Entrepreneur Exam2
timing purchases
a method of controlling the timing of cash outflows that is invisible to suppliers and vendors.
wholesaler
a middleman business which buys (typically in large quantities) and sells (typically in smaller quantities) to businesses rather than consumers.
cash disbursements budget
a schedule of the amounts and timings of payments of cash out of a business.
payables
amounts owed to vendors for merchandise or services purchased on credit (see receivables).
transfer
an endgame strategy in which ownership is moved from one person or group to another. -860,000 family business successions -1 million business sales, transferred to people other than family -succession/business sales typically the largest small business, high-performing small businesses and high-growth ventures
termination
an endgame strategy in which the owner closes down a business. -more likely young firms, 4yrs or less -walkaway, workout, bankruptcy
estate freeze
an estate planning strategy which focuses on transferring assets to heirs when the assets cost are low. - a form of managing transfers within in a family
bearer
any person or business entity who possesses a security.
cash equivalents
assets that may be quickly converted to cash.
factoring receivables
borrowing money secured by a firm's accounts receivable.
noncore projects
revenue-producing tasks and activities related to, but not part of, the primary strategy of a business.
growth trap
a financial crisis that is caused by a business growing faster than it can be financed.
retailer
a middleman business which sells to consumers or end-users of a product (typically in single or small quantities).
overdraft
a negative balance in a depositor's bank account.
cash receipts budget
a schedule of the amounts and timings of the receipt of cash into a business.
manufacturers' suggested retail price
a target price set by a manufacturer for a product or service intended to provide profit for each intermediary in the distribution channel.
Consolidation
a transfer method in which a small business is bought by a larger firm for the purpose of quickly growing the larger firm.
Bot
a web-based program that uses artificial intelligence techniques to automate tasks such as searches
reconciling
an accounting that identifies the causes of all differences between book and bank balances.
e-tailer
an electronic retailer; a store that exists only on the Internet.
clearinghouse
an entity that processes checks and electronic fund transfers for banks and other financial organizations.
cash budget
identifies when, how, and why cash is expected to come into the business, and when, how, and why it is expected to leave.
comprehensive budget
often referred to as a master budgets.
success profits
returns at levels higher than the entrepreneur could make working for other.
substitution profits
returns intended to equal and replace the salary or wages the entrepreneur could draw working for someone else.
Liability of Newness
the set of risks faced by firms early in their life cycles that comes from a lack of knowledge by the owners about the business they are in and by customers about the new business.
Employee stock ownership plan
a formalized legal method to transfer some or all of the ownership of a business to its employees.
agent
a middleman business which represents a manufacturer's product or service to other business-to-business middleman firms.
recievables
amounts that are owed to a business for merchandise that was sold on credit (see payables).
bankruptcy
an extreme form of business termination which uses a legal method for closing a business and paying off creditors when debts are substantially greater than assets. -have little or no chance of earning back the money to pay off major debt
short-term debt
any debt that must be paid in less than one year from the date of the financial statement on which it is reported.
indirect exporting
exporting using intermediaries such as agents, export management companies, or export trading companies.
trade discounts
percentage discounts from gross invoice amounts provided to encourage prompt payment.
noncash incentives
rewards that do not require payment of cash, such as stock options, compensating time off, or added vacation days.
marketable securities
stocks and bonds that are traded on an open market.
manufacturer
the entity which producers a product or service is sold.
Market segmentation
the process of dividing the market into groups that have somewhat homogenous needs for a product or service
guerilla marketing
the use of creative and relatively inexpensive ways to reach your customer. Examples include door-knob hangers, flyers, under windshield wipers, T-shirts, balloons, and messages written on sidewalks.
Undifferentiated Strategy
a marketing strategy that uses no segmentation; assumes that all consumers have virtually identical needs and can be reached by the same marketing mix
direct mail
a method of selling in which catalogs, brochures, letters, videos, and other pieces of marketing materials are mailed directly to customers from which they can mail, call, or e-mail an order. Direct faxing and direct e-mailing are more modern forms.
born international
a new firm that opens a website immediately, thus being exposed to customers from around the world.
sheltered workshop
a nonprofit organization or institution that provides business services by using handicapped or rehabilitated workers.
discounts for prompt payment
a reduction in sales price provided to credit customers for paying outstanding amounts in a timely manner.
charge back
a reduction in the bank account of a merchant by a credit card company.
non sufficient funds
a situation that occurs when a check is returned to a depositor because the writer of the check did not have a bank available balance equal to or greater than the amount of the check.
Marketing Plan
a systematic written plan of all phases of marketing for a business, including information on the product, price, distribution, and promotion strategy, as well as a clear identification of the target market and competition.
liquidity enhancement
an estate planning strategy which focuses on generating cash to cover likely estate taxes. -a form of managing transfers within in a family
tax management
an estate planning strategy which focuses on minimizing estate tax payments. -a form of managing transfers within in a family
contract manufacturing
an existing firm with the correct manufacturing capabilities makes your product for you.
walkaways
business terminations in which the entrepreneur ends the business with its obligations met. -business could be successful or unsuccessful at closing -pay off all debt before closing it down
deposits and progress payments
cash payments received before product is completed or delivered.
Ethnographic Research
data gathered by sample observations-seeing what consumers do, rather than asking them
direct exporting
exporting using no intermediaries.
freight forwarders
firms specializing in arranging international shipments—packaging, transportation, and paperwork.
just-in-time inventory
having just enough product on your shelves to meet the immediate purchases. This usually requires frequent shipment from your supplier.
direct sales
methods of going directly to your customer in order to sell your product. Vending machines, door-to-door salespeople, leasing space at a craft fair, farmer's markets, party sales, and most industrial sales are methods of direct selling.
demand deposits
money held in checking and savings accounts.
cash
money that is immediately available to spend.
Primary Research
new information collected to solve a problem at hand or answer current questions
commercial paper
notes issued by credit-worthy corporations.
traffic generators
other businesses that bring customers (generate traffic) to the area.
direct competition
other companies that make a similar product or provide a similar service; for example, direct competition for coca cola includes all other soft drink providers
Serial entrepreneurs
people who open multiple businesses throughout their career.
direct response advertising
placing an advertisement in a magazine or newspaper, on television or radio, or in any other media. The ad contains an order blank with a phone number and e-mail or regular mail address with the intent of having the customer place an immediate order.
Slack Resources
profits that are available to be used to satisfy the preferences of the owner in how the business is run.
Open-ended question
questions that allow respondents to express themselves as they choose; for example, "What do you like about this book?"
Categorical questions
questions that are answered by selecting the proper category; for example, "What is your ethnicity? White, African American, Hispanic, Asian, American Indian, Other."
supplemental profits
returns above the costs intended as a secondary income for entrepreneurs (where self-employment is secondary to their main job).
direct marketing
selling your goods or services to consumers without intermediaries, typically to select customer groups and typically with tracking of the results.
Marketing Research
systematic collection of interpretation of data to support future marketing decisions
currency
the bills and coins printed by governments to represent money.
Differential Advantage
the characteristics that separates one company from another in product, price, promotion, and for distribution
Liquidation
the popular name for a chapter 7 bankruptcy in which a bankrupt firms assets are sold by the bankruptcy trustee and the proceeds used to pay the firms debts.
Reorganization
the popular name for a chapter13 bankruptcy in which a bankrupt firm continues to operate while paying off debts identified by the bankruptcy trustee.
consignment
the practice of accepting goods for resale, without taking ownership of them and without being responsible to pay prior to their being sold.
Business Life Cycle
the sequence or pattern of developmental stages any business goes through during its life span.
company book balance
the sum of cash inflows and cash outflows recorded in the firms accounting records.
bank ledger balance
the sum of deposits and withdrawals recorded in a bank's accounting records.
bank available balance
the sum of money that has actually been received and paid out of a depositor's account.
cash-to-cash cycle/ operating cycle
the time that is required for a business to acquire resources, convert them into product sell the product, and receive cash from the sale.
multichannel marketing
the use of several different channels to reach your customers, for example, a website, direct mail, and traditional retailing.
workouts
a form of business termination in which the firms legal or financial obligations are not fully met at closing. -arranges to pay off debts after the business is already closed
Focus group
a form of data gathering using a small group led by a moderator
telemarketing
contact via telephone for the express purpose of selling a product or service. _____ can either be inbound (customer calls company) or outbound (company calls customer).
barter
the practice of trading goods and services without the use of money.
money
an accepted medium of exchange.
Secondary Research
information already collected for some other purpose than the current problem or questions
Harvest
recover value through a sale of a firm or its assets.
mail order
sales made from ads in newspapers or magazines, with purchases made online or by phone as well as by mail.
gaming the payment process
using methods to appear to be paying bills on time, when in fact payment is being delayed or avoided.
float
delays in the movement of money among depositors and banks.
channels
people and firms who connect producers of goods and services with customers.
profit
the amount that revenues exceed expenses.
Initial Public Offering (IPO)
Transfer method describing the first-time public sale of a stock listed on a public stock exchange. -where a business sells its stock to the public on a major stock exchange
fulfillment center
a company that will warehouse your products and fill your customers orders for you.
survey
a data-collection method using a questionnaire- in person, on the phone, on paper, or on the internet
letter of credit
a document issued by a bank that guarantees a buyer's payment for a specified period of time upon compliance with specified terms.
documentary draft
a draft which can be exercised only when presented with specified shipping documents.
concentrated strategy
a marketing strategy in which a marketer selects one specific group of consumers and designs a marketing mix specifically for that group
differentiated strategy
a marketing strategy in which a marketer selects two or more distinct groups of consumers and designs specific marketing mixes to meet their needs
microinventory
a set of goods or service that consists of only one or a few items.
scalar question
questions that are answered by some sort of scale ; for example, "on a scale of 1 to 5, how do you like this book?"
Dichotomous Questions
questions that have only two possible choices; for example, "Have you shopped here before?"
Indirect competition
companies that provide alternatives that are dissimilar to your product/service that consumers might choose to meet a similar need; for example, indirect competition for Coca Cola includes any other company providing items to quench thirst