Environmental Factors affecting Entrepreneurship

BY
ANAND R.DESHPANDE

ANAND R DESHPANDE 1
Environment plays a crucial role in setting up of an enterprise because
of the influence of various environmental factors as described below.

• 1. Developmental and institutional factors: The encouragement and

guidance of various governmental and non-governmental institutions
plays a vital role in the setting up of an enterprise.
• 2. Economic Factors: The vital economic factors like demand and
supply will determine the size of the enterprise. The health of the
economy will also determine the various means of financing the
business.

ANAND R DESHPANDE 2
Environment plays a crucial role in setting up of an enterprise because
of the influence of various environmental factors as described below.

• 3. Financial Factors: The finds required for starting up an enterprise

depends on the availability financial institution ns and other sources of
funding and the policies followed by them.
• 4. Social and cultural factors: Evaluating the social and cultural
factors plays a vital role and requires that the enterprise is compatible
with the needs of the population living in a specific region.

ANAND R DESHPANDE 3
Environment plays a crucial role in setting up of an enterprise because
of the influence of various environmental factors as described below.

• 5. Legal factors: Starting an enterprise involves fulfilment of various

legal requirements. Thus these factors have a crucial role in setting up
of an enterprise.
• 6. Political Factors: Various governmental policies prevailing in the
society will affect the setting up of the enterprise. Thus political
factors needs consideration for setting up of an enterprise.

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