Ent 202 small business

Innovation-driven economies

are focused on high-value-added manufacturing but are marked by a very large service sector.

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

business

________ is best described as the process of making a new product available to consumers.

commercialization

Christopher is a hard-working entrepreneur who looked into all the details of his small gaming software business. He focused on all aspects of the business from the initial launch, promotion, and marketing aspects to the final set up. He finds planning convenient and works according to a plan. Christopher is a(n)

comprehensive planner

________ means the extent to which an idea is viable and realistic, and the extent to which you are aware of internal and external forces that could affect your business.

feasibility

The first step of the strategic planning process for a small business is

reviewing and confirming the goals that define the firm.

Which of the following challenges is typical to family businesses?

role conflict and succession

The primary advantage to a buyout is

simplicity

A business action that has been widely adopted within an industry or occupation is known as

standard business practice

When a new product is very popular and the original firm is unable to keep up with consumer demand, other firms jump in to take advantage, a stage often called

the boom

Small businesses differ from high-growth ventures in that in small businesses

the preferred source of funding is the owner's own money rather than other people's money.

The goal of a feasibility study is

to assess if a business idea can be profitably brought to market.

The SCAMPER tool is used to

trigger new ideas for your business

________ refers to a situation where a person's values are in conflict, making it unclear whether a particular decision is the right thing to do.

An ethical dilemma

Which of the following statements about idea-prone companies is true?

An innovative company does not automatically develop out of an innovative business idea.

Which of the following is true with regard to minorities in small businesses?

Both women and minorities face issues with access

________ analysis is based on the concept that the longer you have to wait to receive money, the less valuable it is right now.

Discounted cash flow

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. ________ is the process of investigating a business to determine its value.

Due diligence

Joe has an idea for a new mobile restaurant business. He wants to convert an antique bus into a sit-down restaurant with a service window allowing him to serve people within the bus and walk-ups who want to get their food and take it home. Joe takes his idea and looks at the market desirability, the technical feasibility, and the business viability. Joe is performing a(n)

IDEO screen

Which of the following elements of the BRIE model represents the desire to start a business?

Intention

When considering the kinds of part-time small businesses that exist, which of the following statements is true?

It is possible to have a part-time business in any industry.

Which of the following is true of a blue ocean strategy?

It results in a new product or service.

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. In the ________ section of a business plan, the sales plan, competitive plan, and growth plan are discussed.

Market

________ is the business term for the population of customers for a business owner's products or services.

Market

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. ________ plans are designed to be used internally for management purposes.

Operational

________ refers to a set of shared beliefs, basic assumptions, or common, accepted ways of dealing with problems and challenges within a company that demonstrate how things get done.

Organizational culture

When it comes to building an idea-prone culture, remember that ________ is the fuel that fans the fires of creativity and helps your business reach potentials that you may never have anticipated.

Recognition

________ is the idea and actions that explain how a firm will make its profits.

Strategy

Which of the following statements is not true of entrepreneurial teams?

Team members in a start-up business are limited to the owners.

Which of the following is a reason why most new businesses start on a part-time basis?

The cost of entry and exit is low.

When deciding how to organize your part-time business, which of the following is not one of the three key considerations?

The customers you want to target with your new product or service.

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. Which of the following statements is not true of the product life cycle?

The risks from competition in the introduction stage are generally high.

Which of the following statements about small businesses high in social capital is true?

They are given the benefit of the doubt when problems occur.

Which of the following is true of creative business owners?

They question and challenge the way things appear.

________ is the crucial skill needed for juggling your part-time business and the rest of your life.

Time management

Your ________ is your unique selling points that customers can expect from your goods or services, including those that differentiate your offerings from those of the competition.

Value proposition

________ is a reward universally mentioned by entrepreneurs.

Work flexibility

Which of the following is a disadvantage of buying a franchise?

You give up creative control and have greater reliance on your parent company's financial status.

Which of the following is most likely to be an advantage of a brand new start-up?

a clean slate

Ivan has recently started his new business venture, and he has been busy visiting trade exhibitions, business organizations, electronic business forums, and his previous colleagues in order to build contacts. This will help him use their expertise to the benefit of his business. Ivan is typically working on building

a network

The text defines an entrepreneur as

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

Which of the following is a myth about small businesses?

a small business will never have enough financing

Sven opening his own business servicing private swimming pools. Sven worked hard to build up his customer base, often performing services on last-minute notice, or even on holidays and weekends. Now, Sven has a comfortable number of routine services he provides for his customers and his business is profitable enough to support himself and his family. Which type of business does Sven likely own?

a traditional small business

Which of the following types of value benefits is most likely to be offered by a product if it helps the community, a group, the environment, or the world?

altruism

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. From an entrepreneur's perspective, marketing is all about connecting your customer to your product or service. The first step in this process is

connecting the two through the value proposition.

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. A(n) ________ is a one-page document on letterhead that introduces the business plan and owner to the recipient and indicates why the recipient is being asked to read the plan.

cover letter

Marketing focuses on the ________, while strategy focuses on the ________.

customers; competition

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. A customer role that describes a person in an organization who is responsible for choosing which product or service will be obtained is the

decision maker.

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. A(n) ________ is an action-oriented description of a business designed to open the door to a more in-depth dialogue.

elevator pitch

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. A customer role that describes the person who eventually makes actual use of a product or service in their personal or work life is the

end user

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. Which of the following components gives an overview of the business, its business model, market, expectations, and immediate goals?

executive summary

Joe is planning a new mobile restaurant business. He wants to convert an antique bus into a sit-down restaurant with a service window allowing him to serve people within the bus and walk-ups who want to get their food and take it home. Joe is performing some research into his project and is looking at the overall business idea, the product/service, the industry and market, financial projections (profitability), and the plan for the future action. Joe is performing a(n)

feasibility study

When deciding whether to take a business from part-time to full-time, the key question is usually

financial

Which of the following is the primary goal for performing due diligence?

finding any inefficiencies, unnoticed opportunities, waste, and mismanagement

Which of the following is a generic strategy that targets a portion of the market, called a segment or niche?

focus strategy

Which of the following is the first stage of the new product development process?

idea generation

Eighty-seven percent of start-ups that begin ________ are still in operation five years later.

in business incubators

Michael Porter identifies five different threats of competition for any business. Which of the following choices is not one of Michael Porter's five threats?

investors

Which of the following is essential to the success of any start-up using "lean" business practices?

keep in touch with your customers

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. Price competition starts to rise, and manufacturers find ways to cut costs or introduce new features to keep or gain market share in the ________ stage of the product life cycle.

maturity

Which of the following is an excellent way to find businesses for sale?

networking

Researchers in the field of entrepreneurship and small business believe that ________ behavior is the most basic and important entrepreneurial behavior.

opportunity recognition

________ refers to working for 35 or fewer hours a week.

part time employment

To help and prepare small businesses to handle crisis they have been recommended to avoid

planning only after the crisis has occurred.

Tony is a whiz in the kitchen. Not only does he make great food but he has invented about a dozen time-saving kitchen gadgets along the way. These are all home-made inventions made either by using new materials or by modifying existing gadgets to work in new, better ways. He has made duplicate gadgets for friends and some say they use the gadget every day. Tony quit his construction job to concentrate on his kitchen gadgets—he started his own company, Kitchen Helpers. The relation of product or company capabilities to customer pains and gains is the ________ you offer your customer.

value proposition

Connie decides to open "Connie's Corner Café" and finds the ideal location for her venture. However, it appears that Connie will have to approach investors or bankers for financial backing. When she talks to her local bank manager, Mr. Johnson, he immediately asks for Connie's business plan. Connie is in trouble because she does not know what a business plan looks like. A(n) ________ is a very simple 5-10 word sentence that expresses the fundamental idea or goal of the firm.

vision statement