Every entrepreneur should ask these three questions to themselves and ponder over it. It is essential to know and realize that there’s no perfect decision.
The true essence of entrepreneurship is to come up with a service/product that will benefit the mass at large. Business is all about people and associations, and it is necessary for every entrepreneur to know the best way to cater to people. For that, an entrepreneur needs to know product development, accounting, and marketing. All other aspects of your business are necessary and crucial. And so is economics, which gets overlooked at times.
It is a major flaw that needs to get corrected. In its essence, economics is about incentives, human behavior, and the arrangement of every resource. All these are essential aspects that an entrepreneur must know.
Eric J Dalius emphasizes on three economics truths
Hence, entrepreneurs must understand the three essential economic truths. According to experts like Eric J Dalius, these truths or facts will help marketers and entrepreneurs to take their business to another level. It will cater to the customers efficiently and will also add up the profits.
· Economics isn’t finance
The most common misunderstanding is that economics is about churning out more cash! That is far from the truth. The other inaccuracies comprise how to bank, get rich, and invest. If a person is a good businessman, it doesn’t imply that he is an expert in economics, as well.
According, to economist Thomas Sowell, Economics is "the allocation of scarce resources which have alternate uses." It indicates that there are plenty of resources that one can use for several purposes. It is restricted. Hence, people need to decide what or what not to make of it. It is as simple as that. However, economics becomes highly daunting and confusing when you start to plunge into economic systems. It is essential to know how it works, impacts the economy and other allied topics related to it.
The expert and successful entrepreneurs know and understand it because they have restricted capital, resources as well as minimal demand. And it's their task to maximize each of these. Hence, an essential and background kn0wledge suffices.
· Economics impacts public policies
It is interesting to note that good entrepreneurs at times support bad policies. It affects their employees, customers, the marketplace, and industry. Some companies offered the most significant 401(K) providers that provided over $3 trillion in their assets. It is a huge sum of money. You must be aware of the Occupy Wall Street Protests, where the people rebelled and protested against Wall Street greed and evil. And all these lead to a vast cognitive dissonance. Incidents similar to this take place almost everywhere with several other public policy problems. Most often than not, the good entrepreneurs who have successful small business firms, often vote for unfavorable things like:
· Customer security.
· Reduced wage laws.
· Selecting losers and winners.
· Public-private partnerships.
All these elements maximize the cost of operating a business. It means it’s tough to start a business, and the prices usually get forwarded to the customers. Also, the entrepreneur can't provide for his service and product. It is essential to issue an essential note concerning public-private partnerships and subsidies.
If there’s a time when failure gets hidden or mitigated from an entrepreneur, it affects the business as well as the marketplace. It also increases the bad ideas. That is not all. It also generates an uneven playing field for the ones who can’t attain government security, that hurts minorities.
As and when the government undertakes risk, it gets passed over to the citizens as taxes, failed companies, and bailouts. However, the entrepreneur gets forced to take the entire risk of an organization.
· Economics is all about human behavior
Adam Smith, who's called the Father of Economics, had penned his famous book, named "The Wealth of Nations," back in 1776. Many people don't know that the writer who wrote his essential text on the subject was also a moral philosopher primarily. One of his lesser popular books is called "The Theory of Moral Sentiments". The book got dedicated to understanding as well as exploring all the concepts of moral judgment, conscience, greater good, and virtue.
Hence, marketers and entrepreneurs must realize that economics is all about human behavior! And all the products, action, service needs to be in sync with the correct and just way of conduct. The concept of moral actions that benefit others and the society at large should also extend to the mutually beneficial transactions which aren't coerced. The idea of services to others needs to stay at the fingertips of every marketer and entrepreneur that are present.
What entrepreneurs fail to realize and grasp at times is that this world not perfect! And it will never be an ideal model of existence. It's because people who are your customers aren't perfect themselves. Hence, for an entrepreneur, it's a tall target to strive towards perfection. He/she would fail several times. Instead, what entrepreneurs can do is to welcome the reality and provide their services and products within that realistic frame.
As and when entrepreneurs consider the business decision, it is essential to keep in mind a set of questions. They are:
· At what cost am I doing my business?
· To what am I comparing my business cost?
· What are the essential evidence do I have?
Every entrepreneur should ask these three questions to themselves and ponder over it. It is essential to know and realize that there’s no perfect decision. And entrepreneurs need to embrace this reality and see how best can they impact human behavior for conducting business. Economics will undoubtedly help entrepreneurs understand that.
The 21century business domain is competitive! Brands and entrepreneurs need to stay updated to the market trends and other relevant subjects to carry on their entrepreneurial journey correctly. That will help them to survive successfully and outshine their competitors. It is necessary for expert and smart marketers and entrepreneurs to have a clear understanding of economics and how it can impact their business. There are umpteen online resources and journals available online, that will help them strengthen their know-how.
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