ENTREPRENEURIAL AND

CREATIVITY
WORKSHOP II

By

CHOFOR J
 Course Objectives

The main objective of this course is to initiate the

learners into entrepreneurship and build the
motivation and mind set for self-employment. The
course is intended for second year students of;
Accountancy, Banking, Marketing, Supply Chain
management and Human Resource Management.
This is an upper-level, seminar-type course
examining the basics of entrepreneurship and the
general entrepreneurial climate in Cameroon.
 Contents

• Background to the concepts of entrepreneur

entrepreneurship and intrapreneurships.
• Characteristics and functions of entrepreneurs,
• Business Plan development
• Forms of Business organisations
 Expected Outcomes

Upon completion of the course, it is expected

that students would have acquired the
theoretical and practical knowledge required to
start and manage a small business to full growth
in a successful manner.
 CHAPTER ONE

THE BACKGROUND TO ENTREPRENEURHIP

TWO TYPES OF MEN IN THE WORLD
EITHER MONEY WORKS FOR YOU OR
YOU WORK FOR MONEY
 Introduction
An entrepreneur is the dynamic force behind the
planning and launching of new business
enterprises. They may be involved in all aspects of
the company throughout its life span, beginning
with the raw startup stage, when the venture is
little more than an idea.
They handle issues ranging from the company's
product design to determining the most efficient
production methods and even finding the
company's first customers.
In contrast, a small-business manager is someone
hired to handle the day-to-day management of a
startup. The manager’s goal is to keep the company
growing and operating efficiently. In some cases,
the entrepreneur may bring in a skilled small-
business manager to build the company into a
larger entity. This typically happens after
entrepreneurs realize that their creative vision only
takes their company so far, and having an
experienced manager on board to direct day-to-
day operations will allow the business to continue
to grow.
 Entrepreneur vs. Manager
To begin, what is the difference between a manager
and an entrepreneur? A manager is a leader within
an established organization who oversees the work
of other employees within a department or
sometimes a larger segment of the organization.
They assign tasks, provide guidance, troubleshoot
problems and ensure that deadlines are met.
Although they are given more responsibility and
subsequently higher pay, they are still employees
of the company and must answer to a supervisor or
the company owner.
In contrast, entrepreneurs are people who
recognize a consumer problem, find a solution and
build a business around making that solution
available to the public. They have an idea for a
product or service, develop the product, formulate
a company around its sales and marketing and
assume the financial risks associated with starting
and running the business. They most likely will hire
additional employees to help in the many aspects
of building the company, but they ultimately fulfill
many roles as owner, manager and entrepreneur,
making sure the business follows their design and
mission.
 Traits of a Good Manager
• Good managers are excited about the company where they
work and
• Positively communicate to the employees under them the
corporate culture, or reason why the company is unique
among others.
• Managers can prioritize tasks and lead their department by
making tough decisions.
• But they need to be people-oriented as well, not only
focused on driving forward the tasks, but listening to
employees' concerns and keeping the office on a positive
trajectory.
• Additional character traits which bosses look for in a manager
include integrity, honesty and the ability to assume
responsibility and hold themselves and others accountable
for their actions.
Traits of a Successful Entrepreneur
• People become entrepreneurs in part because of
their natural ability to look at problems and
design solutions.
• They are highly motivated to bring their ideas to
completion and
• Exude a great deal of confidence in their ability.
• They are not afraid to take risks, financial and
otherwise,
• Are also not phased by failure when it comes.
Challenges that come their way are often seen
as a learning experience and perhaps even an
opportunity to discover even better solutions.
Entrepreneurs solve problems
Entrepreneurs are highly motivated about their
ideas
Entrepreneurs have high confidence
Entrepreneurs are not phased by
Failure
RISK!!!
• These smart business people are willing to
acknowledge when they need more information
and are always seeking to learn.
• Entrepreneurs are also very passionate about
their companies and are willing to work very
hard.
• They excel at networking with other business
people and become skilled at selling their
company's products and services.
• Finally, they must be good managers of money if
they are to remain financially successful
Entrepreneurs are always seeking to
learn(MENTORSHIP)
Entrepreneurs work very hard.
Entrepreneurs do Networking
Entrepreneurs are good managers of money if
they are to remain financially successful
 Intrapreneurship

Although managers are employees of companies

they can operate in ways that lean toward being
entrepreneurial. When managers adapt the traits
of entrepreneurs and begin to develop new ideas
within the companies where they already work, a
concept known as intrapreneurship emerges. It is
interesting to compare entrepreneurship and
intrapreneurship, as the two are strikingly similar,
although they occur within different contexts
In both instances, new products and solutions
are developed, enabling the businesses to grow
and expand. However, whereas the
entrepreneur takes all the financial risk for such
growth, the corporate manager assumes no
personal financial risk for his ideas.
Entrepreneurs are the starting and ending points
of most ideas, whereas managers and
employees must communicate their ideas to
superiors, and then convince senior staff to
embrace their ideas and push them forward.
 Benefits of Entrepreneurship

1. The freedom to pursue your own vision.

You can have your own view of the world, and entrepreneurship is the
only venue where you pursue that view and see the fruition of your
vision. Self-employment allows you to do your own thing, and pursue
those areas that you feel passionate about.

2. The control and flexibility you have over your own time.
As your own boss, you work when you want to work; and stop if you
want to stop. You can tailor your work according to your lifestyle and
accommodate various tasks. You can work in however way you please
— in your pajamas, with the TV loudly blaring — without getting a
memo from the personnel department. Self-employment means
freedom from rules.
3. The opportunity to learn and gain knowledge.
The entrepreneur often wears many hats — the strategic
planner, the marketer, the customer service rep, and the
sales rep, even the bookkeeper. There are a million things
you probably didn’t know before you started the business
that you are now forced to learn — and gaining all these
knowledge enriches you as a person.

4. The highs and lows of self-employment.

Entrepreneurs face tremendous challenges and
experience incredible joys when these challenges are
overcame. If you crave excitement, become an
entrepreneur. One moment, the local newspaper is
featuring you; and the next, you are losing your biggest
customer. There’s never a dull moment in self-
employment.
5. The sense of pride and fulfillment in accomplishing
things.
As an entrepreneur, you make things happen. You create
a vision, lay out the plans to bring the plan to fruition and
pursue the steps needed to make the business a success.
Doing all these things can give you an incredible feeling of
pride and joy – seeing your website used by people,
finding your products in the department store, getting
compliments from customers on how your business has
helped them, and being written about by the media. In
many respects, your business is your baby, and nurturing
it and seeing it grow can give any parents a sense of
fulfillment.
6. The confidence you gain in knowing that you can do it.
Entrepreneurship is tough. There will be moments where you
will question yourself, or your decisions into going into the
business. Sometimes, you’d even think that you couldn’t do it
when the obstacles seem insurmountable. But once you
succeed and overcome the challenges, you gain a renewed
confidence and respect for yourself that you can do it.

7. Potential earnings exceed a salaried employee.

As an employee, no matter how hard you work, the financial
remuneration you receive is limited to your salary and an
occasional bonus. As a self-employed person, you can earn so
much more if you hit the right business idea and execute the
business well. The potential financial windfall is so much
higher as an entrepreneur rather than a corporate person.
8. Business owner reaps the full rewards.
You are the business; anything the business
gains is yours. If you are an employee in the
corporate world, your bosses may even claim
your success as theirs! If you are working for
others, you are only a cog in the whole machine

9. Each new day is a challenge.

You never get bored as an entrepreneur: every
day brings a new challenge, new tasks and new
discoveries. You set your pace and you can go
fast if you choose or slow down if you feel like it.
10. The chance to share your learning.
At the end of the day, you can have the chance
to teach and share with others the things you’ve
learned as an entrepreneur. Sharing what you
learned can be your way of giving back to the
community – it can take the form of mentoring
other would-be entrepreneurs, writing a book so
others may see how you did it, or even talking
about your experiences. There is so much
pleasure in giving, and entrepreneurship gives
you a life full of rich experiences.
 CHAPTER TWO

TRANSFORMING A BUSINESS IDEA INTO A

VIABLE BUSINESS PLAN
Sources of Business Entrepreneurial
Ideas
Interests and hobbies
Customer surveys
Brainstorming and dreams
Experience
Franchises
Mass media
Trade fairs and exhibitions
 Establishing a business model and
your business plan

After coming up with a business idea, the next

thing is to conceive a viable business model and
develop a business plan!!!.
 What is a business model?
A Business Model is a conceptual structure that
supports the viability of a product or company and
explains how the company operates, makes money,
and how it intends to achieve its goals.
Every business model intrinsically has three parts –
• everything related to designing and
manufacturing the product
• everything related to selling the product, from
finding the right customers to distributing the
product
• everything related to how the customer will pay
and how the company will make money
 Format of a business plan

Creating a business plan is a key part of starting

any business venture. Even if you’ll never use it
in this format for attracting investors and raising
capital, it can be vital for helping all
entrepreneurs to ask and think through essential
questions.
 Title Page
Enter your business information including the legal name,
address, etc. If you already have a business logo you can
add it at the top or bottom of the title page.
• Business Plan for "Business Name"
– "Date"
– "Business address"
– "Phone"
– "Email"
– "Website"
• If addressing to a company or individual include:
– Presented to: "Name"
• "Company or Financial Institution
 Table of Contents
• Executive Summary..........................................Page #
• Company Description……………………………………….Page#
• Industry Overview...............................................Page #
• Market Analysis and Competition.......................Page #
• Sales and Marketing Plan.............................,......Page #
• Ownership and Management Plan......................Page #
• Operating Plan.....................................................Page #
• Financial Plan.......................................................Page #
• Appendices and Exhibits.....................................Page #
 Section 1: Executive Summary

The executive summary It provides a

short, concise, and optimistic overview of your
business that captures the reader's attention
and creates a need to learn more. The executive
summary should be no more than two pages
long, with brief summaries of other sections of
the plan.
 Section 2: Company Description
This section provides a further overview of your
company now. It includes:
• The company purpose, mission and vision
• Company formation information
• Who the founders are
• Location and geographical markets served or
where you have a presence
• Current status and stage of business
• Any notable achievements so far
 Section 3: Industry Overview
Describe the overall nature of the industry,
including sales and other statistics.
Include trends and demographics, and
economic, cultural, and governmental
influences.
• Describe the existing competition.
• improved or lower cost services you will offer.
 Section 4: Market Analysis and the
Competition

In this section, you need to demonstrate that

you have thoroughly analyzed the target market
and that there is enough demand for your
product or service to make your business
viable. The competitive analysis includes an
assessment of your competition and how your
business will compete in the sector.
 Section 5: Sales and Marketing Plan

A description of how you intend to entice

customers to buy your product(s) or service(s),
including advertising/promotion, pricing
strategy, sales and distribution, and post-sales
support if applicable
 Section 6: Ownership and
Management Plan

This section describes the legal structure,

ownership, and (if applicable) the management,
and staffing requirements of your business.
 Section 7: Operating Plan

The operating plan outlines the physical

requirements of your business, such as office,
warehouse, retail space, equipment,
inventory and supplies, labour, etc
 Section 8: Financial Plan

The financial plan section is the most important

section of the business plan, especially if you
need debt financing or want to attract investors.
The financial plan has to demonstrate that your
business will grow and be profitable. To do this,
you will need to create projected income
statements, cash flow statements, and balance
sheets.
Section 9: Appendices and Exhibits
The appendices and exhibits section contains any detailed
information needed to support other sections of the
plan.
Possible Appendix/Exhibit Items
• Credit histories for the business owners
• Resumés of the owners and key employees
• Site/building/office plans
• Links to your business website
• Any other supporting material that may impress
potential lenders or investors if you are looking for
financing
 FORMS OF BUSINESS
ORGANISATIONS

One of the first decisions that you’ll have to

make as a business owners is how your business
should be structured. You need to know the
advantages and disadvantages of each of the
different forms of business organization to make
sure you’re making the right decision for your
new business.
All businesses must adopt some legal
configuration that defines:
the rights and obligations of participants in
the business’s ownership,
control,
personal liability,
lifespan and
financial structure.
The form of business determines which
income tax return form to file
With respect to the above considerations, the
entrepreneur may choose amongst the
following forms in the Cameroonian context:
A. Non-corporate Business Organisations
1. Sole proprietorship
2. Partnership
B. Corporate Business Organisations
1. Limited liability companies/ Corporations/
joint stock companies(Ltd/Sarl & Plc/SA)
 Sole proprietorship
A sole proprietorship is a business owned by
only one person. It is easy to set-up and is the
least costly among all forms of ownership. The
owner faces unlimited liability; meaning, the
creditors of the business may go after the
personal assets of the owner if the business
cannot pay them. The sole proprietorship form
is usually adopted by small business entities.
 Documents Required for Creation of
a Sole Proprietorship
 Certified National Identity Cards
 Certificate of non-conviction for the owner, not
more than three months old
 4passport size photograph
 Sketch of Localization plan for owner’s residence
 Sketch of localization and address of the business
 Lease agreement for office/ or housing
documents for the office
 Attestation of bank account
 41,500 FCFA
 Documents issued for sole proprietorship
Upon Registration
Upon registration of a Sole proprietorship
business, the entrepreneur is issued the following
documents
 Attestation of registration
 Tax payer’s card
 Attestation of Non-indebtedness
 Stamped localization plans
Sole proprietorship advantages
The owner receives all profits
Profits are taxed only once
The owner makes all decisions and is in
complete control of the company (but this
could also be a disadvantage)
It is the easiest and least expensive form of
ownership to organize.
Sole proprietorship disadvantages

There is unlimited liability if anything happens

in the business. Your personal assets are at
risk (including your personal home).
It is limited in raising funds and the owner
might have to acquire consumer loans.
There is no separate legal status.
 Partnerships
A partnership is a business owned by two or more
persons who contribute resources into the entity.
The partners divide the profits of the business
among themselves.
These come in two types: general and limited
partnership. In general partnerships, both owners
invest their money, property, labor, etc. to the
business and are both 100% liable for business
debts. In other words, even if you invest a little into
a general partnership, you are still potentially
responsible for all its debt. General partnerships do
not require a formal agreement—partnerships can
be verbal or even implied between the two
business owners.
 Documents required for Registration
of a Partnership
In the registration of a partnership business, the same
documents above(for the sole proprietorship) are
required, in addition to the Deed of Partnership
Although it is left to the choice of the partners of the
firm to decide themselves as to what should be
mentioned in their partnership deed, yet a partnership
deed generally contains the following:
1. Name of the firm.
2. Nature of the business.
3. Names of partners.
4. Place of the business.
5. Amount of capital to be contributed by each partner.
6. Profit sharing ratio between the partners.
7. Loans and advances from the partners and the rate of
interest thereon.
8. Drawings allowed to the partners and the rate of
interest thereon.
9. Amount of salary and commission, if any, payable to
the partners.
10. Duties, powers and obligations of partners.
11. Maintenance of accounts and arrangement for their
audit.
12. Mode of valuation of goodwill in the event of
admission, retirement and death of a partner.
13. Settlement of accounts in the case of dissolution of
the firm.
14. Arbitration in case of disputes among the partners.
Advantages of partnerships:
Shared resources provides more capital for the
business
Each partner shares the total profits of the
company
Similar flexibility and simple design of a
proprietorship
Inexpensive to establish a business
partnership, formal or informal
Disadvantages

Each partner is 100% responsible for debts

and losses
Selling the business is difficult—requires
finding new partner
Partnership ends when any partner decides to
end it
 Limited Liabilities Companies
In the Cameroon context, this groups what is known
elsewhere as “Corporations”, and “Joint stock companies”
These forms of businesses include any business organization
that has a separate legal personality from its owners.
Ownership in such a business is represented by shares of
stock.
The owners (stockholders) enjoy limited liability but have
limited involvement in the company's operations. The board
of directors, an elected group from the stockholders, controls
the activities of the corporation.
There are basically two types:
I. Private Limited Companies
II. Public Limited Companies
 Requirements for the Registration of
Limited liability companies In Cameroon

To create a Private Limited Company (Ltd/Sarl) or a

Public Limited Company (PLC/SA), you will need a
minimum capital of CFA 1 million CFA or CFA 10
million respectively. Procedures regarding the
setting up of the company are almost similar to
those of the sole proprietorship company.
However, the commercial registration process
differs. You can either do it yourself or hire a
notary.
Information required from the company founders:
• Name of Company ( Private or Public ) limited
company
• Objectives of the company
• Copy of shareholder (s) national identity card ,
passport or residence permit for foreigner and
birth certificate for minor.
• Non-conviction or non-crime certificate
• Company registered address
• Company start up share capital.
Documents to be Prepared by the Commercial
Attorney:
• Memorandum & Article of Association of the
company
• Notarized statement of subscription and payment
of shares
• Notarized list of company shareholder & company
manager
• Location & localization sketch of business premises
• A Prospectus that details the issue of shares is
equally needed (for PLCs only).
Documents Delivered upon Completion

• Certificate of incorporation
• Certificate of business registration
• Article /memorandum of association duly stamp
• Notarize statement of subscription
• Tax payers card
• Certificate of non-indebtedness
• Duly signed notarization sketch
NB: The minimum share capital to set up a
private limited company (Ltd/Sarl) is
1,000,000 (one million) FCFA whereas that of
a public limited company (Plc/SA) is
10,000,000 (Ten million) FCFA.
 Advantages of Private Limited
Companies(Ltd/Sarl)
• Perpetual existence: The business continues to exist
even after the death of its director. If you are worried
about not having a legacy once you’re gone, you don’t
have to. Private Limited Companies are quite flexible.
Transferring their ownership is easy if the head director
dies or is not able to continue as a director.

• Easy to transfer shares: You won’t have to worry about

losing one of the members anymore. With easily
transferrable shares, the capital and subscription of a
private limited company remain the same.
• Company has a different identity from the
directors: A company is its own person. Once
incorporated, it can even have its own property.
You’ll be able to buy new ventures in the name of
the company.
• Limited Liability: You won’t have to be afraid of
too many losses anymore. With Limited Liability,
the directors are only liable for losses as per their
share subscriptions.
• Easy to borrow funds: Banks trust companies
more than people. Using this trait, you can
borrow a lot of funds from banks in the name of
your company.
Disadvantages Of A Private Limited Company(PLC/Sarl):
• Limited access to funding than in PLCs: You can’t ask the
general public to fund your business. Only members are
allowed to do so.
• Increased legal compliance: You’ll have to fill a lot of
annual, semi-annual, quarterly and monthly forms every
year. You’ll need to get help from Business compliance
experts for this.
• Personal Control is limited than in non corportate: You
require at least 2 directors to start a private limited
company. It makes decisions difficult if you and your co-
director aren’t on the same page for decision making.
• Administration costs are a bit higher than in non-
corporate businesss: Unless your private limited company
performs extraordinarily in business, it won’t survive for
long. The administration costs are high enough to make the
profits look like a mere smear.
 Advantages of Public Limited
Companies(PLC/SA)
1Raising capital through public issue of shares
• The most obvious advantage of being a public
limited company is the ability to raise share
capital, particularly where the company is
listed on a recognised exchange. Since it can
sell its shares to the public and anyone is able
to invest their money, the capital that can be
raised is typically much larger than a private
limited company.
2. Widening the shareholder base and
spreading risk
Offering shares to the public gives the
opportunity to spread the risk of company
ownership. This may allow early investors in the
company to sell some of their own shares at a
profit while still retaining a substantial stake in
the company.
3. Other finance opportunities
4.Growth and expansion opportunities
The value of being able to raise finance is in how it
can be employed to serve the business. By having
more finance potentially more readily available and
on better terms than a private company, the public
limited company can be in an advantaged position
to: Pursue new projects, new products or new
markets, make capital expenditure to support and
enhance the business, make acquisitions (whether
in cash or by offering shares to the shareholders of
the target business, fund research and
development, Pay off existing debt (or replace
existing debt with new debt on better terms), Grow
organically
• 5. Prestigious profile and confidence
Whether deserved or not, having ‘plc’ at the end of
a company name can add standing and prestige.
There is a sense of status about a public limited
company that its private company counterpart just
doesn’t quite have, which can affect how the
business is viewed. More people are likely to be
aware of the company if it is public, particularly if
it’s listed on a stock exchange. In that case, it’s more
likely to receive attention from the media and
investment professionals. This is effectively free
publicity, meaning more people will recognise the
company and its products or services. Better brand
recognition can lead to more sales.
6.Transferability of shares
The shares of a public limited company are more
easily transferable than those in the private
equivalent, meaning shareholders benefit from
liquidity. The fact that the shareholders are less
bound to remain with the company can give
them comfort and may help the company by
making people more willing to invest.
 Disadvantages of Public Limited
Companies(PLC/SA)
1. More regulatory requirements
To help protect shareholders, the legal and regulatory
requirements for a public limited company are more than
for private limited companies.
2. Higher levels of transparency exposes secret
Informations
Public Limited companies have more of their details in
the public domain than other business types. As well as
needing to have its accounts audited, public limited
companies have to disclose more detailed data about the
business and its performance, information which is then
available to anyone who wishes to access it.
3. Ownership and control issues
With a public limited company, it’s much harder
to control who is a shareholder of the company,
and who the directors are ultimately
accountable to. There is therefore a possibility
that the original owners or directors can lose
control of the direction of the company, face
disputes or just spend a lot more time managing
shareholder expectations.
4. More vulnerable to takeovers
At worst, a company can become vulnerable to a
hostile takeover if a majority of shareholders agree
to a bid.
6. Initial financial commitment is higher
Associated costs of company formation may also be
higher, especially if the company’s requirements are
complex. If the company’s shares are to be listed on
a stock exchange, it will typically pay legal and
investment professionals to advise and manage the
listing process. There will be other costs associated
with obtaining a listing.
 SO?
YOU MUST CHOOSE THE APPROPRIATE FORM
OF ENTERPRISE FOR YOUR ENTREPRENEURIAL
IDEA!!!
END