mana

Step 1. Define the decision.Step 2. Identify the alternatives.Step 3. Evaluate the alternatives.Step 4. Select the best alternative.Step 5. Implement the chosen alternative.Step 6. Evaluate the results

.

Next week, Janet Lane will speak at a Chamber of Commerce event about how small companies can be just as innovative as larger ones. You agreed to help him prepare a list of key points to make in her presentation. Which of the following statements can you properly include on the list? Check all that apply.

A product need not be mass produced by a large company for it to be innovative. Many significant innovations originate with individuals or small businesses.

As their business grows, the Lanes eventually want to export their products to overseas resellers. However, they think no one (particularly international customers) will view Woofshirt as a legitimate company until it has at least 100 employees. You disagree. Which of the following are correct statements for you to make to the Lanes? Check all that apply.

About 99% of U.S. businesses have fewer than 100 employees. More than half of all workers in the United States work for companies with fewer than 100 employees.

Think about the different ways entrepreneurs can start their businesses. Which of the following can an entrepreneur expect when starting a new business as a franchisee? Check all that apply.

An entrepreneur must comply with practices required by the franchiser; that is, the franchisee cannot run the business however he or she wants. The franchiser will expect the entrepreneur to purchase supplies from a pre-approved distributor. The franchiser will provide the entrepreneur with some management help and support.

As you write your business plan, you include a section about financing the start-up costs. You have limited personal savings and do not want to ask family or friends for loans. Therefore, you expect to rely solely on bank loans for your expenses. Which of the following statements are true? Check all that apply.

Banks may require that you personally guarantee a loan. A bank officer who approves a loan to your business will not assume a management role in the company. Expecting to obtain loans, without any alternative plans, may prevent you from opening the business. New businesses often have difficulty obtaining bank loans.

What should you tell Edison are possible reasons his restaurant is not achieving the success he desires? Check all that apply.

Edison should immediately hire more staff, including another cook and at least one more waiter or waitress. Expecting the restaurant to be profitable after just 6 months may not have been a realistic expectation. While Edison's experience as a waiter is valuable, it may not have allowed him to develop the breadth of business skills necessary to run a new restaurant.

A business makes an app that processes financial transactions. The business owner decides to sell the app in another country where such apps are not currently in wide use. Which strategy is this business owner using?

Identifying a new market

Case StudyInstagram, the popular photo-sharing app, was launched by Kevin Systrom and Mike Krieger in 2010. Systrom worked for Google full-time and spent time building the Instagram app on the weekends. When Instagram launched on the Apple App Store, it was a hit. Within hours, thousands of users had downloaded the app. Investors saw value in the company, providing millions of dollars in funding. The app grew in popularity, adding millions of users. In 2012, Facebook acquired Instagram for a staggering $1 billion. Which of the following facts indicates that Instagram's beginnings were the result of entrepreneurship?

Kevin Systrom built the early version of the photo-sharing app on the weekends and he and Mike Krieger launched it in the Apple App Store.

Which of the following are disadvantages a franchisee may experience? Check all that apply.

Little support from the franchiser High cost of purchase Business failure of the franchiser Limited managerial control

While Matt likes the structure provided by the rational decision-making process, you caution him that it has some shortcomings. Why is the rational decision-making process difficult to apply completely in many situations? Check all that apply.

Managers often make decisions that are not based on facts and logic. Managers may lack the resources to explore creative solutions. Managers do not always evaluate situations logically.

A friend asked if you would like to open a deli near your school's campus, where there are very few inexpensive places to eat. Although a deli probably would be successful, you declined; even the possibility of losing money made you too nervous due to your low .....................

Risk propensity

The SCORE program, the Small Business Institute, and the Small Business Development Center are all run by which government agency?

Small Business Administration

Imagine that you are one of the investors on Shark Tank. An entrepreneur is pitching her concept to manufacture and market a luxury soap brand. However, you know that many new ventures fail and in this case, the entrepreneur's only work experience is as a retail clerk. Which common reason for new venture failure are you most concerned about? Check all that apply.

Some entrepreneurs overestimate their own management acumen.

Your lifelong friend, Edison, plays several sports sponsored by the local Park and Recreation Department. Edison is very excited about your plan to open a golf shop and wants to support you in that endeavor. Edison is not interested in working at the shop but has some savings and offered to make you a loan. This may be a solution to your needs for funds, if you do which of the following? Check all that apply.

To start a new business, it will be easier to obtain a loan from Edison than getting a bank loan. Even though the money is coming from someone who knows you well and trusts you, having a repayment plan and treating the loan as a business agreement is wise.

Making money is an important part of opening your golf shop, but it is not your only goal. You also want to serve the local community, and you have no plans to expand into a multistore chain. In addition, you see this as an opportunity to have complete control over business decisions. Based on these goals, your friend, Kevin, suggested that you not seek venture capital. Which of the following statements support Kevin's recommendation against venture capital? Check all that apply.

Venture capital companies typically seek an ownership interest when they invest in a company. The primary goal of a venture capital company is to make a profit. Venture capital companies generally invest in companies with the potential for growth.

Initially, the Zhous were surprised that Woofshirt needed to buy materials, supplies, and services from other businesses just to make and sell its own products. For example, a large website hosting firm maintains Woofshirt's Internet site. You explain that, in fact, small businesses are quite important to larger businesses for which of the following reasons? Check all that apply.

While the website hosting firm provides an important service to Woofshirt, Woofshirt is also important to the website firm as a customer. Small businesses should limit their interactions with big businesses so they can maintain their entrepreneurial spirit. Small businesses often sell the products made by larger companies to the end users.

As you have planned for your new business, you have obtained a lot of valuable information from the U.S. Small Business Administration (SBA). You are now at the stage where you are arranging for financing. Which of the following are true about SBA financial programs? Check all that apply.

You should not assume that an SBA loan will be available to your business. SBA loans are not a major source of new business funding, due to restrictions on who can obtain SBA-backed loans and to budget cutbacks at the SBA. The SBA has a program through which it guarantees loans made by commercial lenders. If you cannot get a loan through a bank, the SBA has a variety of lending programs that might help you obtain a loan.

A manager seeks....................... by quickly deciding to sell to a new market.

a first-mover advantage

A part of the market that established companies are not serving is known as.............. .

a niche

A company is....................... if it is owned by no more than a small group of people and is not large enough to affect its environment.

a small business

After working for other people for many years, Simone opened................... , selling one-of-a-kind, handmade jewelry. Simone always wanted to work for herself and not be accountable to investors or anyone else.

a small business

Jack wanted to buy the highest-performance Tesla Model S. However, because the car costs over $100,000 and Jack is a student with only a part-time job, principles of................. led him to test drive only cars within his realistic price range.

bounded rationality

Jack's coffee shop and three other mom-and-pop stores formed............. to oppose plans for opening a large chain store on their street.

coalition

Alex is opening a clothing shop in the Old Town Boutique District in Alexandria, Virginia, near several other small fashion stores; this is an example of................... .

entrepreneurship

Approximately one-fourth of U.S. employees work for organizations that have....................... workers.

fewer than 20

Large businesses.........................small companies to provide parts and services in order to do business.

frequently need

Entrepreneurs often find opportunities in the retail and service sector because these industries have relatively.................costs of entry.

low

A small business is............... likely to be successful in the service or retail sector than in the manufacturing sector.

more

An entrepreneur who borrows money from her parents is using------------ to start the business.

personal resources

Imagine that your friend Amara has lived all her life in Yuma, Arizona, and has never traveled far from her hometown, but has applied to colleges in Idaho, Michigan, New Hampshire, and Florida. Despite her _____________Amara thought moving to a previously unexplored city might be interesting.

state of uncertainty

You are fortunate to have family and friends who wholeheartedly support your plan to open the soccer shop, and they have confidence you will succeed. Your father, Aunt Dina, and friend Charles all agree to loan you money to get the shop started. Before accepting their offers, which of the following should you consider? Check all that apply.

Family and friends are a common source of funding for new businesses. It is easier to obtain money from family and friends than from a bank, if they are able and willing to loan it to you.

An entrepreneur decides to start a business to serve customers whose needs are not being met very well by existing businesses. Which strategy is this entrepreneur using?

Identifying a niche in an established market

Because you have planned to open a business for many years, you have saved enough money to run the business for at least 6 months. Which of the following are benefits of using your own money, rather than getting loans? Check all that apply.

If the business is not successful, you may use up your savings, but you will not have a loan, which would require making loan payments, despite the failure of your business. You can avoid going through the approval process for a loan.

Think about the different ways entrepreneurs can start their businesses. Which of the following can an entrepreneur expect when buying an existing business? Check all that apply.

The entrepreneur is less likely to make mistakes that will cause the business to lose money. The business will have working relationships with vendors and suppliers. The entrepreneur will have the benefit of learning the business's past successes and failures.

Think about the different ways entrepreneurs can start their businesses. Which of the following can an entrepreneur expect when starting a new business from scratch? Check all that apply.

The entrepreneur will be personally responsible for making most management decisions. The entrepreneur's mistakes may cause the business to lose money at first. The business may take a very long time to become profitable.

You know that entering into an agreement with a venture capital company involves significant trade-offs. Which of the following should you consider before seeking venture capital? Check all that apply.

The goals of a venture capital company may be different from the goals of the entrepreneur who started the business. A venture capital company usually receives an ownership interest in the business in exchange for its investment. Venture capital companies are making a financial investment with the goal of earning a profit for themselves.

You have big plans for your first year of business, and you estimate you will need to borrow and spend approximately $1.5 million before your golf shop becomes self-supporting. You have a friend who started her business with the help of loans guaranteed by the U.S. Small Business Administration (SBA). Which of the following statements are true? Check all that apply.

The maximum amount available to your business will depend on the specific SBA program for which your business qualifies. If you cannot get a bank loan with reasonable terms, the SBA has many different lending programs for which your business might be eligible. Not all SBA programs provide for $1.5 million in loans.

Imagine that a friend wants to start a new business and has asked you what it takes to succeed as an entrepreneur. Based on the guidance provided by the Small Business Association, you would explain that successful entrepreneurs possess which of the following characteristics and skills? Check all that apply.

They are comfortable with risk. They are skilled negotiators. They are persuasive speakers.

Imagine that your friend Martha has applied to attend universities only located in New York, which means she will encounter cold weather and snow in the winter. Assuming she is accepted at those schools, Martha will choose a school with a ------------regarding the weather she can expect.

A state of certainty

You are also interested in obtaining funds from a venture capital company. After all, many successful companies started in this manner, and it seems like an easy way to get money. However, your friend Maria explained that your conception of what venture capital entails may be inaccurate. Which of the following statements made by Maria are correct? Check all that apply.

A venture capital company usually takes an equity (ownership) position when it invests in a business. A venture capital company may insist on having input regarding major business decisions as part of the investment agreement. Venture capital companies typically look for businesses with rapid growth potential.

Woofshirt sews its own products, but must first buy the raw materials. Woofshirt purchases fabric from a large textile reseller. The Lanes have several questions about the relationship between small and large businesses. Which of the following are accurate statements for you to make? Check all that apply.

Both the fabric manufacturer and Woofshirt benefit from transactions between the two companies. Buying fabric from the distributor is an example of how small businesses can be important to larger businesses.

Orlando made the decision to open his food truck because he wanted to share the seasonings of his culture with others. Suppose that Orlando now wants to make a decision about whether he will offer new dishes in addition to tortas. He decides to ask several family members to help him make the decision. Each family member sends Orlando their ideas on what new food items will be good to add to his menu. Orlando combines all of the ideas, and sends the combination back out, asking for additional thoughts and information from his family. He does this until the family members agree on the best food item to add. Orlando is using the.................... of decision making.

Delphi Group style

In the video, Orlando Osornio says that his dad always ran his own business. If Orlando's father had not been successful, but Orlando continued to run the business, thinking that if he just kept up his father's work, it would become successful, which of the following behavioral processes was influencing Orlando?

Escalation of commitment

Several companies realize that there is a market for software that helps libraries manage the lending of digital books. One small company develops a product and begins marketing it before any of its competitors. Which strategy is this company using?

Exploiting a first-mover advantage

Which of the following are common reasons that new ventures fail? Check all that apply.

The entrepreneur cannot put enough time into running the business. The entrepreneur lacks management expertise.

Which of the following are common reasons that new ventures succeed? Check all that apply.

The entrepreneur is highly driven and dedicated. The entrepreneur knows a great deal about business management.

Case StudyIn 2008, the economy took a down-turn. Many industries suffered including real estate. Christina Anstead and Tarek El Moussa were real estate agents, but the slow housing market forced them to consider other ways to earn a living. Ironically, it is that same recession that led to their new business. Home values dropped and foreclosures on property increased, making it possible for savvy investors to buy homes cheap, make repairs, and resell them for a profit. Christina and Tarek turned to flipping homes, later pitching the concept for a reality television show to HGTV. The show, Flip or Flop, had staying power, and was renewed for a 10th season, scheduled to air in 2021. Anstead's spinoff show, Christina on the Coast, was renewed for a third season. The two real estate experts and reality TV stars hire contractors to do much of the repair work on the houses they flip, but they manage the process from property scouting to closing the sales deal.Sources: HGTV. (n.d.). Flip or Flop. Retrieved November 27, 2020, from https://www.hgtv.com/shows/flip-or-flop/; Christina on the Coast, https://www.hgtv.com/shows/christina-on-the-coast Which statement about the business founded by Christina and Tarek explains why they are identified as entrepreneurs?

When Christina and Tarek started their small new business, they determined the strategy and managed day-to-day operations.

Large businesses typically enjoy success in manufacturing due to........................ , which result in lower per-unit costs when large quantities are produced.

economies of scale

A lower-risk to entering a market is

tobuy an existing business .

Entrepreneurs are investors, but not all investors are entrepreneurs. The distinguishing characteristic is.......................

whether there is active involvement in the planning, organization, and operation for the business .

After you review the six steps with Matt, he asks for an example of how to evaluate alternatives as he decides whether VoxSigns should lay off employees. Which of the following is the correct example to give to Matt?

Matt would assess each option in terms of feasibility, satisfactoriness, and consequences; he will want to consider if the company is capable of implementing each option, as well as the resulting financial returns and other consequences (such as lower employee moral for remaining employees)

When it launched, its two founders, Kevin Systrom and Mike Krieger, were the only employees. In Instagram's early days, it was....................

a start-up .

A document called ..................... describes an entrepreneur's goals, strategies, and methods to implement those strategies.

abusiness plan