Entrepreneurs are the person who successfully runs and manages a business. They utilise their qualities and characteristics in business to develop strategies for growth. Also, they risk their financial resources in hop of making profit. Entrepreneurship is a process of starting or running a business successfully (Setianto, Fathoni and Warso, 2016). Most of the small and medium size businesses are been operated by them. They highly contribute in GDP of a nation. An entrepreneur is responsible for his overall decisions that makes a business grow. Business can be successful only when challenges faced are effectively overcome by taking proper decisions. This report will show how a new business is started and what barriers are faced.
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CASE 1 A Great Place to Launch a Business
1 Explanation about the barriers that the collegiate entrepreneurs face
Entrepreneurship is a procedure of designing, launching and running a new business. In this aspect entrepreneurs is a person who invest capital and take the risk associated with business. As per the given case scenario, college is not just a time of learning, partying and growing into young adulthood. Russel D' Souza and Jon Groetzinger are two students at Dartmouth College (Cerrato and Piva, 2012). These two student used their personal saving to launch their company under which they purchased modern dorm room essential such as television, DVD players, compact refrigerators, lamps, telephones, chairs and futons. While the collegiate entrepreneur start the business then there are several kinds of challenges and barriers that they will face regarding start up of business. These challenge and barriers are as discussed below-
Lack of Money- This is the major barrier which may face by entrepreneur at the time of starting new business. While any entrepreneur starts business then it is very essential to have sufficient amount of capital. As Russel D' Souza and Jon Groetzinger are two students in the collage so it is quite complicated to start business because they have not sufficient amount of fund. In this case they have purchased several items by use their personal saving.
Lack of knowledge about business- This is another barriers which may face by collegiate entrepreneur at the time of start business unit (Abreu and Grinevich, 2013). Due to the lack of sufficient knowledge about the business strategy, policies, market research, analysis, legislation, entrepreneur may face the issue regarding the business. Russel D' Souza and Jon Groetzinger have to focus on the various strategies, market research, business policies, practices etc regarding the new business so as they can easily cope up with new implementation and execution of business plan.
Market changes- Market change is another barrier which may face by the entrepreneur at the time of staring business. As there are several components regarding business environment and market which needed to consider by individual before enter into the business. If these elements changes then it directly affects planning and implementation of business strategy of new business (Drucker, 2014). Thus, in the case of Russel D' Souza and Jon Groetzinger they have to conduct market research in appropriate manner for collect the information about the changes in the several elements of business environment and market.
2 What are different benefits that the collegiate entrepreneurs have when launching a business?
As per the given case, Russel D' Souza and Jon Groetzinger are college student and they are going to launch their new business in the college. They have several kinds of benefits regarding new start up which are discussed below-
- Financial risk is less- This is the major benefit which may acquired by the entrepreneur at the time of start up new business. While student engages in the entrepreneurship then they invest less amount of capital (George and Bock, 2011). As they have not sufficient amount of fund so they invest less amount of capital and uses old resources in the new business. Thus, it can be said that they have very less financial risk in the new business.
- Campus advisory board- There are many colleges which have effective amazing alumni networks, incubators, entrepreneurship clubs etc. These all helps to the collegiate entrepreneurs in order to launch the new business. In the school, there will have access to entire advisory departments such as finance, management, marketing, accounting, legal and more. High qualified professors helps to entrepreneur in order to provide appropriate information regarding the new start up and required resources.
- Technology- College are a hotbed of technology and people who understand it. There re various kinds of technologies which can offered to student through the college like fax machine, WiFi, Scanners, software, a high tech library, sell phones, iPod, laptops etc. These all resources can collect Russel D' Souza and Jon Groetzinger by the college so it can be said that technology related advantage they have from the college.
- Opportunity to create their own destiny- This is another one of the benefit for the collegiate entrepreneurs because with help of design new business they learn several new skill, knowledge, potential, effectiveness etc which helps them in developing their personality and professionalism (Hmieleski, Carr and Baron, 2015). Thus, it can be said that with help of collegiate entrepreneurship, student can create their own path of career and destiny.
3 Discussion about some advice to entrepreneur who is about to start a business?
As per the given case scenario, Russel D' Souza and Jon Groetzinger are college student and they are going to launch their new business in the college so they required to gain several kinds of effective strategies, advice, suggestion related to new business start up through which they will not face any kind of problem. Following are some advice to a fellow student who is about to start a business-
Set prioritize- Collegiate entrepreneurs should set their priorities regarding their work of new start up business so as major activities can accomplish within specific time period (Mudalige, Ismail and Malek, 2016). Entrepreneur should focus on the major task and activities in their work and give priorities to them accordingly.
Utilize School resources- Collegiate entrepreneurs should use school resources and so as they can save the costs. They can easily take free WiFi, online resources, library material, copy and print service, student software etc so as they can save their cost and budget in it.
Connect with other students- Collegiate entrepreneurs should improve networking with other college students so as they can collect idea, knowledge and creativity regarding new business. As per the research it has been found that there are many start up that have employed students for on boarding (Schlaegel and Koenig, 2014). With help of other classmates and friends, Collegiate entrepreneurs can easily improve its existing procedure of entrepreneurship at workplace.
Find funding options-
Create a schedule and checklist- Collegiate entrepreneurs should develop their own schedule and checklist regarding their work so as each activities and conduct according to specific time period. With help of proper time management and schedule of work, entrepreneur can easily conduct activities and function in an effective and efficient manner.
4 How can a college or university create a culture of entrepreneurship to the campus and community?
Entrepreneurship is very significant aspect in the present time by which individual can earn desired profitability according to the set business. In the context of college and university entrepreneurship. It is great opportunity for the young workers and student who have lack of experience, education etc (Zhang, Song and Zhong, 2016). The college and university can create culture of entrepreneurship with helps of several strategies. In order to create culture of entrepreneurship, management of college should create opportunities for students to participate in social entrepreneurship contests so as they can learn new idea, creativity, strategy, thoughts regarding business. Furthermore, management of college should invite business executives to deliver lectures so as students can quickly learn and grasps real world insight that help in starting new venture. College management should organize activities and event regarding the new business so as they can learn something new regarding the business enterprise.
1) Entrepreneurial characteristics of Bill
A successful entrepreneur is identified by his qualities and traits. The characteristics that he or she possesses helps in becoming successful (Fayolle and Liñán, 2014) The ideas and strategies developed and implemented by entrepreneur depends on his characteristics. In case of Bill he was having several qualities that made him successful businessman. It is described below :-
Positive attitude – Bill always has a positive attitude that made him a great human being. He took decisions and worked with positive mind. This helped him to boost his confidence leading to better results. It was also beneficial for employees as they were motivated by Bill's behaviour. This overall lead to improvement in product quality.
Good grasping power – Bill was eager to learn new things. He was having a good grasping power that made him to learn and apply things in the business (Hmieleski, Carr and Baron, 2015) Due to this he was able to make changes in business operations that enabled employees to work efficiently. By this he was able to take make more technical decisions on four years that improved product quality.
Perfection – As Bill was a craftsman, he was having a perfection in making crafts. So this helped him to do business in perfect way. Before taking any decision he analysed its pros and cons. This was useful in identifying risk associated with it. Thus, Bill took effective decisions and implemented it. This characteristic helped him to provide perfection in products to customers.
Effective decision taking – In the past years Bill has taken many technical decisions in business. In this he installed new machines as he knew that business was based in product quality. By this he improved product quality to retain its customers (Mudalige, Ismail and Malek, 2016) At the same time he told his employees to treat customers with respect. This was useful in increasing customer satisfaction. This helped business to grow and develop.
These characteristic made Bill a successful businessman. It helped in taking proper decisions and implementing strategies to expand business and improving quality of product.
2) Steps taken by Bill to avoid pitfalls
Every business goes through downfall at sometime. It occurs due to poor decisions or market conditions. Thus, it becomes necessary for businessman to take effective measures and steps in order to avoid pitfalls. In context to case study Bill also have to take certain steps to ensure smooth flow of business (Schlaegel and Koenig, 2014) These are described below :-
- Bill must ensure that customer can only be retained if product quality remain the same. A little bit of change in this will affect business operations. For this, Bill should train employees on how to maintain product quality.
- Bill must get involved in business operations so that it will help him to identify loop wholes in operations. With this it will be easy to improve those areas by taking effective measures. It will be beneficial for bill to develop strategies so that it can be implemented in case of critical situations.
- Bill must ensure that customer are equally respected by employees (Zhang, Song and Zhong, 2016) For this he can evaluate employee performance by setting some standards. Also, it will help in maintaining strong customer relationship management. So that in case of change in any issues and problems it can be solved easily. It will help in retaining customer and ensuring long term growth of business.
- Bill should evaluate internal environment of business by dong SWOT analysis. It will help in analysing overall efficiency and productivity of business. Moreover, the main purpose of this is to identify threats so that measures can be taken to overcome it. This step taken by Bill will help in survival of business in long run.
Thus, all these steps taken by Bill will help in overcoming threats that can occur in the future (Henrekson and Sanandaji, 2014) Also, it will ensure smooth flow of business operations. Furthermore, it might help in expanding business in other areas to gain more market share.
3) If you were Hugo, would you sell Bill the business under the terms discussed in the case? Explain
Yes, I would have sold business to Bill but not under the given terms and conditions. I would have changed it. I would have asked Bill to become partner in business or to buy whole business. I know that Bill was not having enough cash to buy that so I would have told him to pay rest of the amount in instalments within 10 years (Sahut and Peris-Ortiz, 2014) Rather than taking a portion of profits I would prefer to sell business. It is because in business profits are uncertain, so it might be that business is not able to generate enough profits that Bill can give me for 15 years. Also, it may happen that after sometime business may suffer from loss. Then, it will not be in condition to give profits. Moreover, Bill might cheat me after sometime. He can give me few profits that is actually generated. This can be done by changing figures and showing wrong financial statements. So from these overall aspects I would have sold business to Bill but not under same terms and conditions.
Engaging in partnership would be beneficial. In this both will share equal profits and loss. The partnership will be of 70 – 30. (Curran and Storey, 2016) This would be easy for Bill to work in partnership by sharing loss and profit. Moreover, in this anyone can terminate partnership if any fraud is done. Besides this, I would have dissolute partnership deed willingly. This will make it easy for Bill to continue run business by becoming the owner. Also, it does not require high amount of investment. So I would have convinced Bill to enter in partnership.
On the other hand it would be beneficial if profits generated are very high. So I can get better amount. But to be at safer side I will not take this risk and rather would have sold entire business to Bill. This will make easy for Bill to work on his own by taking effective decisions without having any interference of Hugo (Storey, 2016). Also, he might get more involved in business operations that will enable him to develop strategies for growth and development.
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From this it is concluded that there comes many barriers while running a business. These barriers have to be removed in order to ensure sustainability of business in long run. Entrepreneur develops various strategies to overcome these barriers. Moreover, how entrepreneur characteristics can help in making a business successful is discussed. Other than this there are various steps that have to be taken to avoid pitfalls is shown. These pitfalls can affect the entire business. Thus, an entrepreneur should take effective decision at right time so that it does not affect business operations. This will help in growth and expansion of business.
- Curran, J. and Storey, D.J. eds., 2016. Small firms in urban and rural locations. Routledge.
- Fayolle, A. and Liñán, F., 2014. The future of research on entrepreneurial intentions. Journal of Business Research. 5(5). pp.663-666.
- Henrekson, M. and Sanandaji, T., 2014. Small business activity does not measure entrepreneurship. Proceedings of the National Academy of Sciences, 111(5), pp.1760-1765.
- Hmieleski, K.M., Carr, J.C. and Baron, R.A., 2015. Integrating discovery and creation perspectives of entrepreneurial action: the relative roles of founding CEO human capital, social capital, and psychological capital in contexts of risk versus uncertainty. Strategic Entrepreneurship Journal. 45(4). pp.289-312.
- Mudalige, D., Ismail, N.A. and Malek, M.A., 2016. Exploratory Study on Relationship between Entrepreneur Characteristics and Dynamic Capabilities in Export SMES. Paradigm. 78(2). pp.113-130.
- Sahut, J.M. and Peris-Ortiz, M., 2014. Small business, innovation, and entrepreneurship. Small Business Economics, 42(4), pp.663-668.
- Schlaegel, C. and Koenig, M., 2014. Determinants of entrepreneurial intent: a meta‐analytic test and integration of competing models. Entrepreneurship Theory and Practice. 5(2). pp.291-332.