1.5.2 - entrepreneurial motives and characteristics Flashcards
5 main characteristics required to become successful entrepreneur
- understanding the market
- determination
- passion
- resilience
- ability to cope with risk
Do good entrepreneurs take risks
They way up the risk and reward and if the risk isn’t too great then they take it
3 common skills good entrepreneurs need to demonstrate
- financial skills
- persuasive abilities
- networking skills
What is involved with financial skills
Understanding key financial documents and how finance allows a business to function
What’s involved in networking skills
Having a wide range of business contacts and being able to find help when it is needed
2 financial reasons people set up a business
Profit maximising
Profit satisficing
Def of product maximising
Continually seek to get the most profit from every business transaction
Drawbacks of profit maximising
Can cause long term problems with consumers feeling exploited
Def of profit satisficing
Blending a desire for profit with other factors such as building a good reputation of having a work-life balance
Weakness of profit satisficing
Need to accept lower than possible profits in the short term to build a brand or reputation
The 4 non-financial motives
Independence, home-working, ethical stance and social entrepreneurship
Description of independence
Set up their own business in order to saiid taking orders from others and keeping in line with company policy. Research shoes being own goss is a very common motive
Description of home-working
Other form of independence, highly favoured by those with family commitments
Description of ethical stance
For those with strong beliefs, their ethical stance may lead them to reek the need to start their own business, especially if unwilling to compromise their beliefs by working in a business
Description of social entrepreneurship
Business started with goal to make positive contribution to their community, sometimes providing a service that helps people in need.
