ENTREPRENEURIAL PLANNING 

• Forms of Business Organization

  • Sole - Proprietorship

  • Partnership

  • Company

• Concept of Business Plan

• Format of Business Plan

• Components of 

  • Organizational Plan

  • Operational Plan

  • Production Plan

  • Financial Plan

  • Marketing Plan

  • Human Resource Planning

Activities undertaken to earn monetary gains are called economic i.e. activities primarily concerned with: 

• Production  

• Distribution and/or  

• Consumption of goods and services. 

Activities done out of love, care, affection, self-satisfaction, emotions, sympathy, patriotism etc. but not for money, are known as non-economic. 

1. Manufacturing: 

Production of merchandise for use or sale using labour and machines, tools, chemical and biological processing, or formulation, may also refer to a range of human activity, from handicraft to high tech, but is most applied to industrial production, in which raw materials are transformed into finished goods on a large scale. 

2.  Service: 

An intangible commodity a type of economic activity that is intangible is not stored and does not result in ownership. A service is consumed at the point of sale. Services are one of the two key components of economics, the other being goods. 

3. Trading:

Not a new phenomenon we've been doing it for centuries! The trade that occurred among the most primitive humans has evolved over time. Trading is.  

• the activity or process of buying, selling, or exchanging goods or services  

• the amount of things or services that are bought and sold: the money made by buying and selling things or services  

• the act of exchanging one thing for another 

Business is a continuous human economic activity with an objective to earn profit by producing, buying, and selling of goods and services. Irrespective of size, nature, scale or ownership, an activity is referred as business if it exhibits the following essential characteristics:  (Any 6 only needed)

1. Entrepreneur's presence - There must be someone/person to take initiative for establishing a business and undertake the risk associated with the same. 

2. Economic activity - All those activities related to the production and/or distribution of goods and services, with economic motive i.e. profit can form part of business. 

3. Production or procurement of goods and services - A business which either produces or procures goods and services for offering them to consumers, could be: 

   1. Consumer's goods 

   2. Producer's goods

   3. Services 

4. Sale or exchange of goods and services - A business must involve sale, exchange, or transfer of goods and/or services for the satisfaction of human needs against a value/price. Goods/services purchased or produced for personal/self-consumption, is not a business. 

5. Regularity - One time transaction or dealing in goods and services is not business, even if one earns profit in return. Business must be done regularly. 

6. Utility creation - Business activities result in creation of utilities i.e. 

   1. Form utility – Changing the form of raw material into finished product creates form utility.

   2. Place utility – From the place of production, transporting goods to the place of consumption results in place utility.

   3. Time utility – The process of storing the goods when not required to supplying them when required generates time utility. 

7. Profit earning - Profit is the reward for undertaking a business activity as no business can survive for long without earning profits. 

8. Uncertainty of return - Business does not guarantee for the return of either principal amount invested in the business or the profit. 

9. Element of risk - Business involves risk i.e., uncertainty. 'Higher the risk, higher the profit' goes the old proverb. The actual business situation is affected by a variety of uncontrollable external factors casting favourable or unfavourable impact on business. Thus, the risk element keeps a businessman vigilant and going.