keyown = 0
Enterprise
The origins of enterprise
Firms start when entrepreneurs organise resources and take risks in the expectation of earning a profit. More specifically, enterprises tend to be set up for one or more of the following reasons:
To solve a problem
Some firms originate to solve a problem faced by consumers, by other firms, or by government. For example, internet comparison websites solve the problem faced by consumers of having limited time to research the whole market for the best current deals.
To exploit an idea
Many firms start in order to exploit an original idea or an invention. If the invention can be turned into a good or service which adds value, it can command a price, and earn a profit. For example, Dyson plc (Dyson Group plc) was established by James Dyson to exploit his inventions and designs created and produced when he was in his early twenties.
To fill a gap
Some firms start because the entrepreneur identifies a gap in an existing or emerging market, such as online delivery businesses, like Amazon.
Because it can produce at lower cost
Many firms enter a market because to produce an existing product more cheaply, or more effectively, than existing firms in the market. For example, Tesco plc started in 1919 when co-founder Jack Cohen sold cheap groceries from a single stall in London’s East End.
|
To exploit knowledge
Many firms exploit information that is not readily available, such as estate agents and travel agents, like Kuoni.
In all cases, entrepreneurs anticipate that they will be successful and earn themselves a profit for their personal risk-taking and entrepreneurial skill. Private firms can only survive if they satisfy consumer demand effectively.
Financing enterprise
Entrepreneurs need finance to test, produce, and distribute their products. Finance can be obtained from a number of sources, including:
The entrepreneur’s own funds, called private equity
Selling shares in their business, called share capital
Borrowing from individuals, banks via loans and mortgages, or from other firms
Credit from suppliers, which is similar to a loan in its effect
Types of enterprise
There are several types of enterprise, each one distinguished by its legal ownership, including:
Private enterprise
Sole traders
|
MY TEXTS + MY PROGRAMMS
Link to video(lessons and others)
Lessons
Work
My piece of text
|
|