Entrepreneurship midterm

Lean Business Practices

addresses the specifics of new business creation, particularlyInternet-based businesses, where rapid experimentation and constant monitoring of viewers' choices are possible

creative destruction

the way that newly created goods, services, or firms can hurt existing goods, services, or firms

minimum viable product

-A concept central to lean business practices where you make a minimum product, but one that can be sold. -By selling to customers and collecting feedback, an entrepreneur can develop a product at minimum cost.

planning styles

-Comprehensive: long term -Critical Point: most important first -Opportunistic: start with a goal -Reactive: passive -Habit: don't plan

Caveat emptor

-Latin: let the buyer beware -Philosophy sometimes used by businesses to put the burden for consumer protection onto the customer

the key to selecting an industry

-Offers good potential for making a profit -Offers attractive opportunities to work with a minimum of risk and competition

strategy

-The ideas and actions that explain how a firm will make its profit -Good strategy leads to greater chances for survival and higher profits

product

-anything that is offered to the market to satisfy consumer wants, needs, and demands -goods, services, people, ideas

oppurtunity recognition

-searching and capturing new ideas that lead to business opportunities -involves creative thinking that leads to discovery of new and useful ideas

steps to follow when acquiring a business

1. Conduct extensive interviews with the sellers of the business.2. Study the financial reports and other records of the business.3. Make a personal examination of the site (or sites) of the business.4. Interview customers and suppliers of the business 5. Develop a detailed business plan for the acquisition.6. Negotiate an appropriate price for the business, based upon the business plan projections.7. Obtain sufficient capital to purchase and operate the business

RBI screening questions

1. People: Who are you? 2. Offering: What are you offering? 3. Customer: Whom are you offering it to? 4. Value proposition: Why do they care? 5. Distinctive competencies: Do you have any key or core science/technology or feature?

path to business plan

1. Vision- tagline, 5-10 words 2. Mission- paragraph that describes the firms goals 3. Elevator Pitch- 1 min or less action oriented speech 4. Executive Summary- one to two page overview of the business 5. Business Plan- includes cover letter, title page, table of contents, executive summary, the company, the industry, the market, the organization, the financials, the appendixes

Goals os Due diligence

1. You are attempting to find any wrongdoing: (1) fraud, (2)misrepresentations of the sellers and (3) missing information 2. You are trying to find any inefficiencies, unnoticed opportunities, waste, and mismanagement

what is looked for when pitching a plan

1. Your passion for the business 2. Your expertise about the business and the plan 3. How professional you are in your work 4. How easy it would be to work with you

four key ideas when starting a business

1. believe that you can do this 2. planning + action = success 3. help helps 4. do well. do good

Feasibility 5 primary areas

1. the overall business idea 2. the product/service 3. the industry and market 4. financial projections (profitability) 5. the plan for future action

influencer

A customer role describing a person or group who can make credible or recognized suggestions or recommendations to others regarding purchase choices

decision maker

A customer role that describes a person in an organization who is responsible for choosing which product or service will be obtained

purchaser

A customer role that describes an individual or institution that pays for or obtains a product or service

end user

A customer role that describes the person who eventually makes actual use of a product or service in his or her personal or work life

customer profile

A detailed description of a hypothetical potential customer for a product or service, also called a customer persona

business plan

A document designed to detail the major characteristics of a firm— its product or service, its industry, its market, its manner of operating(production, marketing, management), and its financial outcomes with an emphasis on the firm's present and future

Serviceable obtainable market (SOM)

A marketing term (also called the target market) that represents the customers that a firm expects to be interested in its particular product or service, and able to be serviced by the firm

Penetrated Market (PM)

A marketing term that describes the actual number of customers of an operating firm, divided by the size of the target market, which gives a percentage of the market the firm (or product/service) has attained so far

Total Available Market (TAM)

A marketing term that refers to all of the people or organizations (in one nation, region, or the world) who might consider a product or service being offered

Serviceable available market (SAM)

A marketing term that refers to the customers within the geographic reach of a firm

industry analysis

A research process that provides the entrepreneur with key information about the industry, such as its current situation and trends

organizational culture

A set of shared beliefs, basic assumptions, orcommon, accepted ways of dealing withproblems and challenges within a company thatdemonstrate how things get done

budget cycle

A term applied to the process for setting the schedule for making purchases by an individual or an organization

Primary Research

An approach to researching based on the gathering of new information, using techniques such as interviewing, surveying, and observation (focus group, survey)

Secondary Research

An approach to researching based on the use of existing information, often from government, commercial, or academic databases and research efforts

Promotion Focus

An entrepreneur's attention to maximizing gains

prevention focus

An entrepreneur's attention to minimizing losses

industry dynamics

Changes in competitors, sales and profits in an industry over time

Minority Owned Businesses

Minority-owned businesses represent 14.6%of all United States businesses

The Five Ps of Entrepreneurial Behavior

Passion, Perseverance, Promotion/Prevention focus, Planning style, Professionalization

radical innovation strategy

Rejecting existing ideas and presenting a way to do thingsdifferently

value proposition

Small business owners' unique selling points (also known as benefits)that customers can expect from your goods or services, including benefits that differentiate your offering from those of the competition

marekting research

Systematic collection and interpretation of data to support future marketing decisions

total product

The entire bundle of products, services, and meanings of your offering; includes extras like service, warranty, or delivery, as well as what the product means to the customer

external legitimacy

The extent to which a small business is taken for granted, accepted, or treated as viable by organizations or people outside the small business or the owner's family

industry

The general name for the line of product or service being sold, or the firms in that line of business

pitch

The name given to the formal slide presentation summarizing your business plan given before judges or potential investors or partners

purchasing process

The sequence of steps an individual or organization goes through in deciding to buy a product or service

Business life cycle

The sequence or pattern of developmental stages any business goes through during its life span. Stages: emergence, existence, success, take off, resource maturity

competitive advantage

The way a firm implements customer benefits that keeps the firm ahead of other firms in the industry

boot strapping

Using low-cost or free techniques to minimize your cost of doing business

Entrepreneur

a person who owns or starts an organization, such as a business

Women Owned Businesses

Women-owned businesses are one of the fastest-growing sectors of all United States businesses. makes up 29.6%

RBI screen ("Really Big Idea")

a fast technique for making initial assessments(called screens) of prospective business ideas based on five questions

family businesses

a firm in which one family owns a majority stake and is involved in the daily management of the business. makes up 39% of US businesses

Independent Entrepreneurship

a person or a group own their own for profit business

competitors

all the firms also selling that product or service

imitative strategy

an overall strategic approach in which the entrepreneur does more or less what others are already doing

core product

basic description of what a product is

Paths to Business Ownership

buy an existing business, buy a franchise, start from scratch, may inherit a business, may be the manager of a business

novelty

characterized by being different or new

imitative

characterized by being like or copying something that already exists

Augmented product

core product plus features that tend to differentiate it from the competition

internal understanding

extent to which employees, investors, and family members in the business know the business's purposes and operations

4 Ps of marketing

four components of marketing: price, promotion, place, product

product life cycle

introduction, growth, maturity, decline

pitch deck

the slideshow presentation that summarizes a business plan

social entrepreneurship

involving the creation of self sustaining charitable and civic organizations

what makes a strategy good?

its fit to the goals and objectives of your business and there sources you can bring to it

sustainable entrepreneurship (green entrepreneurship)

minimize the depletion of natural resources, maximize the use of a recycles material, or improve the environment

Causal model of entrepreneurship

one in which you want to create a product or service that does not yet exist and to achieve that end, you have to cause the product or service to exist.

firm

organization that sells to or trades with others

founders

people who create or start a new business

serial entrepreneur

people who open multiple business throughout their career

buyers

people who purchase and existing business

heir

person who becomes and owner through inheriting

franchise

prepackaged business bought, rented, or leased from a company

due diligence

process of investigating a business to determine its value

Innovativeness

refers to how important a role new ideas, products, services, processes, or markets play in an organization

how entrepreneurs handle challenges

scale back, bird in the hand, pivot, take it on the road, ask for help, plan to earn

goods or services

the tangible things (goods) or intangible commodities (services) created for sale

entrepreneurial alertness

set of observational and thinking skills that help entrepreneurs identify good opportunities

Types of organziations

sole proprietorship, partnership, limited liability corp, c-corp or s-corp, non profit

Corporate Entrepreneurship

takes place in existing businesses around new products, services, or markets

Incremental strategy

taking an idea and offering a way to do something better than it is done presently

flexibility rewards

the ability of business owners to structure life in the way that suits their needs best

Feasibility

the extent to which an idea is viable and realistic and the extent to which you are aware of internal and external forces (environment) that could affect your business

industry life cycle

the five different stages - introduction, growth, shakeout, maturity, and decline - that occur in the evolution of an industry over time

income rewards

the money made by owning one's own business

growth rewards

what people get from facing and beating challenges

self employed

working for yourself