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​Highlight four ways in which a legal-political environment can impact negatively on entrepreneurs

27/3/2021

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​Highlight four ways in which a legal-political environment can impact negatively on entrepreneurs. (4 mks)

  1. Lack of political stability in the country scares away investors.
  2. Government policies like high taxation discourages investors.
  3. Requirements for one to start a given business may be costly.
  4. Procedures to be used to acquire relevant documents may be lengthy and tiresome.
  5. Lack of political goodwill to support entrepreneurs in a country’s government.

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Define the following terms as used in Business Studies

27/3/2021

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Define the following terms as used in Business Studies. (4 mks)

(i) Economics

​It refers to the study of how human beings strive to satisfy their unlimited wants using the limited / scarce resources.

​(ii) Entrepreneurship

​It refers to the process of identifying business opportunity and acquiring necessary resources to maximize the profit.
Entrepreneurship

​(iii) Opportunity cost 

​This is the value of the best next alternative forgone when acquiring or when a choice has been made.

​(iv) Scale of preference

It is a list of wants showing the order in which they are satisfied from the most urgent to the least urgent.

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​Highlight four ways in which entrepreneurs can observe ethics in the management of their business

19/3/2021

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​Highlight four ways in which entrepreneurs can observe ethics in the management of their business. (4 mks)

  1. By having zero tolerance to corruption in business dealings.
  2. By practicing fair business practices with competitors
  3. By providing quality goods and services
  4. By compliance with the country’s laws and regulations.
  5. By offering fair prices on goods and services to avoid consumer exploitation.
  6. By not discriminating of employees in terms of gender, religion, ethnicity and race.
  7. By eliminating use of unfair means of achieving business objectives such as boarding and selling of counterfeit goods.
Highlight four ways in which entrepreneurs can observe ethics in the management of their business

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Ethical Issues in Business

3/10/2020

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Ethical Issues in Business

Ethical Issues in Business
  1. ​Ethics -
    refers to a set of values, principles and rules of acceptable behavior which influence how individuals, groups of people and the society in general behave.
  2. Business ethics-
    refers to acceptable behavior that should be displayed by business people. Business ethics helps businesses in deciding what actions are right or wrong depending on circumstances.
  3. Ethical issues-
    ​are the moral concerns that arise in the course of carrying out business.

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Causes of Business success

3/10/2020

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Causes of Business success

​A business is considered as being successful if it makes consistent profit and experiences progressive growth in the scale of its operations.
Causes of Business success

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Factors that influence entrepreneurship practices

3/10/2020

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What are the factors that influence entrepreneurship practices?

Factors that influence entrepreneurship practices
There are many conditions or factors which may encourage or discourage entrepreneurship. Some of these factors are:
  1. Government policy- 
    Some government policies are favourable to the operations of the business and thus encourage people to go into business while other policies may be unfavourable and will discourage people from going into business. E.g. higher taxes are unfavourable hence discouraging.
  2. Infrastructure- 
    infrastructure includes transport and communication networks, water, security etc. Availability of good infrastructure in an area tends to encourage people to set up businesses while poor infrastructure tends to discourage them
  3. Levels of education and skills- 
    Relevant and appropriate knowledge and skills are necessary if the business has to succeed. These are acquired through education, training or experience.
  4. Availability of markets- 
    Adequate markets encourages existing entrepreneurs to continue producing and also encourage/attract new ones to venture into business.
  5. Availability of resources- 
    Appropriate resources are necessary for starting and smooth running of a business. These resources include physical, human, capital and technology.
  6. Cultural and social beliefs and attitudes-
    These are norms, values and beliefs of a given community. Culture helps determine the kind of goods and services that people consume. This in turn, dictates the type of businesses to be established in such communities. E.g. Muslims do not take pork therefore businesses selling pork will not do well in such communities.
  7. Competition-
    Businesses will do well if they are able to complete favourably. Others will avoid competition by establishing businesses where there is no competition.
  8. Political stability-
    political stability gives conducive atmosphere for businesses to start and thrive on the other hands, where there is no political instability, businesses may not do well and entrepreneurs may close down businesses or new ones may not come up.
  9. Natural factors-
    natural factors such as rainfall, temperatures, earthquakes, pests, drought etc. may influence the type of businesses that are carried out in an area, especially agricultural businesses.
  10. Presence of role models in the society-
    ​The presence of successful entrepreneurs acts as an encouragement to aspiring entrepreneurs.


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Introduction, Contents and Why you need a Business Plan

3/10/2020

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Introduction, Contents and Why you need a Business Plan

Introduction to Business Plan

Introduction, Contents and Why you need a Business Plan
What is a Business Plan?
  • ​This is 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 written document that outlines the future activity for an existing or proposed business venture. [Slideshare.net]
  • Is the formal written expression of the entrepreneurial vision, describing the strategy and operations of the proposed venture.  [Slideshare.net]
  • A business plan is a document that brings together the key elements of a business that include details about the products and services, the cost, sales and expected profits.  [Slideshare.net]


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Introduction and Factors to consider when evaluating a business opportunity

3/10/2020

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Introduction and Factors to consider when evaluating a business opportunity

Introduction and Factors to consider when evaluating a business opportunity

Introduction to Business Opportunity

A good business plan is not necessarily a business opportunity. A business idea becomes a business opportunity if it is viable i.e. it can be developed into a successful/profitable business enterprise
A business opportunity is a favourable chance that an entrepreneur accepts for investment. It exists where there is a gap to be filled in the needs of the market.
​Examples of such gaps include;
  1. In availability of products-
    This is where goods and services needed by the consumers are not available at all in the market.
  2. Poor quality products-
    A business opportunity exists if one offers better quality goods and services than those of the existing businesses.
  3. Insufficient quantities-
    This is where the goods supplied are not enough to meet the demand/need of the consumers.
  4. Un-affordable prices-
    A business opportunity exists where one would charge affordable prices.
  5. Poor services-
    A business opportunity exists where customers are not served well.
​A business opportunity is a favourable chance that an entrepreneur accepts for investment. It exists where there is a gap to be filled in the needs of the market. 

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Generating Business Ideas and Sources of Business Ideas

3/10/2020

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Generating Business Ideas and Sources of Business Ideas

Generating Business Ideas

Generating Business Ideas and Sources of Business Ideas
For an entrepreneur, the first step in starting a business begins with an idea (business idea)
Business ideas are all about thoughts on possible businesses an entrepreneur can start or improve. It indicates among other things;
  1. The products to produce/sell
  2. Who the business will sell to (market)
  3. Where the business will be located
  4. How the business will be run (management)
  5. Why the business is needed (objectives)

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Characteristics of an entrepreneur

3/10/2020

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What are the Characteristics of an Entrepreneur?

Characteristics of an entrepreneur
​A good entrepreneur should have the following characteristics;
  1. Desire to achieve-
    An entrepreneur is a person who wishes to excel and has the drive to succeed while competing with others. He/she always tries to accomplish something new.
  2. Ability to solve problems-
    An entrepreneur is expected to struggle with determination to get solutions even under difficult situation so that the business can succeed.
  3. Risk taker-
    Entrepreneurs take viable business ventures even when they are not sure of the returns. They assess situations and take calculated risks.
  4. Initiative –
    An entrepreneur should be aggressive in implementing ideas well ahead of other businesses so that he/she can be ahead of them.
  5. Time consciousness-
    An entrepreneur should be able to use time wisely and avoid wasting it. A wise and quickly implemented decision may mean success in business whereas time lost may mean failure.
  6. Creativity and innovation-
    An entrepreneur should be able to generate new ideas as well as think of the best ways of putting them into practice.
  7. Independence and self-confidence-
    Entrepreneurs are their own bosses and should believe in their ability to do things and succeed.
  8. Persistence and patience-
    An entrepreneur should not give up when challenges arise. Sometimes, he/she takes time and make a repeated action or adopts a different course of action in order to overcome such challenges so as to reach the target
  9. Decisive-
    Entrepreneurs have strong problem, solving and decision making skills. The business environment is such that decision has to be made quickly to respond to any situation that may arise.
  10. Persuasive-
    Convincing people to believe in their ideas and buy their products keeps entrepreneurs in business
  11. Goal-oriented-
    Entrepreneurs are achievers who work towards set goals. They continually monitor progress to determine whether they are achieving the goals they have set and where improvements need to be made.
  12. Seek information-
    Entrepreneurs use various methods to get the relevant information that is necessary for the success of the business.
  13. Concern for high quality products-
    An entrepreneur should strive to cope or beat the existing standards of quality. This will enable him/her succeed in a competitive market.
  14. Commitment to work-
    An entrepreneur places priority on getting tasks accomplished. To achieve this he/she may make extra ordinary personal sacrifice e.g. working until very late.
  15. Concern for customer satisfaction-
    An entrepreneur should ensure that customers are satisfied so as to continue being/remain loyal to the business.
  16. Desire to feedback-
    ​An entrepreneur should be interested in knowing how the business is performing.

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Importance of entrepreneurship to an economy

3/10/2020

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Importance of entrepreneurship to an economy is as follows:

Importance of entrepreneurship to an economy
  1. Creation of employment- 
    Through entrepreneurship, jobs are created which help in absorbing people who would otherwise have been jobless e.g. people employed in the jua kali sector. 
  2. Formation of capital-
    Profit earned by entrepreneurs may be used to expand the business or even to start other businesses. Wages and salaries paid to the employees is a source of capital to them.
  3. Raising standards of living- 
    Entrepreneurs pay wages and salaries to their employees which enable them to acquire goods and services they need to live comfortable lives. Entrepreneurs also provide a wide variety of goods and services to consumers hence leading to improved living standards.
  4. Encourages the use of local resources- 
    Entrepreneurship makes it possible to use/exploit local resources. Idle resources such as scrap metal may be used to make jikos.
  5. Improving infrastructure- 
    The existence of businesses in the economy makes the government establish or improve infrastructure such as roads, communication facilities and water. At other times, entrepreneurs may combine forces to improve infrastructure in their area of operation.
  6. Savings on imports- 
    Local entrepreneurs are able to produce goods and services that are a substitute to imports. This helps the country to reduce the amount of money required to pay for such imports.
  7. Reducing foreign dominance of the economy- 
    Participation of local entrepreneurs in various business activities helps in reducing investments by foreigners in the particular area.
  8. Promotion of technology/promotion of innovation, research and development- 
    Entrepreneurs are creative and they come up with new and better ways of accomplishing tasks. Most of the inventions and innovations in our society have been developed by entrepreneurs.
  9. Promotion of entrepreneurial culture/helps in the creation of role models- 
    Successful entrepreneurs/entrepreneurial ventures encourage other members of society to initiate their own businesses and hence act as role models in the business world.
  10. It contributes to government revenue- 
    Taxes and fees paid by entrepreneurial ventures constitute part of government revenue/income that helps it to facilitate its operations.
  11. It promotes economic growth- 
    Entrepreneurs produce goods and services. This increases the volume of goods and services in the economy leading to expansion of the economy.
  12. It may promote self-actualization and esteem- 
    ​By initiating businesses in which they are their own bosses, entrepreneurs pride is boosted and this may promote the overall productivity of the economy.

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Introduction to Entrepreneurship

3/10/2020

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Meaning of entrepreneurship

Introduction to Entrepreneurship
​This is the process of identifying business opportunities and gathering the necessary resources to start and run a business.
An entrepreneur who identifies business opportunities and gets the necessary resources in order to start and run a business. The entrepreneur therefore creates new businesses or transform the existing ones in the face of risks and uncertainties in order to make profits.
An entrepreneur is therefore a business owner; he starts and organizes the business (the factors of production in appropriate combination)


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    Business Studies Notes Form 1 - 4

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