7 Factors Affecting Entrepreneurship: Useful Tips You Need To KnowOluwaseun Olayisade
What are the factors affecting entrepreneurship development in our clime?
To discuss the factors affecting entrepreneurship in our clime it is only fair to define entrepreneur and entrepreneurship.
Entrepreneur simply defined is a person who organizes and manages a business with considerable initiative and risk.
Also defined as a person who starts and nurtures a small business, assumes all the risk and reward of a given business venture.
The entrepreneur is commonly seen as a business leader, an innovator of new ideas and business processes. Also good at detecting new business opportunities.
Entrepreneurship has traditionally been defined as the process of designing, launching and running a new business. It could start as offering a product or service for sale or hire.
Entrepreneurship reduces unemployment and stagnation in the economy. Also increases the competitiveness and growth of businesses.
Hence entrepreneurship development (ED) is the use of entrepreneurial behavior and the dynamics of business set-up to develop and expand an enterprise.
Entrepreneurship development refers to the process of improving entrepreneurial knowledge and skills through structured training and programs.
It aims to increase the base of entrepreneurs in order to speed up the pace at which new ventures are established.
Entrepreneurship development focuses on the individual who wishes to start or expand a business.
It concentrates on growth and innovation. Urging more people to become entrepreneurs.
Entrepreneurship development accelerates employment creation and translates to sustainable economic development of any society due to entrepreneurs being the driving force of any society.
The success of entrepreneurship in any society depends on a number of factors asides having the attributes of successful entrepreneurs.
The factors are classified thus for easy assimilation.
• INDIVIDUAL FACTORS
These factors directly influence the individual entrepreneur:
– Ability to capitalize ideas
This is the ability to turn ideas into income.
– Creativity and Knowledge
Do you see solutions or do you see problems? Being an entrepreneur entails being able to proffer solutions to problems.
Do you recognize an opportunity when you see one or do you complain all day?
– Parental Influence and Background
In cases where parents or close relatives are successful entrepreneurs you are easily influenced to tow that line.
– Ability to Plan
As an individual your ability to make plans will help keep you in business even when all seems to be going up in flames.
Financing is a big part of being an entrepreneur. Your ability to finance the business and also draw investors in is a big one because the lifeline of any business is capital.
– Hardwork and Persistence
Persistence and perseverance will keep you going after all the no’s you get at every turn. This determines your continuity. Giving up means closing shop.
– Ability to Manage and Minimize Risk
No successful entrepreneur made it without taking risks. How willing are you to take risks? Also how far can you go?
Ability to identify risks worth taking saves time and precious resources.
• PSYCHOLOGICAL FACTORS
– Need for achievement
Some people become entrepreneurs to prove a point that they can also achieve something.
– Idea Driven
Some individuals are idea filled and always have the urge to experiment. This should be accompanied with the ability to turn the ideas to cash.
– Perception and Motivation
Are you of the perception that you should determine your career path or someone else should?
• ECONOMIC FACTORS
– Market Network
Is there a ready market for your business or you have the ability to create it?
Are loans readily available and accessible?
What is the availability of skilled and unskilled labour?
– Raw Materials
Are the raw materials readily available or do they need to be imported?
– Industrial and Fiscal Policy
• SOCIAL FACTORS
– Society Values
Finding yourself in a society that believes in and encourages entrepreneurship also affects entrepreneurship
– Social Mobility
Are you presently located in an upward mobile society?
– Legitimacy of Entrepreneurship
– Role Models
Having successful entrepreneurs as role models is also one of the factors affecting entrepreneurship decision.
– Social Pressure
– Respect and Status
• LEGAL FACTORS
This is the State of Law and Order in every given society and what the law stipulates about any given situation.
– Income Tax Law
What does the law say about income tax?
– Labour Law
What does the law say about hiring and firing?
– Wage Law
What does the law say about the income earned?
• POLITICAL FACTORS
– Political Stability
– Ideology and Policies of Government
– Change in Government
– Government Actions
Actions of the government of the day can either favor entrepreneurs or not. Presently the actions taken by the government in power is not favourable.
– Lack of Government Support
• CULTURAL FACTORS
Factors affecting entrepreneurship either have positive or negative effects. It is their positive effect that contributes to the development of entrepreneurship in any given society promoting economic development. Dependent on the government, society and individual alike.
Do you know more factors affecting entrepreneurship? Kindly join the conversation to share.