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MC080401068
Salma Noreen

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MGT602 – Entrepreneurship
Assignment no 1

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CASE STUDY

Following is a statement in which a business owner attempts to explain and justify his preference
for slow growth in his business:

I limit my growth pace and make every effort to service my present customers in the manner they
deserve. I have some peer pressure to do otherwise by following the advice of experts – that is, to
take on partners and debt to facilitate rapid growth in sales and market share. When tempted by
such thoughts, I think about what I might gain. Perhaps I could make more money, but I would
also expect a lot more problems. Also, I think it might interfere somewhat with my family
relationships, which are very important to me.

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Questions:
1. Should this venture be regarded as entrepreneurial? Is the owner a true entrepreneur?

Answer: As we see the definition of Entrepreneurship, an Entrepreneur is the person who has all
rights and responsibilities of his business, in case of lose, Entrepreneur bear lose. He also can
make changes in his business for increment of wealth; he can use innovative ideas and
techniques. A person who has to assumes the risks and rewards. The entrepreneurship is the one
who brings the capital, labor, resources, materials and other assets. So we can say this venture
should be regarded as entrepreneurial.

I don’t think that owner is a true entrepreneur, because he wants to be sole proprietor but for
business he has to adopt partnership. He is in the condition of confusion, he is frustrated and
couldn’t able to select one option as he is saying that one side is better for his business but his
wishes is opposite. He limits his business because he can’t handle big one but it can also be risky
for him but same time he is afraid of partnership, as he has fear of losing whole business in case
of partner become a fraud. He is bit confused because he has not much financial resources and
also afraid of losing this extra money as his business is not going in good condition.

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So when we see his condition and his thinking, we can’t say that he is true entrepreneur. Because
a true entrepreneur can’t think about partners, he assumes all risks and rewards alone, he takes all
decisions alone, but here we see the owner is depressed and he can’t take decisions confidently.

2. Do you agree with the philosophy expressed here? Is the owner really doing what is best
for his family?

Answer: The owner is looking depressed. He has to adopt partnership for his business but he
doesn’t want to. Business seems to be destroying and as experts suggest him and he also admit
that if he has some partners, it facilitates his business, provide his business some sources of
financial resources as well as assuming the risk. But same time he is thinking about the effects of
partnership on his business life. Taking decisions will not be only his hands in case of
partnership. As partners equally assume risks so they also equally assume the benefits and
rewards.
It seems that his business is his own family business, in which he doesn’t want or simply can’t
make changes even for innovation point of view, he is afraid of family relationship as there is
mostly happened to adopt family business as it was before so here seems same case with this
person.
I am agree with the philosophy which is expressed here, as this type of condition can make
confused when one side we see our success but we are bound to adopt another way where we are
already bearing loss. Same happened with this person, he is continuously bearing loss so he
limited his business and experts suggest him a way which he admit that can be useful for his
business but due to his family he can’t adopt that. Same time he is thinking about risks which are
involved in adopting suggested way which is better for his business.
When we talk about his family and think about his relation that he is doing good or bad then we
can easily conclude that he is doing whatever best for his family in sense of doing their style of
business but same time he is doing bad for his family in long term as if he lose his business. And
will be only source of earning for his family then he will be doing very wrong for his family
indirectly. But one thing is crystal clear for us that he is totally doing wrong for his business
because as a good entrepreneur he must take good steps for his business’s betterment which are
not taken by him.
3. What kinds of problems is this owner avoiding?

Answer: After studying the case we come to know some problems which are in owner’s mind
and he is trying to avoid them, because of these problems he is not able to take any decision. Let
me elaborate one by one as follows:
Customers Problems/Business handling problems:
He is not able to handle his business alone so he limits his business, so he can serve current
customers properly, this situation shows that he want to extend his business but he can’t handle
properly so he need partners as experts suggest him for his business betterment. So his biggest
problem is that he can’t handle his business alone, he hasn’t abilities of sole proprietor.
Family Problems:
As case study shows that it might his family business so he can’t make changes in this business
for keeping his good family relations which are very important for him, but at same time he don’t
want to lose his business. As he is thinking that he can make money if he was not to face the
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problem of family. One other problem is that in case of losing business he might lose his earning,
family pressure is also a problem for him.
Financial Problem:
For extension of business, sometimes we have to bring and invest some money but sometimes it’s
not much easy for only man so he needs some partners who will ready to invest some money for
his business and also help him in handling business activities. But entering partners in business
can be risky so it is also a problem for him and he want to avoid this too by keeping
proprietorship.
Debt:
He is also depressed because he needs money for his business but if he take loan from bank then
he must promise in exchange of getting money that in case he will not be able to give back lent
amount to the bank then bank have right to snatch his property or other thing equal to that
amount. When we are going to take loan for this type of business then it might be much risky
because there are many chances to lose of business means loss of lent money.