Entrepreneurship Taking Risks and Making Profit Essay

Submitted By shyan13
Words: 540
Pages: 3
Open Document
Entrepreneurship: Taking Risks and
Making Profit
GEB 1011
Introduction to Business
Greg Lindeblom

Guess which company?
 In

1907, two Seattle teenagers pooled their money and came up with $100
 They started delivering messages and parcels by bicycle for local merchants
 What company did they found?

Guess which company?
 United

Parcel Service (UPS)
 Founded in Seattle in 1907 by Jim Casey and Claude Ryan

Business and Entrepreneurship
Defined
 Business

= any organized activity that offers goods and services in a market
 Entrepreneur = a person who risks money and time to start and operate a business
–

An entrepreneur accepts the risk and therefore deserves reward = profit

 Profit

= the difference between revenues and costs for a business

Other definitions
 Stakeholder

= someone with a vested interest in the success of a business
–

Shareholder, employee, manager, customer, vendor Profit and Loss
 When

revenues > costs, the business earns a profit
 When revenues < costs, the business earns a loss
 Profit is the motivation for all business activity

Risks and Rewards
 Risk

= the chance that the entrepreneur will lose money, time or personal property
 Entrepreneurs must be compensated for taking the risk = profit
 How do entrepreneurs earn that reward?
–
–

Courage, creativity, capacity for hard work
Giving up other aspects of a “comfortable” life

Entrepreneurship
 Why
–

take the entrepreneurial challenge?

Opportunity, independence, challenge, profit

 What

kind of personal attributes are necessary for an entrepreneur?
–
–
–
–

Self-direction and self-discipline
Action-oriented
Energetic
Tolerant of uncertainty

Objectives of business
 Survival
 Growth

– increasing sales and market share

 Profit
 Social

responsibility – to produce a good or service that has utility and quality

The environment confronting an entrepreneur  When

an entrepreneur decides to start a business, he/she must consider:
–
–
–
–
–

Economy
Legal aspects
Technology
Competition
Global environment

 There

is more to the decision than the product/service and the customer base

Economic and Legal Environments
 Freedom

of ownership and protection of private property
 Contract and law enforcement
 Economic infrastructure (eg. Tradable currency)  Taxes and regulations
 Minimization or elimination of corruption

Technological Environment
 How

to produce more goods/services with the same resource base
 Productivity of workers and capital
–

Highly dependent on education

 Delivery

alternatives

Competitive Environment
 How

many competitors do you have?
Show More

Related Documents: Entrepreneurship Taking Risks and Making Profit Essay

Entrepreneur Essay

providing your idea is connected with personal finance risk. In general people dislike risk – they are scared from the uncertainty. Not everyone is ready to face the consequences from taking this risk and because of that not everyone is born to be entrepreneur. What is the entrepreneur in the most general sense? Which one it is crucial for an entrepreneur: to be possessed with individual qualities like a magnetism and stability, to be fearless and risk-taker or effective in different functions like finance…

Words 5328 - Pages 22

Essay on Social Objective Vs Financial

Francis Group, LLC ISSN: 1049-5142 print/1540-6997 online DOI: 10.1080/10495142.2013.759822 Social Entrepreneurship in Nonprofit Organizations: An Empirical Investigation of the Synergy Between Social and Business Objectives DAVID DI ZHANG and LEE A. SWANSON Department of Management & Marketing, Edwards School of Business, University of Saskatchewan, Saskatoon, Saskatchewan, Canada Social entrepreneurship in nonprofit organizations has emerged as an increasingly important domain, both in academic research…

Words 8263 - Pages 34

Essay about Study Guide

undertakes to organize, manages, and assumes the risks of a business. ENTREPRENEURSHIP- a dynamic process of vision, change, and creation that requires an application of energy and passion towards the creation and implementation of new ideas and creative solutions. ENTREPRENEURIAL MANAGEMENT- the techniques and principles of this emerging discipline will drive the entrepreneurial economy in the twenty-first century. MYTHS OF ENTREPRENEURSHIP: 1. Entrepreneurs Are Doers, Not thinkers 2. Entrepreneurs…

Words 1460 - Pages 6

Entrepreneurship and business Essay

Discuss the relationship between entrepreneurship, innovation and economic development. What role does creativity and problem solving play in this relationship? Refer to both theory and examples from the business world to support your discussion? Entrepreneurship is not just about ‘starting a business’. It is about seizing opportunities in the market place, making changes or improvements and creating value. Entrepreneurs look at problems at hand and take them as opportunities (1). By uncovering…

Words 1026 - Pages 5

Leadership, Leadership Style, And Major Business Principles Of Donald Trump

of a profit-oriented entrepreneurial approach in which the primary goal is to provide a product or service to consumers and to make a profit. Profit-oriented entrepreneurs organize a business and assume risk for the sake of profit. The entrepreneur is out to make money, take risks and beat the competition (“Marken Communications”, 2010). These entrepreneurs are excited by the challenge of starting an organization, recognizing the business comes first and making it successful. Once profits are generated…

Words 2259 - Pages 10

Relationship Between Innovation And Economic Development

We all know what a ‘Triangle’ is. A polygon with three sides and thus three angles. And attributing each angle to the three concepts, namely entrepreneurship, innovation and economic development is the best way to describe the relationship between the three. Depending on the definition, as there are many, we use for each individual concept we can vary the degree of their angle measure or importance in this triangle or relationship. Supporting this view of relationship Schumpeter(1934) argued that…

Words 1983 - Pages 8

Enterprenuer Notes Essay

Entrepreneurship: Successfully Launching New Ventures, 4e (Barringer/Ireland) Chapter 1 Introduction to Entrepreneurship 1) GiftZip, the company profiled in the opening feature for Chapter 1, makes money via: A) payments from companies that offer gift cards for displaying their cards on the site B) the direct sale of gift cards displayed on its site C) monthly subscription fees D) online advertising E) earning an affiliate fee for gift card purchases that originate from its site Answer:…

Words 6135 - Pages 25

Structural Orientation Essay

Review and Research Questions 1. Entrepreneurial orientation Definition…………………………………………………………………….7-9 2. 3. Autonomous………………………………………………………………………………………………………….9-11 4. 5. Innovativeness…………………………………………………………………………………………….….………….11 6. 7. Risk Taking…………………………………………………………………………………………………….……..11-12 8. 9. Proactive………………………………………………………………………………………………………………12-14 10. 11. Competitive Aggressiveness…………………………………………………………………………………14-15 12. 13. Small business obstacles and recent growth trend………………………………………………

Words 17622 - Pages 71

Competitive Process: Austrian and Post-Keynesian Criticisms of the Standard Neoclassical View Essays

imposed by the theory upon individual decision making, and (b) the mathematics simultaneous equation system ( Kirzner, 1997 ). This standard theory assumption was critcised by both Austrian and Post-Keynesian school. Austrian dissatisfaction with the neoclassical competitive model stemmed from their dynamic insights of the market phenomenon. Austrian economists argue that the key issue in understanding the competitive process of economy is entrepreneurship ( Kirzner, 1997 ) . The P-K school deemed that…

Words 2217 - Pages 9

The World Is Exceedingly Interconnected

proximity between he service provider and the consumer. No export option. Factors of production Land- any natural resource: farm land, water, climate, etc. Labor – what your minimum wage is, while taking into account how much people work Capital- money Entrepreneurship-creative ideas, decision making, management (ex. hiring engineers) Chapter 2 Political Systems Collectivist- good of the whole Individualist Democracy Totalitarianism- ex. someone elected democratically, but then the elected…

Words 4717 - Pages 19