ENTREPRENEURSHIP DEVELOPMENT

1. THE MEANING OF ENTREPRENEUR.

An entrepreneur is a person translating profitable Idea into productive activity.

In short an entrepreneur is a person who is responsible for setting of a business or enterprise
According to “Richard Cantillon
“An entrepreneur is an agent who buys factors of production at certain prices in order to
combine them into a product with a view to selling it at uncertain prices in future”.

2. DEFINITION OF ENTREPRENEURSHIP
Entrepreneurship refers to a process of an action of on entrepreneur or person undertake to
establish his enterprise.
According to Higgins B “Entrepreneurship is the function Of seeking investment and production
opportunity, organising an enterprise to undertake a new production process, raising capital, hiring
labour, arranging the supply of raw materials, finding, site, introducing new techniques and
commodities, discovering new sources of materials and selecting top managers of day to day
operations of the enterprise.

3. MEANING OF ENTERPRISE .

Enterprise is someone taking initiative to start a business.

Enterprise considered as an organization engaged in business activity or economic activity .

4. SPONTANEOUS ENTREPRENEUR.

These entrepreneur start those business out of their natural talent like initiative, boldness, conviction
and confidence in their ability.

Meaning of Intrapreneur.
An Intrapreneur is a person who is having all the qualities and characteristics of an
entrepreneur but not having economic and other support to take a business activity on his
own. Therefore he works for others has a paid employee.
For ex: successful CEO, skillfull managers or employee at any level.
5. Meaning of venture capital:
Venture capital refers to financing that comes from companies or individuals in the business
of investing in young, privately held businesses.
They provide capital to young businesses in exchange for an ownership share of the business

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Assistant professor ,
Department of Commerce .
 6. What is tiny industry?
Tiny industries is one with the investment limit of rupees 2.5 million in plant and
machinery irrespective of location of the unit.
7. What is Ancillary industry ?
An ancillary industry is a subsidiary industry or supplementary industry to a main
industry .
It plays Very important role in main industry
Ex: manufacture and supply of automobile for car manufacturing industry.
8. What is cottage industry ?
A cottage industry is one which is carried in the house of the handicrafts persons with
the help of other members of the family by using simple and hand operated tools with
or with out power.
• Ex : weaving, pottery , toys making carpentry ,basket and mat making , gold Smith,
black Smith etc..
9. Define business plan
The business plan is a written document prepared by the entrepreneur that describe all
the relevant external and internal element involved in starting a new business venture.

A written document describing the nature of the business, the sales and marketing
strategy, and the financial background, and containing a projected profit and loss
statement.
It is an integration and functional plans such as marketing ,finance, manufacturing and
human resources.
10. MEANING OF SMALL SCALE INDUSTRIES:
• Small scale industries are those which are organised on small scale bases and produce
goods on smaller level by using machines , powers , hired labours, modern technology .. etc.
• Ex: garments, plastic goods , sewing machine, electrical goods , blades ,shoes paper
,production, furniture, ornaments , sports articles , oil and rice Mills etc..
• According to national income accounting SSI's defined as
“A unit engaged in manufacturing, rendering services, repairing processing and preservation
of goods having investment in plant and machinery at an original cost not exceeding 1 crore”.
11. MEANING OF FEASIBILITY REPORT:
Feasibility report is a document that assesses potential solutions to the business problems or
opportunity and determines which of these are viable further analysis.
According to centre for Entrepreneurship at university of Rochester,
“ A feasibility study or report can be defined as a controlled process for identifying problems
and opportunities, defining successful outcomes and assessing the range of costs and benefits
associated with several alternatives for solving a problem”.

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 1. Explain the functions of entrepreneur
2. Innovation 10. Generation innovation business
idea
3. Bearing of risk and uncertainty
11. Organisation factor of production
4. Decision making
12. Infuses motivation assistance
5. Co-ordinates things effectively
13. Provided direction to the business
6. Planning the project from and ensures it’s effective
operation

7. Introduced new methods into 14. Social responsibility

practice
15. Public relations
8. Managing the finance
16. Taking initiative
9. Mobilising the finance
17. balanced economic development

2).Qualities/Characteristics of An Entrepreneur
1. Creativity 11. Emotional stability 18. Inactive
2. Innovation 12. Effective 19. Goal orientation
3. Team building communication 20. Motivational
4. Risk taking 13. Public relation stability
5. Commitment 14. Technical 21. Good character
6. Problem solving knowledge 22. Courtesy
7. Decision making 15. Business secrecy 23. Hard work
8. Leadership 16. Administrative 24. Foresight
9. Self confidence ability 25. Patience.
10. Sound knowledge 17. Clear objectives

3) Objectives (or) importance of an entrepreneurship :

1. Voluntary initiation 6. Optimum utilization of natural
2. Balanced growth resources
3. Capital formation 7. Variety of production and
4. Self-employment technology
5. Employment generation 8. Promote export

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 9. Quality enhanced through research 12. Entrepreneurship brings social
and development stability.
10. Economic development
11. Reduces the problem of brain –
drain
4). Discuss the various problems encountered by women Entrepreneur in India.
1.Shortage of finance 10.Lack of self confidence
2.Lack of Education 11.Male Dominated society
3.Shortage of Raw materials 12.Keen Competition
4.low capacity to bear risk 13.Inadequate Marketing facility’s
5.Lack of training 14.Low mobility
6.Social Attitudes 15.High cost of production
7.Lack of Information 16.Lack of Infrastructure
8.Limited liability 17.Lack of business support
9.Family Responsibility 18.Lack of managerial skills

5).Pros and cons of being an Entrepreneurs

I. Pros (Advantages):-
1. Alternative to current career
2. Bridge the gap between knowledge and application
3. Converting an idea into money
4. Be your own boss
5. Better utilisation of skills and knowledge
6. Competition
7. Originality respected
8. Business opportunity
II. Cons (Disadvantages):-
1. Management
2. Experience
3. Time management
4. Remuneration
5. Benefits

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6). The types/classifications of entrepreneur.
c) Motivated entrepreneur
1 According to types of business d) Spontaneous entrepreneur
4 According to growth
a) Business entrepreneur a) Growth entrepreneur
b) Trading entrepreneur b) Super growth entrepreneur
c) Industrial entrepreneur 5 According to stage of development
d) Corporate entrepreneur a) First generation entrepreneur
e) Agricultural entrepreneur b) Modern entrepreneur
2 According to use of technology c) Classical entrepreneur
a) Technical entrepreneur 6. According to gender and age
b) Non-technical entrepreneur a) Men entrepreneur
c) Professional entrepreneur b) Women entrepreneur
3 According to motivation c) Young entrepreneur
a) Pure entrepreneur d) Middle aged entrepreneur
b) Induced entrepreneur e) Old entrepreneur
7).The Role of SSI in Indian Economic Development
1. Self employment 9. Balance regional development
2. Equitable spread of income and 10. Individual supervision
wealth 11. More revenue to government
3. Employment generation 12. Free from factory problems
4. Supporting large scale industries 13. Quick yielding
5. Contribution to foreign exchange 14. Increasing production and
6. Optimum use of capital investment
7. Facilities entrepreneurial 15. Contribution towards national
development Income
8. Optimum use of local resources 16. Better industrial relation

8).The internal and external problems of small scale industries.

i. Internal problems
1. Choice of an idea
2. Faulty planning
3. Poor management
4. Poor production
5. Inadequate finance
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 6. Labour problem
7. Inadequate training
8. Poor quality
9. Poor and loose organization
10. Lack of strategies

ii. External problem

1. Infrastructural
a. Location
b. Power
c. Water
d. Post office
e. Communication
2. Financial
a. Capital
b. Working capital
c. Long term fund’s
d. Recovery
3. Marketing
4. Taxation
5. Raw material
6. Industrial and financial regulation
7. Inspection
8. Technology
9. Policy competitive and valuable environment
9). Factors influencing An Entrepreneurship.
I. Internal factor
1. Ambitions
2. Self reliance
3. Success of other entrepreneur
4. Professional entrepreneur
5. Psychological factor
6. Parental background
7. Independence need achievement
8. Profit making
9. Challenges

II. External factors

1.Economic factors

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A. Capital D. Market
B. Labour E. Infrastructure
C. Raw material
2. Social factors
A. Caste factor D. Occupational factor
B. Family background E. Customs and traditions
C. Educational factor F. Value of society
3. Technological factors
A. Advancement and cheap availability of technology
4. Political factor
a. Political stability c. Stable policy
b. Policy of govt towards business d. Maintenance of law and order

5. International factors
A. Pre global trade policy C. Install production facilities
B. Need of international co-operation D. Tap new foreign markets

10) Advantages of small scale industries.

1. SSI’s consume less capital.
2. Demand average level technology.
3. Create immediate and permanent employment.
4. It facilitates proper utilization of capital resources and skills
5. It increases demand for consumers goods.
6. It helps to create economic stability.
7. Ensure equitable distribution of income
8. Earn considerable foreign exchange.
9. Provides greater opportunity for the growth of large scale industry.
10. Do not require heavy and costly infrastructure.

11). Steps involved in before commencing SSIs.

1. DECISION TO BECOME AN ENTREPRENEUR
2. SELECTION OF PRODUCT OR SERVICES
3. DECIDE ON FORM OF OWNERSHIP
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 4. IDENTIFICATION OF LOCATION

5. Location
*Availability of sufficient space including the space requires for future expansion.
*Availability of raw material at reasonable price.
*Easy availability of labour.
*Transport facility.
*Availability of industrial fuel and its supply.
*Nearness of the site to market.
*Water supply as per the requirement.
*Climate condition of the area.
*Tax incentives available in that locality.

1. Clearances and permits:

i. Other Clearances
ii. Land / location
iii. Building
iv. Plant and machinery
v. Raw materials
vi. Power
vii. Water:
A) Public supply(local bodies)
B) Supply from state government authority.
C). Supply from state irrigation department.(for bulk consumption)
viii. Other Approvals:
a) General
b) Registration and Licence of under factories
c) Provident fund Registration
d) ESI Registration with central excise Dept.

6. Licensing:
7. Registration:

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 8. Market feasibility

9. Financial feasibility:
ix. Cost of the project
x. Means of financing
xi. Cost of production
xii. Estimates of sale and production
xiii. Working capital requirement and its financing
xiv. Estimates the working results(profitability projections)
10. Technical feasibility:
i. Quality control measures
ii. Power /water availability and supply layout
iii. Communication network layout
iv. General functional layout
v. Material flow diagram
vi. Production line diagram
vii. Plant, equipment, furniture, fixtures.
viii. Product specification to be adopted
ix. Selection, placement, training or skills Labour

11. Social feasibility :

i. Maintenance of quality of a product and fair prices for customers
ii. Measures to environmental protection
iii. Healthy employer and employee relationship
iv. Improving the salary structure to workers
v. Providing better working conditions
vi. Higher earnings and higher standard of living
vii. Increase national income and improve income distribution
viii. Estimation of cost and benefits to society
Social cost benefits analysis considered
Cost and benefits to the community
Cost and benefit to the national exchange
Cost and benefits to the Entrepreneur

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12. QUALITY ASSURANCE
13. MARKETING RESEARCH
14. MONITORING

12). Explain the marketing problems of small scale industries

1. Lack of standardization 12. Competition
2. Poor quality 13. Poor designing
3. Lack of service after sales 14. Ignorance of potential markets
4. Lack of knowledge of marketing
5. Financial weakness, limited
resources
6. Lack of testing equipment
7. Absence of marketing strategy
8. Decade payment
9. Lack of local market
10. Heavy dependence on middlemen
11. Lack of advertisement and
promotion

13).Steps taken to solve the problems of Small Scale Industries.

1.Institutions which promotes SSI's
1.DOI(Directorate of promote SSI's)
2.SIDO(Small industries development organization)
3.IDC(Industrial development corporation)
4.KVIC(Khadi and village industries commission)
5.UM (Udyoga Mithra)
6.NSICL(National small scale Industries corporation limited)
7.SSIB(Small scale Industries board)
2.Institutions offering financial support.
1.IFCI(Industrial financial construction India)
2.ICICI(industrial credit and investment corporation of India)
3.IRBI(Industrial reconstruction bank of India)
4.SIDBI(Small industries development bank of India)
5.KSFC(Karnataka state financial corporation limited)
6.KSIIC(Karnataka state industrial investment corporation)

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3.Institution offering technical support.
1.CITD(Central institute of tool design)
2.NID(National institute of design)
3.TDICI(Technology development and information of corporate of India)
4.PPDC(Product and process development of India)
5.ITCO(Industrial and technology consulting organization)
6.SIDO(Small industries development organization)
7.Regional centers tool design institute products and process development centre
4.Institutions offering marketing support.
1.STC(state trading corporation)
2.EXIM(export and import bank of India)
3.EPCCB(Export promotion council and commodity board)
4.IIPL(Indian institute of packaging)
5.Institutions promoting entrepreneurs.
1.CED(Centre of entrepreneurship development)
2.EDII(entrepreneurship development institution of India)
3.IIE(Indian institute for entrepreneurship)
4.NIESBUT(National institute for entrepreneurship and small business development)

Other steps taken to solve problems of SSI:

6. Conduct of detail survey. 11.Effective marketing organization
7. Proper education and training of 12.Provision of subsidies for
workers. electricity.
8. Improvement in techniques.
9. Supply of inputs
10.Supply of capital

13). Importance /Needs/Functions of business plan.

1. Road map 9. It helps in deciding budget
2. Sales tool 10. It provides SWOT analysis
3. Financial map 11. It helps in resources planning
4. Self evaluation 12. Provides proper guidance
5. Identify risk 13. It helps to establish smart goals and
6. It helps to know return on venture milestones
7. It helps to remain competitive 14. It helps to plan human resources
8. It helps in proper communication

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14). Stages involved in preparing action plan (or) Promotion plan.
1. Conceiving business plan 6. Preparing a right plan
2. Screening the idea 7. Project implementation
3. Business analysis 8. Feedback and commercial
4. Feasibility report production
5. Alternative plans
15).List out the steps or outline involved in the formulation of business plan.
1. The executive summary 9. Production/ operation plan
2. Description of the business 10.Competator analysis
3. Product or service strategy 11. Ownership
4. Management 12. Key personnel
5. Financial requirements 13. Accounting records
6. Organization description 14. Financial information
7. Description of Industry profile 15. Appendices
8. Description of marketing strategy

16) Common pitfalls in the preparation of business plan.

1. Capacity utilization. 6. Wrongful selection of business
2. Understanding of the market. location.
3. Over estimation/ under 7. Unrealistic pricing strategies.
estimation of demand. 8. Unrealistic cash flow estimates.
4. Selection of appropriate 9. Lack of understanding of trading
machineries. channels.
5. Under estimation of project cost. 10. Lack of understanding of
appropriate technology

17).What are the advantages of industrial estates?

An industrial estate is a place where the required facilities and factory accommodation are
provided by the government to the entrepreneurs to establish their industries there.
According to P. C. Alexander,
“An industrial estate is a group of factories, constructed on an economic scale in suitable sites
with facilities of water, transport, electricity, steam, bank post office, canteen, watch and
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ward and first aid, and provided with special arrangements for technical guidance and
common service facilities”.

1. Economies of scale 6. Saving of time and

2. Low investment efforts
3. Less risk 7. Entrepreneurial
4. Mutual co-operation development
5. Balanced regional
development 8. External economics
OBJECTIVES OF INDUSTRIAL ESTATES
1. To encourage the growth of SSIs
2. Provide infrastructure and accommodation facilities to the entrepreneur
3. To achieve decentralise industries to rural and backward areas
4. To encourage growth of ancillary industry in surroundings of major industries
units
5. To faster the development of industries well as entrepreneurship by providing
economies and incentives
18).Major aspects/Elements of business plan.
1. Financial aspects of business plan
1. Funding 6. Funding strategies
2. Risk 7. Sources of equity funding
3. Funding requirements 8. Sources of debt financing
4. Sources of funds 9. Sources of non traditional financing
5. Uses of funds

Areas of financial information

 Expected sales  Current balance sheet
 Expenses figures
 Cash flow figures

2. Marketing aspects of business plan

1. Well defined market 6. Pricing strategy
2. Channel strategy 7. Communication strategy
3. Target market strategy 8. Sales strategy
4. A positioning statement 9. Revenue model
5. Product or service strategy
3. Human resource aspects of business plan

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 1. Top management 5. Advisors
2. Middle management
3. Operations management
4. Supporting staff

The following information about HR in the aspects of business plan will add
clarity :-
 Number and type of  Training methods
employees  Job description
 Pay structure

4. Technical aspects of business plan

1. Accounting taxes, finance 6. Human resource management
2. Order taking and tracking 7. Internet marketing
3. Inventory management 8. Graphics
4. Date based management 9. Communication with customers
5. Presentation 10. Mailing list

Key issues choosing a technology

 Functions  Ability to upgrade
 Ease of use  Financial consideration in
 Cost acquiring the technology
 Security

5. Social aspects of business plan

1. Take the welfare of society into 4. Protect the environment ecology
consideration by undertaking anti pollution
2. Focus on value of society measures
3. Optimise the use of resources 5. Participate in social welfare
programmes
6. Make charitable contribution

19). Objectives of seminars and conventions organised by AWAKE

1 . To provide an international platform focusing and economic empowerment of women and
international trade.
2. To provide an opportunity for interaction between entrepreneurs to learn about the best biz
practices.
3. Business to business trade meets
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4. Networking of biz association.
5.To evolve pro-women entrepreneur policies.
6.Exposure to new ideas of marketing access to financial Technology / innovation.
7.Exploring biz opportunities

20).List out the financial institutions offering financial assistance to SSI.

1. State financial corporation (SFC).
2.Industrial development Bank of India
(IDBI).
15. Khadi and village Industries
3.Industrial financial corporation of Commission(KVIC).
India (IFCI).
16. Stock Exchange.
4.Industrial credit and investment
17. Venture capital Finance.
corporation of India (ICICI).
18. House Development Finance
5.Industrial reconstruction Bank of India
Corporation of India.
(IRBI).
19. The shipping credit and investment
6.Commercial banks.
company of India.
7.Life insurance corporation ((LIC).
20. The World Bank.
8. General Insurance Corporation(GIC).
21. Asian developed Bank.
9. Unit Trust of India(UTI).
22. Infrastructure and leasing financial
10. Small industrial development Bank of corporation.
India(SIDBI).
11. Mutual Funds.
12. Leasing companies.
13. Risk capital foundation.
14. National Bank for agriculture and
rural development(NABARD).
21). Finical incentives available to SSIs.

1. Composite loan scheme 2. Margin money scheme for tiny sector

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 3. Special capital scheme 9. Bill rediscounting scheme
4. Equity fund scheme 10. Margin money scheme for revival of
5. Seed capital scheme sick units
6. Equity fund scheme 11. Rehabilitation scheme for sick units
7. Soft loan scheme for modernisation 12. Credit guarantee scheme
8. Differential rate of interest scheme

22). Advantages of partnership firm.

1. Easy to form 5. Sharing risk

2. Availability of large resources 6. Protection of interest of each
3. Better decisions partner
4. Flexibility in operations
Disadvantages of partnership firm
1. Unlimited liability
2. Uncertain life
3. Lack of harmony
4. Limited capital
5. No transferability of share

24). Functions of small industries service institute

(SISI)

1. It serve as interface between central 6. Trade and market information

and state govt. 7. Project profiles
2. It render technical support services 8. State industrial potential surveys
3. It conduct entrepreneurship 9. District industrial potential surveys
development programmes 10. Workshop facilities
4. It initiate promotional programmes 11. Training in various trade /activities
5. Economic consultancy

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Department of Commerce .