Role of an entrepreneur in an economy

• What is the role of an entrepreneur in the economy ?

  Entrepreneurs create employment opportunities not only for themselves but for others as well.
• How can entrepreneurial actives influence a countries economic performance ?

  •Bringing new products

  •Methods

  •Production processes

  •Boosting competition and productivity more broadly.
• 1.Entreprenurs provide job opportunities.

  More careers and income.
• 2. Entrepreneurs increase competition and boost productivity

  By challenging existing firms which leads to more competition. This can cause existing firms to re-assess operations, increase value, lower costs and become more efficient.
• Increased competition…

  will push established firms to INCREASE PRODUCTIVITY AND ENHANCE THEIR PERFORMANCE.
• 3.Entrepreneurs create new business and new markets.

  -Demands will change allowing new businesses to start.

  -If market place is saturated it can result in new markets which is considered positive impact on the economy
• 4.Entrepreneurs add national income

  -New wealth from new markets potentially leading to higher income, boosting national income.

  -This is in the form of higher government spending and tax revenue.
• 5. Entrepreneurs introduce innovative technologies

  Innovative and inventiveness and foundational driving factors for entrepreneurs which can result in great contribution to the economy.
• Creative destruction??

  Idea that new entrepreneurs are innovative which challenges existing firms. Productive firms will grow while the least production are forced to leave the market resulting in an EXPANSION OF THE ECONOMY’S PRODUCTIVE POTENTIAL
• What is the process of creative destruction linked to?

  Technological change.
• What could technological change result in ?

  Efficiency and Productivity

  Lower costs for production possibly improving quality and quantity of goods.
• What can technological change lead to?

  Development of new products and markets and may destroy existing markets. .
• Example of creative destruction??

  CD’s transitioned into mustic streaming apps such as spotify.
• What is added value?

  The difference between the cost of materials and the selling price of a product( Selling price-total input)
• Example of added value??

  Apple prouction cost of an iphone is 150 but selling price is 700. Therefore you would minus 700 by 150 to get ur added value.
• How can greater price be charged ??

  The more valuable that product is to customers.
• Ways to add value??

  •Branding

  •Design

  •Quality

  •Customer service being excellent
• Added Value: Branding

  A brand name is a name, logo or slogan associated to a product or service.

  Advertising and marketing help build a brand.
• Added Value: Design

  The image of a product is how it appears to customers.

  A positive and up-to-date product image will increase sales, increase profits and revenue

  Businesses will need to keep investing in Research and Development to keep producing products customers want.
• Added Value: Quality

  Quality can mean how well-made the products are.

  Quality can also mean how well the service meets the needs and expectations of customers.
• Business benefits of Adding Value??

  • Charge a higher price

  •Differentiate from competitors

  •Protections against competitors offering lower prices.