1. Create Entrepreneurial Opportunities
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Business environment is affect the business activity. There are mainly two types of
business environment internal and external a business has absolute control in the internal
environment, where it has no control on the external.
The internal environment has received considerable attention by firms. Internal
environment contains the owner of the business,the shareholder,the managing director the
non-manager,employee,the customers, the infrastructure of the business organization and
cultural of the organization
The external environment of an organization comprises of all entities that exists out side
its boundaries, but have significant influence over its growth and survival an organization
has little or no control over its. External environment but needs to consonantly monitor
and adapt to these external changes.
There are two types of external environment
 Micro/Operation environment
 Macro/General environment
Micro/Operation environment:-
The environmental consist of the factors in the company’s immediate environment
that affects the performance and working of the company.
 Customers
 Employees
 Suppliers
 Share holders
 Media
 Competitors
Macro/General environment:-
The macro factors are generally more uncontrollable than micro environment factor
when the macro factors become uncontrollable the success of the company depends up on
its adaptability to the environment
 Economic conditions
 Demographic conditions
 Social and cultural Trends
 Political or legal technological conditions
 Globalization
1.Economic:-
There is a close relationship between business and its economic environment it
obtains all inputs from economic environment and all its output is absorbed here with the
state of economy is usually in flux. The current situation (specific to the industry) and any
changes that may be forecast are important.the economic goes through a services of
fluctuations associated with general booms and recessions in economic activity.

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1.1GNP trends:-
In Srilanka GNP trends data are below
year 2006 2007 2008 2009 2010 2011 2012 2013
GNP
data
7.5 7.1 4.6 4.8 7.9 8.4 5.5 6.5
Source:- central bank annual reports(SL)
All sectors of the economy contributed positively to growth, and favorable weather
conditions and the gradual recovery in external demand supported the steady rise in
economic growth over the four or five year.
In Srilanka average GNP rates are increase in last five year so Entrepreneur are seek the
business activity in the GNP rates
Opportunities creation:-
 In the situation increase the export and import so entrepreneur are identify
opportunities of invest exports and import sector.
 Same time increase in people income rate so investor will invest the luxury good
product in order to get a high profit.
 And invest infrastructure product
1.2Interest rate:-
year 2006 2007 2008 2009 2010 2011 2012 2013
Interest
rate
10.00 10.50 10.50 7.5 7.5 7.0 7.50 6.50

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Source:- central bank annual reports(SL)
This graph show interest rate level of sri Lanka. According the graph last five years the
source alternative characteristics and unchaste that is increasing and decreasing
frequently.
Opportunity:-
 Due to the ability of obtaining loan is increasing which help to investing in some
other kind of profitable business.
 So normally entrepreneur doesn’t like to invest financial sector due to impact of the
income by the lowest interest rate
1.3Unemployment level:-
year 2006 2007 2008 2009 2010 2011 2012 2013
Data 6.50 6.00 5.4 5.8 4.4 4.2 4.0 4.4
Source:- central bank annual reports(SL)
According to the graph last five year average unemployment level is decreasing

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Opportunity:-
 It indicate that employee is holding a job so it a entrepreneur want to get a new
employee they will ask a higher salary in this situation entrepreneur decide to
introduce capitalize technology in production.
 When employment level is increase if working women level also increased so
create-able entrepreneur decide to introduce fast food center and baby care center
 Provide employment product (Ex:- shoes and cosmetic)
1.4Government Expenditure:-
year 2006 2007 2008 2009 2010 2011 2012 2013
Data 67.00 67.70 67.20 70.00 64.40 69.80 69.60 66.80
Source:- central bank annual reports(SL)
This graph show the government expenditure level
Last five year sri lankan government mostly spend only a defense sector and road
development sector and improve and develop infrastructure.
Opportunity:-
 Invest the infrastructural production department
 Defense material production
 Another service(Ex:-traveling services,maintain services)
1.5 Income level of household:-
year 2006/07 2009/10 2012/13
Mean income 26286 35496 46207
Median income 16735 24106 30400

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Source:- Central Bank Annual Reports(SL)
This show household income in last five year. It’s rapidly increase
Opportunity:-
 Luxury good product(Ex:- car, luxury houses, fancy product)
 Entertainment products(Ex:- cinema)
 Health care product.
2.Demographic Conditions:-
Refer to the size of density,distribution and growth rate of population. All these factors
have a bearing on the demand for various good and services.
2.1 Population and Growth:-
year 2006 2007 2008 2009 2010 2011 2012 2013
Data(000) 19886 20010 20217 20450 20653 20869 20328 20483
Source:- Central Bank Annual Reports(SL)

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Opportunity:-
 Target market is increasing
 Develop new business
2.2Age distribution of Sri Lanka(enumerated population -18 districts):-
Age 0-14 15-29 30-39 40-54 54+
male 2265812 2293569 1259191 1545452 1061083
female 2183174 2314946 1288542 1573188 1174192
Source:-Department of census and statistics
This graph show age distribution level of Sri Lanka 2012
Opportunity:-
 Here 0-14 and 15-29 age group people high so we can identify
 Children cloths and food products
 Young girl use products(Ex:- beauty cream,perfume)
 Luxury good produce(Ex:- phone ,bike )
 Open Fast food center.
 Health care product
 Entertainment products
2.3 Birth rate:-
year 2009 2011 2013
Birth Rate(1000) 18.6 17.6 17.5
Source:- Central Bank Annual Reports(SL)
Opportunity:-
 Baby care production
 Baby Food item and health care production and cosmetic
 Bank and new insurance polices

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2.4 Immigration:-
Nationality
Data(2011)
Sri Lankan Asian European North
American
South
American
African Australian others
Amount 1206135 616104 470165 70780 1863 9939 56475 1246
Source : Department of Immigration & Emigration
Opportunity:-
 Transports services
 Hotel and residential services
 Hides services
3.Social and cultural:-
Social value and life style change overtime and most fuck importance of these directly or indirectly
leave an impact on the business environment
3.1 Family formation:-
The family provides an environment for human beings to learn to eat, talk, and walk and to
acquire morals, a sense of culture and modes of behavior. The family is seen as the product
of human history and changes through time, adapting to society.
Sri lankan family formations are religious methods
 Tamil
 Sri lankan Tamil
I. Eastern
II. Northen
 Indian tamil
 Muslims
 Singalees
 Kandiyan
 Western people
 Christian
Opportunity:-
According to the cultural arrangement an entrepreneur can identify a opportunity to
produce good and services special cultural group. As the cultural ceremony is a different
so the entrepreneur can make a profitable by produce services

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3.2 Environmental concern:-
Sri lankan environmental is beautiful and natural tourism point
So many beach and beautiful and natural garden.
Opportunity:-
 Tourism and hotel
 Hider and health care services for tourist
 Fascinated good center and traveling
 Can produce some infrastructure and services
3.3 Health trends:-
Health and social status of Sri Lanka has shown a significant progress over the last
several years. Life expectancy of Sri Lankans is 68 years for males and 76 years for
females in 2006 (Central Bank Annual Report. 2008), Maternal mortality rate is 39.3 per
100,000 live births (FHB. 2006), and Infant mortality rate is 10 per 1000 live births
(Registrar General’s Dept. 2006), Under five mortality is 12.1 per 1000 births (Registrar
General’s Dept.2006). However, improvement of nutrition indicators has not kept pace
with the others.
Despite the relatively high literacy rate (90.8% in 2006) in the country (Central Bank
Annual Report. 2008), and achievements in economic growth, the nutritional status of
children is not satisfactory, and neither is that of adolescents and women. According to
the Demographic & Health Survey 2006/2007 data, low birth weight prevalence is 16.6%.
Among the under five children, 21.1% are underweight (compared to 22.8% revealed by
DHS 2000), and about 14.7% under 5 years are wasted (15.5% in 2000). Stunting levels
have declined from 18.4% in 2000 to 17.3% in 2007 (DHS). The nutrition status shows a
wide variation across the districts & as for wasting, it ranges from 10.5% to 28.1%
substantiating the geographical disparity

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Opportunity:-
 Lifestyle changes:-
 Now Sri lankan people lifestyle easily change to western style
 Opportunity:-
 Beauty products
 Costume center and product
 Electronic product
 Gymnasium
4.Political or legal and technological condition:-
The political environment of a country is influenced by the political organizations such as
philosophy of political parties ideology of government or party in power nature and
extent of bureaucracy influence of primary groups. the political environment of the
country influences the business to a great extent. The political environment includes the
political system the government policies and their attitude towards the business
community all these aspects have a bearing on the strategics adopted by the bushiness
firms the stability of the government also influence business and related activities to a
great extent it sends a signal of strength, confidence to various groups and investors
further ideology of the political part also influence the business organization and its
operations political changes are closely tied up with legal changes legal environment
includes flexibility and adaptability of law and others legal rules governing the business it
may include the exact rulings and decisions of the courts
4.1 Education:-
year 2007 2010 2012
Primary net enrollment ratio 89.9 90.3 98.4
Eligible for university(A/L) 62.5 59.0 63.0
Opportunity:-
 Tuition center
 Educational products(Ex:- book and etc..)
 Build a educational institution
4.2 Policies:-
 According to the mahinda chindana an entrepreneur can seek several opportunist
 Srilanka will move to Asia knowledge huge
 All family get a electricity
 Srilanka will move to center of transport(Ex:- build hambantota port)
 Thivinekuma plan
Opportunity:-
 So entrepreneur can identify several opportunist.

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4.3 Agriculture:-
Source:- Central Bank Annual Reports(SL)
This graph show Agriculture level of sri Lanka. According the graph last five years the
source alternative characteristics and unchaste that is increasing and decreasing
frequently.
Opportunity:-
 Make agriculture product(Ex:- milk ,vegetable)
 Agriculture instrument
 Infrastructural and other services
 Transport services
 Export good for other county
5.Globalization :-
Globalization may be define as “ the growing economics interdependence of countries
world wide through increasing volume and variety of cross border transaction in good
and services and of international capital flow and also through the more rapid and wide
spread diffusion of technology ”.
5.1 FDI policies:-
 Invest in Sri Lanka 10 year don’t give a tax
 Given Infrastructural services
 Other opportunist of investor
year 2006 2007 2008 2009 2010 2011 2012 2013
Data 6.3 3.4 7.5 3.2 7.0 1.4 5.2 4.7

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Opportunity:-
 Make large product factory
 Less rent and other prices
 Government give so many incentive

5.2 Trade agreement:-
 India and Srilanka free trade agreement
 Pakistan and Srilanka free trade agreement
 China and Srilanka free trade agreement
 BIMSTAC agreement
 SAFTA agreement
Opportunity:-
 Easily import and export good less tax
 provide transport services
 Improve the quality because so many competitor
References
 Central Bank Sri Lanka
 Department of Immigration & Emigration Sri Lanka
 Department of census and statistics
 Google.lk
 Health department Sri Lanka