ENTP 250 Midterm

heterogeneity

a quality of a service in which each time it is provided it will be slightly different from the previous time

inseparability

a quality of service in which the service being done cannot be disconnected from the provider of the service

industry analysis

a research process that provides the entrepreneur with key information about the industry, such as current situations or trends

perishability

a service that if it is not used wen offered, it cannot be saved for later use

entrepreneurial alertness

a special set of observation and thinking skills that help entrepreneurs identify good opportunities the ability to notice that things have been overlooked, without actually launching a formal search for opportunities, and the motivation to look for opportunities

balance sheet

a statement of what a business owns (assets), what it owes to others (liabilities), and how much value the owners have invested in it (equity)

vision statement

a very simple 5-to-10-word sentence or tagline that expresses the fundamental idea or goal of the firm

differentiation strategy

aimed at clarifying how one product is unlike another in a mass market

cost strategy

aimed at mass markets in which a firm offers a combination of cost benefits that appeals to the customer

total available market

all of the people or organizations (in one nation, region, or the world) who might consider a product or service being offered

revenue

an increase in owners' equity caused by selling your product or service

tangibility

an item's capability of being touched, seen, tasted, or felt

imitative strategy

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

gains

any sort of outcome (a product, service, outcome, or situation) customers or potential customers would like to encounter or be able to depend on a driving force of creating new products or services

pains

any sort of problem, annoyance, source of aggravation, shortcoming, or suboptimal situation customers or potential customers face a driving force of creating new products or services

accounting equation

assets = liabilities + owners' equity

tax accounting

based on specific accounting requirements set by governmental taxing agencies

variable costs

change with each unit produced ex. raw materials

strategic actions

competitive responses requiring a major commitment of resources

tactical actions

competitive responses with low resource requirements

augmented product

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

penetrated market

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

feasibility study

evaluates the potential of a business opportunity by studying five primary areas in depth: 1. the overall business idea 2. the product/serive 3. the industry and market 4. financial projections (profitability) 5. the plan for future action

breakeven point

the point at which total costs equal gross revenue

product development process

the procedure to organize and pursue the creation of new goods or services

customer development process

the procedure to organize and pursue the finding, obtaining, and keeping of new customers

financial accounting

a formal, rule based set of accounting principles and procedures intended for use by outside owners, investors, banks, and regulators

perceptual map

a graphic display that positions products, services, brands, or companies according to their scores on important strategic dimensions

license

a legal agreement granting you rights to use a particular piece of intellectual property

niche market

a narrowly defined segment of the population that is likely to share interests or concerns

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 on the firm's present and future

focus group

a form of data gathering from a small group led by a moderator

mission statement

a paragraph that describes the firm's goals and competitive advantages

royalty

a payment to a licensor based on the number or value of licensed items sold

mass market

a customer group that involves large portions of the population

expense

a decrease in owners' equity cause by consuming your product or service

rbi screen

"really big idea" a fast technique for making initial assessments of prospective business ideas based on five 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?

supra strategies

- craftsmanship: specialized product , localized business operations, high levels of craftsmanship - customization: short delivery times, custom features, short production runs, high quality - supersupport: extensive, intensive, and personalized after-sales service - serving the underserved/interstices: targeting markets forgotten by larger competitors - elite: high-quality products with high prices, backed up by high expenditures, for advertising and R&D - single-mindedness: developing and demonstrating exceptional expertise in one product or service - comprehensiveness: offering one-stop shopping with complete inventory, immediate delivery, knowledgeable staff, and the major supporting services in one location - formula facilities: use a prepackaged business to offer a better or more consistent product or service - bare bones or no-frills: keep prices super low by cutting back on décor, hours, or employees - cutting out the intermediary: today farmers at their roadside stands and bands selling their own tracks online are able to sell at lower prices and still make more money by eliminating wholesalers' and retailers' markups - tightly manage decentralization: once you know how to efficiently run one type of business, it often becomes easier to open related firms (especially common for internet businesses)

business plan audiences

- family and friend investors - silent partners/angel investors - joint venture partners - bankers - government agencies and institutions - potential customers - key employees

value benefits

- quality: offering a level of quality others do not - style: items that are beautiful, fashionable, popular, or otherwise aesthetically pleasing - delivery: sometimes offering delivery is enough, others the timing matters - service: go the extra mile - technology: offer state of the art technology that others do not have - shopping ease: providing one-stop shopping - personalization: build customer products/services or personalize the customer experience - assurance: offering guarantees, warranties, service that takes the risk out of buying - place: being conveniently local or selling/delivery where others do not - credit: extending credit where others do not - brand/reputation: come from products/services offered or your own firm's reputation - belonging: some products confer value because they make the customer part of a larger group - altruism: if your product helps the community, a group, the environment, or world

sources of new business ideas

1. work and personal experience: frustrations or unfulfilled wishes from your life working or being a consumer 2. a similar business: seeing something new to you or your area, and thinking about importing or copying it 3. chance: "being in the right place at the right time" 4. family and friends: someone else has a great idea 5. education or expertise: applying what you've learned in school or developed on your own 6. idea sites

elevator pitch

a 30 seconds (100 words or less) action-oriented description of a business designed to sell the idea of the business to another

business entity concept

a business has an existence separate from that of its owners

scope

a characteristic of a market that defines the geographic range covered by the market (from market to global)

scale

a characteristic of a market that describes the size of the market (mass or niche)

business model canvas

explores the 11 most important factors in developing a start-up that would appeal to customers, compete well, and generate profit - customer segments: a group or subgroup of potential purchasers that can be approached in a coherent manner - problem: pain faced by customers you are trying to solve - solution: how you create gains for your customers - value proposition: small business owners' unique selling points (aka benefits) that customers can expect from your goods or services, including benefits that differentiate your offering from those of competition - channels: how you get your product or service to the customer - customer relationships: how you treat and take care of your customers - revenues: how you make money solving the problem and selling to customers - key resources: what great thing you or your firm has that no one else does - key activities: the most central activities in your business to doing the job right and making the firm successful - key partners: the individuals and organizations that can help make you successful costs: consider all these costs and general start-up costs

gross profit

funds left over after deducting the cost of goods sold

promotional mix

how much of each message conveyance you will use to sell your product as well as your objective in using each one

kpi's

key performance indicators measures or metrics tat identify the outcomes that are most important to the success of a business while outcomes like sales or products produced are kpi's, events leading up to these are also considered key, like customers coming to your store or website for sales, or number of products started

liabilities

legal obligations to give up things of value in the future

cost benefits

lower costs: operating from your home, getting family members to help, selling something you already got your value out of scale savings: buying in volume scope savings: multifunction printer learning: more experience means fewer mistakes and greater efficiencies organizational practices: automated/professionalized/mastered a product or service to the extent it can do more cheaply than others

tagline

memorable catchphrase that captures the key idea of a business, its service, product, or customer (aka slogan)

depreciation

regular and systematic reduction in income that transfers asset value to expense over time

radical innovation approach

rejecting existing ideas, and presenting a way to do things differently

fixed costs

remain constant regardless of quantity of output ex. rent

serviceable obtainable market

represents the customers that a firm expects to be interested in its particular product or service, and be able to be serviced by the firm

seo

search engine optimization techniques applied to web pages in order to obtain favorable placement on internet search page results

opportunity recognition

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

premium pricing

setting a price above that of the competition to indicate a higher quality

prestige pricing

setting a price above that of the competition to indicate your product is a status symbol

odd-even pricing

setting a price that ends in the number 5, 7, or 9

partitioned pricing

setting the price for a base item and then charging extra for each additional component

value proposition

small business owners' unique selling points (aka benefits) that customers can expect from your goods or services includes benefits that differentiate your offering from those of the competition

assets

something the business owns that is expected to have economic value in the future

managerial accounting

specifically intended to be used by managers for planning, directing, and controlling a business

incremental approach

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

focus strategy

targets a portion of the market, called a segment or niche

net profit

the amount of money left after operating expenses are deducted from the business

core product

the basic description of what a product is ex. bar of soap, housecleaning service, etc.

serviceable available market

the customers within the geographic reach of a firm

owners' equity

the difference between assets and liabilities of a business

total product

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

brand promise

the gains provided (i.e. benefits) or the help given (i.e. pains removed) by the product or service your firm offers

primary market research

the gathering of new information, using techniques such as interviewing, surveying, and observation

target market

the group of customers in the area you plan to serve who would be likely interested in your product, or those of competitors can refer to individuals or market groups called segments

the 4 p's

the major components of a marketing effort (aka the marketing mix) - product - price - promotion - placement

pitch deck

the name given to the formal presentation of a slideshow summarizing your business plan given before the judges or potential investors or partners

competitive advantage

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

market segmentation

the process of dividing the market into groups that have somewhat homogeneous needs for a product or service

due diligence

the process of investigating a business to determine its value and potential for investment

customer relationship management

the process of tracking the customer's different contacts with the firm, and using this data to help improve sales as well as the customer's experience

marketing funnel

the rule of thumb in marketing that it takes a large number of people to be made aware of your product in order to find a purchaser

cash flow statement

the sources and uses of cash in a business for a specified period of time

retained earnings

the sum of all profits and losses, less all dividends paid since the beginning of the business

secondary market research

the use of existing information, often from government, commercial, or academic databases, and research efforts

generic strategies

three widely applicable classic strategies for businesses of all types - differentiation - cost - focus

customer vector

type of crm report that segments by customer (or customer group) on purchases or dates of purchase

pivot

typically describes a change of direction in the thinking of an entrepreneur or a firm, often based on new data or other findings

customer job

what a potential customer is trying to do perform or complete some sort of task, solve some problem, or try to achieve some outcomes the target of the job is often the key to what a proposed product or service is intended to help

casual model of entrepreneurship

you want to create a particular product or service that does not exist yet, and to achieve that end, you have to cause the product or service to exist this can mean you will have to learn more skills, or find others to help you achieve your end - feel - check - plan - do