Of course, KH pals often hear about entrepreneurship and self-employment, right? Yes, many people think that entrepreneurship and self-employment are the same profession and have the same meaning. However, these two professions are different.
The difference between entrepreneurship and self-employment is often difficult for ordinary people to understand. This is because both terms are more often used in the business and professional realms. Both entrepreneurship and self-employment are related to each other. However, entrepreneurship focuses more on the activity of starting, developing and managing a business by taking risks and initiatives. In contrast to entrepreneurship, self-employment focuses more on financial gain. To better understand the difference between the two, check out the full explanation in the following article.
Definition of Entrepreneurship and Self-employment
Before discussing the differences, it’s good to know the meaning of entrepreneurship and self-employment first. In general, entrepreneurship is a form of courage and readiness owned by someone to bear the risks that he will bear for the work they are engaged in. The work in question is a person’s effort to run a business with his own means, energy, and capital. Entrepreneurship in general can also be interpreted as a form of ability from a person in processing creativity into an innovation with observance. Where someone who has this ability forms an opportunity to build a business venture. So it can be concluded that an entrepreneur is someone who has the readiness, courage and thinking to run a business that can affect himself and even the surrounding environment. Meanwhile, self-employment is a type of work that is of course different from entrepreneurship. Where according to the Directorate of General Secondary Education (1982: 65) self-employed is one type of work or someone who does work independently and is not determined by superiors, because an entrepreneur does not have a boss. In general, entrepreneurs can also be defined as people who have the courage to think, behave and act to create various kinds of jobs and undergo an independent career.
What’s the Difference between Entrepreneurship and Self-employment?
From the definition of entrepreneur and self-employed above, do you know the difference between the two? If only glanced at, it might be difficult to know the difference between entrepreneurship and self-employment. To avoid confusion, here is an explanation of the differences between entrepreneurship and self-employment.
Business Scope
Entrepreneurs are always expanding the scope of their business. As much as possible, entrepreneurs will look for ways to get greater profits through business development. For example, a businessman who has a photo service business, he develops his business by creating a photo studio. That way the customer can double payment for photos and studio rent. While an entrepreneur usually finds a business opportunity, they will focus on the business. For example, an entrepreneur in photo services will focus more on improving his photography skills than opening new business branches.
Business Management
Entrepreneurs run their business full time. This means that he really spends all the time he has to take care of his business. In addition, the self-employed have no other involvement outside the business. Meanwhile, entrepreneurs usually do not use all their time to do business. It is possible that he runs the business on the side because he wants to take advantage of existing opportunities.
Business Development
Entrepreneurs in managing businesses usually also continue to look for new innovations and try to make updates with technology. Competition in business makes entrepreneurs come up with the latest products that make them different from business competitors. Meanwhile, an entrepreneur tends to be flexible in following existing innovations to be used as business opportunities. They are arguably more relaxed and not fixated on constantly updating their business. Entrepreneurs are able to take advantage of business opportunities that exist around them.
Asset Ownership
The second significant difference between entrepreneurship and self-employment is the ownership of assets. The assets in question are the ownership of capital funds and the role in making decisions in business operations. A person is called an entrepreneur when he or she is relatively involved in business operations only. Meanwhile, an entrepreneur owns their own assets.
Mindset
The difference between entrepreneurship and self-employment also lies in the mindset of the people who live it. It can be understood that an entrepreneur is someone who opens a new business independently. Entrepreneurs can see several opportunities that can be utilized, so that they will benefit from these opportunities. An entrepreneur, on the other hand, has the mindset that just by continuing an existing concept, he can get a bigger profit. For example, today many entrepreneurs are seen through the emergence of many startup companies. They usually have their own concepts and are able to develop their companies.
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Entrepreneurs, on the other hand, generally run something that already exists and can profit from it.
Whether you’re an entrepreneur or self-employed, don’t forget to complete your business legality!
Now, you understand what entrepreneurship and self-employment are, and how they differ. So, which profession will you choose? Whatever profession and type of business you will run, don’t miss to complete the business legality. The legalities that must be owned to become a successful businessman include a business establishment deed, Taxpayer Identification Number (NPWP), Business Identification Number (NIB), Trade Business License (SIUP), certification, and a registered trademark. Compliance with the rule of law helps build a good business reputation. Businesses that are run ethically and legally are more trusted by consumers, business partners, and other parties. In addition, a legitimate business has legal certainty and can conduct its operations without unnecessary legal risks. Successful businesses that are legal can create a stable business environment, allowing them to focus on long-term growth strategies. Moreover, having complete legality can also increase investor confidence, facilitate access to financing, and open up greater investment opportunities. Not surprisingly, they find it easier to establish sustainable business relationships and maintain a healthy business environment. Conversely, business habits that violate and do not fulfill legality will result in serious legal consequences, such as fines, sanctions, and even lawsuits that have a negative impact on operational sustainability and reputation.
KH Contact
How, are you ready to determine the level of your business journey by becoming an entrepreneur or self-employed? Or are you still confused about the process and what steps must be taken in starting a business? Just consult with Contract Law!
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We have been trusted by more than 5000 business people and companies in Indonesia to facilitate their needs in starting and running their business. Guaranteed to be easier and safer, because you can consult with professional legal experts regarding matters needed to start a business such as business entity establishment, licensing and taxation, to intellectual property registration. What are you waiting for, become a successful entrepreneur and/or self-employed person by making everything easier with Kontrak Hukum! To view services according to your needs, please visit the KH Services – Starting a Business page. If you still have questions, you can also contact us at Tanya KH or via direct message (DM) to Instagram @kontrakhukum.
