entrepreneurs and leaders

Question 1

ROLE OF an ENTREPRENEUR

Answer 1

• generating a good business idea (good = based off understanding of consumers/ market)
• spotting an opportunity (gaps in market)

Question 2

entrepreneur expansion bad habits

Answer 2

• over estimating demand
• failing to raise funds
• not recruiting the right or enough ppl

Question 3

barriers to entrepreneurs

Answer 3

• funding (banks less willing to give start up loans due to them being likely unprofitable)
• gender bias
• societies view (they feel they’re trying to avoid taxes)

Question 4

ENTREPRENEURIAL MOTIVES

Answer 4

• profit maximisation
• independence
• home working
• ethical stance
• make a positive contribution to their community

Question 5

forms of business

Answer 5

• sole trader (person who starts up a business without turning it into a company)
• partnership (a business with several sole trader owners)
• LTD (private limited company - limited liability)
• PLC (public limited company - limited liability)
• franchising (start up a business using a tried and tested formula)

Question 6

business objectives

Answer 6

targets set by businesses using a strategy to achieve it:

• survival (generating enough cash to sustain a business)
• profit maximisation
• cost efficiency (minimise cost to maximise profit)
• sales maximisation (growing customers)

Question 7

unlimited liability definition

Answer 7

means that owners must take personal responsibility for covering debts run by their business

Question 8

limited liability

Answer 8

a form of legal protection which ensures owners can only lose money they invested into a business, not personal assets

Question 9

OPPORTUNITY COST + trade off

Answer 9

opp cost - the loss of other alternatives when one alternative is chosen
trade off - a compromise with options when making a decision, choosing a bit of one and a bit of the other

Question 10

moving from an entrepreneur to a leader

Answer 10

one an entrepreneurs business grows they become leaders, common issues with it:

• delegating: finding it hard to let go of authority
• maintaining effective communication: with more staff coming in, it’s harder to keep communication flowing well
• coordinating more people: harder to build relationships with everyone than previously
• keeping an eye in the big issue: subtle changes in direction can take place