Copyright ©2012 Pearson Education, Inc.

publishing as Prentice Hall

1-1
Learning Objectives
 Define the role of the entrepreneur in the Pakistan economy.
 Describe the entrepreneurial profile
 Explain how entrepreneurs spot business opportunities.
 Describe the benefits of owning a small business.
 Describe the potential drawbacks of owning a small business.
 Explain the forces that are driving the growth in
entrepreneurship.
 Put business failure into the proper perspective.
 Explain how entrepreneurs can avoid the major pitfalls
of running a business.
What is an Entrepreneur?

 One who creates a new business in the face of risk

and uncertainty for the purpose of achieving profit
and growth by identifying opportunities and
assembling the necessary resources to capitalize on
them.

 Entrepreneurship is defined as the act of starting and

running your own business or a tendency to be
creative and wish to work for yourself in your own
ventures.
 Entrepreneur

Someone who takes nothing for granted

Entrepreneurs usually start with nothing more than an

idea—often a simple one—and then organize the
resources necessary to transform that idea into a
sustainable business.
Why People Become Entrepreneurs?

 Reluctant Entrepreneur
A person who becomes an entrepreneur as a result of some
severe hardship.
 Refugee
A person who becomes an entrepreneur to escape an
undesirable situation.
 The Many Varieties of Entrepreneurship

➢ Founder (“Pure” Entrepreneur)

A person who brings a new firm into existence
➢ Administrative Entrepreneur
An entrepreneur who overseas the operations of a ongoing
business
➢ Franchisee
An entrepreneur whose power is limited by the contractual
relationship with a franchising organization
➢ Entrepreneurial Team
Two or more people working together as entrepreneurs
The role of the entrepreneur in the Pakistan economy

➢Entrepreneurs boost economic growth by

introducing innovative technologies, products,
and services.

➢Entrepreneurs provide new job opportunities in

the short and long term.

➢Entrepreneurial activity raises the productivity of

firms and economies.
Role of the Entrepreneur
➢ Initiating and leading business activities.
➢ Forecasting business changes.
➢ Creating jobs.
➢ Identifying business opportunities.
➢ Creating and sharing wealth.
➢ Improving the standard of living.
➢ Taking up and reducing business risk
How Entrepreneurship Progressed in Pakistan

➢ Lack employment opportunity

➢ Lack of Connection
➢ Business not expanding
➢ Not the best in academics
➢ Not being “Nokhari Oriented”
➢ Suitable Finances
➢ Willing to take risk
Entrepreneurs of Pakistan
 Nishat Group/Mian Mansha (Worth:$5.57 billion)

 Nishat Group is a business cooperation owned by

the country’s richest man Mian Muhammad Yahya
Mansha with a worth of $5.57 billion, Mansha
Owns Around 60 companies.

 After 1979 mansha established the Largest

Textile Complex setting up about 7 textile mills in
the city of Faisalabad named nishatabad, being
the largest exporter of Pakistan with exports
above $1 Billion.

 Moreover the business Group now owns biggest

cooperation's of Pakistan including MCB bank,
DG Khan Cement, Adam Jee life insurance,
Nishat Textiles, Nishat Power, Nishat Properties,
Nishat Hotels, Hyundai Nishat Motors and Nishat
Emporium
Entrepreneurs of Pakistan

 Bestway Group/Sir Anwar Pervaiz (Worth:$4.50 billion)

 Hashu Group/Sadaruddin Hashwani (Worth:$3.80 billion)
 Bahria Town/Malik Riaz Hussain (Worth:$3.4 Billion)
 Ary Group/Abdul Razzaq Yaqub – Late(Worth:$1.40 Billion)
 Packages Group/ Syed Babar Ali (Worth:$870 million)
 Sapphire Group/Mian Abdullah (Worth:$850 million)
Entrepreneurial profile/ Characteristics

➢ Willingness to take initiative

➢ Preference for moderate risk (Calculating Risk Taker)
➢ Confidence in their ability to succeed (Optimistic)
➢ Self-reliance (reliance on one's own efforts and abilities)
➢ Perseverance (persistence in doing something despite difficulty or
delay in achieving success)
“Fall seven times; stand up eight.”
➢ Desire for immediate feedback (Nothing gives you feedback
like your own business)
Entrepreneurial profile/ Characteristics

 High level of energy (Building a successful business requires a

great deal of stamina)
➢ Competitiveness (They enjoy competitive games and sports and
always want to keep score)
➢ Future orientation (serial entrepreneurs)
➢ Skilled at organizing
➢ Value achievement over money

Entrepreneurship is not a genetic trait; it is a skill that is learned.

Women Entrepreneurs
◼ More Women Entrepreneurs
 More women than men are starting new businesses
 40% of all businesses are now majority female-owned
 Movement of women into nontraditional industries
◼ Problems Facing Female Entrepreneurs
 Discrimination and difficulties related to gender
 Lack of access to credit
 Lack of networking connections
 Balancing work and family life
 How entrepreneurs spot business
opportunities.

“Innovation is the special instrument of entrepreneurship

 Entrepreneurs achieve success by creating value in the

marketplace when they combine resources in new and
different ways to gain a competitive edge over rivals.
 Creativity is the ability to develop new ideas and to discover
new ways of looking at problems and opportunities.
 Innovation is the ability to apply creative solutions to those
problems and opportunities to enhance or to enrich people’s
lives.
 How entrepreneurs spot business opportunities

 Monitor Trends and Exploit Them Early On

 Take a Different Approach to an Existing Market
 Put a New Twist on an Old Idea
How entrepreneurs spot business opportunities

 Look for Creative Ways to Use Existing Resources

 Realize That Others Have the Same Problem You Do
 Notice What Is Missing
Drawbacks of Small Business Ownership

➢Uncertainty of income
➢Risk of losing your entire investment
➢Long hours and hard work
➢Lower quality of life until the business gets
established
➢ High levels of stress
➢ Complete responsibility
➢ Discouragement
 Explain the forces that are driving the growth in entrepreneurship

 Entrepreneurs as Heroes (successful entrepreneurs have hero status

and serve as role models for aspiring entrepreneurs)
 Entrepreneurial Education (More than 200,000 students are
enrolled in entrepreneurship classes across the United States)
 Economic and Demographic Factors
 Technology Advancements
 Outsourcing
 Independent Lifestyle
 E-commerce and the World Wide Web
 International Opportunities
The Cultural Diversity of Entrepreneurship

▪ Young entrepreneurs (Primary Career Path)

▪ Women entrepreneurs
▪ Minority-owned enterprises
▪ Immigrant entrepreneurs (Highly Educated & Experienced )
▪ Part-time entrepreneurs
The Cultural Diversity of Entrepreneurship

➢ Home-based business owners

➢ Family business owners
➢ Copreneurs (“Copreneurs” are entrepreneurial couples who work
together as co-owners of their businesses)
➢ Corporate castoffs/“Dropouts”
➢ Retired Baby Boomers
(1946–1964)
Copreneurs
Benefits of Small Business Ownership

The opportunity to:

◼ Control your own destiny

◼ Make a difference
➢ Social entrepreneurs
◼ Reach your full potential (desired job)
◼ Reap impressive profits
◼ Contribute to society and to be recognized for your efforts
◼ Do what you enjoy and to have fun at it
Small Businesses
Although there is no universal definition of a small
business, a common delineation of a small business is one that
employs fewer than 100 people.

◼ Employ 50.2% of the nation’s private sector workforce

◼ Pay 45% of total private payroll
◼ Create more jobs than big businesses
➢ SBA estimates they create 79% of all net new jobs in the U.S.
Small Businesses
◼ Are leaders in offering training and advancement
opportunities to workers
➢ Provide 67% of workers with their first jobs
◼ Produce 51% of the nation’s private GDP
◼ Account for 47% of business sales
◼ Key role in innovation:
➢ Produce 13 times more patents per employees than
large companies
Small Businesses
Putting Failure into Perspective
❑ Because of their limited resources, inexperienced
management, and lack of financial stability, small
businesses suffer a relatively high mortality rate.
❑ About 54% of new companies fail within 4 years
❑ Entrepreneurs are not paralyzed by the prospect of
failure
❑ Failure – a natural part of the creative process
❑ Successful entrepreneurs learn to fail intelligently
Disney also went bankrupt several times before he created
Disneyland.
Avoiding the Pitfalls of Small Business Failure

➢ Know your business in depth

➢ Prepare a business plan
➢ Manage financial resources
➢ Understand financial statements
Avoiding the Pitfalls of Small Business Failure

➢ Learn to manage people effectively

➢ Set your business apart from the competition
➢ Maintain a positive attitude
Conclusion
Entrepreneurs:
 Are an important part of the free enterprise system
 Are a diverse and talented group of people
 Represent a cross-section of society as a whole
 Are able to enhance the profitability of their
businesses through acquiring additional knowledge
and experience