Entrepreneurship 2nd Semester

Compare and contrast buying a business and starting your own business.

Buying a Business 1. Buying a business may be less risky than starting one from scratch. 2. An existing business already has a location, goodwill, staff, and a physical plant. There may be substantial inventory and established trade credit. 3. Some businesses are sold because they are losing money or have a poor reputation. Inventory may be dated and equipment or facilities may need repairs. 4. Franchises can be expensive and there is a lack of freedom. Starting a New Business 1. Starting a new business takes more time and effort. 2. You can do things your own way. 3. You are the boss. 4. You must have the financial resources.

Technology has made it easier to -------------- with people in other countries.

Communicate

When doing business in other countries, it is important to understand the expectations of that country's

Culture

A federal agency formed to create and enforce environmental standards

Environmental Protection Agency

Dealing in international markets presents some challenging ------ dilemmas for Americans.

Ethical

------ set the boundaries for what we believe to be correct and moral behavior.

Ethics

A law that requires businesses to respond quickly to consumer complaints

Fair Credit Billing Act

McDonald's is an example of a(n)

Franchise

the total value of all goods produced during the year

Gross Domestic Product (GDP)

the electronic commerce systems that allow you to sell products and services online anywhere in the world

IBEX

------ - ---------- gave over a half billion dollars to fight hunger, disease, and similar conditions.

John D. Rockefeller

Hiring a firm to design and produce packaging for your product is an example of

Outsourcing

---- ------- began focusing on unsafe automobiles and moved on to other areas where he felt consumers were treated unfairly.

Ralph Nader

classifying goods sold in the international market

SITC codes

The ------ -- ------- --- ensures that businesses fully inform consumers about purchases.

Truth in lending act

You will probably not regret decisions you make that are based on your

Value system

Before you can determine if a new venture is feasible, you must prepare

a Business plan

a person with a record of successes

achiever

Entrepreneurs are -------- --------. They set goals, make decisions, and act on their decisions.

action oriented

According to the U.S. Department of Commerce, the hottest products for exporting are electronic equipment, chemical products, paper products, apparel, industrial machinery, computers, and ------------ products.

agricultural

To be successful in the global market, you must be able to offer products or services

at competitive prices.

Entrepreneurs must understand how the economy works. What skill does this describe

basic business skills

Being the ----- is a benefit that most entrepreneurs put at the top of their lists.

boss

illegal payments to obtain special considerations

bribes

To find a new business, you may need to hire a(n)

business broker.

the buildings, equipment, tools, and other goods needed to produce a product

capital

the rivalry among businesses for consumer dollars

competition

a situation that prevents having an objective point of view

conflict of interest

The important thing for entrepreneurs to understand about Europe is that ------- --------- among some countries are huge.

cultural difference

Research about entrepreneurs reveals a wide span of ages, -------- ---------, and personal histories.

educational background

A(n) ---------sets out to be the best at whatever he or she does, because a(n) entrepreneur is an achiever.

entrepreneur

One way to prevent some of the problems that family businesses face is to

establish clear lines of responsibility.

guidelines for human behavior

ethics

Instead of starting a new business, you could enter a(n)------ ------- or buy an existing business.

family business

A(n) ----- ------ -------- is a partnership created by two or more companies for a specific purpose over a set period of time.

foreign joint venture

skills that are used in all jobs when setting up and running a business

foundational skills

seller of a franchise

franchisor

handles overseas shipments for a fee

freight forwarder

Entrepreneurs want to make their own decisions. Which word best describes this characteristic?

independent

finding new ways of doing things

innovation

Small businesses are more vulnerable than large businesses for ethics violations because they are

less structured and formal

Entrepreneurs who attempt to do business internationally

need to understand the culture.

Which of the following are some of the major trends for the creation of new businesses?

new kinds of strategic alliances growth of home-based businesses increased emphasis on outsourcing

ways of doing things that have come about over time

norms

Developing countries provide a risky form of -------- for entrepreneurs.

opportunity

The entrepreneurial process involves taking the steps to recognize a(n) --------- and create a business for profit.

opportunity

to contract with other companies for services

outsource

The success or failure of an entrepreneurial venture rests entirely on the

owner.

establishing a record in advance of any problems

proactive

a set of characteristics that identifies a type or a category of person

profile

Many entrepreneurs were influenced in early life by a(n) --------, a person whose attitude and achievements the entrepreneurs tried to emulate.

role model

people whose attitudes and achievements others try to emulate

role models

requires a business to acknowledge it has a contract with society

social responsibility

periodicals that target people with special interests in a variety of areas

specialty magazines

Taxes imposed by a government on imported or exported goods are called

tariffs.

Entrepreneurs need -------- ------ to coordinate and manage work teams.

teamwork skills

An increased reliance on ---------- is one of the main trends that affect business today.

technology

Two forces that help promote environmentalism are

the media and the public.

Starting a new business entails more ----- --- ------- than opening a franchise.

time and effort

taxes, quotas, and other restrictions on goods entering or leaving a country

trade barriers

Two of the main reasons for the global economy are the changes in

trade barriers and technology

periodicals published for specific types of businesses or industries

trade magazines

The greatest advantage of a family business is the ------ and togetherness that family members share.

trust

Being an entrepreneur involves risks as well as rewards. Which of the following is a risk of being an entrepreneur?

uncertain income

A company's good reputation and goodwill can be lost quickly because of

unethical behavior.

Define characteristics and briefly describe the 10 general characteristics needed by entrepreneurs.

1. Persistent. Entrepreneurs are willing to work until a job is done, no matter how long it takes. They are tenacious in overcoming obstacles and pursuing their goals. 2. Creative. Entrepreneurs continually look for new ways to solve old problems. 3. Responsible. Entrepreneurs do not "pass the buck." They take responsibility for their decisions and actions. 4. Inquisitive. Entrepreneurs want to know as much as possible about anything that might affect their ventures. They conduct research and ask questions to solve problems. 5. Goal-oriented. Entrepreneurs set and achieve goals. 6. Independent. Entrepreneurs want to make their own decisions. 7. Self-demanding. Entrepreneurs have high expectations. 8. Self-confident. Entrepreneurs believe in themselves. 9. Risk-taking. Entrepreneurs like to take risks, but they are not reckless. 10. Restless. Once entrepreneurs achieve their goals, they begin looking for new challenges. 11. Action-oriented. Entrepreneurs are doers as opposed to spectators. They make decisions and act on them. 12. Enthusiastic. Entrepreneurs are energetic and passionate about their pursuits.

To identify consumer markets, you should be aware of

Demographic Changes

Discuss the guidelines many entrepreneurs use to create a code of ethics for their business

Discuss potential solutions. Have your employees offer suggestions on how they might handle these situations. Discussing these will give you a sense of their values and help everyone reach a positive outcome. Write a set of general guidelines. Base these on your discussions. The guidelines should offer a range of acceptable ways to deal with different situations. Improve your code. When a new situation or solution occurs, discuss it. Then add it to your guidelines.

Discuss at least four ways to show respect to people of different cultures when conducting business in another country.

Dress conservatively in dark colors. Do not correct the other person's English. Be prepared to remove your shoes in some situations. Do not comment on food except to praise it. Do your homework before the first meeting. Build a relationship before you do business. Bring your own interpreter.

To participate in a trade mission, you will need to have a product that is on the government's ---- ---------- list.

best prospect

a set of guidelines for business conduct

code of ethics

It is important to study each country before attempting to do business there because of

cultural differences.

characteristics that describe a population

demographics

money to spend after necessary expenses are paid

disposable income

To find export opportunities, many entrepreneurs use the services of a(n)

export management company

the selling and shipping of products to another country

exporting

Which of the following is a contribution that a business owner makes to the community?

generates jobs

he interconnected economies of the nations of the world

global economy

a trait of entrepreneurs

goal-oriented

customer loyalty

good will

An asset of acquiring an existing business is customer loyalty, or

goodwill

Today, most consumer protection is a direct result of the consumer movement and

government regulations.

Entrepreneurs use ------- ------- skills to get along with others.

human relations

Businesses that buy goods from other countries to sell in their own country are ----------.

importing

One secret to finding a good business opportunity is the ability to understand ---------, because changes in interests create profitable niches for new businesses to fill.

industry

Entrepreneurs want to know as much as possible about anything that might affect their ventures. Which of these terms describe this characteristic?

inquisitive

Entrepreneurs must conduct business in a way that demonstrates -------- and builds their reputation.

integrity

Many -------- can be turned into successful business adventures.

interests

It is wise to hire a(n) --------- to translate the other person's language into English when conducting business in a foreign country.

interpreter

The biggest risk of being in business for oneself is the possibility of losing one's investment.

investment

the amount of money one puts into a business as capital

investment

One reason that the United States imports a vast number of goods from other countries is because of

low labor costs

Some governments are not respectful of ----- --- ---------- held by people in other countries.

patents and copyrights

One source for creative ideas for new businesses can come from ------- --------.

people watching

A successful entrepreneur is willing to work until a job is done. Which of these terms describe this characteristic?

persistent

the promotion of human welfare through giving

philanthropy

Business ownership carries with it a certain amount of

prestige.

Because of public outcry, Exxon's -------- was seriously damaged when the Valdez oil tanker spilled in Prince William Sound.

reputation

Small business owners have the ability to meet and talk with foreign agents, distributors, or potential business partners through

trade missions.