UNDERSTANDING ENTREPRENEURSHIP

An entrepreneur is:

“Any person who identifies an opportunity in the market, gathers resources and creates and grows a business venture to meet these needs. He or she bears the risk of the venture and is rewarded with profit if it succeeds”.

An entrepreneur therefore organizes and manages a business and assumes risk for the potential of profit. This shows that opening a small business involves both risk and a financial investment. An entrepreneur decides to take control of his / her future and become self-employed, whether by creating his / her own unique business or working as a member of a team.

The next definition to consider is the word “success”.

The dictionary definition of success is:

“Fortune, prosperous progress, achievement, attainment of wealth, influence or acclaim”.

ENTREPRENEURSHIP IN TANZANIA

More than 95% of businesses in Tanzania are small enterprises. Together, they contribute about 35% of the country's Gross Domestic Product (GDP). There are currently in excess of a million entrepreneurs in Tanzania, running small, medium or micro enterprises (SME’s) responsible for generating up to 40% of total employment.

Micro enterprises

The majority of micro enterprises fall under the informal sector. They also include survivalist enterprises, whose income generation is less than the minimum income standard or poverty line, often there are no paid employees and asset value is minimal. For example, vendors and hawkers.

Small enterprises

These are mostly formalized undertakings. The distinguishing factor is that a secondary coordinating managerial structure is in place.

Medium enterprises

Here there is further decentralization of decision-making, with a more an advanced management structure and an increased division of labour.

Large enterprises

These have a hundred and above employees and their capital investment in machinery is large (above 800 million Tanzanian Shillings).

CULTURAL, SOCIAL AND GENDER BARRIERS TO ENTREPRENEURSHIP

The cultures and societies of sub-Saharan Africa all have the following characteristics in common:

High Power Distance: this is typical of cultures where there is a strong hierarchy of authority, based on age and family status.

High Uncertainty Avoidance: unwillingness to take risks, a need to stick with what is familiar.

Low Individualism: “Ubuntu” and “Ujamaa"; a drive towards conformity within a group.

Low Masculinity: a low individual need for achievement.

THE ADVANTAGES AND DISADVANTAGES OF BEING AN ENTREPRENEUR

Before embarking on your journey, it is important to get a clear idea of the advantages and disadvantages of running your own business. This will assist you to assess your risks and weigh up the benefits.

The Disadvantages:

• Financial risk
• Stress
• Greed
• Getting to grips with it all

External factors

The Advantages:

Sense of achievement

Financial freedom

Independence

Contribution to society

Personal growth

Incentives

CHARACTERISTICS AND QUALITIES OF A SUCCESSFUL ENTREPRENEUR

Successful business owners, large and small, generally have a few things in common:

Business Experience

Drive and Attitude

Determination and Commitment

Interpersonal Skills and Leadership

Family Support and Lifestyle

Money Handling Skills

Planning and Organizational Ability

Creativity and Innovation

Health and Stress Management

Quote “If you can dream it, you can do it.”- Walt Disney

Quote “Man is a goal seeking animal. His life only has meaning if he is reaching out and striving for his goals”.- Aristotle

SMART Goal Setting The criteria for SMART goals are:

S = Specific

M = Measurable

A = Attainable

R = Realistic

T = Timely

IDENTIFYING BUSINESS OPPORTUNITIES

The word “idea” comes from an ancient Greek word meaning “a specific thought which arises in the mind”.

The entrepreneur must first evaluate whether the idea presents a viable business opportunity or not.

Durable The product / service will be around long enough for you to capitalize on the opportunity fully.

Timely The product / service is offered at the right time for meeting the needs of the market.

Add value The product / service must create value for the end user / customer.

Attractive The end user must want to buy it.
Source:http://www.tccia.com/tcciaweb/SMEtoolkit/introduction.htm