entreprenuership final new

8/2/2019 Entreprenuership Final New

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Introduction

Entrepreneurship is more than simply starting a business. The termentrepreneurship means: a process through which individuals identify

opportunities, allocate resources, and create value. This creation of value is oftenthrough the identification of unmet needs or through the identification ofopportunities for change.

Entrepreneurs see problems as opportunities, then take action to identifythe solutions to those problems and the customers who will pay to have those

problems solved.

Entrepreneurial success is simply a function of the ability of an entrepreneurto see these opportunities in the market place, initiate change (or take advantage ofchange) create value through solutions.

Entrepreneurs can make a simple shift in their thinking to drastically impactthe way they look at their business and the natural business cycle. The way of

thinking can be summed up as: think of your business as you would a stock youown and your time as the currency invested in the stock. Successful stock market

investors are disciplined and objective. They decide at the outset of their

investments at what point they will buy, sell or hold a stock. Investors whoinevitably lose money are emotional and do not adhere to an investment plan.

Characteristicsof an entrepreneur

Ability to bear risk, Technical knowledge about production techniques and marketing, Ability to gather financial and motivational resources Ability to build a sound organization. Innovative i.e introduction of something new to the nation (e.g: Dhirubhai

Ambani, Indian entrepreneur);

Imitating i.e. one who adopts a method of production or technology alreadyadopted by someone else and may not be able to afford resources forentrepreneurial research;

Fabien i.e those who are cautious in adopting any changes and are shy andlazy to adopt new methods


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What if I fail? That is undoubtedly the biggest question on mind as oneestablishes his own business. As an entrepreneur, one is excited about his new

business venture. He also knows the possibility of failure looms.

Given the time, money and effort that it takes to start a business, not tomention the high rates of small business failure, it is a wonder that anyone venturesout on their own. It is monumentally challenging to convince prospective investorsand lenders that ones idea is worthy of the risk they will take while one has hisown questions about the business viability.

Despite these obstacles, most entrepreneurs, will have no problemdeveloping their business, getting excited about its prospects, and sharing theirexcitement with others. Like many entrepreneurs one may establish his company

with the best of all worlds in mind and fail to consider what will happen when theworst of all worlds happens. An old maxim warns: When you fail to plan, youplan to fail.

The Remedy: Spend adequate time thinking through the business in advance.The risks attendant to starting ones own business can be minimized by analyzingmistakes made by other entrepreneurs and avoiding them. The more time youspend minimizing risk, the happier you and your investors will be.

Here are some of the common mistakes committed by entrepreneurs:

Management Mistakes

Lack Of Experience

Poor Financial Control

Weak Marketing Efforts

Failure To Develop Strategic Plan

Uncontrollable Growth

Poor Location

Improper Inventory Control Incorrect Pricing

Entrepreneurial Transition


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Profit and loss? Balancesheet? Cashflow !

o Uncontrolled increase in stores and personnel were bleeding thetreasury.

o Turnover being the mantra, subhiksha worked on slim and zero

margins, often invoking the wrath of other players in the market.o Thus cash outflows were high whereas inflows in terms of margins

were nonexistent.

Mastering the supply chain

o A wall mart bills scale through integrated supply chain, not by being a

re-seller!o Downstream supply chain was not integrated

o Bulk buying is not a source of advantage.o In effect, subhiksha was being a re-seller buying products from

vendors and selling them at zero margins.

Managing vendors

o Subhiksha tried to build scale on bulk quantity purchases fromvendors and a liberal credit term extended to them.

o Your vendors only have a limited leashexpecting huge credit cycles

to make up for return on investments is hardly good vendor

management Inventory management

o Credit defaults caused supply breakages

o Hence it led to situations where either there were huge storeinventories going bad

o or the stores simply did not have stocks!

o Inconsistency resulted in customer dissatisfaction with store

franchise!o Furthermore, unrestrained practices like reselling to other retailers,

made companies squeeze supplies.o In rush to earn return on investment and turnover, subhikhsa stores

were resorting to indiscipline and wasteful practices.

Discounts as USP

o The only USP was discounthardly a competitive edge.o Footfalls turn around and turnover being the guru mantra: Subhiksha


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never understood its customers.o In a rush to build turnarounds and turnover and meet targets, lower

level managers resorted to reselling it to retailers and emptying theirinventories.

o In effect, target pressure impacted the USP since consumers chose tobuy from outside the stores since the store was sold out.

Quality of ground level management

o Personnel recruited to run operations were locals.

o Tendency towards dishonest practices in face of turnover pressure!

o Scored own goals by playing into the turnover traps.

o Quality of store service was bad, adherence to rules of retail were

minimal.

Diffused focus

o Subhiksha sold fresh vegetables, medicines, groceries, mobile phones,

accessories and morewhere was the focus?o How Robust was the business model and the man power to handle

such diversity?o Did they ever stop to catch a breath and consolidate?


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11 Deadly mistakes many young entrepreneursmake

1. No Clear Goal/Vision

One very deadly mistake common among young entrepreneurs is the lack ofvision. Many young entrepreneurs venture into business without giving any

thought on its implications, they dont know what they want to achieve and theydont know what it takes to achieve it.

Achieving business success has a lot to do with your person and onefundamental truth is that your goals/vision can mould you up. If your goal is to

build the biggest company in the world and all you do is sit down and play gamesmorning and night you should know that you are going nowhere.

As a young entrepreneur you should make sure you have clear goals for yourbusiness, you should know what you want to achieve from the very beginning and

you shouldnt spend your time beating around the bush.

Aside having great goals you should also make your goals and vision clearto those working with you, if they know what you want to achieve they will knowhow much effort they need to put in to make it a success.

2. Lack of Focus

This particular mistake is a killer and has destroyed the future of manyyoung entrepreneurs. Every now and then young entrepreneurs can be seen starting

so many businesses without waiting for one to succeed.

Business success is not about you having 20-30 businesses; it is about youhaving a successful business. There is no point in you having 50 businesses if noneof them succeeds.


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You should also realize that results dont come overnight so you shouldmake sure you focus on one business model for a long time before giving up on it.Dont expect to start a business and get results in one month, give your business aminimum of 6 months, and if possible years, before deciding if it is for you or not.

3. Unwilling to Admit Faults

It is one thing to make a mistake, it is another thing to admit and correct thatmistake. There is no how you can correct a mistake you dont admit to.

One major mistake young entrepreneurs make is that they are not willing toadmit their faults, they believe their business, ideas and everything they do is the

best thereby turning deaf ears to the advice of others.

It always help to admit and correct your mistakes when you discover thembecause this will help you avoid terrible dangers in the future. Always give ears towhat others have to say and dont pretend as if you know all or as if your decisionis perfect, always listen to others, admit, correct and learn from your mistakes.

4. Not Listening

Another very deadly mistake young entrepreneurs make is that they dont

listen, they just keep talking and talking and talking, little do they know that thiskills rather than build them.

Wise people dont talk much but there is always sense in the little they say.

Talkative are seen as foolish people and so does many serious businesspeople. If you are looking for sponsors or partners for your business and all youkeep on doing is talking, a wise partner will not associate with you.

There is power in listening and wise people say very few words and listen as

much as they can. Dont be known as a talkative but listen and think very carefullybefore you talk.

Another thing about listening is that it help you gain more respect as a youngentrepreneur and it also help you avoid unnecessary troubles. People havingnegative intention will not want to move near someone who is very wise and ifthey see that you listen and dont talk they will become even more afraid of you.


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5. Greed

This deadly mistake has claimed the life of so many businesses. Many youngentrepreneurs are so greedy that they venture into business only because of themoney, it is these type of people who wont do proper research before starting their

business, it is also these type of people who will sell their startups at a very smallstage.

If all you see about a business is the money you should know you aredestined to fail. Dont just focus on the money you can get from a business, rather,focus on other important things, including the future of the business.

6. Talking, Talking and Doing Nothing

If you are one of these types of entrepreneurs you will understand me better.There are some entrepreneurs who can talk about why their business idea is the

best and how they wish to change the world with it but you will end up seeingthem doing nothing.

There is no point in you talking about your business when you are not readyto do something about it. It is even advisable not to talk about your business until ithas materialized.

No matter how great your idea is, your idea isnt a business until it has been

developed; why not keep your talking until this stage.

7. Spending More Time on Developing and Less time on Selling

This is another deadly mistake noticed among young entrepreneurs,especially online. It is very important not to focus all your efforts on providingquality products while doing less about marketing it, this will only kill your

passion for your business.

Try to realize that there is nothing perfect and while it is important to spend

more time and give your best on making your product and business the best youshould also realize that you truly cant know how great or perfect your business isuntil it is tested by the public.

Focus 50% of your time on your product and 50% on marketing. It isimportant to realize that it doesnt matter how great your product is you will needto market it to get results. It is a suicide spending 90% of your time developing


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quality products and 10% on marketing it.

8. No Business Plan

Lack of business plan is another deadly mistake young entrepreneurs make,

they start their business and do things how they want, failing to realize that thisisnt the best way to go about a business.

Having a business plan help make your business better because you alreadyhave an organized way to do things, there will be no wasting of time on things thatdoesnt matter.

Having a business plan also help you know what will be the main source ofrevenue for your business and how the revenue should be spent, there will be nowaste of revenue because you already know where your money should go.

Another great advantage of a business plan is that it helps attract morepeople to your business.

9. Impatience

If you have ever wondered why 80% of businesses fail then this is it. Lackof patience is a disease and it will only make sure you never have a successful

business. Being patience is a virtue and it will help you build great businesses and

opportunities.

Your business wont go far if you are not patient because almost all thesuccessful businesses we have now became successful years after they have beenestablished. You should know as a young entrepreneur that there is nothing calledovernight success, you have to work hard and wait patiently to achieve realsuccess.

It is also important not to relent in the process of waiting; you never knowwhat will change your business forever.

10. No Enough Money

Questions from many young entrepreneurs such as how can I get this forfree? how can I get that for free? can be come across. Everybody know you are ayoung entrepreneur and you are not working so it wouldnt be easy to get funds butthere are some things that you should never get for free. If you are planning to start


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a website online stop looking for free domain names and hosting, they willdisappoint you when you need them most.

Instead of looking for free things you can rather focus on spending your timeworking part-time or doing some basic jobs to get the main funds you need to kick-start your business. You can also ask your friends, family members, and anybodyyou can ask for funds. Yes, it is not easy and no true success is easy to come by soyou shouldnt expect to achieve success easily as an entrepreneur, you have to paya great price for it.

11. Doing it Alone Not Getting Support from Others

Young entrepreneurs love doing everything alone and this kill rather thanbuild them. No serious entrepreneur will do everything alone so you should try to

get support from as many people as you can, you shouldnt waste your time doingeverything alone.

When talking about doing it alone it is not about managing your businessonly but it also has to do with some external things that can affect your business.You shouldnt just work on building your business alone but rather get in touchwith other successful entrepreneurs, network with them and let them know howimportant they are to you and how important you are to them.

Two heads are truly better than one and you wouldnt go far doing things on

your own, try to get support from others and your business will experience a greatleap.


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Case Study

17 Mistakes Start-ups Make!

John Osher has developed hundreds of consumer products, including an electrictoothbrush that became America's best-selling toothbrush in just 15 months. Healso started several successful companies, including Cap Toys.

He built sales to $125 million per year and then sold the company to Hasbro Inc.in 1997. But his most lasting contribution to the business world just may be a listof screw-ups he jotted on the back of a piece of paper.

After he sold my business to Hasbro, he decided hed make a list of everythinghe'd done wrong and [had] seen other entrepreneurs do wrong," explains the 57-year-old Jupiter, Florida, serial entrepreneur. "I wanted to make a company thatdidn't make any of these mistakes. I wanted to see if I could come up with the

perfect company."

He came up with an informal list of "16 Mistakes Start-Ups Make"-since expandedto 17-that has been used in a Harvard Business School case study, has been cited inmany publications, and has become a part of what he teaches buddingentrepreneurs in his frequent university lectures. He also used the list in 1999 whenhe started Dr. John's SpinBrush to sell a $5 electric toothbrush that quickly becameAmerica's best-selling toothbrush. In 2001, Procter & Gamble purchased thecompany from him for $475 million.

"I didn't expect it to actually work like that, but it did," Osher says. "It'll probablynever happen again. But we made a perfect business, from the beginning to sellingit to another company." Since then, however, Osher has created another product, anelectric dish scrubber that he also sold to Procter & Gamble. And he has yetanother health-and-beauty product-development effort underway-although he's

keeping the details close to the vest-in which he'll try again to create the perfectbusiness.

To home in on what lies behind the 17 mistakes, Osher told Entrepreneur whatthey are and how you can learn from them to achieve your own level of perfection.


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Mistake 1: Failing to spend enough time researching the business idea to see if it'sviable. "This is really the most important mistake of all. They say 9 [out] of 10entrepreneurs fail because they're undercapitalized or have the wrong people. I say9 [out] of 10 people fail because their original concept is not viable. They want to

be in business so much that they often don't do the work they need to do ahead oftime, so everything they do is doomed. They can be very talented, do everythingelse right, and fail because they have ideas that are flawed."

Mistake 2: Miscalculating market size, timing, ease of entry and potential marketshare. "Most new entrepreneurs get very excited over an idea and don't look for thetruth about how many people will want to buy it. They put together financial

projections as part of a presentation to pump up their investors. They say, 'Themarket size is 50 million people that could use this product, and if I could only sellto 2 percent of them, I'd be selling a million pieces.' But 2 percent of a market is a

lot. Most products sell way less than 1 percent."

Mistake 3: Underestimating financial requirements and timing."They set theirfinancial requirements based on Mistake 1, and they go ahead and make acommitment to this much office space and this many computers, and hire a vice

president of sales, and so on. Before they know it, based on sales projections thatwere wrong to start with, they have created costs that require those projections to

be met. So they run out of money."

Mistake 4:Over projecting sales volume and timing. "They have already

miscalculated the size of the market. Now they over project their portion of it.They often say 'There are 200 million homes, and I need to sell [to] x number ofthem.' When you break it down, though, a much smaller number of those are reallysales prospects. That makes it impossible to make their sales projections."

Mistake 5: Making cost projections that are too low. "Their cost projections arealways too low. Part of the reason is that they project much higher sales. There arealso unknown reasons that always come out that usually make costs higher than

planned. So on top of everything, their margins are now lower."

Mistake 6: Hiring too many people and spending too much on offices andfacilities. "Now you have lower sales, higher costs and too much overhead. Theseare the things that you see every day in companies that fail. And they all grow outof that first mistake: failing to research the size and viability of the opportunity."


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Mistake 7: Lacking a contingency plan for a shortfall in expectations. "Even ifyou're realistic in your estimates to start, there are things that happen when youstart a new business. Your sales ideas may be no good; bank rates may go up; theremay be a shipping strike. These aren't the result of poor planning, but they happen.More often than not, entrepreneurs just feel that something will come along whenthey need it. They don't have contingency plans for it not working out at the sizeand time they want."

Mistake 8: Bringing in unnecessary partners. "There are certain partners you need.For instance, you often need money, so you're going to need money partners. Buttoo many times, the guy with the idea takes on all his friends as partners. Many

people don't provide strategic advantages and don't warrant ownership. But they'reall going to get 25 percent of the company. It's totally unnecessary, and it's amistake. Before people are made partners, they have to earn it."

Mistake 9: Hiring for convenience rather than skill requirements. "In my firstbusiness or two, I hired relatives. It was easy to do, but in many cases, they werethe wrong people [for the job]. And it's hard to fire people, especially if they'rerelatives or friends. More time needs to be spent handpicking people based on skillrequirements. You really need super-skilled people who can wear more than onehat. It just bogs you down when you hire people who can't do the job."

Mistake 10: Neglecting to manage the entire company as a whole. "You see thishappen all the time. They'll spend half their time doing something that represents 5

percent of their business. You have to have a view of your whole company. But toooften, the person running it loses that view. They get involved in a part, and theydon't manage the whole. Whether I do this product or that product, whether I hiresomebody, [I consider] how they [will] fit long term and short term in the big

picture. Constantly try to see your big picture."

Mistake 11: Accepting that it's "not possible" too easily rather than finding a way."I had an engineer who was a very good engineer, but with every toy wedeveloped, he would say, 'You can't do it that way.' I had to be careful not to acceptthis too easily. I had to look further. If you're an entrepreneur, you're going to breaknew ground. A lot of people are going to say it's not possible. You can't accept thattoo easily. A good entrepreneur is going to find a way."

Mistake 12: Focusing too much on sales volume and company size rather thanprofit. "Too much of your management is often based on volume and size. Somany entrepreneurs want to say 'I have a company that's this big, with this many


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Don't let it become a potpourri, or it loses its power. For instance, you say, 'We'realready selling to Kmart, so we might as well make a toy because Kmart buystoys.' If you do that, the company becomes weaker. A company needs to be focusedon what it is. Then its power builds from that."

Mistake 17: Lacking an exit strategy. "Have an exit plan, and create your businessto satisfy that plan. For instance, I am thinking I might run my new business fortwo years and then get out of it. I think it's an opportunity to make a tremendousamount of money for two years, but I'm not sure [whether] it's proprietary enoughto stop the competition from getting in.

So I'm in with an exit strategy of doing it for two years and then winding down. Iwon't commit to long-term leases, and after the first year, we'll start watching themarketplace very closely and start watching inventories.


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Steps to avoid mistakes in Entrepreneurship

You have to make it clear to everybody what you're doing and why you are doingit. You should avoid mistakes as much as possible. Everything and everyone has acertain purpose. As an entrepreneur, you're considered a "unique" individual. If youcan clarify this to yourself, you will feel a surge of energy and enthusiasm. Thesethings can attract prospective clients. Everything you do now is like a magnet thatattracts energy.

The next thing that you have to do in order to earn great profits is to establishyour market. You should have an exact target for your products or services. Youhave to study the qualities of your customers so that you can make your own

product or service stand out from your competitors.

You should make use of every marketing material that you have to craft asignificant message to your customers. You have to communicate with themhonestly and authentically. Everything you do should be rooted in truthfulness andreliability. By doing this, you will attract more clients. With your energy, peoplewill be drawn to you.

Some entrepreneurs fail because of doubt and fear. They hesitate to take some

risks involved in the business. They doubt their abilities and skills. This is a barrierthat you should be able to knock down otherwise clients will shy away from you.

The next thing is to organize your schedules. Prioritize your businessobligations and responsibilities should be done at the right time and at the rightorder. You have to manage your time effectively. If you can develop and masterthis skill, it will mean more clients and definitely, more money.

You have to have the right system for your business so that you can also havetime away from work and be able to generate new ideas for other businessventures. You must have a system for your business operations, marketing, andofferings.

Change is the only thing permanent in this world. You have to adjust yourbusiness ideas according to these changes. Try to see if the products or servicesyou offer are still in demand.


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Some entrepreneurs live only for their business. They often forget aboutachieving the proper balance between personal and business life. You have toestablish specific strategies so that you can enjoy your success in all aspects ofyour life.

By following these steps, you will surely have a more successful business life andyou can expect more money to come your way. Being an entrepreneur will surelygive you more money that what you've ever imagined.


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Early setbacks of some of the Famous

Entrepreneurs

Many entrepreneurs have their business heroes. Some are revered not onlyfor their spectacular successes but for the reversals they endured and subsequentlyovercame. With economic indicators for a strong business recovery still faint, itcan be helpful to recall the early setbacks of some of the best-known entrepreneursand what can be learned from them.

Here's a look at iconic entrepreneurs, their early struggles and their eventual

comebacks.

Henry Ford

Company: Ford Motor Co.Setback: Ford suffered a few failed automotive endeavors early in his career,including Detroit Automobile Co., which he started in 1899. Its cars were lowquality and too pricey for average consumers.

Turnaround: Ford continued to develop better auto designs and gained nationalacclaim in 1904 by demoing a car -- the "Ford 999" -- that broke the land-speedrecord by going a mile in about 40 seconds. In 1908, he released the Model T, awell-made, low-priced car that quickly gained traction with U.S. consumers.Annual sales topped $250,000 by 1914.Quote: "Whether you think you can, or you think you can't -- you're right."

Lesson: Building a brand requires more than just building a good product.


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Frederick W. Smith

Company: Federal Express (now FedEx Corp.)

Setback: After revolutionizing overnight mail delivery in the 1970s, Smithintroduced an electronic delivery service, Zapmail, in 1984 to compete with faxmachines. But Zapmail didn't draw the anticipated interest and cost the companynearly $350 million over two years.

Turnaround: FedEx abandoned Zapmail in 1986 and the company refocused itsenergy on its core delivery business. The company generated $35 billion in revenuein 2010.

Quote: "Leaders get out in front and stay there by raising the standards by whichthey judge themselves and by which they are willing to be judged."

Lesson: Be willing to acknowledge failure, abandon bad ideas and move on.

Steve Jobs

Company: Apple ComputerSetback: After his forced resignation from Apple in 1985, Jobs spent the followingseveral years developing NeXT, a computer workstation for educators. But with ahigh price tag and reports of numerous bugs, sales never materialized. Thecompany burned through hundreds of millions of investor dollars.

Turnaround: Apple announced it would buy NeXT in 1996, bringing Jobs back to

the company as interim CEO. He's since developed the iPod and iPad, makingApple one of the most successful Fortune 500 companies of the past decade.

Quote: "You can't just ask customers what they want and then try to give that tothem. By the time you get it built, they'll want something new."


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Lesson: Having the right resources and people around you makes a big difference.

Martha Stewart

Company: Martha Stewart Living OmniMedia

Setback: She built her business from scratch and became a billionaire. But shemade a mistake (insider trading) that negatively affected her reputation andlanded her in jail.

Turnaround : Being an entrepreneur with guts; she refused to be cowed by hermistakes and she bounced back to fortune and fame. This is what she has to sayabout her mistake and resulting failure.

Quote: My new motto is: When you're through changing, you're

through.
http://strategicbusinessteam.com/entrepreneurial-skills-development/how-to-become-a-self-made-billionaire/http://strategicbusinessteam.com/entrepreneurial-skills-development/how-to-become-a-self-made-billionaire/


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CONCLUSION

Avoiding ten mistakes made by budding and seasoned entrepreneurs alike will putyou far ahead in the game. At the root of most of these mistakes is a lack of

planning and a failure to check with reality. When you start out, you may operatein a state of euphoria. Nothing can possibly go wrong and no one else could

possibly have your idea. While the latter may be true for the time being, the formeris a delusion. In every new venture, something is bound to go wrong at some point,rarely will everything happen just as youve envisioned.

An event may be catastrophic or seem hardly noticeable; in either cases there willbe some effect on the business. So why should you even try to plan ahead?Most events are foreseeable, at least as to the probability of occurrence. When theyare foreseeable, they are preventable, or, at least, their effects can be mitigated.

Another well- known maxim: success comes about when preparation meetsopportunity. A business caught without a plan or options is a business that willsoon be gone.

To err is human

So from this we want to convey that its humane to make mistakes.An Entrepreneur should be a good listener, a man of principles and a good strategic

planner. He must try to avoid the mistakes and try that its repetition is minimal.As, a person learns from mistakes and failures not only of his own but also fromothers. At such a phase it is the optimistic approach of an entrepreneur thatinspires him to think ahead and take risk to stand again and move towards growth.For an entrepreneur failure is a stepping stone and not a stopping stone. For himthe mantra is:To Rise, Awake And Stop Not Till The Goal Is Achieved.


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PREFACE

The document presents an overview of variety of mistakes that mostentrepreneurs often make. It covers the major and the most common mistakes thatare made by entrepreneurs during the course of their business.

An attempt has also been made to throw light on the repercussions of thesefaulty decisions. How fatal they can end up being has also been tried to explain.

The objective of the document is to provide the reader with knowledge ofhow and what kind of mistakes are done by entrepreneurs worldwide. Apart fromthis, an attempt has also been made in to show how to avoid making such blundersor how to overcome these.

The document is also supported by case lets to showcasing the effects ofnon- identification of mistakes and cases in which mistakes have been identified &worked upon.


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ACKNOWLEDGEMENT

We hereby show our gratitude to M.S. University, BBA Program, Faculty ofCommerce, for giving us with the opportunity to explore the entrepreneurial world.

We also present our gratitude to Mr. Bharat Pathak, professor in-charge, forguiding us through this sea of entrepreneurship, without whom, learning wouldnthave been fun and interesting.

entreprenuership final new

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