company
I. Definition of the concepts: Asset
owns
I. Definition of the concepts:
Assets are anything valuable that your
company owns, whether it’s equipment,
land, buildings, or intellectual property.
When you look at your assets, you’re
trying to answer a simple question:
"How much do I have?"
If it has value, and you own it, it’s an
asset.
I. Definition of the concepts:
Your liabilities are any debts your company
has, whether it’s bank loans, mortgages,
unpaid bills, or any other sum of money
that you owe someone else.
When you look at your accounting
software or spreadsheets and look at your
liabilities, you’re asking:
"How much do I owe?"
I. Definition of the concepts:

6. Credit Institution An
undertaking whose business
is to receive deposits or other
repayable funds from the
public and to grant credit for
its own account;
I. Definition of the concepts:
6. Credit Institution: is a company the
principal and permanent economic
activity of which is to receive cash
deposits and other repayable funds
from the public and to grant loans for
its own account and in its own name
and provide other financing.
I. Definition of the concepts:

7.Income refers to money

received, especially on a
regular basis, for work or
through investments.
I. Definition of the concepts:

8. Income Generating Activities

(IGAs) consist of small
businesses managed by
individuals or a group of people
to increase their household
income through livelihood.
CONTENTS
i. Definition of the concepts
ii. Income generating activities (IGA)
iii. Resources required in developing IGA
iv. Entrepreneurship
II. Income Generating Activities
1. What types of IGAs are available in
your neighbourhood?
2. What are the potential IGA that
may benefit the surrounding
community?
3. What are the reasons for initiating
the IGAs.?
SUB CONTENTS
1. What types of IGAs are available in your
neighbourhood?

2. What are the potential IGA that may benefit the

surrounding community?

3. What are the reasons for initiating the IGAs.?

II. Income Generating Activities
2. Potential income generating
activities
• livestock and poultry keeping.
• Animal production.
• Handicrafts.
• Shopkeeper activities.
II. Income Generating Activities
1. Potential income generating
activities
• Food drying
• Preparation and marketing of
dairy products.
• Agricultural production.
II. Income Generating Activities
2. Potential income generating
activities
• livestock and poultry keeping.
• Animal production.
• Handicrafts.
• Shopkeeper activities.
SUB CONTENTS
1. What types of IGAs are available in your
neighbourhood?

2. What are the potential IGA that may benefit the

surrounding community?

3. What are the reasons for initiating the IGAs.?

 II. Income Generating Activities
1. Common reasons for initiating IGAs
• Independence and opportunity to do what you like
Contribute to society and be recognized for one’s
effort
• Tax reduction
• Challenge one’s skills, ability and innovativeness
• Opportunity to make a difference in the community
 II. Income Generating Activities
2. Common reasons for initiating IGAs
• Exploitation of market opportunity in the
community
• Response to crisis to situation in the society
• Disagreement with one’s boss
• Following role models through copying
successful entrepreneurs.
 II. Income Generating Activities
3. Common reasons for initiating IGAs
• Availability of resources-raw materials,
markets, customers, capital etc.
• Government support-policies that motivate
self-employment
• Unsatisfied with available products
• Feeling uncomfortable in an organization
II. Income Generating Activities
1. What are the types of resources
required in developing income
generating activities ?
III. Resources required in developing IGA

1. Land – natural resources such as iron

ore, gold, diamonds, oil, etc.
2. Labour – human resources such as
wage-earning workers
3. Capital – plants and equipment used in
the production of final goods, such as
assembly lines, trucks, heavy duty
machinery, factories, etc.
CONTENTS
i. Definition of the concepts
ii. Income generating activities (IGA)
iii. Resources required in developing IGA
iv. Entrepreneurship
IV. Entrepreneurship
1. Entrepreneurship is about how, by whom, and with
what consequences opportunities to bring future
goods and services into existence are discovered.

2. An entrepreneur is someone who

perceives an opportunity and creates
an organization to pursue it.
IV. Types of entrepreneurs
A nascent entrepreneur Is an
individual who is in the process of
starting a new business.

A nascent entrepreneur can either

be a novice or habitual.
IV. Types of entrepreneurs
A novice entrepreneur is an
individual who has no prior
business ownership experience as a
business founder, inheritor of a
business or purchaser
IV. Types of entrepreneurs
A serial entrepreneur is an
individual who has sold or closed
an original business, established
another new business, sold or
closed that business and continues
this cycle of entrepreneurial
behaviour.
IV. Types of entrepreneurs
A habitual entrepreneur is an individual
who has prior business ownership
experience.

A portfolio entrepreneur is an individual

who retains an original business and builds
a portfolio of additional businesses through
inheriting, purchasing or establishing them.
IV. Entrepreneurship
In groups discuss and present your answers

1. What is the importance of entrepreneurship?

IV. Entrepreneurship
 In groups discuss and present

 What is the importance of entrepreneurship?

a. Social importance
b. Commercial importance
c. Economic importance
a. Social importance
 Entrepreneurship helps people to improve their
socioeconomic life. It is the source of satisfying people’s
needs and wants.
 It can be used to transform the lives of people within a
certain area.
 t is the source of employment.
 It helps to solve problems such as public health
problems, accessibility to clean and safe water etc.
b. Commercial importance
 It is the source of income generation.
 It also improves quality of products and services.
 It leads to business competition which eventually
improves the wellbeing of the society
C. Economic importance
It improves economic status of
an individual, family and
community at large.
It improves the income of the
country.
It is the source of employment
REVIEWS

i. What is entrepreneurship?

ii. What are the types of an entrepreneur?

iii. What are the potential IGAs?
Task

What do you understand by the following?

i. Return of investiment. (ROI)
ii. How would you calculate ROI?
iii. What is a profit margin.
THE END
Reference
i. Boris, U. (2010). Frontiers in Entrepreneurship. (1st ed.). Born, Springer

ii. Bornstein, B., & Davis, S. (2010). Social Entrepreneurship: What everyone
Needs to Know: New York: Oxford University Press
iii. Makuya, V. O. (2012). Small business management and Entrepreneurship
manual. University of Dodoma, Dodoma.
iv. Marriot, S. and Towle, T. (2010). Entrepreneurship. Owning your future. 11th
Edition. Prentice Hall. New York.
Answer

i. Return on investment (ROI) is a financial metric that

is widely used to measure the probability of gaining
a return from an investment. It is a ratio that
compares the gain or loss from an investment
relative to its cost. It is as useful in evaluating the
potential return from a stand-alone investment as it
is in comparing returns from several investments.
Answer

i. Return on investment (ROI) is a financial metric that

is widely used to measure the probability of gaining
a return from an investment. It is a ratio that
compares the gain or loss from an investment
relative to its cost. It is as useful in evaluating the
potential return from a stand-alone investment as it
is in comparing returns from several investments.
Answer

i. Profit margin gauges the degree to which a

company or a business activity makes money,
essentially by dividing income by revenues.