Entrepreneurship

SMALL BUSINESS
MANAGEMENT II
ENTREPRENEURSHIP
Definition of Entrepreneurship
• The concept of entrepreneurship was first
established in the 1700s, and the meaning
has evolved ever since. Many simply equate it
with starting one’s own business.
• But entrepreneurship is more than just merely
starting a business.
• It involves;
 Seeking opportunities
 Taking risks beyond security
 Having the tenacity to push an idea through to
reality
Entrepreneurship:
A dynamic process of vision, change, and creation.
• Requires an application of energy and passion
towards the creation and implementation of new
ideas and creative solutions.
Essential ingredients include:
• The willingness to take calculated risks—in terms of
time, equity, or career.
• The ability to formulate an effective venture team; the
creative skill to organize needed resources.
• The fundamental skills of building a solid business
plan.
• The vision to recognize opportunity where others see
chaos, contradiction, and confusion.
• Entrepreneurship is the process of
creating something with value by devoting
the necessary time and effort assuming
the accompanying financial, physiological
and social risks and receiving the
resulting rewards of monetary and
personal satisfaction.
Who Are Entrepreneurs?
• Entrepreneur refers to a person who visualizes a
business opportunity, takes steps to promote a
new enterprise, assembles resources in the form
of men, materials and money to make the business
venture successful and bears the risk and
uncertainties involved.
• These are independent individuals, intensely
committed and determined to persevere, who
work very hard.
They are confident optimists who strive for
integrity.
They burn with the competitive desire to excel and
use failure as a learning tool.
Attributes of Successful
Entrepreneurs
• Successful entrepreneurs come in various
ages, income levels, gender, and race.
They differ in education and experience.
But research indicates that most
successful entrepreneurs share certain
personal attributes, including: creativity,
dedication, determination, flexibility,
leadership, passion, self-confidence, and
“smarts.”
Entrepreneurs
• Creativity is the spark that drives the
development of new products or services or
ways to do business. It is the push for
innovation and improvement. It is continuous
learning, questioning, and thinking outside of
prescribed formulas.
• Dedication is what motivates the
entrepreneur to work hard, 12 hours a day or
more, even seven days a week, especially in
the beginning, to get the endeavor off the
ground. Planning and ideas must be joined by
hard work to succeed. Dedication makes it
happen.
Entrepreneurs
• Determination is the extremely strong desire
to achieve success. It includes persistence
and the ability to bounce back after rough
times. It persuades the entrepreneur to make
the 10th phone call, after nine have yielded
nothing. For the true entrepreneur, money is
not the motivation. Success is the motivator;
money is the reward.
• Flexibility is the ability to move quickly in
response to changing market needs. It is
being true to a dream while also being
mindful of market realities.
Entrepreneurs
• Leadership is the ability to create rules and to
set goals. It is the capacity to follow through
to see that rules are followed and goals are
accomplished.
• Passion is what gets entrepreneurs started
and keeps them there. It gives entrepreneurs
the ability to convince others to believe in
their vision. It can’t substitute for planning,
but it will help them to stay focused and to
get others to look at their plans.
Entrepreneurs
• Self-confidence comes from thorough
planning, which reduces uncertainty and the
level of risk. It also comes from expertise.
Self-confidence gives the entrepreneur the
ability to listen without being easily swayed
or intimidated.
• “Smarts” consists of common sense joined
with knowledge or experience in a related
business or endeavor. The former gives a
person good instincts, the latter, expertise.
Successful Entrepreneurs
• Successful entrepreneurs come in various
ages, income levels, gender, and race.
They differ in education and experience.
But research indicates that most
successful entrepreneurs share certain
personal attributes, including: creativity,
dedication, determination, flexibility,
leadership, passion, self-confidence, and
“smarts.”
TYPES OF ENTREPRENEURS
A. ON THE BASIS OF TYPE OF BUSINESS.
Entrepreneurs are classified into different
types. They are;
1) Business Entrepreneur: He is an individual
who discovers an idea to start a business and
then builds a business to give birth to his idea.
2).Trading Entrepreneur: He is an
entrepreneur who undertakes trading activity i.
e; buying and selling manufactured goods.
Types of Entrepreneurs
3) Industrial Entrepreneur: He is an entrepreneur
who undertakes manufacturing activities.
4) Corporate Entrepreneur: He is a person who
demonstrates his innovative skill in organizing
and managing a corporate undertaking.
5) Agricultural Entrepreneur: They are
entrepreneurs who undertake agricultural
activities such as raising and marketing of crops,
fertilizers and other inputs of agriculture. They
are called agripreneurs.
B. ON THE BASIS OF USE OF TECHNOLOGY:
Entrepreneurs are of the following types.
1) Technical Entrepreneur: They are extremely
task oriented. They are of craftsman type.
They develop new and improved quality
goods because of their craftsmanship. They
concentrate more on production than on
marketing.
2) Non-Technical Entrepreneur: These
entrepreneurs are not concerned with the
technical aspects of the product. They develop
marketing techniques and distribution
strategies to promote their business. Thus they
concentrate more on marketing aspects.
3) Professional Entrepreneur: He is an
entrepreneur who starts a business unit but
does not carry on the business for long period.
He sells out the running business and starts
another venture.
C. ON THE BASIS OF MOTIVATION:
1) Pure Entrepreneur: They believe in their own
performance while undertaking business
activities. They undertake business ventures
for their personal satisfaction, status and ego.
They are guided by the motive of profit.
2) Induced Entrepreneur: He is induced to take
up an entrepreneurial activity with a view to
avail some benefits from the government.
These benefits are in the form of assistance,
incentives, subsidies, concessions and
infrastructures.
3) Motivated Entrepreneur: These
entrepreneurs are motivated by the desire to
make use of their technical and professional
expertise and skills. They are motivated by
the desire for self-fulfillment.
4) Spontaneous Entrepreneur: They are
motivated by their desire for self-employment
and to achieve or prove their excellence in job
performance. They are natural entrepreneurs.
D. ON THE BASIS OF STAGES OF
DEVELOPMENT: They may be classified into;
1) First Generation Entrepreneur: He is one
who starts an industrial unit by means of his
own innovative ideas and skills. He is
essentially an innovator. He is also called new
entrepreneur.
2) Modern Entrepreneur: He is an
entrepreneur who undertakes those ventures
which suit the modern marketing needs.
3) Classical Entrepreneur: He is one who
develops a self supporting venture for the
satisfaction of customers’ needs. He is a
stereo type or traditional entrepreneur.
E. CLASSIFICATION ON THE BASIS OF
ENTREPRENEURIAL ACTIVITY: They are
classified as follows:
1) Novice: A novice is someone who has
started his/her first entrepreneurial venture.
2) Serial Entrepreneur: A serial entrepreneur
is someone who is devoted to one venture at
a time but ultimately starts many. He
repeatedly starts businesses and grows them
to a sustainable size and then sells them off.
3) Portfolio Entrepreneurs: A portfolio
entrepreneur starts and runs a number of
businesses at the same time. It may be a
strategy of spreading risk or it may be that
the entrepreneur is simultaneously excited
by a variety of opportunities.
Necessity and Opportunity
Entrepreneurship
• Number of start ups per adult population as
per Global Entrepreneurship Monitor
Report
• Necessity entrepreneurs
 started a business because they “have no
better choices for work”.
• Opportunity Entrepreneurs
 started a business to take advantage of a
business opportunity
INTRAPRENEURSHIP
• Operating entrepreneurially within an established
organization. Organization’s include;
 Religious institutions
 Corporate organization
 Government-Central or Local
 Non-governmental organization (NGO)
 Community
 Home/Family
 School
 As a practicing consultant
Intrapreneurs
• Intrapreneurs are persons who create
something new inside an existing
organization
• Intrapreneurs are found in all kinds of
organizations
• They are highly valued in today’s world
because it calls for constant improvement,
aggressiveness, vision, ability to assess
risks and quickly take action, etc.
Evolution of Entrepreneurship
• Entrepreneur is derived from the French
entreprendre , meaning “to undertake.”
• The term “entrepreneur” is said to be first
used with regard to the business context, in
the 18th century (1755) by an Irish economist
by the name Richard Cantillon.
• He made the first reference to an
entrepreneur as an agent who purchases
means of production (land, labour and capital)
to combine into marketable products.
• This definition seemed to satisfy people
until the 19th Century when another
economist “Jean Baptiste Say” described
the entrepreneurial function in broader
terms.
• He defined entrepreneurship as “the
bringing together of the factors of
production with the provision of
management and bearing of risks
associated with the venture”
• Building on Say’s thinking, Schumpeter (1934)
made a distinction between “entrepreneurs”
and other business founders/owner-
managers by suggesting that; entrepreneurs
are individuals who combine resources in
new ways through introduction of new
products, new methods of production,
marketing and delivery; opening up new
markets; finding new sources of supply; or
reorganizing an industry
• Schumpeter saw entrepreneurship as
innovative process of change, whereby new
products, or new combinations or procedures,
are created through “creative destruction”
• Business expert Peter Drucker (1909-2005)
took this idea further, describing the
entrepreneur as someone who actually
searches for change, responds to it, and
exploits change as an opportunity. A quick
look at changes in communications—from
typewriters to personal computers to the
Internet—illustrates these ideas.
Entrepreneurs versus
Small Business Owners: A
Distinction
• Small Businesses Owners
– Manage their businesses by expecting stable
sales, profits, and growth
• Entrepreneurs
– Focus their efforts on innovation, profitability
and sustainable growth
Role of Entrepreneurship in the
Economy
• It is beyond reasonable doubt that
entrepreneurship is essential for
economic development in a country like
Tanzania and anywhere in the world.
Entrepreneurs are regarded as the prime
movers of innovations and act as key
figures in economic development of a
country. Specifically entrepreneurship
serve the following roles in the economy.
Promotes Capital Formation
• Entrepreneurs promote capital formation by
mobilising the idle savings of public.
• They employ their own as well as borrowed
resources for setting up their enterprises.
• Such type of entrepreneurial activities lead
to value addition and creation of wealth,
which is very essential for the industrial and
economic development of the country.
Contributed towards innovations
• Almost 2/3 % of all and R & D
innovations are due to the
entrepreneurs.
• Technological progress
alone cannot lead to
economic development
unless technological
breakthroughs are put to
economic use by
entrepreneurs.
• It is the entrepreneur who
organizes and puts to use
capital, labour and
technology in the best
possible manner for the
setting up of his enterprise.
Promotes Balanced Regional
Development
• Entrepreneurs help in promoting a
country's export-trade, which is an
important ingredient of economic
development.
• They produce goods and services in large
scale for the purpose earning huge
amount of foreign exchange from export
in order to combat the import dues
requirement.
Reduces Concentration of
Economic Power
• Industrial development normally lead to
concentration of economic power in the
hands of a few individuals which results in
the growth of monopolies.
• In order to address this problem, a large
number of entrepreneurs need to be
developed, which will help reduce the
concentration of economic power amongst
the population.
Wealth Creation and Distribution
• It stimulates equitable redistribution of
wealth and income in the interest of the
country to more people and geographic
areas, thus giving benefit to larger
sections of the society.
Increasing Gross National Product
and Per Capita Income
• Entrepreneurship help increasing gross
national product as well as per capita income
of the people in a country.
• Increase in gross national product and per
capita income of the people in a country, is a
sign of economic growth.
Improvement in the Standard of
Living
• Entrepreneurship play a key role in increasing
the standard of living of the people by
adopting latest innovations in the production
of wide variety of goods and services in large
scale at a lower cost.
• This enables the people to avail better quality
goods at lower prices which results in the
improvement of their standard of living.
Use of Local Resources
• Entrepreneurs proper use the resources
which can result in the progress or
development of that area and creating the
local employment too.
Challenges facing entrepreneurship in
Tanzania
i. Limited source of funds- most of financial
institutions offers loans to those already have a
business. Some demand collaterals which may
not be available to entrepreneur.
ii. High cost of capital-microcredit institutions the
major source of financing entrepreneurs offer
loans at very higher interest rates.
iii. Lack of enterprising culture-many people prefer
to save their money in foreign banks rather than
investing in income generating activities.
Challenges facing entrepreneurship in
Tanzania
iv. Competition from big companies
v. Stringent conditions imposed by foreign
markets on products coming from third
world countries.
vi. Limited production capacity
vii. Lack of enough support
The Myths/Misconceptions of
Entrepreneurship
Myth 1: Entrepreneurship is easy
• The desire to succeed does not imply it is
going to be easy. It takes commitment,
determination and hard work. Entrepreneurs
often encounter difficulties and setbacks
Myth 2: Entrepreneurship is found only in small
businesses.
• Just because an organization is small doesn’t
automatically make it entrepreneurial.
Entrepreneurship can be found in any size of
an organization
Entrepreneurship Myths
Myth 3: Entrepreneurship is a risk gamble
• People think because entrepreneurship involves
pursuing new and interested ideas it must be a
gamble. Not really. Entrepreneurship involves
calculated risks not unnecessary ones. There are
times when entrepreneurship means avoiding or
minimizing risks.
Myth 4:Entrepreneurial ventures and small

business are the same thing.
• There are distinctive differences between the
two
Myth 5: Successful entrepreneurship needs
only a great idea.
• Creating or having an idea is only a part of the
equation being successful entrepreneur it
involves;
 Understanding demands of different phases
of entrepreneurial process.
 Taking organized approach to developing the
entrepreneurial venture
 Coping with the challenges of managing an
entrepreneurial venture.
Myth 6: Entrepreneurs Are Born, Not Made
• The basis for the belief in the born hypothesis
is that some individuals, families or
communities display the propensity to behave
entrepreneurially more dominantly than others.
• However , while individuals are born with
distinctive potential to learn certain things
faster and better than others (i.e. playing
soccer, singing , painting), they are not born
with these specific competencies. They largely
acquire what exists around them once they are
born.
Myth 7:Entrepreneurs Are Always Inventors
• This is a result of misunderstanding and
tunnel vision. Many inventors or innovators
are also entrepreneurs.
• Numerous entrepreneurs encompass all
sorts of innovative activities.
Myth 8: All Entrepreneurs Need Is Money
• For the true entrepreneur, money is not the
motivation. Success is the motivator;
money is the reward.
Myth 9: Entrepreneurs are doers, not thinkers.
• Entrepreneurs have a tendency toward action, but
they are also thinkers.
• Emphasis today is on the creation of clear and
complete business plans.
Myth 10: Entrepreneurs seek success but

experience high failure rates.
• Many entrepreneurs suffer a number of failures
before they are successful.
• Failure can teach many lessons to those willing to
learn and often leads to future success.
Assignment
• Assume you have a project whose objective
is to support a group of youths to start and
develop their own business enterprises. Your
objective is to have a group of businesses
that generate the highest possible profits in 5
years. You have to choose only 25
beneficiaries from a group of 300 young
people with different levels of education,
ranging from Diplomas to bachelor degrees.
When choosing beneficiaries, which would
you give more importance: level of education
or enterprising behavior. Is it ethical?
SCHOOLS OF THOUGHT OF
ENTREPRENEURSHIP AND
PROCESS APPROACHES
Schools of Thought of
Entrepreneurship
THE MACRO VIEW OF ENTREPRENEURSHIP
• Is a view which presents a broad selection
of factors relating to success or failure in
existing entrepreneurial businesses in the
external locus of control. It also includes
external processes that are beyond the
control of the individual entrepreneur and
can be broken down into three
subcategories:
The Environmental School of
Thought
• This school deals with external factors that
affect the lifestyle of a potential entrepreneur.
These could be positive or negative forces in
the modeling of entrepreneurial desires. The
school focuses on institutions, values and
influence of the society that put together, form
a socio-political environmental framework that
affects the development of an entrepreneur.
For example strong support from family and
friends may influence the desire to become an
entrepreneur. In the case of Richard Branson
this would refer to the major influence of his
mother.
The Financial/ Capital School of
Thought
• The foundations of this school are based
on the capital-seeking process. The search
for start-up and growth capital is the
complete focus because securing venture
capital is vital to an entrepreneur’s
development. In this case, the entire
entrepreneurial venture is viewed from a
financial management viewpoint and
decisions involving finance occur at every
major point.
The Displacement School of
Thought
• This thought process concentrates on the
negative side of the existence of group, where
someone can feel out of place or be displaced
from the group. It argues that a group can slow
a person’s development, either bringing it to a
halt or removing specific factors vital to the
individual for them to advance. As a result the
frustrated individual is motivated to succeed
which can be projected into an entrepreneurial
pursuit. There are three major types of
displacement that demonstrate this school of
thought
The Displacement School of
Thought
• Political displacement. Government
regulations and policies that can limit/
redirect certain industries or reject free
enterprise.
• Cultural displacement. Social groups
excluded from professional fields e.g. Ethnic
background, sex, race, religion.
• Economic Displacement. Job loss, capital
shrinkage and anything affected by economic
variations of recession and depression.
Schools of Thoughts Cont.…
THE MICRO VIEW OF ENTREPRENEURSHIP
• Examines the factors that are specific to
entrepreneurship and are part of internal
locus of control. The potential
entrepreneur has the ability to direct or
adjust the outcome of each major
influence.
The Entrepreneurial Trait School of
Thought
• Focuses on identifying traits common to
successful entrepreneurs.
• The study of successful people who tend to
exhibit similar characteristics that would
increase successful opportunities
• Four factors usually exhibited by successful
entrepreneurs:
1. Achievement
2. Creativity
3. Determination, and
4. Technical knowledge
The Venture Opportunity School of
Thought
• Focuses on the opportunity aspect of
venture development—the search for idea
sources, the development of concepts, and
the implementation of venture opportunities.
• Views creativity and market awareness as
essentials
• Deals with the ability to recognize new
ideas and opportunities and to implement
the necessary steps of action
The Strategic Formulation School of
Thought
• Emphasizes the planning process in
successful venture development.
• The effective venture formations are
constructed by unique markets, unique
people, unique products, or unique
resources. Each of these unique aspects
has it’s own strategy.
Approaches to Entrepreneurship
Integrative Approach
• Built around the concepts of inputs to the
entrepreneurial process and outcomes from
the entrepreneurial process.
• Focuses on the entrepreneurial process itself
and identifies five key elements that
contribute to the process.
• Provides a comprehensive picture regarding
the nature of entrepreneurship that can be
applied at different levels.
Figure 1.2 An Integrative Model of Entrepreneurial Inputs and
Outcomes
Source: Michael H. Morris, P. Lewis, and Donald L. Sexton,

“Reconceptualizing Entrepreneurship: An Input-Output Perspective,”SAM
Advanced Management Journal 59, no.1 (Winter 1994): 21–31.
Approaches to Entrepreneurship
Entrepreneurial Assessment Approach
• Stresses making assessments qualitatively,
quantitatively, strategically, and ethically in
regard to the entrepreneur, the venture, and
the environment
Multidimensional Approach
• Views entrepreneurship as a complex,
multidimensional framework that
emphasizes the individual, the environment,
the organization, and the venture process.
CREATIVITY AND
INNOVATION
Opportunity Identification:
The Search for New Ideas
• Identifying an opportunity is an integral part
of entrepreneurship.
• It involves pursuing creative ideas and the
innovative process.
• The first step for any entrepreneur is the
identification of a “good idea.” But the search
for good ideas is never easy.
• Once the opportunity has been recognized it
can lead to both personal and societal wealth.
Innovation and the Entrepreneur
Innovation: Meaning
• Is the process by which entrepreneurs convert
opportunities into marketable ideas. Is a
combination of the vision to create a good idea and
the perseverance and dedication to remain with the
concept through implementation.
• Innovation refers to successful creation,
development, and marketing of new goods or
successful application of new techniques or ways of
working that improve the effectiveness of
individuals and organizations.
• Innovation is a key function in the entrepreneurial
process and a specific function of entrepreneurship.
Major Types of Innovation
• Invention. Totally new product, service, or
process
• Extension. New use or different application of
an already existing product, service,
or process
• Duplication. Creative replication of an
existing concept
• Synthesis. Combination of existing concepts
and factors into a new formulation or use
Other Types of Innovation
Product innovation
• A product innovation is the introduction of a
good or service that is new or significantly
improved with respect to its characteristics or
intended uses. This includes significant
improvements in technical specifications,
components and materials, incorporated
software, user friendliness or other functional
characteristics. Think for example the
evolution of cell phones from analogue ones
to digital ones, introduction of disc walk-man
and laptops, the creation of the ‘Direct Line’
telephone insurance business instead of via
high street outlets, door-to-door, by post or
through intermediaries known as insurance
brokers, the coming of electric sewing
machines. Product innovations can utilize
new knowledge or technologies, or can be
based on new uses or combinations of
existing knowledge or technologies.
Types of Innovation Cont.
Process innovation
• A process innovation is the implementation
of a new or significantly improved
production or delivery method. This
includes significant changes in techniques,
equipment and/or software. Process
innovations can be intended to decrease
unit costs of production or delivery, to
increase quality, or to produce or deliver
new or significantly improved products.
• Business-to-business (B2B) Ecommerce is
dramatically reducing the need for paperwork
and those who process paper, namely
administrators. It is no surprise that all sorts of
business organizations from airlines to
insurance companies offer a discount for buying
online. Buying online means less paper and
money spent processing paper. One has only to
look at the size of the discounts offered to get
an idea of the efficiency gains that firms can
make.
• Other examples of process innovation are such
as Computerized Airline Reservations,
introduction of a bar-coded goods-tracking
system, introduction of GPS tracking devices for
transport services, payments via mobile phones
etc.
Marketing innovation
• A marketing innovation is the
implementation of a new marketing method
involving significant changes in product
design or packaging, product placement,
product promotion or pricing. Marketing
innovations are aimed at better addressing
customer needs, opening up new markets,
or newly positioning a firm’s product on the
market, with the objective of increasing the
firm’s sales.
Examples of marketing innovations includes
product design or packaging: coke sharing
cans bottle with names, First use of a
significantly different media-product
placement in a television programme;
Introduction for the first time of a franchising
system etc.
Organizational innovation
• An organizational innovation is the
implementation of a new organizational
method in the firm’s business practices,
workplace organization or external relations.
Organizational innovations can be intended
to increase a firm’s performance by reducing
administrative costs or transaction costs,
improving workplace satisfaction (and thus
labor productivity), gaining access to non
tradable assets (such as non-codified
external knowledge) or reducing costs of
supplies.
Innovation Process
• An innovation starts as a concept that is
refined and developed before application.
Innovations may be inspired by reality. The
innovation process, which leads to useful
technology, requires:
Research-continued search and
collecting information for possible
innovation-innovation ideas.
Development (up-scaling,testing/
laboratory work)
Innovation Process
• Production-creating the product or
service.
• Marketing-identifying those in need of
the product or service, arranging pricing,
promotion and placement of the product.
• Use-utilizing the product/service.
Experience with a product results in
feedback and leads to improved innovation.
Innovation Process
Figure 3.1: Typical steps in the life cycle of a
new technology/innovation
Principles of Innovation
• Be action oriented.
• Make the product, process, or service simple and
understandable.
• Make the product, process, or service customer-
based.
• Start small.
• Aim high.
• Try/test/revise.
• Learn from failures
• Follow a milestone schedule.
• Reward heroic activity.
• Work, work, work.
Sources of Innovative Ideas
The Unexpected
• The market place is the number one area to look
for opportunities. An entrepreneur/innovator
should be constantly studying the market.
• Questions like; Is a particular product or service
in greater or lesser demand than anticipated?
Why? Is there a way I can exploit this unexpected
success? What has to happen if I want to
convert this success into an opportunity?
• Upon looking at the market it is easier to
stumble at a profitable opportunity
The Incongruity
• There is a difference between what is and what
should be. This is a key to developing wildly
successful businesses but it’s tricky.
• Facebook is a good example of a company that
succeeded in this. Prior to the social network’s prolific
rise Myspace was the dominant player (2005-2009),
but it had its shortcomings.
• Facebook wisely noted what Myspace was compared
to what it should be and built that platform. It turned
its weakness into an opportunity and built a more
customer friendly easy to use social network with
more features (compared to Myspace entertainment
and music only platform).
• One of the best places to look for incongruity is in
your own customers. Their complaints and unmet
wants are all the hints you need.
Process Need
• Process need involves identifying your
business’s (venture) process weak spots and
correcting or redesigning them. This is a task
oriented solution meaning that the source of
innovation comes from within your existing
capabilities and ways of doing business – not
the market.
• An example might be a restaurant that identifies
that people wait too long for their entrees and
so decides to hire another chef to speed up
creation times.
• Essentially your business will want to look for
all weak links and eliminate them.
Industry and Market Structure Change
• Your industry and the market are in continual
change. Regulations change and some product
lines expand while others shrink. Firms should
continually be on the watch for this.
• One example is deregulation. When a previously
regulated industry becomes open there is
historical precedence for companies that enter
early to be very successful. Example the electrical
industry, once business are allowed to start
production the early firms will be at an advantage
• Other things to watch out for are the convergence
of multiple technologies and structural problems
that occur from time to time (often immediately
following an industry boom).
Demographics
• We constantly see changes occur in
populations, income levels, human capital
(education) and age ranges. Smart firms
are constantly paying attention to this.
• Combining demographic data with
segmentation and targeting is a powerful
method of accurately meeting a target
market’s desires.
Changes in Perception, Meaning, and Mood
• Over time populations and people change. The
way they view life changes, where they take their
meaning from, and how they feel about things also
is modified over time and smart companies must
pay attention to this in order to capitalize (and
avoid becoming forgotten, a relic of ages past).
• Here is a good example. There is a principle called
“downageing” which refers to people who look at
50 as being 40. Industries have responded to this,
most notably in the cosmetic and personal care
industry which provides plenty of solutions to help
these people look younger. Full industries are
creeping up that make people feel younger.
New Knowledge
• As the speed of technological revolution
increases there will be an ever increasing
number of opportunities that open up. The
internet has been the most notable one in the
last couple decades but there have been an
excess of other industries and opportunities
that pop up as a result of this technological
revolution.
• New knowledge is about more than just
technology though, it’s about finding better
ways of doing things and improving
processes. Your business should look to this
new knowledge for ways it can improve
incrementally.
Major Innovation Myths
• Innovation is planned and predictable
• Technical specifications should be
thoroughly prepared
• Creativity relies on dreams and blue-sky
ideas
• Big projects will develop better innovations
than smaller ones
• Technology is the driving force of
innovation success
Creativity (Meaning)
• Creativity is the ability to develop new ideas
and to discover new ways of looking at
problems and opportunities.
• The generation of ideas that result in the
improved efficiency or effectiveness of a
system.
• Creativity is the spark that drives the
development of new products or services or
ways to do business. It is the push for
innovation and improvement. It is continuous
learning, questioning, and thinking outside of
prescribed formulas.
Creative Process
• Creativity is a process that can be
developed and improved. Some
individuals have a greater aptitude for
creativity than others.
Creative Process
• Phase 1: Background or knowledge
accumulation
• Phase 2: The incubation process
• Phase 3: The idea experience
• Phase 4: Evaluation and implementation
Characteristics of Creative People
• Self-disciplined, independent, often antiauthoritarian
• More adaptable
• More adventurous
• High in memory, good attention to detail
• Broad knowledge background
• Greater tolerance for ambiguity and discomfort
• Little tolerance for boredom
• Ability to accept conflict and tension rather than
avoiding them
• Ability to concentrate
Characteristics of Creative People
• Are able to withstand being thought of as

abnormal or eccentric
• More maturely autonomous and less
dependent on views of others
• More curious
• Openness to experience, new ideas
The Creative Climate
Characteristics of a creative climate:
• A trustful management that does not over
control the personnel
• Open channels of communication among all
business members
• Considerable contact and communication
with outsiders
• A large variety of personality types
• A willingness to accept change
• An enjoyment in experimenting with new ideas
• Little fear of negative consequences for
making a mistake
The Creative Climate
• The selection and promotion of
employees on the basis of merit
• The use of techniques that encourage
ideas, including suggestion systems and
brainstorming
• Sufficient financial, managerial, human,
and time resources for accomplishing
goals
Assignment
• Identify and analyze the viable SMEs
opportunities in Tanzania and suggest the
ways that can be used to make potential
entrepreneurs realize and exploit these
opportunities.
STARTING A NEW BUSINESS
VENTURE
Introduction
• Once an entrepreneur becomes aware of the
concept and role of new venture, he could make up
his mind and proceed toward taking concrete
actions to establish the unit. The entrepreneur
could for that purpose, draw a plan of action so as
to suit his requirement of setting up a new venture.
• To be a successful entrepreneur it is necessary to-
have the foresight and an ability of sensing
Opportunities. It is an important entrepreneurial
function which calls for the ability and eagerness
to perceive and receive the curious signals and
process them for arriving at a final decision in
favor of an idea/enterprise.
Introduction
• An entrepreneur searches for and
identifies an opportunity before working
energetically to convert it into a business
reality. Opportunity is a result of
interaction between the need of the
society, capability of the entrepreneur and
resources available in the environment.
1. Researching the Venture’s
Feasibility
Generating and evaluating business ideas
• Entrepreneurs need ideas to start and
grow their entrepreneurial ventures. Idea
generation is an innovative and creative
process.
• It takes time, not only in the initial stages
of the venture but throughout the life of
the business
Sources of business ideas
I. Personal interest or hobbies. Many
entrepreneurial ventures got their start from the
entrepreneur’s love of doing/wanting/enjoying
something.
II. Entrepreneur’s work experiences, skills and
ability. By tapping into knowledge of a
particular industry or market gained by working
in it, an entrepreneur can pin point areas of
potential opportunities. Example; one pilot
created the first wheeled suitcase as a more
comfortable way of carrying luggage from one
point to the other.
Sources of business ideas
III. Looking at goods and services currently
available. Observing both familiar and unfamiliar
ones to see if there are needs that aren't being
met. Products that we use everyday, do they do
everything that you wish them to do?
IV. External environment. Positive trends and
changes that provide unique and distinct
possibilities for innovating and creating values
in the entrepreneurial context. Opportunities can
be found in the technological, socio-culture,
demographics and legal-political sectors
Ways to Generate Ideas
1. Environmental Scanning
• Scanning of environment refers to the understanding
of socio-culture, economic, technological, fashion
and even the changing life style and aspirations of
local people.
• It is not a matter of just observing the obvious in the
environment but sensing the emerging opportunities
out, of the interaction of such futuristic/emerging
needs of goods and services which otherwise are
not perceived by general masses.
• Scanning of environment is done by collecting
information from various sources. They include;
A. Personal Informal Sources
• Family
• Customers
• Friends
• Colleagues
• Salesmen
• Social Contacts
• Employees
B. Personal Formal Sources

• Bankers
• Business Councilors Impersonal Written Sources
C. Impersonal Written Sources
• Magazines
• Journals
• Books
• Newsletters
• Newspapers
• Catalogues
D. Impersonal Oral Sources
• Trade Shows
• Seminars / Workshops
• Professional Organizations
• Small Business Organizations
• Suppliers/Dealers
One should use as many sources as possible for the purpose
of scanning the environment.
2. Brainstorming
• A group of people get together in a room,
preferably one with a relaxed environment
where everybody will be free to stretch their
mind and think beyond the ordinary.
• Talking is nonstop where the leader states
the issue or problem to be addressed and
participants contribute various ideas.
• All ideas are recorded for later discussion
and analysis
3. Focus Group
• Group of individuals provide information
about proposed goods or services in a
structured setting.
• A focus group may look at a proposed
product or idea and answer specific
questions asked by the moderator
• In other instances a focused group may be
given a general issue to discuss and the
moderator just leads the discussion based on
the comments made by the group.
4. Creativity and creative problem solving
• The ability to combine ideas in a unique way. It
involves making unusual association between ideas.
• Linking new concepts in unusual way. Entrepreneurs
use different methods to link ideas. Some are listed
below
i. Checklist method. Entrepreneur uses a list of
questions or statements to develop new ideas
ii. Free association. A new idea is developed through
a chain of word association
iii. Attribute listing. An entrepreneur develops a new
idea by looking at positive and negative attributes
of a good or service
Evaluating Ideas
• When you are in need of a new laptop,
smart phone, clothes do you take the first
one you see/come across? Most of us don’t.
We tend to look around for one that will
best fit our needs an that which is in our
budget range.
• The same applies to business ideas. We
want to pursue an option that is going to
allow us to best meet our goal(s) given the
resource available.
Why conduct evaluation?
(Importance)
• Minimize risk while maximizing returns
• Make best use of limited resources-human,
money, time etc.
• Decide what is important in the
entrepreneurial venture- own reasons for
starting a business.
• Identify strengths and weaknesses of ideas-
knowing strength and weaknesses of each
idea help to stick to one with strong
characteristics.
Financial Feasibility of an Idea
(Breakeven Point)
• Once you get the best idea it is important to
test/determine its feasibility (financial
perspective) by calculating the breakeven
point (BEP).
• When a business is breaking even it is
earning just enough to cover its costs
• Any level of revenue below the BEP the
business will experience loss
• Any level of revenue above the BEP the
business is experiencing profit.
BREAKEVEN POINT
BEP= TFC
P-VC
Where BEP= Breakeven Point
P= Unit price of a product being sold
VC= Variable cost
TFC= Total fixed cost
• Variable costs. Costs that change in proportion to
the level of output i.e. raw materials, labor costs and
utility
• Fixed costs are expenses that do not change
regardless of the volume i.e. rent, insurances,
premiums and property taxes
Example (Question)
• Masumbuko wants to start a stationery
business that will be offering
photocopying services. Charge per copy
will be 50 Tsh per paper. The projected
Total Fixed Cost is Tsh 27000 per year and
Variable Cost Tsh 20 per copy. Calculate
the BEP for Masumbuko’s expected
business. Should he proceed with the idea?
How to evaluate Ideas
• Evaluating entrepreneurial ideas revolves
around personal and market place
consideration. That is measuring the ideas
against marketplace considerations.
• The idea should be viable in a competitive
and dynamic marketplace.
• The more market driven your venture is,
the greater chances of success are.
Evaluation Techniques
Two major techniques are involved;
1. The four question approach
 Do you love the business?
 Are you skilled at the business?
 Do you have experience at the business?
 Is the business simply a fad or trend?
2. Feasibility study
• Is structured and systematic analysis of
various aspects of a proposed
entrepreneurial venture designed to
determine its workability.
• If done properly feasibility study can make
preparing and writing the business plan a
whole lot easier
• Feasibility study covers;
I. Introductory section
• Historical background and brief summary of product
• Potential strengths and weaknesses and key
information
• Accounting considerations
• Management considerations
• Financial considerations
• Legal considerations
• Tax considerations
II. Appendices
Filling with supporting charts, graphs,
diagrams, layouts, resumes and so forth
2. Planning the Venture
• Planning is an initiatory function in the sense
that it is initiated in the first place to
formulate a systematic program in detail for
doing or achieving a mission still unformed or
undeveloped.
• It is a function which implies a
comprehensive and extensive task of
devising and laying out in distinguished
sections a detailed program of actions to be
carried out to convert an idea into a safe and
sound business entity.
• Planning for a venture, as generally
observed, is the groundwork in preparation
for making a proposed venture start and
grow smoothly.
• This means developing a document to act
as a guide. The document is a “business
plan”
Planning the Venture (Business Plan)
• A Business Plan is a basic document which
gives an explicit but precise account of what one
has in mind to achieve and, in that context, it
defines: What will have to be done? When will be
done? How will be done? Who will do? How
much will it cost?
• Business plan: A written document detailing a
proposed venture, covering current status,
expected needs, and projected results for the
enterprise. It contains a thorough analysis of the
product or service being offered, the market and
competition, the marketing strategy, the
operating plan, and the management as well as
profit, balance sheet, and cash flow projections.
Business plan
• It portrays an overall picture of a business
proposal, attempts to justify its technical
feasibility as well as commercial success
and makes clear suggested course of
actions in distinguished sections.
Benefits/Purposes of a Business
Plan
• Highlights basic elements. Regardless of
size, nature, main objective and location of
a venture, as also investment, risk and
uncertainty involved in it, a project plan lays
stress on the basic elements common to
almost every business. The basic elements
include ownership; business location;
objective; policies and strategies; resource
requirements; budget estimates; and
anticipated ways and means to accomplish
goals.
Plan
• Deals with decisive issues. Before
everything else, a decision has to be
reached as to whether or not to go for any
investment in the proposed venture. More
importantly, a project plan justifies the
individual capacity to mobilize resources
entrepreneurial ability of the would-be
entrepreneur.
• Helps timely implementation. A project plan
document serves as a handbook to be followed in
the process of organizing, directing, coordinating
and controlling planned activities aimed at
ensuring timely implementation of objectives.
• Facilitates registration. A project plan, of course,
is essential for seeking from a competent
authority permission to engage in a business.
Both permission and registration by respective
authorities are essentially necessary to
commence and carry out any business activity
and to seek financial assistance from commercial
banks as also specialized financial institutions.
Plan
• Assists in evaluation. A project plan
assists in evaluating overall worth of a
new business idea.
• Serves to gain support. A project plan
serves as a means to look for and acquire
requisite financial and material assistance
from external sources.
Plan
• Prepares groundwork. It aids to prepare
the ground for a new unit. Said simply,
project planning is one of the vital
elementary tasks necessary to make ready
the groundwork for primarily a new
venture, large or small, and seldom for
expansion, diversification or
modernization of an existing unit.
Contents of a Business Plan
I. Executive Summary
• This summarizes the key points the entrepreneur
wants to make about the entrepreneurial venture.
• These might include brief statement of vision,
mission, primary goals and objectives, history of
the venture, including perhaps a time line, key
people involved in the venture, nature of the
business, concise product or service
descriptions, explanation of the market niche,
competitors and competitive advantage,
proposed strategies and a summary of financial
information
• The executive summary should be able to
provide concise yet comprehensive
significant information about the venture.
• The reader should be able to obtain all the
relevant information highlight about the
venture in this section.
II. Analysis of opportunities
Presents detailed analysis of the perceived
opportunity involving describing market target,
competitors and industry trends
• This means sizing up the market by describing
the demographics of the target market;
 Who are the customers?
 How many are they?
 What values and expectations do they have?
 How will the product or service meet their needs?
• Describing and evaluating industry trends
 What is the current status of the industry?
 What are the trends in the industry?
 Evaluation of the industry growth rate; is it
growing, stable, declining?
 What does it take to be successful in the
industry?
• Identifying and evaluating competitors
 Who are the competitors?
 What are their strengths and weaknesses?
 What are they currently doing?
You must show how you have thoroughly
researched the market and know as much
the possible advantages and drawbacks of
the proposed opportunity
III. Analysis of context
Focuses on broad external changes and trends,
such as economic trends.
• These external factors may include an analysis
of macroeconomic environment, such as the
state of economy, current and forecasted
inflation or interest rates, trends in consumer
spending, or any other economic trends that
might have an impact on the venture
• An evaluation of any current or proposed
governmental rules and regulations that might
have an impact on entrepreneurial venture
• An analysis of broad technological not
related to the specific market or industry
that might affect the venture and if
appropriate, a description of global
changes and trend that might have an
impact on the entrepreneurial venture.
IV. Description of the business section
• Describe the specifics of how the opportunity will
be captured and exploited. It involves clarifying
the vision and mission, anticipated costs,
operation plans, description of key employees,
training needs, location etc.
• Specifically this section describes how you are
going to organize, launch and manage the venture.
This section provides thorough explanation of the
vision and mission statement and the description
of the desired organizational culture
• Marketing plans including overall marketing
strategy, pricing, sale tactics, service warrant
policies, advertising and promotion tactics,
production development plans such as
explanation of the development status
(prototype availability) and tasks difficulties
and risks and anticipated costs
• Manufacturing and operations plans such as
description of the proposed location, facilities
and improvement, equipment and work flow
Contents of a Business Plan Cont..
• Human resource plans including

description of key employees,
composition of board of advisors,
including their background experience and
skills, current and predicted future staffing
needs, compensation and benefits,
training needs and overall schedule and
timetable of events.
V. Financial data and projections
Financial plans should cover at least three
years and contain the projected income
statements (profit and loss statements), fro
forma cash flow analysis (monthly for first year
and quarterly for the next 2 years), pro forma
balance sheets, break even analysis and cost
control.
Although these calculations and interpretation
might be difficult, they are absolutely critical.
No business plan is complete without financial
information.
• If you anticipate equipment purchases or
other major capital expenditures, list the
items cost and what collateral you have
available. In your financial projection analyses,
provide explanatory notes whenever the data
seem contradictory or unclear.
• Try to make financial projection as realistic as
possible. Do your research. Research costs,
prices being charged by competitors any
other quantitative information that will add to
validity and reliability of your data.
Contents of a Business Plan Cont..
VI. Supporting documentations

Supporting documentation is an important
component of an effective business plan.
Back up your description with charts, graphs,
tables, photographs, resumes and other
visual tools.
3. Managing Competition for a New
Venture
• Competition is everywhere. Very few
industries or markets haven't experienced
some form and degree of competitiveness.
• Researching competition through
competitor intelligence can be a powerful
tool for entrepreneurs.
• Competitor intelligence is a process of
gathering information on who competitors
are, what they are doing, and how their
actions will affect your organization.
• Competition is defined as organizations
battling with each other for some desired
outcome, it may be customers, market
share, survey ranking, or needed resources.
• There are three ways/approaches to define
possible competitors.
1. The industry perspective
2. The marketing perspective
3. The strategic groups' perspective
The Industry Perspective
• It identifies competitors as organizations
making the same product or providing the
same service. For instance, there's the oil
industry, the seed industry, the fertilizer
industry etc. The competitors in each of
these industries are producing the same or
similar types of products or services.
• Using this approach, an entrepreneur can
assess the intensity of competition by looking
at how many organizations are in the industry
and how they differ from each other.
The Marketing Perspective
• Competitors are organizations that satisfy the
same customer need. For example, if the
customer need is technical information,
potential competitors might range all the way
from R&D, Scientists, Print and electronic media,
Development agencies etc.
• These are different industries that are
attempting to satisfy the same customer need.
Under this perspective, the intensity of
competition depends on how well the
customer's needs are understood or defined
and how well different organizations are able to
meet that need.
The Strategic Groups' Perspective
• Strategic groups are groups of competitors
following essentially the same strategy in a
particular market or industry. Within a single
industry, you might find a few or several
strategic groups, depending on what
strategic factors are important to different
groups of customers- that is, What factors
customers use in making purchase decisions.
• For instance, two strategic factors often used
in grouping competitors are price (low to high)
and quality (low to high).
• Competitors would then be "grouped“
according to their price quality strategies,
with those following the same or similar
approaches in the same strategic group.
• Keep in mind that the important strategic
factors used to determine an organization's
competitors are different for every industry
and can be different even for various
industry groups. The possible dimensions
for identifying strategic groups are price,
quality, geographic scope, product line,
market share, profits and product
uniqueness.
The Strategic Groups' Perspective
• Example: Mercedes Benz, BMW, Jaguar

are in the same strategic group.
• Range rover, Lexus, Jeep can also be in a
same strategic group
• I-phone 6, Samsung Galaxy S6, Sony
Xperia Z5 are also in the same strategic
group.
COMPETITOR INFORMATION
A. Type of Competitive Information to be
collected: Possible areas to use to guide
competitors information research include:
• Types of products or services are competitors
offering.
• Major characteristics of these products or
services.
• Their products' strengths and weaknesses.
• The way of handling, marketing, pricing, and
distributing.
COMPETITOR INFORMATION
• Attempts to do the activities differently
from other competitors and their success
percentage.
• Competitive advantage(s) of their
activities.
• Profitability percentage of their activities.
• Mode of reaction of the competitors when
something (or someone) new comes in.
B. Sources of getting Competitive Information:
• Published financial sources
• Former employees
• Dealers, representatives, distributors and suppliers
• Trade fairs and exhibits
• Market surveys; Competitors' brochures and Web-
pages
• News stories found in newspapers or other printed
publications and on broadcast media news
programs;
• Competitive intelligence firms
• Interviews with consultants
COMPETITOR ANALYSIS MATRIX
• Once you've gathered information on your

competitors, you might want to organize it in
some type of competitor analysis matrix.
• List the competitors along the horizontal axis
and the type of competitive information along
the vertical axis. Fill in the actual information
for each competitor in the appropriate cell.
• In this way, you would be able to compare
your potential competitors easily. Also, this
type of competitor analysis becomes an
important part of your feasibility study and
your business plan.
COMPETITOR ANALYSIS MATRIX
Competitive Information Business 1 Business 2 Business 3 Business 4
offered
Products or services
Product strengths
Product weaknesses
Competitive advantage
Competitive disadvantage
Other Competitive
Information
PRINCIPLES OF MANAGING
COMPETITION
For the business to survive in the face of stiff
challenge and to ensure its sustained growth in
that environment, the entrepreneur has to
adopt certain principles of managing
competition. Some of them are:
• Spot early opportunities.
• Develop a deeper understanding of the
customer national and international.
• Keep track of the competitors.
• Identify current trends which would shape
the future.
SWOT ANALYSIS
• To innovate, an entrepreneur has to make a
diagnosis of the current situation. The
diagnosis of the current situation is done by
conducting an Internal and External Analysis.
Analysis of External and Internal
Environment together is called SWOT
Analysis.
• SWOT Analysis refers to identifying the
strengths, weaknesses, opportunities and
threats of an organization. SWOT Analysis
is a tool, often used by organizations in
planning its future.
SWOT ANALYSIS
• This tool can be explained in a simplified
manner as follows:
 S - Strengths of the organization.
 W - Weaknesses.
 O - Opportunities of the environment.
 T – Threats.
SWOT ANALYSIS
• The Internal Analysis of the organization

will cover the organizational position with
respect to different functional areas like
production, finance, marketing, R &
Distribution and so on.
• More specifically, this may look into a
company's sales volume, market share,
profitability and so on. This will reveal its
strength and weakness.
SWOT ANALYSIS
• The External Analysis will do the
necessary scanning of the business
environment to identify any threat and
opportunities posed on the company, its
products or services. More specifically,
this will include the industry performance,
competitive activity and a review of the
growth and decline of the user industries.
STRENGTHS AND WEAKNESS
• Every business needs to evaluate its
strengths and weaknesses periodically. The
management or an outside consultant
reviews the business's marketing, financial,
manufacturing and organizational
competencies.
• In examining its strengths and weaknesses
clearly, the business does not have to correct
all of its weaknesses nor gloat about all of its
strengths. They have to slowly overcome
their weakness and convert it into its strength.
STRENGTHS
Some of the strengths of an
organization are:
• Availability of necessary
infrastructure.
• Adequate production capacity.
• Skilled manpower.
• Good manufacturing practices,
quality assurance and quality control.
• Low cost of manufacture.
• Facilities for product and process
development.
STRENGTHS
• Good location.
• Wide distribution network.
• Motivated staff.
• Liquidity.
• Branding.
• Consistency in earning profits.
WEAKNESSES
• Rising cost of operations.
• Growing union pressures.
• Low level of motivation of staff.
• Non-availability of raw material.
• Scarcity of capital.
• Weak credit worthiness.
WEAKNESSES
• Problem of under utilization of capacity.
• Outdated technology.
• Poor project planning.
• Inadequate training in skills.
• Insufficient managerial expertise.
• Inadequate infrastructure.
OPPORTUNITIES AND THREATS
• An entrepreneur has to know the parts of the
environment to monitor, if the business is to achieve
its goals.
• A business has to monitor key macro environmental
forces like demographic, economic, technological,
political, legal, social and cultural factors, and, also
significant micro environmental forces like
customers, competitors, distribution channels,
suppliers, etc. that will affect its ability to earn
profits.
• The business unit should set up a marketing
intelligence system to track trends and important
developments. For each trends or development,
management needs to identify the implied
OPPORTUNITIES
Some of the opportunities of an organization are:
• Growing population.
• Increase in disposable income.
• Availability of appropriate technology.
• Favorable government policies.
• Availability of different task environment like
market information, distribution outlets and media.
• Presence of favorable cultural environment.
• Climatic changes.
• Changing customer tastes and preferences.
THREATS
• Shortage of power, water, fuel.
• Recession.
• Tough competition.
• Political instability.
• Fiscal policy resulting into increased taxes,
duties, imports reservations, licensing.
• Technological obsolescence.
• High cost of raising finance.
4. Financing the Venture
To start an entrepreneurial venture an
entrepreneur needs funds.
• Common financing sources include;
a) Personal savings
b) Family and friends
c) Financial Institutions
d) Venture investors
e) Business development programs
Sources of Finance
1. Personal savings
• Experts agree that the best source of
capital for any new business is the
entrepreneur’s own money. It is easy to use,
quick to access, has no payback terms, and
requires no transfer of equity (ownership).
• Also, it demonstrates to potential investors
that the entrepreneur is willing to risk his
own funds and will persevere during hard
times.
Sources of Finance
2. Friends and family
• These people believe in the entrepreneur, and
they are the second easiest source of funds to
access. They do not usually require the
paperwork that other lenders require.
However, these funds should be documented
and treated like loans.
• Neither part ownership nor a decision-making
position should be given to these lenders,
unless they have expertise to provide. The
main disadvantage of these funds is that, if
the business fails and money goes lost, a
valuable relationship may be jeopardized.
Sources of Finance
3. Financial Institutions
• Include banks, savings and loan
institutions, credit unions and finance
companies.
• The downside for these institutions is the
high interest rate not easily affordable by
most starting entrepreneurs, and the
collateral that most do not have.
4. Venture investors
• This is a major source of funding for start-ups
that have a strong potential for growth. However,
venture investors insist on retaining part
ownership in new businesses that they fund.
a) Formal institutional venture funds
• Are usually limited partnerships in which passive
limited partners, such as retirement funds,
supply most of the money. These funds have
large amounts of money to invest. However, the
process of obtaining venture capital is very slow.
Sources of Finance
b) Corporate venture funds.
• Are large corporations with funds for
investing in new ventures. These often
provide technical and management
expertise in addition to large monetary
investments.
• However, these funds are slow to access
compared to other sources of funds. Also,
they often seek to gain control of new
businesses.
Sources of Finance
c) Angel investors.
• These tend to be successful entrepreneurs
who have capital that they are willing to risk.
• They often insist on being active advisers to
businesses they support. Angel funds are
quicker to access than corporate venture
funds, and they are more likely to be invested
in a start-up operation.
• But they may make smaller individual
investments and have fewer contacts in the
banking community.
Sources of Finance
5. Business Development Programs
• These are programs designed to encourage
and help entrepreneurs get their feet on the
ground by providing funds and assistance at
the early stages of entrepreneurial venture.
• Examples include: TPSF (Tanzania Private
Sectors Funds), SIDO (Small Industries
Development Organization), Business
Incubators such as the University of Dar es
salaam Entrepreneurship Centre (UDEC)
Forms of Business Ownership
• One of the first decisions an entrepreneur faces
when starting a business is selecting the form of
ownership for the new venture. Too often,
entrepreneurs give little thought to the decision,
which can lead to problems because it has far-
reaching implications for the business and its
owners—from the taxes the company pays and
how it raises money to the owner’s liability for the
company’s debts and his or her ability to transfer
the business to the next generation.
• There is no single “best” form of business
ownership. Each form has its own unique
set of advantages and disadvantages. The
key to choosing the right form of
ownership is to understand the
characteristics of each business entity
and to know how they affect an
entrepreneur’s business and personal
circumstances.
The following are some of the most important
issues an entrepreneur should consider in
choosing a form of ownership:
• Tax considerations. The government is
constantly modifying the tax, and the year-to-
year fluctuations in a company’s income
require an entrepreneur to calculate the firm’s
tax responsibility under each ownership
option every year. Changes in taxes may have
a significant impact on the firm’s “bottom line”
and the entrepreneur’s personal tax exposure.
• Liability exposure. Certain forms of ownership
offer business owners greater protection from
personal liability from financial problems,
faulty products, and lawsuits. Entrepreneurs
must evaluate the potential for legal and
financial liabilities and decide the extent to
which they are willing to assume personal
responsibility for their companies’ obligations.
Individuals with significant personal wealth or
a low tolerance for the risk of loss may benefit
from forms of ownership that provide greater
protection of their personal assets.
 Start-up and future capital requirements. The form
of ownership can affect an entrepreneur’s ability to
raise start-up capital. Some forms of ownership are
better than others when obtaining start-up capital,
depending on how much capital is needed and the
source from which it is to be obtained. As a business
grows, capital requirements Increase, and some
forms of ownership make it easier to attract outside
financing.
 Control. Certain forms of ownership require an
entrepreneur to relinquish some control over the
company. Before selecting a business entity,
entrepreneurs must decide how much control they
are willing to sacrifice in exchange for resources
from others.
 Managerial ability. Entrepreneurs must assess their
own ability to successfully manage their companies.
If they lack skill or experience in certain areas, they
should consider a form of ownership that allows
them to involve individuals who possess those
needed skills or experience into the company.
 Business goals. The projected size and profitability
of the business influence the form of ownership an
entrepreneur chooses. Businesses often evolve into
different forms of ownership as they grow, but
moving from some formats can be complex and
expensive.
Legislation may change and make current ownership
options no longer attractive.
 Management succession plans. When
choosing a form of ownership, business
owners must look ahead to the day when
they will pass their companies on to the next
generation or to a buyer. Some forms of
ownership better facilitate this transition than
others. In other cases, when the owner dies,
so does the business.
 Cost of formation. Some forms of ownership
are much more costly and involved to create.
Entrepreneurs must weigh the benefits and
the costs of the form they choose.
Sole Proprietorship: business owned by
single person and takes all liabilities.
Partnership:
Corporation
Limited Liability Company
Group Based Enterprises
Sole Proprietorships
Is a form of a business whereby one
individual owns the business, takes
responsibility for the operational and
strategic direction of the business and
assuming the profits and losses of the
business solely (alone).
There are no legal requirements for
establishing that business except
obtaining licenses, permits & registration.
Advantages of Sole Proprietorships
Ease of formation
Sole ownership of profits
Decision making and control vested in one
owner
Flexibility
Relative freedom from governmental
control
Freedom from corporate business taxes
Disadvantages of Sole
Proprietorship
Unlimited liability
Lack of continuity
Less available capital
Relative difficulty obtaining long-term
financing
Relatively limited skills and experience
Partnerships
Is a form of a business whereby two or
more people agree to invest money, time
and/or other resources in one enterprise,
in pursuit of profits. They have to agree on
the responsibilities and rights of each of
the members. In the event that they do not
have a formal agreement, the Partnership
Act can be used automatically.
Partnerships
• There are two main kinds of partnerships,
general partnerships and limited partnerships.
• In a general partnership, all partners are liable
for the acts of all other partners. All also have
unlimited personal liability for business debts.
• In contrast, a limited partnership has at least
one general partner who is fully liable plus
one or more limited partners who are liable
only for the amount of money they invest in
the partnership.
Advantages
Ease of formation
Direct rewards
Growth and performance facilitated
Flexibility
Relative freedom from governmental
control and regulation
Possible tax advantage
Disadvantages
Unlimited liability of at least one partner

Lack of continuity
Relative difficulty obtaining large sums of
capital
Bound by the acts of just one partner
Difficulty of disposing of partnership
interest
Corporation
It is most complex to form and operate. It
is a business entity that is separate from
its owners and managers.
Many entrepreneurial ventures are
organized as closely held corporations.
Corporation is owned by limited group of
people who do not trade the stock publicly.
Advantages
Limited liability
Ownership is transferable
Easier access to financial and other types
of resources
Continuous existence.
Disadvantages
It is expensive to set up
There is double taxation problem. (Income
is taxed at both corporate & shareholder
level).
Limited Liability Company (LLC)
The business (company) has a legal status
separate from the owners, and can sue and
be sued on its own standing.
Is new form of organization and ownership
– a hybrid between partnership &
corporation.
The LLC enjoys liability protection of
corporation and tax benefits of partnership.
It is highly flexible.
Group-based Enterprises
Some informal and micro business
operators organize themselves into some
kind of community or groups, as a way of
overcoming the disadvantage of
smallness. Such groups give members a
voice and/or access to critical resources,
such as markets, finance and training.
INTELLECTUAL PROPERTY
RIGHTS
What is Intellectual Property?
Intellectual property is a valuable asset for an
entrepreneur. It consists of certain intellectual
creations by entrepreneurs or their staffs that
have commercial value and are given legal
property rights.
Examples of such creations are a new product
and its name, a new method, a new process, a
new promotional scheme, and a new design.
A fence or a lock cannot protect these
intangible assets. Instead, patents, copyrights,
and trademarks are used to prevent
competitors from benefiting from an
individual’s or firm’s ideas.
Protecting intellectual property is a
practical business decision. The time and
money invested in perfecting an idea might
be wasted if others could copy it.
Competitors could charge a lower price
because they did not incur the startup costs.
The purpose of intellectual property law is
to encourage innovation by giving creators
time to profit from their new ideas and to
recover development costs.
Intellectual property rights can be bought,
sold, licensed, or given away freely. Some
businesses have made millions of by
licensing or selling their patents or
trademarks.
Every entrepreneur should be aware of
intellectual property rights in order to
protect these assets in a world of global
markets. An intellectual property lawyer can
provide information and advice.
Forms of Intellectual Property
Rights
The main forms of intellectual property
rights are:
A. Patents: A patent grants an inventor the
right to exclude others from making,
using, offering for sale, or selling an
invention for a fixed period of time - in
most countries, for up to 20 years. When
the time period ends, the patent goes into
the public domain and anyone may use it.
Forms of Intellectual Property
Rights
B. Copyright: Copyrights protect original
creative works of authors, composers, and
others. In general, a copyright does not
protect the idea itself, but only the form in
which it appears - from sound recordings to
books, computer programs, or architecture.
The owner of material has the exclusive
right to reproduce the work, prepare
derivative works, distribute copies of the
work, or perform or display the work publicly
C. Trade Secrets: Trade secrets consist of
knowledge that is kept secret in order to gain an
advantage in business.
• Customer lists, sources of supply of scarce
materials, or sources of supply with faster
delivery or lower prices may be trade secrets.
• Trade secrets are usually protected by contracts
and non-disclosure agreements. No other legal
form of protection exists. The most famous
trade secret is the formula for Coca-Cola, which
is more than 100 years old.
• Trade secrets are valid only if the information
has not been revealed. There is no protection
against discovery by fair means such as
accidental disclosure, reverse engineering, or
independent invention.
D. Trademarks: A trademark protects a symbol, word,
or design, used individually or in combination, to
indicate the source of goods and to distinguish them
from goods produced by others.
• For example, Apple Computer uses a picture of an
apple with a bite out of it and the symbol which
means registered trademark. A service mark similarly
identifies the source of a service. Trademarks and
service marks give a business the right to prevent
others from using a confusingly similar mark.
• In most countries, trademarks must be registered to
be enforceable and renewed to remain in force.
However, they can be renewed endlessly.
• Consumers use marks to find a specific firm’s goods
that they see as particularly desirable — for example
Toyota automobiles.
ETHICS AND SOCIAL
RESPONSIBILITY
What Are Ethics?
Individual values form the basis of ethics, a
set of moral principles that govern
decisions and actions.
To act ethically is to behave in ways that
are in keeping with certain values.
Business ethics are moral principles
applied to business issues and actions.
Entrepreneurs have considerable influence
on their company’s business ethics.
Why Practice Business Ethics?
The main reason for behaving ethically, in
business or in any area of life is simply that
it’s the right thing to do.
Three practical reasons why you should
practice business ethics:
 Customers are more confident when buying
goods and services from an ethical
company.
 An ethical workplace motivates employees.
 Ethical behavior also prevents legal
problems.
Writing a Code of Ethics
People do not share the same ethical
values.
Because not everyone has high ethical
standards, entrepreneurs need to create
clear ethics policies.
Many entrepreneurs develop an explicit
code of ethics that spells out appropriate
business conduct.
Writing a Code of Ethics
A code of ethics describes a business’s
moral philosophy and gives concrete
guidelines for carrying it out.
Writing a code of ethics forces you to
clarify your own values and principles.
Having a code will also help prevent and
resolve ethical problems.
A written code provides some protection
against claims of unfairness.
Social Responsibility
Corporate social responsibility means that
businesses act in ways that balance profit
and growth with the good of society.
The principle that companies should
contribute to the welfare of society and not
be solely devoted to maximizing profits
For a business to survive, it must exhibit
social responsibility.
Social Responsibility
Social responsibility often translates into
profits. This advantage for business is
sometimes described as “doing well by
doing good.”
One type of socially-responsible corporate
behavior is ethical sourcing, which means
buying from suppliers who provide safe
working conditions and respect workers’
rights.
Responsibility to Individuals
Social responsibility affects employees,
customers, investors, and creditors.
Entrepreneurs have legal obligations to
provide a safe workplace and fair
employment policies.
Acting responsibly toward suppliers or
vendors results in making the best choices
of materials and using them wisely.
Investors and creditors provide the money to
start and run a business. They must believe
in both the idea behind the business and the
entrepreneur.
Responsibility to Customers
Do not mislead customers.
Give complete information regarding
proper use.
Label unsafe products as such.
Offer the best quality products at the
lowest prices.
Responsibility to the Environment
• Sustainable Design. Sustainable products
meet the planet’s current needs while
preserving resources for future generations.
• Alternative Energy. Researchers are
working to make fossil-fuel alternatives
such as solar, wind, and hydrogen power
more efficient.
• Fair Trade. This is a way of doing business
based on principles of social and
environmental responsibility and promoting
sustainable growth.
Responsibility to the Community
Cause-related marketing is a partnership
between a business and a nonprofit group for
the benefit of both. It increases sales for the
business and raises money and awareness
for the nonprofit group.
Sponsorship is when a business sponsors a
community event or service in exchange for
advertising.
With facilitated giving, a business makes it
easier for customers to contribute to a cause.
Responsibility to the Community
• Philanthropy Voluntary promotion of
human welfare. occurs when business
leaders donate money and other
resources for socially beneficial causes.
• An in-kind donation is the gift of a good or
service (donating their products and
services).
SMALL AND MEDIUM
ENTERPRISES
Small Business
SMALL BUSINESS
Like entrepreneurship, small business has no single
definition. Countries and Institutions have developed
definitions and classifications that reflect their own
requirements. These criteria tend to reflect the
nature and composition of the country’s economy.
The basis for categorization is often a combination
of qualitative and quantitative criteria and has
included; number of employees, capital invested,
share capital, number of shareholders, total assets,
turnover, market share, geographical market
coverage, organization complexity, composition of
management and degree of formalization (Olomi
2009).
Definition of Small Business in
Tanzania
There is a common practice of classifying
businesses into; micro, small, medium
and large. Sometimes Micro and Small
Enterprises (MSMEs) are referred to
separately, depending on the context. The
most commonly used term is Small and
Medium Enterprises (SMEs).
According to the SME Development Policy
of 2003 SMEs is classified as follows:
CATEGORIES OF SMEs IN TANZANIA
Category Number of Employees Capital Invested

Micro enterprise 1–4 Up to 5 mil.
Small enterprise 5 – 49 Above 5 mil. to 200 mil.
Medium enterprise 50 – 99 Above 200mil.to 800 mil.
Large enterprise 100 + Above 800 mil.

Characteristics of Small Business
Built around personal and financial needs

of an individual or family
Generally have fewer products or services
Small business are frequently dominated
and controlled by one person. The owner
has a great influence in all aspects of the
firm’s direction, development and
performance. The owner tends to perform
a variety of job functions
Remain in close contact with their markets
Characteristics of Small Business
Tend to be more open-minded and willing to
try new things
Give employees more opportunity for
individual expression
Tend to make decisions more quickly than
large businesses
Have more limited resources
Many small firms are heavily reliant on a
small number of customers. Usually focus
on a narrow group of customers.
Advantages of Small Business
1. They are relatively more environmental
friendly.
2. They are generally based on local resources.
3. They provide plenty of opportunities for
creativity and experimentation.
4. They facilitate equitable distribution of
income and wealth.
5. They enjoy the government support
6. These helps in the balanced regional
development.
Advantages of Small Business
7) It is possible to make necessary changes
as and when required.
8) These help in reducing prices.
9) There is a close and direct personal
contact with the customer and employees.
10) They create more employment
opportunities.
11) They require only less capital.
Disadvantages of Small Business
Small Businesses lack of funds.
They lack managerial and other skills.
They always face tough competition from
large businesses.
They are not well equipped to make
advantage of the latest technology and
modern methods.
There is only a little scope for division of labor
and specialization.
MSMEs cannot afford to spend large sums of
money on research and experiments
INTRODUCTION TO
MARKETING
MEANING OF MARKETING
Meaning of Marketing
We know that the businessman
produces goods and services for our
use. These are not necessarily
produced at the places where they are
consumed or used.
Even in villages, now-a-days you find
the products manufactured all over
Tanzania and in other countries are
used.
This implies that the manufacturers must
be making efforts to ensure that their
products are in demand and reach the
ultimate consumers all over the globe.
 So, when you go to the market to buy a
readymade shirt you find that there are
several options available to you in terms of
quality of cloth used, design, colour, price
etc. and you can buy what suits you most.
This also implies that the manufactures
assess the needs of the consumers, their
tastes and preferences and plan the products
accordingly. Not only that, they also ensure
that people are aware about the product and
its features.
All these activities are said to be part of
marketing function of any organization. Thus,
marketing refers to the process of
ascertaining consumers’ needs and supplying
various goods and services to the final
consumers or users to satisfy those needs .
Basically, marketing is the performance of
business activities that direct the flow of
goods and services from producers to
consumers or users.
Definition of Marketing
The American Marketing Association
defines marketing as an organizational
function and set of processes for creating,
communicating and delivering value to
customers and for managing customer
relationships in ways that benefit the
organization and its stakeholders.
Traditional Concept of Marketing
According to the traditional concept,
marketing means selling goods and
services that have been produced. Thus, all
those activities which are concerned with
persuasion and sale of goods and services,
are called marketing.
This concept of marketing emphasizes on
promotion and sale of goods and services
and little attention is paid to consumer
satisfaction.
This concept has the following implications;
a) The main focus of this concept is on product,
i.e., we have a product and it has to be sold.
So, we have to persuade the consumers to
buy our product.
b) All efforts of the marketing people are
concentrated on selling the product. They
adopt all means like personal selling and
sales promotion to boost the sales.
c) The ultimate goal of all marketing activity is
to earn profit through maximization of sales.
Focus on Product
Means Selling
Ends Profit through Sales

Maximization
Modern Concept of Marketing
The modern concept of marketing
considers the consumers’ wants and needs
as the guiding spirit and focuses on the
delivery of such goods and services that
can satisfy those needs most effectively.
Thus, marketing starts with identifying
consumer needs, then plan the production
of goods and services accordingly to
provide him the maximum satisfaction..
• In other words, the products and services
are planned according to the needs of the
customers rather than according to the
availability of materials and machinery.
Not only that, all activities (manufacturing,
research and development, quality control,
distribution, selling etc.) are directed to
satisfy the consumers
Thus, the main implications of the modern
concepts are:
a) The focus of this concept is on customer
orientation. The marketing activity starts
with an assessment of the customers
needs and plan the production of items
that satisfy these needs most effectively.
This also applies to all other marketing
activities like pricing, packaging,
distribution and sales promotion.
b) All marketing activities like product
planning, pricing, packaging, distribution
and sales promotion are combined into
one as coordinated marketing efforts.
This is called integrating marketing. It
implies:
i. developing a product that can satisfy the
needs of the consumers;
ii. taking promotional measures so that
consumers come to know about the products,
its features, quality, availability etc.;
iii. pricing the product keeping in mind the target
consumers’ purchasing power and willingness
to pay;
iv. packaging and grading the product to make it
more attractive and undertaking sales
promotion measures to motivate consumers
to buy the product; and
v. taking various other measures (e.g., after
sales service) to satisfy the consumers’ needs.
c) The main aim of all effort is to earn profit
through maximization of customer
satisfaction. This implies that, if the
customers are satisfied, they will
continue to buy, and many new
customers will be added. This will lead to
increased sales and so also the profits.
Focus on Customers’ need
Means Coordinated marketing efforts
Ends Profit through Customer’s

satisfaction
DIFFERENCE BETWEEN MARKETING
AND SELLING
• The terms ‘marketing’ and ‘selling’ are related
but not synonymous. ‘Marketing’ as stated
earlier, emphasizes on earning profits through
customer satisfaction. In marketing, the
focus is on the consumer’s needs and their
satisfaction.
• ‘Selling’ on the other hand focuses on
product and emphasizes on selling what has
been produced. In fact it is a small part of the
wide process of marketing wherein emphasis
is initially on promotion of goods and services
and eventually on increase in sales volume.
AND SELLING
• Marketing has long term perspective of
winning over consumer loyalty to the
product by providing him maximum
satisfaction. However, selling has short-
term prospective of only increasing the
sales volume.
AND SELLING
• In marketing, the consumer is the king whose
needs must be satisfied. In selling, the
product is supreme and the entire focus is its
sale.
• Marketing starts before production and
continues even after the exchange of goods
and services has taken place. It is so because
provision of after sale service is an important
component of marketing process.
• Selling starts after the production and ends
as soon as the exchange of goods and
services has taken place.
IMPORTANCE OF MARKETING
A. Marketing helps business to keep pace with

the changing tastes, fashions, preferences
of the customers. It works out primarily
because ascertaining consumer needs and
wants is a regular phenomenon and
improvement in existing products and
introduction of new product keeps on taking
place. Marketing thus, contributes to
providing better products and services to
the consumers and improve their standard
of living.
B. Marketing helps in making products

available at all places and throughout the
year. We are able to get seasonal fruits
like mangoes and oranges round the year
due to proper warehousing or proper
packaging. Thus, marketing creates time
and place utilities
C. Marketing plays an important role in the

development of the economy. Various
functions and sub-functions of marketing
like advertising, personal selling,
packaging, transportation, etc. generate
employment for a large number of people,
and accelerate growth of business.
D. Marketing helps the business in increasing
its sales volume, generating revenue and
ensuring its success in the long run.
E. Marketing also helps the business in

meeting competition most effectively.
OBJECTIVES OF MARKETING
1. Provide Satisfaction to Customers : All

marketing activities are directed towards
customer satisfaction. Marketing starts with
ascertaining consumer needs and produce
goods that satisfy those needs most
effectively. Not only that the pricing and
distribution functions of marketing are also
planned accordingly.
2. Increase in Demand : Through advertising and
other sales promotional efforts, marketing
aims at creating additional demand for their
products. Satisfied customers also help in
creating new customers.
For example, if you buy a ‘gel pen’ and feel

satisfied, next time also you will buy the same
pen and obviously when you tell others about
it they will also feel like giving it a try.
3. Provide Better Quality Product to the
Customers : This is a basic objective of
marketing. The business houses try to
update and upgrade their knowledge and
technology to continuously provide better
products. If they do not do so, they will be
phased out through competition.
4. Create Goodwill for the Organization : Another
objective of marketing is to build a good public
image and create goodwill for the organization. This
helps in maintaining loyalty to the product and
accepting new products of the same company.
5. Generate Profitable Sales Volume : The ultimate
objective of all marketing efforts is to generate
profitable sales volumes for the business. Taking
care of customer needs and wants by providing the
required goods and services at prices they can
afford, and at places and time that are convenient
to them ultimately lead to increased sales and
profits.
FUNCTIONS PERFORMED IN
MARKETING
• Marketing Research : Marketing research
involves collection and analysis of facts
relevant to various aspects of marketing. It is
a process of collecting and analyzing
information regarding customer needs and
buying habits, the nature of competition in
the market, prevailing prices, distribution
network, effectiveness of advertising media,
etc. Marketing research gathers, records and
analyses facts for arriving at rational
decisions and developing suitable marketing
strategies.
MARKETING
• Product Planning and Development : As you
know marketing starts much before the
actual production. The marketers gather
information regarding what are the needs of
the consumers and then decide upon what
to produce. So, the task of marketing
begins with planning and designing a
product for the consumers. It can also be
done while modifying and improving an
already existing product.
MARKETING
• Buying and Assembling : Buying and
assembling activities as a part of marketing
refer to buying and collection of required
goods for resale. This function of marketing
is primarily relevant to those business
organizations that are engaged in trading
activities. In the context of manufacturing
organizations, buying and assembling
involves buying raw materials and
components required for production of
finished goods.
• Packaging : Packaging involves putting the goods in
attractive packets according to the convenience of
consumers. Important considerations to be kept in
view in this connection are the size of the package
and the type of packaging material used.
• Goods may be packaged in bottles (plastic or glass),
boxes (made of tin, glass, paper, plastic), cans or
bags. The size of the package generally varies from
a few grams to a few kilograms, one piece to a
number of pieces of a product, or in any other
suitable quantity in terms of weight, count, length
etc.
• Packaging is also used as a promotional
tool as suitable and attractive packages
influences the demand of the products. It
may be noted that packaging is different
from packing, which refers to putting
goods in suitable containers for
transportation purposes.
• Standardization and Grading : Standardization refers
to development of standards for production of goods
with respect to shape, design, colour and other
characteristics. If products are standardized,
customers are able to identify a product and its
characteristics very well. So goods can be sold by
sample or description.
• Standardization helps in promoting the sale of the
product by increasing consumers’ confidence in the
product quality. Grading involves separating products
into different classes on the basis of certain
predetermined standards relating to size and quality.
Grading is required in case of agricultural, forest and
mineral products such as cotton, sugar cane, iron ore,
coal, timber, etc.

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SMALL BUSINESS

Myth 4:Entrepreneurial ventures and small

Myth 10: Entrepreneurs seek success but

Source: Michael H. Morris, P. Lewis, and Donald L. Sexton,

• Are able to withstand being thought of as

B. Personal Formal Sources

• Human resource plans including

VI. Supporting documentations

• Example: Mercedes Benz, BMW, Jaguar

• Once you've gathered information on your

• The Internal Analysis of the organization

Unlimited liability of at least one partner

Category Number of Employees Capital Invested

Small enterprise 5 – 49 Above 5 mil. to 200 mil.

Medium enterprise 50 – 99 Above 200mil.to 800 mil.

Large enterprise 100 + Above 800 mil.

Built around personal and ﬁnancial needs

Traditional Concept of Marketing

Ends Proﬁt through Sales

Modern Concept of Marketing

Focus on Customers’ need

Means Coordinated marketing efforts

Ends Proﬁt through Customer’s

A. Marketing helps business to keep pace with

B. Marketing helps in making products

C. Marketing plays an important role in the

E. Marketing also helps the business in

1. Provide Satisfaction to Customers : All

For example, if you buy a ‘gel pen’ and feel

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