Ch 3 Mini Sim Entrepreneurship

Decision Point: Starting Your Business You've done research on the competition in the area, and you worked for a sandwich franchise during college, so you're not entirely unfamiliar with the business. But you also know you've got a lot to learn, and you want to make the right decisions and make your business a success. Which of the following should you do first? Select an option from the choices below and click Submit.

Write the business plan.

Decision Point: Know Your Responsibilities If you choose to enter into a limited partnership with Larry, which of the following would be true with respect to responsibility for debts of the partnership? Select an option from the choices below and click Submit.

You are personally responsible for all of the debts of the business. Larry is responsible for debts only to the extent of his investment.

Decision Point: Do You Know the Sections of the Business Plan? Think you've got a good grasp of the sections of a business plan?Drag each description into the correct section of the business plan. Once you have categorized all the items, click Submit.

Executive Summary: A brief, compelling introduction of your business and its customers, along with an explanation of how you will make the business successful Company Overview: High level explanation of your business that includes a mission statement, the location, and key employees Market Analysis: Detailed information about your industry, target market, assessment of competitors, and legal requirements impacting your business Products or Services: A description of your products or services, how they will meet the needs of customers, and the benefits of your products and services compared to your competitors Marketing and Sales: An explanation of how you will identify potential customers, as well as your marketing approach Financial Projections: An explanation of how your business will meet its financial obligations and maintain positive cash flow

Decision Point: The Advantages of Starting a Business from Scratch You have decided to start the business from scratch. What are the advantages of starting a business from scratch versus buying an existing business or purchasing a franchise? Select all advantages that apply from the list below, and then click Submit.

Freedom to choose suppliers and hire and train employees Ability to select location, equipment, and inventories

Decision Point: Financing the Business Although the $200,000 you inherited from your uncle provided you with a solid financial foundation upon which to start your business, you quickly realize that you're going to need a lot more to get the business going. You have decided that, in addition to your start-up costs, you will follow experts' advice and budget for sufficient capital to operate for 6-12 months without earning a profit. You determine that you will need at least another $100,000 to make the business a reality. Unfortunately, you don't have anywhere near that amount in your personal savings, and your family isn't able to help. Where are you going to get those funds? Which of the options listed below would be the best option to secure financing for your business? Select an option from the choices below and click Submit.

Investigate the Small Business Administration (SBA) loan programs available to small businesses.

Decision Point: Structuring Your Business Apparently, good news travels fast! You receive a call from Larry, a former coworker at the sandwich shop where you worked in college. He has heard that you're thinking about opening a sandwich shop and expresses interest in joining you in your entrepreneurial venture. Larry is willing to invest a significant amount of money in the business, but he has no desire to participate in the day-to-day operations of the business. If you choose to go into business with him, which form of non-corporate business ownership would be best suited for the business? Select an option from the choices below and click Submit.

Limited partnership

Decision Point: How to Get into the Sandwich Business The first decision you face is how to get into business. After doing considerable research, you see three options available to you. Which one will you choose? Select an option from the choices below and click Submit.

Start the business from scratch.

Decision Point: The Best Type of Corporation for Your Company The concept of unlimited liability scares you. You do a considerable amount of research, have several conferences with Larry, and consult the Small Business Administration, and you determine that incorporation may be the best way to avoid unlimited liability for the debts of the business. However, you'd also like to avoid double taxation. With those criteria in mind, which of the following corporations would be best suited for your business? Select an option from the choices below and click Submit.

Subchapter S corporation