The Concept And Signs Of Entrepreneurial Activity

The activities of an entrepreneur are aimed at regularly making a profit from the following operations: use of property, production, and sale of goods, the performance of work, provision of services. A businessman is one who is engaged in such activities, registering himself in the manner prescribed by law. They do business independently and at their own risk.

Another definition of this term: an occupation of an intellectual nature, inherent in an initiative and enterprising person who has the resources to carry out this activity. An entrepreneur acts in his own financial interests (making a profit), benefiting society (creating jobs, producing a product).

Independence.

It can be property or organizational. The first implies that the entrepreneur has and disposes of his property, which he uses in business.

The second means that the entrepreneur independently makes decisions concerning his case.

Its independence is manifested at all stages — from the moment of making a decision to conduct a certain activity to make a profit from it. A businessman acts on his own initiative, does not obey anyone’s orders or orders. This distinguishes the activities of an entrepreneur from labor, where the employee fulfills the requirements and instructions of the management.

Systematic.

Entrepreneurial activity is not an action, but a process that takes some time. Consistency is one of the main features of a business, and its main criterion is the regularity of profits for a certain reporting period.

Property liability.

An entrepreneur risks his property — corporate and/or his own, depending on the organizational and legal form within which the company operates.

Formality.

Doing business is possible only after the registration of an individual as an entrepreneur and the company itself. Any activity aimed at making a profit is illegal without registration.

Focus on making regular profits.

The goal of any business is systematic income. If it does not generate income (due to a crisis situation at an enterprise or in the country) but is aimed at this, then it can also be called entrepreneurial. If the activity does not set itself the goal of generating income, then it is not of a commercial nature and therefore cannot be considered as such.

Risk.

Business is always associated with risk — organizational, economic, financial. Moreover, some types of risks depend on the entrepreneur, while others do not (for example, certain changes in the legislation of the country, which were said on the company’s activities). To protect himself from unforeseen expenses associated with risks, a businessman can insure his business. All kinds of risks motivate him to work smarter and more successfully.

Competence.

A businessman must have theoretical and practical skills in this area, specialized education. However, professionalism is not required for all types of activities. It is more likely for those types of business that can be engaged in after obtaining a license (for example, notary services).

The continuous search for business resources.

The entrepreneur is constantly looking for new sources that will ensure his success. These are money, technology, equipment, raw materials, materials, premises, labor, clients, and partners. He is not allowed to stand still in the development of his business, otherwise, there is a great risk of failure.

Types of business.

Depending on the sphere of the economy, the content of the work, the methods of carrying out various operations. Entrepreneurial activity is:

1. Commercial. This type is the most common. Commercial entrepreneurship is associated with any form of exchange of goods for money or for another product.
2. Production. It is based on the fact that an entrepreneur produces various goods with the help of special equipment, technologies, and other resources. Of course, the word “himself” does not mean that a businessman does it with his own hand. This is what the company formed by him does.
3. Financial and credit. In it, the main commodities are money, securities, currency values. This type is the most difficult, it requires an extraordinary mind of an entrepreneur, special skills, and abilities.
4. Advisory. This is the provision of services related to the provision of advice, recommendations, analysis, expert assessments, diagnostics. The most common type of such business is consulting.
5. Farmers. There are requirements for farming by law. For example, only people with family ties can be participants in one farm. In some cases, the presence of participants who are not relatives of the head of the farm is allowed, but there can be a maximum of five of these people. Their task is to manage the farm, with the further sale of the grown resources.
6. Intermediary. Here the businessman himself does not produce or sell anything but acts as an intermediary between sellers and buyers.
7. Insurance. The riskiest, because it is associated with unforeseen circumstances. Because of this, the client needs to pay a certain amount in accordance with the signed insurance conditions. The profits of insurance companies are formed by customer contributions.