ABSTRACT

The main focus of this study was to examine The Effect of Entrepreneurial Behavior on The Growth of Entrepreneurial Ventures: Case Study Buea Municipality, three specific objectives were used for the study, to identify the behaviors of entrepreneurs on their business ventures in Buea Municipality, to identify the challenges of entrepreneurs on their business ventures in Buea Municipality, to examine the effect of entrepreneurs behaviors on their business ventures in Buea Municipality. 570 respondents who were made up of business men and women were used for the study. Data was collected with the use of questionnaires administered to 570 entrepreneurs within Buea Municipality. From findings, respondents pointed out that entrepreneurs behaviors are a major contributions to business growth and downfall. Majority of the respondents attested to the fact that their good customer approach influences their business positively, secondly majority of the respondents were of the opinion that they face huge challenges on taxes and unmerited competition. Based on the findings, recommendations have been made for entrepreneurs to follow the right pattern of paying their taxes.

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

As far back as the 1950s, researchers began linking entrepreneurial behaviors and entrepreneurship ventures that could determine who is more likely to become a successful entrepreneur (Onugu, 2005). McClelland (1961) for example asserted that entrepreneurs possessed certain personality characteristics than non- entrepreneurs. While on the other hand, Obadina (1999) acknowledged that the only main difference between entrepreneurs and non-entrepreneurs is that entrepreneurs want to be in control of their own destiny. This control is indicative and draws attention to the fact that, “there is no set of behavioral attributes that allow us to separate entrepreneurs from non- entrepreneurs”. They argue that anyone wishing to become successful needs to achieve, and that all achievement elements are found not only in entrepreneurs but also in all successful people. Additionally, literature studies on entrepreneurship portray successful entrepreneurs as individuals who possess a personal quality that enables them to make decisions that have far reaching effects in conditions of uncertainty.

The ability to make such decisions can be achieved in some people through training, while in others, it is inborn. From the 1980s and 1990s, research on personality characteristics and socio- cultural backgrounds of successful entrepreneurs were conducted (Adeoye, 2012). Therefore, this study will explore the interaction of entrepreneurial behavior and entrepreneurial ventures in Buea municipality in Cameroon

Entrepreneurial activities involve high levels of uncertainty. The uncertainty in the market environment that entrepreneurs encounter while establishing their ventures is a major component of business context. According to McMullen and Shepherd (2006), “uncertainty constitutes a conceptual cornerstone for most theories of the entrepreneur”. They point out that when entrepreneurs   perceive   that   uncertainty  is   diminishing,   entrepreneurial   activities increase.

Environmental uncertainty is a significant component of entrepreneurial context that entrepreneurs consider when they explore opportunities (Liao and Gartner, 2006). Three types of uncertainty related to entrepreneurial activities – financial, competitive and operational – have been developed by Matthew and Human (2000, 2004). Their classification focuses on implementation. Financial uncertainty refers to whether or not an entrepreneur can secure enough financial resources to support the start-up. Competitive uncertainty refers to the insecurity of operating in a competitive environment that challenges the success or survival of the venture.

Operational uncertainty stems from problems with identifying the best personnel and physical settings in which to operate. From the record of his commercial activities, it was apparent that Fan Li treated business context as essential to site selection. Two examples of this were that, at his seaside site in Qi, the abundant resources were supportive of agriculture, fishery and the salt industry, and that because of Tao’s central location, transportation was convenient for facilitating the obtainment of resources. In modern China, environmental uncertainty is important for the consideration of entrepreneurial activities. As it is still going through rapid development, China is witnessing accompanying economic growth, and many of its industries have experienced, and continue to undergo, major transformations. This, in turn, leads to complex industrial dynamics (Luo, 2003). Given that, as some experts believe, “China’s economy is characterized by lack of coherent business laws and strong governmental control over limited resources” (Lee et al., 2001), it is likely that when entrepreneurs create start-ups in China, they face high levels of uncertainty. Based on literary sources regarding Fan Li’s business history, when uncertainty in the business environment diminishes, business context improves; conversely, higher uncertainty worsens business contexts. Thus, the study posits this hypothesis regarding business context:

Entrepreneurs and the small business sectors have more and more become recognized as important factors determining the dynamics of an economy, for example, Buea municipality is made up of many startups and entrepreneurs. It is assumed that the experience and behavior of the economic agent that I call entrepreneur is the core of the entrepreneurial process. Without the perseverance, the ideas, goals and actions of one or several individuals no new business and innovations would be introduced on the market. Few studies have actually tried to model and understand the impact of both entrepreneurial behavior and the environmental ventures. This research study tries to incorporate both, i.e., entrepreneurial behavior is assumed to be determined their entrepreneurial ventures. Therefore, there is no general theory of entrepreneurship or definition of the term and it is consequently difficult to compare research findings.

On the other hand, entrepreneurship is such an important and interesting research area that multiple perspectives are needed to explain its complexity. It is not probable that one theory can encompass all features of entrepreneurship. As a result of this heterogeneity, several researchers have proposed different systems to categorize and make comparison possible. Amit, Glosten and Muller (1993) and Kets de Vries (1977) argue that research can be best understood by focusing on the entrepreneurial role. They see the entrepreneur as fulfilling a role or a function in the economy such as innovation (creation of new combinations and changes in the economy), managing- coordinating (business growth and expansion), or risk-taking (the bearers of risk and uncertainty in society) (Buchanan & Di Pierro, 1980). Here, the distinction between the individual and the process is not always clear. This is because the classification is based on entrepreneurship in economic theory where societal processes are more interesting to the theorists than the individuals carrying them out.

Furthermore, this research is often theory driven. Others like Elkjrer (1992) and Low and MacMillan (1988) separate the study of the individual from the study of the function. Stated differently, studies of the individual to the entrepreneurial process to a person or a small group of persons whereas studies of the entrepreneurial function downplay the role of the individual and highlight the importance of society. An example of the former is McClelland’s (1961) attempt to explain economic development with the need for achievement motive. This research mainly deals with traits and motives specific to the entrepreneur. Johannisson (1988), on the other hand, argues that entrepreneurship is not related to an individual but to the interaction between several individuals. 5 It is therefore more fruitful to study different exchanges (e.g., of information, of money) in networks and how these networks evolve. Focus is therefore on inter individual processes rather than on individual actions (Aldrich & Zimmer, 1986; Birley, 1985; Larson, 1992; Lipparini & Sobrero, 1994; Ostgaard & Birley, 1994; Zhao & Aram, 1995). A third perspective downplays the importance of the individual and concentrates on how the infrastructure facilitates and constrains entrepreneurship.

It is here assumed that the actions of one or even a few key entrepreneurs cannot alone change the infrastructure. Changes are dependent of numerous institutional events such as law, general technical development, taxes, politics, but also demographics. Entrepreneurship is therefore viewed as a collective achievement (Cento Bull, 1993). In addition, another important difference is the process of study. Entrepreneurship research mainly concentrates on two phases, the first of which concerns the creation of enterprises. Here the mere creation of a business and its determinants are of focus. Research in this area is mainly interested in understanding what factors affect start-up frequency and the survival of the newly established firms.

1.2 Statement of the Problem

Entrepreneurial performance is restricted to tasks that are or can be under the control of the entrepreneur behavior, such as the role of the board, organization, decision making, and goals and strategies. The basic argument is that an understanding of entrepreneurial behavior is better understood by examination of behaviors that are under the control of the entrepreneur. Only when we understand the determinants of entrepreneurial performance can we link entrepreneurial behavior to business performance. In the Buea municipality, majority of the entrepreneur’s behavior are poorly matching the growth of their business ventures. Differently stated, we have to know what an entrepreneur does and why, and how these actions affect business performance. Entrepreneurial performance or growth is determined by the environment and their behavior and the individual capacity and will. The entrepreneur is assumed to act on the environment in accordance with his or her goals. The actual performance or growth of the entrepreneur is difficult to measure and is often confounded with the business performance in times of challenges.

1.3 General Objective

The general objective of this research is to evaluate the effect of entrepreneurial behavior on the growth of entrepreneurial ventures: Case study Buea Municipality.

1.3.1 Specific objectives

1. To identify the behaviors of entrepreneurs on their business ventures in Buea Municipality.
2. To identify the challenges of entrepreneurs on their business ventures in Buea Municipality.
3. To examine the effect of entrepreneur’s behaviors on their business ventures in Buea Municipality.

1.4 Research Questions

1.4.1 Main Research Question

The general research question of this study is to evaluate to what extent entrepreneurial behavior effects the growth of entrepreneurial ventures: Case study Buea Municipality.

1.4.2 Specific Research Question.

1. To identify the extent to which behaviors of entrepreneurs effects their business ventures within the Buea Municipality.
2. To identify the extent to which the challenges of entrepreneurs effects their business ventures within the Buea Municipality.
3. To identify the extent to which behaviors of entrepreneurs affects their business ventures within the Buea Municipality.