Full Marks: 80
Time: 3 hours
The figures in the margin indicate full marks for the questions.
1 (a) Distinguish between Entrepreneur and Entrepreneurship. Write the definitions of entrepreneurship.
-> The difference between Entrepreneur and Entrepreneurship are:-
1. An entrepreneur is one who undertakes and operates a new enterprise and assumes some accountability for the inherent risks.
1. Entrepreneurship is the practice of starting new organizations, particularly new businesses generally in responses to identified opportunities.
2. Entrepreneur is often synonymous with founder.
2. Entrepreneurship ranges in scale from solo projects to major undertakings creating many job opportunities.
3. The person who starts and operates a business enterprise is an entrepreneur.
3. The process in which an entrepreneur starts and operates his business enterprise is entrepreneurship.
4. The entrepreneur is a coordinator as he coordinates all the three elements of production i.e. land, labour and capital.
4. Entrepreneurship is the coordination maintained by an entrepreneur.
5. The person who innovates something new is an entrepreneur.
5. The innovation of something new or the process of innovation is entrepreneurship.
6. He who leads an enterprise towards its vision thorough leadership, motivation is an entrepreneur.
6. The way in which an entrepreneur leads his entrepreneur leads his manpower, motivates of the firms goal is entrepreneurship.
7. He who bears risk of the firm for the sake of making a reasonable profit is an entrepreneur.
7. The risk bearing practice that is done by an entrepreneur is entrepreneurship.
The process of launching, developing and running a business venture along with its financial risks is called entrepreneurship. In simple terms, it is willingness to launch a new business venture. It is very important for the economic development of the expanding global marketplace. A person who undertakes entrepreneurship is called an entrepreneur.
Entrepreneurship has been described as the “capacity and willingness to develop, organize and manage a business venture along with any of its risks to make a profit.” While definitions of entrepreneurship typically focus on the launching and running of businesses, due to high risks involved in launching a start-up, a significant proportion of start-up businesses have to close due to “lack of funding, bad business decision, an economic crisis, lack of market demand, or a combination of all of these.”
TYPES OF ENTREPRENUERSHIP
1) Administrative Entrepreneurship- The entrepreneurial activity under this category is centred on administrative techniques and functions. It gives a new option to handle prevailing or future situations in a more effective way that provides advantages and a competitive edge. Total quality management, job redesigning, new techniques of doing things, participative management or management by consensus are a few of the examples of administrative entrepreneurship that increase overall organizational efficiency and that makes the firm successful and sustainable in the competitive market environment.
2) Opportunistic Entrepreneurship– It is the best characteristics of entrepreneurship. Environmental changes always offer new opportunities. But everybody is not equally capable of identifying and to utilize that opportunity on time. The entrepreneurship that identifies exploits and executes that opportunity in the first hand regarded as opportunistic entrepreneurship.
3) Acquisitive Entrepreneurship– The entrepreneurship that learns from other competencies is acquisitive entrepreneurship. It acquires something new of value front, the competitive environment or achieves the competitor’s technical capacities. It keeps entrepreneurship sustainable in a competitive environment. The failure never restraints them from acquisition but motivates them further to discover such a thing with a new visitor.
4) Imitative Entrepreneurship– The entrepreneurship that imitates a good or service operating in the market under a franchise agreement is the imitative entrepreneurship. It is the medium that spread technology over the world. It adopts an existing technology with minor modifications appropriate to the local condition.
5) Private Entrepreneurship– The entrepreneurship that is initiated under the private sector is private entrepreneurship. The government gives various support services through private and public concerns that encourage private initiative in taking entrepreneurial ventures. A mutual relationship between private and public sectors would make economic development speedy and balanced.
6) Public Entrepreneurship– The entrepreneurship that is undertaken by the government through its various development agencies is public entrepreneurship. All countries, developed or underdeveloped, take a public initiative in venture ideas to fulfil the initial deficiency of private entrepreneurs.
7) Individual Entrepreneurship– The entrepreneurship that is undertaken by an individual or a family with the personal initiative is individual entrepreneurship.
8) Mass Entrepreneurship– This type of entrepreneurship emerges in an economy where a favourable climate of motivation and encouragement exists for developing a wide range of entrepreneurship among general mass is mass entrepreneurship. It increases small and medium enterprises in a country.
CHARACTERISTICS OF ENTERPRENEURSHIP
- Process: Entrepreneurship is a systematic, purposeful, creative and continuous process, which an entrepreneur undertakes to run the business smoothly.
- Innovation: Innovation is the key feature of the entrepreneurship, which creates a difference in the market place. Indeed, it helps the enterprise to introduce the product quickly, as there is hardly any company which selling the product in the market.
- Development of Network: Developing strong connections with the parties such as suppliers, distributors, banks, debtors, creditors and many more, which are directly or indirectly related with the business process, to have a good worth, in the market.
- Profit potential: Profit is something that keeps the organization going; in fact, it acts as a motivation for the entrepreneurs, to do better than before. So, before taking any decision regarding the enterprise, priority is given to the profit potential, i.e. while taking any step further, the entrepreneur identifies whether it is profitable or not.
- Forecasting of Market Trends and future possibilities: The entrepreneur has to keep a close watch on the market trends and future demands so that the enterprise could continuously work to improve the products or service offered, and grow further.
(b) Elucidate the factors which motivate entrepreneurship.
-> The process of launching, developing and running a business venture along with its financial risks is called entrepreneurship. In simple terms, it is willingness to launch a new business venture. It is very important for the economic development of the expanding global marketplace. A person who undertakes entrepreneurship is called an entrepreneur.
Entrepreneurship has been described as the “capacity and willingness to develop, organize and manage a business venture along with any of its risks to make a profit.” While definitions of entrepreneurship typically focus on the launching and running of businesses, due to high risks involved in launching a start-up, a significant proportion of start-up businesses have to close due to “lack of funding, bad business decision, an economic crisis, lack of market demand, or a combination of all of these.”
The factors which motivate entrepreneurship are:-
All entrepreneurs have their own respective journeys to start their companies. There is no “one size fits all” theory or strategy that works for everyone who wishes to be an entrepreneur.
However, there are certain peculiar factors that do play a pivotal role in motivating and inspiring people to own a start-up.
You cannot be a lifeless soul who doesn’t believe in anything and neither wishes to believe. An entrepreneur needs to know how to take calculative risks that sometimes, involve a lot of things at stake.
The courage of taking risks usually comes from having faith in something. And, faith usually arises when one has passion towards something.
You go to any motivational speaking seminars and you will see every speaker talking about the importance of passion in starting a business.
Success of a company is directly proportional to hard work and perseverance of the owner. It is, however, passion of the owner that pushes them to work hard.
The energy of passion can take your business all over the world. In addition, it helps in keeping us going during days when money isn’t coming and work isn’t happening.
So definitely, passion is a key motivating factor that drives people towards entrepreneurship.
Let’s talk about being self-reliant, which is another key motivational factor that drives more than half of the world’s population towards entrepreneurship.
One of the biggest problems with working for someone else is that you are almost never given the freedom to solve a problem on your own. It is always about getting permissions from higher authorities along with finishing mysterious paperwork for the same.
For some, that turns out exactly to be the key reason for starting their own company. Entrepreneurs are very creative people, and they don’t want to slow down their creativity for any reasons.
It’s the sense of freedom, independence, self-reliance that motivates them to entrepreneurship.
3. Feeling of accomplishment
For some of us, the feeling of pride that comes along in making a difference in the society is what plays a crucial role in establishing a venture.
It’s the pride and a sense of accomplishment that one feels in offering services to the community makes one attracted to entrepreneurship.
Every night before you go to bed, you see yourself feeling satisfied with your day work, it is this exact feeling why people would want to work for themselves.
It is about doing the best that you can for your customers, striving hard for excellence in all the endeavours drives them to start a company.
4. Personal Growth
In real sense, when you run your own business, you really come to know what you are made of. The kind of adversities that you face on daily basis help you become more aware of you as a person, and also helps you grow phenomenally.
When you start working for yourself, you have nobody to fall back on. You have no option but to work on your weaknesses in order to make your business grow.
For instance, if you don’t have the mastery over online marketing then you have no other choice but to cultivate the skills of learning online marketing. In this case, you can look for several online marketing tools such as local online business directory Australia.
Start researching list of online business directories in Australia and advertising in these directories.
Besides online business directories, Australia, there are many other online marketing tools that you can explore.
The bottom point is, to explore and grow.
5. Sense of Control
In my opinion, a sense of control over things comes across as the most profound reason for being an entrepreneur. Most of the entrepreneurs get fascinated by the sense of immense security that comes in being your own boss.
You feel as if you are in complete control of your work and people around.
It’s the sense of security and control that helps in driving the entrepreneurial skills of a person.
2(a). What do you mean by ‘entrepreneurial’ competencies? Explain four soft skill competencies of an entrepreneur.
-> Competencies are particular qualities that a company’s recruiters have decided are desirable for employees to possess. During job interviews and assessments, competencies are used as benchmarks against which assessors can evaluate candidates. Competencies are not skills, although they are similar. Skills are learned, while competencies are inherent qualities an individual possesses- combining skills, knowledge and ability.
The five entrepreneurial competencies are:-
1. Initiative– Initiative of any business activity comes from the entrepreneur. It is the entrepreneur who takes action that goes beyond job requirements or the demand of the situation. He does things before asked or forced by the events.
Example- Ramesh was standing near the sea wall at Marine Drive in Mumbai along with a number of people. A boy who stretched too far out fell into the water and began to drown. People shouted but did not do anything else. Ramesh jumped into the sea, swam out and saved the boy. Ramesh took the initiative which brought out some of his hidden skills.
2. Persistence– An entrepreneur should take repeated actions to overcome the obstacles that get in the way of reaching goals. He/she should never be disheartened by failures.
Example- Ankita decided to set up a unit manufacturing FRP (Fibreglass Reinforced Plastic) products. She purchased land and engaged a firm of contractors for constructing the building. As luck would have it the watchman engaged their got murdered and the contractor’s workers panicked and left the construction work. Somehow, Ankita managed to get the construction completed. By the time she could start production, FRP technology has changed and she hardly had any orders. As a result she defaulted in payment of interest to the financial institution which had extended financial assistance. She sold the land and building, paid back the financial institution, salvaged the machinery, shifted it to a rented place and started again. She is now an established entrepreneur.
3. Communication– Communication is a way to make interaction between people. Entrepreneurs always try to improve their communication skills because it will assist them in sharing their ideas and presenting them clearly and to constantly work in a better way with their staff, team members, clients and colleagues. They understand the role of communication in entrepreneurship and they furnish themselves with some best tips to make their regular interactions effective.
Example- Richard Branson is a motivational speaker which is a good example of communication competency. He has strong communication skills and he inspires other people through their strong communication skills.
4. Networking– Business without network or contacts unable to be successful. Entrepreneurial network is an association of entrepreneurs organized, formally or informally, with the object of increasing the effectiveness of the members’ business activities. Such networks extend from very informal mutual support arrangements on up to national and international membership organizations based on formal rules, substantial membership fees, and often employing professional staffs.
Example- Google Company is one of the examples of networking which is one of a business competency. Google Company have a strong network either formal or informal contacts with many small or big farmers, market dealers, and valuable customers. Networking helps them by sharing updated information and also helps to give recommendation and suggestion to improve their business or products through feedback which ultimately make their business successful.
5. Creativity– A thorough observation of the entrepreneurial process shows that creative thinking is the must have “skill” of an entrepreneur for creation of new ideas. Creativity allows a person to devise interesting processes, which gives so many advantages to entrepreneurs.
Example- Mark Zuckerberg is a student as well as a CEO of Facebook. He owned and manage well reputable network “Facebook” which is a popular web that provides free access networking around the globe. That makes only possible because of his creative skills.
Four soft skill competencies of an entrepreneur are:-
Soft-skills are skills which cannot be acquired through education or work experience. They are generally inherent in an individual or are developed by him/her consciously. For example, communication skills, interpersonal skills and entrepreneurial competencies, etc.
Leadership is all about motivating others and helping them find their best selves. It also requires an ability to understand people. When you know your team members and where they best fit, you are more likely to put them where they belong — and that means you can build a better company.
If you want to be a successful entrepreneur, you have to know how to work well with others. You might need a combination of soft skills to be effective at teamwork. It’s important to listen to others, know how to utilize your company’s human capital, and inspire people to work together for best results. It also means you need to do your own part. Recognizing your part in the team, and acknowledging others’ contributions is important.
Communication involves many different media. For best results, you want to develop different communication skills. Some of the common communication skills include:
All of these skills require that you learn how to share your message effectively in a way people understand and relate to. When others understand you, they are more likely to catch your vision.
4. Problem Solving
As an entrepreneur, you need to be ready to solve any problems that come your way. This requires creativity, but you also need to have good analytical skills. With this soft skill, you should be able to analyze the situation and look at it from different angles. On top of that, it’s important to find different, sometimes out-of-the-box solutions to your problems. This is one of the best soft skills for entrepreneurs and business leaders who need to overcome obstacles and challenges.
(b) Explain the theory of invisible cost.
-> The Invisible cost or the Transaction cost was created by Ronald Coase. Transaction cost refers to the cost of providing for some good or service through the market rather than having it provided from within the firm. Ronald Coase describes in his article “The problem of Social Cost” the transaction costs he is concerned with:
In order to carry out a market transaction it is necessary to discover who it is that one wishes to deal with, to conduct negotiations leading up to a bargain, to draw up the contract, to undertake the inspection needed to make sure that the terms of the contract are being observed, and so on.
Invisible or Transaction costs can be divided into three broad categories:
- Search and information costs are costs such as in determining that the required good is available on the market, which has the lowest price, etc.
- Bargaining and decision costs are the costs required to come to an acceptable agreement with the other party to the transaction, drawing up an appropriate contract and so on.
- Policing and enforcement costs are the costs of making sure the other party sticks to the terms of the contract, and taking appropriate action if this turns out not to be the case.
- Ronald Coase contends that without taking into account transaction costs it is impossible to understand properly the working of the economic system and have a sound basis for establishing economic policy.
The Nature of the Firm (1937) by Ronald Coase:
Ronald Coase observes that market prices govern the relationship between firms but within a firm decision are made on a basis different from maximizing profit subject market prices. Within the firm decisions are made on through entrepreneurial coordination. There are a great variety of arrangements in producing goods. In agriculture often most of the labour force works on a day-to-day basis. In other industries the labour force may be permanent, tied to the firm with long-term contracts. Repair services in some firms may be supplied by an internal organization; in others it is provided by specialized firms from outside. A firm is a system of long-term contracts that emerge when short-term contracts are unsatisfactory.
The unsuitability of short term contracts arises from the costs collecting information and the costs negotiating contracts. This leads to long term contracts in which the remuneration is specified for the contracted in return for obeying, within limits, the direction of the entrepreneur.
Coase notes that the economic theory of the production level of a plant in the short run and long run are well worked out, but the theory of the size of the firm is not well developed. This is clear in the matter of acquisition of companies by other companies.
Ronald Coase gives the origin of the Nature of the Firm as a course in the organization of the business unit which he taught in 1932. He noted that there are inconveniences of market transaction, but it transactions are not governed by the price system there has to be an organization. The object of a business organization is to reproduce the conditions of a competitive market for the factors of production within the firm at a lower cost than the actual market. But if an organization exists to reduce costs then why are there any market transactions at all? Coase gave two reasons:
· The costs of organizing additional transactions rise with scale and are equated with the costs of additional market transactions;
· The organization of bigger firms may not reproduce the effects of market conditions.
Ronald Coase best describes the relationship between internal and external transaction costs and activity of firms: Every company will expand as long as the company’s activities can be performed cheaper within the company. For example, if there is a risk of environment uncertainty, external transaction costs will increase. Consequently, a company will be more eager to keep its economic activity internal. There will be fewer contracts with suppliers and less external meetings and supervision.
Oliver Williamson adds that a transaction costs occurs “when a good or a service is transferred across a technologically separable interface.” He also states that critical dimensions for transactions are 1) uncertainty,2) frequency and 3) degree of durability. This reflects the initial idea proposed by Coase. In addition to certainty, manager needs to know the potential future outcomes of a decision. The easiest way to understand this theory is to create an example. Imagine that you want to outsource marketing activity to another company. You need to make a decision. Normally you would base your decision based solely on calculations. However, according to Coase, a good manager needs to take into account bureaucratic costs of your company. When the transaction costs of monitoring another company are lower than the bureaucratic costs of your company, you will decide to outsource the activity to the environment.
Invisible or Transaction cost Economists:
Economists Ronald Coase and Oliver Williamson are credited for introducing and popularizing the concept of Transaction Cost Economics (TCE). The TCE theory explains the need for companies in a market. If markets operated in a perfect world, companies would not be needed, as market forces would provide the coordination and incentives needed for production activities.
However, in a real market, companies exist with hierarchies and exercise authority that allocates resources efficiently. Markets, on the other hand, use their bargaining power to allocate resources. The TCE theory states that a hierarchy can allocate resources more effectively, or efficiently, than a market due to imperfect information and bounded rationally.
3(a) Elucidate the role of NABARD in financing small firms.
-> It is the apex banking institution to provide finance for Agriculture and rural development. National Bank for Agriculture and Rural Development (NABARD) was established on July 12, 1982 with the paid up capital of Rs. 100 cr. by 50: 50 contribution of government of India and Reserve bank of India. It is an apex institution in rural credit structure for providing credit for promotion of agriculture, small scale industries, cottage and village industries, handicrafts etc.
Functions of NABARD:
NABARD was established as a development bank to perform the following functions:
1. To serve as an apex financing agency for the institutions providing investment and production credit for promoting various developmental activities in rural areas;
2. To take measures towards institution building for improving absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions and training of personnel;
3. To coordinate the rural financing activities of all institutions engaged in developmental work at the field level and liaison with the Government of India, the State Governments, the Reserve Bank and other national level institutions concerned with policy formulation; and
4. To undertake monitoring and evaluation of projects refinanced by it.
5. NABARD gives high priority to projects formed under Integrated Rural Development Programme (IRDP).
6. It arranges refinance for IRDP accounts in order to give highest share for the support for poverty alleviation programs run by Integrated Rural Development Programme.
7. NABARD also gives guidelines for promotion of group activities under its programs and provides 100% refinance support for them.
8. It is setting linkages between Self-help Group (SHG) which are organized by voluntary agencies for poor and needy in rural areas.
9. It refinances to the complete extent for those projects which are operated under the ‘National Watershed Development Programme ‘and the ‘National Mission of Wasteland Development‘.
10. It also has a system of District Oriented Monitoring Studies, under which, study is conducted for a cross section of schemes that are sanctioned in a district to various banks, to ascertain their performance and to identify the constraints in their implementation, it also initiates appropriate action to correct them.
11. It also supports “Vikas Vahini” volunteer programs which offer credit and development activities to poor farmers.
12. It also inspects and supervises the cooperative banks and RRBs to periodically ensure the development of the rural financing and farmers’ welfare.
13. NABARAD also recommends about licensing for RRBs and Cooperative banks to RBI.
14. NABARD gives assistance for the training and development of the staff of various other credit institutions which are engaged in credit distributions.
15. It also runs programs for agriculture and rural development in the whole country.
16. It is engaged in regulations of the cooperative banks and the RRB’s, and manages their talent acquisition through IBPS CWE conducted across the country.
Role of NABARD:
NABARD has been instrumental in grounding rural, social innovations and social enterprises in the rural hinterlands. It has in the process partnered with about 4000 partner organisations in grounding many of the interventions are it, SHG-Bank Linkage programme, and tree-based tribal communities’ livelihoods initiative, watershed approach in soil and water conservation, increasing crop productivity initiatives through lead crop initiative or dissemination of information flow to agrarian communities through Farmer clubs. Despite all this, it pays huge taxes too, to the exchequer – figuring in the top 50 tax payers consistently. NABARD virtually ploughs back all the profits for development spending, in their unending search for solutions and answers. Thus the organisation had developed a huge amount of trust capital in its 3 decades of work with rural communities. 
1. NABARD is the most important institution in the country which looks after the development of the cottage industry, small scale industry and village industry, and other rural industries.
2. NABARD also reaches out to allied economies and supports and promotes integrated development.
3. NABARD discharge its duty by undertaking the following roles :
1. Serves as an apex financing agency for the institutions providing investment and production credit for promoting the various developmental activities in rural areas
2. Takes measures towards institution building for improving absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions, training of personnel, etc.
3. Co-ordinates the rural financing activities of all institutions engaged in developmental work at the field level and maintains liaison with Government of India , state governments, Reserve Bank of India (RBI) and other national level institutions concerned with policy formulation
4. Undertakes monitoring and evaluation of projects refinanced by it.
5. NABARD refinances the financial institutions which finances the rural sector.
6. NABARD partakes in development of institutions which help the rural economy.
7. NABARD also keeps a check on its client institutes.
8. It regulates the institutions which provide financial help to the rural economy.
9. It provides training facilities to the institutions working in the field of rural upliftment.
It regulates and supervise the cooperative banks and the RRB’s, throughout entire India.
NABARD has its head office at Mumbai, India.
NABARD Regional Office[RO] has a Chief General Manager [CGMs] as its head, and the Head office has several top executives viz the Executive Directors[ED], Managing Directors[MD], and the Chairperson. It has 336 District Offices across the country, one special cell at Srinagar . It also has 6 training establishments.
NABARD is also known for its ‘SHG Bank Linkage Programme’ which encourages India’s banks to lend to self-help groups (SHGs). Largely because SHGs are composed mainly of poor women, this has evolved into an important Indian tool for microfinance . By March 2006, 22 lakh SHGs representing 3.3 crore members had to be linked to credit through this programme.
NABARD also has a portfolio of Natural Resource Management Programmes involving diverse fields like Watershed Development, Tribal Development and Farm Innovation through dedicated funds set up for the purpose.
(b) Elucidate the functions of marketing .
-> Marketing is related to the exchange of goods and services. Through its medium the goods and services are brought to the place of consumption. This satisfies the needs of the customers. The following activities are undertaken in respect of the exchange of goods and services:
1. Gathering and Analysing Market Information:
Gathering and analyzing market information is an important function of marketing. Under it, an effort is made to understand the consumer thoroughly in the following ways:
(a) What do the consumers want?
(b) In what quantity?
(c) At what price?
(d) When do they want (it)?
(e) What kind of advertisement do they like?
(f) Where do they want (it)?
What kind of distribution system do they like? All the relevant information about the consumer is collected and analysed. On the basis of this analysis an effort is made to find out as to which product has the best opportunities in the market.
2. Marketing Planning:
In order to achieve the objectives of an organisation with regard to its marketing, the marketer chalks out his marketing plan. For example, a company has a 25% market share of a particular product.
The company wants to raise it to 40%. In order to achieve this objective the marketer has to prepare a plan in respect of the level of production and promotion efforts. It will also be decided as to who will do what, when and how. To do this is known as marketing planning.
3. Product Designing and Development:
Product designing plays an important role in product selling. The company whose product is better and attractively designed sells more than the product of a company whose design happens to be weak and unattractive.
In this way, it can be said that the possession of a special design affords a company to a competitive advantage. It is important to remember that it is not sufficient to prepare a design in respect of a product, but it is more important to develop it continuously.
4. Standardisation and Grading:
Standardisation refers to determining of standard regarding size, quality, design, weight, colour, raw material to be used, etc., in respect of a particular product. By doing so, it is ascertained that the given product will have some peculiarities.
This way, sale is made possible on the basis of samples. Mostly, it is the practice that the traders look at the samples and place purchase order for a large quantity of the product concerned. The basis of it is that goods supplied conform to the same standard as shown in the sample.
Products having the same characteristics (or standard) are placed in a given category or grade. This placing is called grading. For example, a company produces commodity – X, having three grades, namely A’. ‘B’ and ‘C’, representing three levels of quality; best, medium and ordinary respectively.
Customers who want best quality will be shown ‘A’ grade product. This way, the customer will have no doubt in his mind that a low grade product has been palmed off to him. Grading, therefore, makes sale-purchase easy. Grading process is mostly used in case of agricultural products like food grains, cotton, tobacco, apples, mangoes, etc.
5. Packaging and Labelling:
Packaging aims at avoiding breakage, damage, destruction, etc., of the goods during transit and storage. Packaging facilitates handling, lifting, conveying of the goods. Many a time, customers demand goods in different quantities. It necessitates special packaging. Packing material includes bottles, canister, plastic bags, tin or wooden boxes, jute bags etc.
Label is a slip which is found on the product itself or on the package providing all the information regarding the product and its producer. This can either be in the form of a cover or a seal.
For example, the name of the medicine on its bottle along with the manufacturer’s name, the formula used for making the medicine, date of manufacturing, expiry date, batch no., price etc., are printed on the slip thereby giving all the information regarding the medicine to the consumer. The slip carrying all these is details called Label and the process of preparing it as Labelling.
Every producer/seller wants that his product should have special identity in the market. In order to realise his wish he has to give a name to his product which has to be distinct from other competitors.
Giving of distinct name to one’s product is called branding. Thus, the objective of branding is to show that the products of a given company are different from that of the competitors, so that it has its own identity.
For instance, if a company wants to popularise its commodity – X under the name of “777” (triple seven) then its brand will be called “777”. It is possible that another company is selling a similar commodity under AAA (Triple ‘A’) brand name.
Under these circumstances, both the companies will succeed in establishing a distinct identity of their products in the market. When a brand is not registered under the trade Mark Act, 1999, it becomes a Trade Mark.
7. Customer Support Service:
Customer is the king of market. Therefore, it is one of the chief functions of marketer to offer every possible help to the customers. A marketer offers primarily the following services to the customers:
(ii) Handling customers’ complaints
(iii) Technical services
(iv) Credit facilities
(v) Maintenance services
Helping the customer in this way offers him satisfaction and in today’s competitive age customer’s satisfaction happens to be the top-most priority. This encourages a customer’s attachment to a particular product and he starts buying that product time and again.
8. Pricing of Products:
It is the most important function of a marketing manager to fix price of a product. The price of a product is affected by its cost, rate of profit, price of competing product, policy of the government, etc. The price of a product should be fixed in a manner that it should not appear to be too high and at the same time it should earn enough profit for the organisation.
Promotion means informing the consumers about the products of the company and encouraging them to buy these products. There are four methods of promotion: (i) Advertising, (ii) Personal selling, (iii) Sales promotion and (iv) Publicity. Every decision taken by the marketer in this respect affects the sales. These decisions are taken keeping in view the budget of the company.
10. Physical Distribution:
Under this function of marketing the decision about carrying things from the place of production to the place of consumption is taken into account. To accomplish this task, decision about four factors are taken. They are: (i) Transportation, (ii) Inventory, (iii) Warehousing and (iv) Order Processing. Physical distribution, by taking things, at the right place and at the right time creates time and place utility.
Production, sale and consumption-all the three activities need not be at one place. Had it been so, transportation of goods for physical distribution would have become irrelevant. But generally it is not possible. Production is carried out at one place, sale at another place and consumption at yet another place.
Transport facility is needed for the produced goods to reach the hands of consumers. So the enterprise must have an easy access to means of transportation.
Mostly we see on the road side’s private vehicles belonging to Pepsi, Coca Cola, LML, Britannia, etc. These private carriers are the living examples of transportation function of marketing. Place utility is thus created by transportation activity.
12. Storage or Warehousing:
There is a time-lag between the purchase or production of goods and their sale. It is very essential to store the goods at a safe place during this time-interval. Godowns are used for this purpose. Keeping of goods in godowns till the same are sold is called storage.
For the marketing manager storage is an important function. Any negligence on his part may damage the entire stock. Time utility is thus created by storage activity.
4(a) Describe in details the various phases of EDP. Elaborate the problems faced by EDP.
-> Entrepreneurship Development Programme (EDP) is a programme which helps in developing the entrepreneurial abilities. The skills that are required to run a business successfully is developed among the people through this programme. It has become one of the major instruments for the promotion and development of entrepreneurship in India during the last three to four decades. This programme is perfect for them. This programme consists of a structured training process to develop an individual as an entrepreneur. It helps the person to acquire skills and necessary capabilities to play the role of an entrepreneur effectively.
Phase of Entrepreneurship Development Programme: Training Phase and Post-Training Phase!
The main objective of this phase is to bring desirable change in the behaviour of the trainees. In other words, the purpose of training is to develop ‘need for achievement’, i.e. motivation among the trainees.
Accordingly, a trainer should see the following changes in the behaviour of the trainees:
a. Is he/she attitudinally tuned very much towards his/her proposed project idea?
b. Is the trainee motivated to plunge into entrepreneurial career and bear risks involved in it?
c. Is there any perceptible change in his entrepreneurial attitude, outlook, skill, role, etc.?
d. How should he/she behave like an entrepreneur?
e. What kinds of entrepreneurial traits the trainee lacks the most?
f. Whether the trainee possesses the knowledge of technology, resources and other knowledge related to entrepreneurship?
g. Does the trainee possess the required skill in selecting the viable project, mobilizing the required resources at the right time?
Some of the questions listed above also answer the basic underlying assumption in designing a suitable training programme for the potential entrepreneurs. Having trained the trainees, the trainers need to ask themselves as to how much, and how far the trainees have moved in their entrepreneurial pursuits.
Post-Training Phase (Follow-up):
The ultimate objective of Entrepreneurship Development Programme is to prepare the participants to start their enterprises. This phase, therefore, involves assessment to judge how far the objectives of the programme have been achieved. This is also called ‘follow-up’. Follow-up indicates our past performance, drawbacks, if any, in our past work and suggests guidelines for framing future policies to improve our performance.
In nutshell, the purpose behind EDP follow-up is to:
a. Review the pre-training work;
b. Review the process of training programme; and
c. Review past training approach.
Problems faced by EDP are:
1. No Policy at the National Level- Though Government of India is fully aware about the importance of entrepreneurial development, yet we do not have a national policy on entrepreneurship. It is expected that the government will formulate and enforce a policy aimed at promoting balanced regional development of various areas through promotion of entrepreneurship.
2. Problems at the Pre training Phase- Various problems faced in this phase are — identification of business opportunities, finding & locating target group, selection of trainee & trainers etc.
3. Over Estimation of Trainees- Under EDPs it is assumed that the trainees have aptitude for self employment and training will motivate and enable the trainees in the successful setting up and managing of their enterprises. These agencies thus overestimate the aptitude and capabilities of the educated youth. Thus on one hand the EDPs do not impart sufficient training and on the other financial institutions are not prepared to finance these risky enterprises set up by the not so competent entrepreneurs.
4. Duration of EDPs- An attempt is made during the conduct of EDPs to prepare prospective entrepreneurs thoroughly for the various problems they will be encountering during the setting up and running of their enterprises. Duration of most of these EDPs varies between 4 to 6 weeks, which is too short a period to install basic managerial skills in the entrepreneurs. Thus the very objective to develop and strengthen entrepreneurial qualities and motivation is defeated.
5. Non Availability of Infrastructural Facilities- No prior planning is done for the conduct of EDPs. EDPs conducted in rural and backward areas lack infrastructural facilities like proper class room suitable guest speakers, boarding and lodging etc.
6. Improper Methodology- The course contents are not standardized and most of the agencies engaged in EDPs are themselves not fully clear about what they are supposed to do for the attainment of pre-determined goals. This puts a question mark on the utility of these programmes.
7. Mode of Selection- There is no uniform procedure adopted by various agencies for the identification of prospective entrepreneurs. Organizations conducting EDPs prefer those persons who have some project ideas of their own and thus this opportunity is not provided to all the interested candidates.
8. Non Availability of Competent Faculty- Firstly there is problem of non availability of competent teachers and even when they are available, they are not prepared to take classes in small towns and backward areas. This naturally creates problems for the agencies conducting EDP.
9. Poor Response of Financial Institutions- Entrepreneurs are not able to offer collateral security for the grant of loans. Banks are not prepared to play with the public money and hence they impose various conditions for the grant of loans. Those entrepreneurs who fail to comply with the conditions are not able to get loan and hence their dream of setting up their own enterprises is shattered. Helpful attitude of lending institutions will go a long way in stimulating entrepreneurial climate.
(b) Illustrate the needs and objectives of EDP .
-> As the term itself denotes, EDP is a programme meant to develop entrepreneurial abilities among the people. In other words, it refers to inculcation, development, and polishing of entrepreneurial skills into a person needed to establish and successfully run his / her enterprise. Thus, the concept of entrepreneurship development programme involves equipping a person with the required skills and knowledge needed for starting and running the enterprise.
Let us also consider a few important definitions of EDPs given by institutions and experts:
Small Industries Extension and Training Institute (SIET 1974), now National Institute of Small Industry Extension Training (NISIET), Hyderabad defined EDP as “an attempt to develop a person as entrepreneur through structural training.
The main purpose of such entrepreneurship development programme is to widen the base of entrepreneurship by development achievement motivation and entrepreneurial skills among the less privileged sections of the society.”
According to N. P. Singh (1985), “Entrepreneurship Development Programme is designed to help an individual in strengthening his entrepreneurial motive and in acquiring skills and capabilities necessary for playing his entrepreneurial role effectively. It is necessary to promote this understanding of motives and their impact on entrepreneurial values and behaviour for this purpose.” Now, we can easily define EDP as a planned effort to identify, inculcate, develop, and polish the capabilities and skills as the prerequisites of a person to become and behave as an entrepreneur.
Need for EDPs:
That, entrepreneurs possess certain competencies or traits. These competencies or traits are the underlying characteristics of the entrepreneurs which result in superior performance and which distinguish successful entrepreneurs from the unsuccessful ones.
Then, the important question arises is: where do these traits come from? Or, whether these traits are in born in the entrepreneurs or can be induced and developed? In other words, whether the entrepreneurs are born or made? Behavioural scientists have tried to seek answers to these questions.
A well-known behavioural scientist David C. McClelland (1961) at Harvard University made an interesting investigation-cum-experiment into why certain societies displayed great creative powers at particular periods of their history? What was the cause of these creative bursts of energy? He found that ‘the need for achievement (n’ ach factor)’ was the answer to this question. It was the need for achievement that motivates people to work hard. According to him, money- making was incidental. It was only a measure of achievement, not its motivation.
In order to answer the next question whether this need for achievement could be induced, he conducted a five-year experimental study in Kakinada, i.e. one of the prosperous districts of Andhra Pradesh in India in collaboration with Small Industries Extension and Training Institute (SIET), Hyderabad.
This experiment is popularly known as ‘Kakinada Experiment’. Under this experiment, young persons were selected and put through a three-month training programme and motivated to see fresh goals.
One of the significant conclusions of the experiment was that the traditional beliefs did not seem to inhibit an entrepreneur and that the suitable training can provide the necessary motivation to the entrepreneurs (McClelland & Winter 1969). The achievement motivation had a positive impact on the performance of entrepreneurs.
In fact, the ‘Kakinada Experiment’ could be treated as a precursor to the present day EDP inputs on behavioural aspects. In a sense, ‘Kakinada Experiment’ is considered as the seed for the Entrepreneurship Development Programmes (EDPs) in India.
The fact remains that it was the ‘Kakinada Experiment’ that made people appreciate the need for and importance of the entrepreneurial training, now popularly known as ‘EDPs’, to induce motivation and competence among the young prospective entrepreneurs.
Based on this, it was the Gujarat Industrial Investment Corporation (GIIC) which, for the first time, started a three-month training programmes on entrepreneurship development. Impressed by the results of GIIC’s this training programme, the Government of India embarked, in 1971, on a massive programme on entrepreneurship development. Since then, there is no looking back in this front. By now, there are some 686 all-India and State level institutions engaged in conducting EDPs in hundreds imparting training to the candidates in thousands.
Objectives of EDP:
The major objectives of the Entrepreneurship Development Programmes (EDPs) are to:
a. Develop and strengthen the entrepreneurial quality, i.e. motivation or need for achievement.
b. Analyse environmental set up relating to small industry and small business.
c. Select the product.
d. Formulate proposal for the product.
e. Understand the process and procedure involved in setting up a small enterprise.
f. Know the sources of help and support available for starting a small scale industry.
g. Acquire the necessary managerial skills required to run a small-scale industry.
h. Know the pros and cons in becoming an entrepreneur.
i. Appreciate the needed entrepreneurial discipline.
j. Besides, some of the other important objectives of the EDPs are to:
k. Let the entrepreneur himself / herself set or reset objectives for his / her enterprise and strive for their realization.
l. Prepare him / her to accept the uncertainty in running a business.
m. Enable him / her to take decisions.
n. Enable to communicate clearly and effectively.
o. Develop a broad vision about the business.
p. Make him subscribe to the industrial democracy.
q. Develop passion for integrity and honesty.
r. Make him learn compliance with law.
(b) Write the prospects of entrepreneurship development in NER with brief profile of NER.
-> The emergence of local entrepreneurship in different sectors of North East India is expected to bring economic development in a significant way. In order to give opportunities to the rise of enterprises, there are some nongovernmental organizations involved in providing institutional support to aspiring entrepreneurs. They help young entrepreneurs by imparting training and extending credit. Entrepreneurship has become a decisive aspect of change in the region, empowering individuals to seek new opportunities. Efforts have to be made to exploit the natural resources of the different states and tap into other potential areas. The states have to plan intelligently and strategize their efforts, concentrating on areas of strength and available resources. This emerging entrepreneurial scenario demands the need for a qualitative study on the involvement of different contributors towards entrepreneurship development in the region. A case study of the role of Entrepreneurs Associates of Nagaland has been done and presented for the paper.
The Following May Be Considered as Possible Developments in the Entrepreneurial Scene Having Good Prospects for Entrepreneurs
Sericulture: Sericulture is an agro-based labour-intensive industry and can provide ample scope for generation of employment opportunities and economic upliftment to entrepreneurs. The congenial climatic conditions of the region give rise to immense possibilities for the development of sericulture, viz., Mulberry, era, oak, Tasar and Muga.
Horticulture: The NER also produces and has potential for agro horticulture. The different varieties of fruits grown are apple, pear, plum, peach, citrus, papaya, banana, guava, mango, litchi, pineapple and jackfruit. Horticulture is one area where there is high prospect for entrepreneurs to start food processing units.
Floriculture: Floriculture is yet another area where there is potentiality. With the suitable agro-climatic conditions, there is good scope for the development of cut flowers, ornamental plants, flowering plants, flower seeds and plantlets. But, for all these there is need to develop a package of practices and post-harvest technologies so that their quick dispatch to the markets will be ensured.
Small Scale and Cottage Industries: The sale of vegetables, seasonal fruits, other home-made products and handlooms and handicraft items are small income generating ventures which can be expanded into small scale and cottage industries. These industries are labour-intensive and would provide huge employment opportunities.
Essential Oils and Aromatic Chemicals: Essential oils and aromatic chemicals of plant origin play an important role in our daily life. There is ample scope/ prospect for essential oils like citronella, lemon grass, orange peel and ginger.
Handloom and Handicrafts: The Handloom and Handicraft development also have scope in the region. The beauty of cane and bamboo works and traditional shawl and garments show great demand at the national and international level. To venture into all these areas require enterprising people. One primary problem that entrepreneurs face is the lack of suitable outlets to sell the products. This poses a challenge to entrepreneurs and other stakeholders in sustaining their enterprises. Moreover, the capacity of business enterprise in the region is found to be low because of other aspects such as lack of market familiarity, lack of viable concept, lack of technical and managerial skills, lack of business technical know-how, etc. However, these are all removable kind of barriers. Education, which encompasses different dimensions of entrepreneurship, is the best means of developing man’s resourcefulness.
1. To study the role of private agencies in providing assistance to potential entrepreneurs in North East India.
2. To evaluate the role of EA in promoting international trade in South East Asia.
3. To identify the prospects for entrepreneurs in North East India with the effective implementation of India’s Act East Policy.
1. Nature of Data: The study is based on primary and secondary data. Primary data has been collected through personal interviews and questionnaires. Discussions with entrepreneurs and other stakeholders have been conducted. The secondary data has been collected from the handbooks, annual reports, evaluative reports, guidelines and documents of various Government Departments/agencies.
2. Area of Study: The study has been conducted for the entire North Eastern Region with a case study on the state of Nagaland. Nagaland has been selected since the scholar belongs to the state and little study has been done on the state under entrepreneurship.
3. Sampling Design and Size: A multistage purposive sampling procedure has been adopted for the investigation. The total population for the selection of respondents for survey is entrepreneurs from the state of Nagaland. The sample population included rural as well as urban areas with a sample size of 100 respondents each from the urban areas and 100 respondents from rural areas.
4. Statistical Tools and Techniques: The data collected have been scored, tabulated and analyzed. Frequencies and percentages have been used to interpret the socio-economic characters, success rate, and income and employment generation. To examine the impact of trainings and other incentives, Trend Analysis has been used indicating the number of trainees registered and the success rate of the trainings.