Intro to Business Chapter 6
entrepreneurial team
A group of experienced people from different areas of business who join together to form a managerial team with skills needed to develop, make, and market a new product.
Small Business Investment Company (SBIC) Program
A program through which private investment companies licensed by the Small Business Administration lend money to small businesses.
entrepreneurship
Accepting the risk of starting and running a business.
Service Corps of Retired Executives (SCORE)
An SBA office with volunteers from industry, trade associations, and education who counsel small businesses at no cost (except for expenses).
affiliate marketing
An online marketing strategy in which a business rewards individuals or other businesses (affiliates) for each visitor or customer the affiliate sends to its website.
incubators
Centers that offer new businesses low-cost offices with basic business services.
intrapreneurs
Creative people who work as entrepreneurs within corporations.
micropreneurs
Entrepreneurs willing to accept the risk of starting and managing the type of business that remains small, lets them do the kind of work they want to do, and offers them a balanced lifestyle.
Why do many small businesses avoid doing business globally?
Financing is often difficult to find. Many people don't know how to get started and do not understand the cultural differences in foreign markets. The bureaucratic red tape is often overwhelming.
What are some of the advantages small businesses have over large businesses in selling in global markets?
Foreign buyers enjoy dealing with individuals rather than large corporations because (1) small companies provide a wider variety of suppliers and can chip products more quickly and (2) small companies give more personal service.
venture capitalists
Individuals or companies that invest in new businesses in exchange for partial ownership of those businesses.
What does the government do to promote entrepreneurship?
Make enterprise zones (specific geographic areas to which governments try to attract private business investment by offering lower taxes and other government support).
Why are people willing to take the risks of entrepreneurship?
Opportunity, profit, independence, and challenge.
market
People with unsatisfied wants and needs who have both the resources and the willingness to buy.
How do micropreneurs differ from other entrepreneurs?
While other entrepreneurs are committed to the quest for growth, micropreneurs know they can be happy even if their companies never appear on a list of top-ranked businesses.
Small Business Administration (SBA)
A U.S. government agency that advises and assists small businesses by providing management training and financial advice and loans.
small business
A business that is independently owned and operated, is not dominant in its field of operation, and meets certain standards of size (set by the Small Business Administration) in terms of employees or annual receipts.
business plan
A detailed written statement that describes the nature of the business, the target market, the advantages the business will have in relation to competition, and the resources and qualifications of the owner(s).
A business plan is probably the most important document a small-business owner will ever create. There are nine sections in the business plan outline shown in the chapter. Can you describe at least five of those sections now?
Section 1: Executive Summary (two to three page summary of the proposed venture). Section 2: Company Background (describe company operations to date, potential legal considerations, and areas of risk and opportunity). Section 3: Management Team (include and organization chart, job descriptions of listed positions, and detailed resumes of the current and proposed executives). Section 4: Financial Plan (provide five-year projections for income, expenses, and funding sources). Section 5: Capital Required (indicate the amount of capital needed to commence or continue operations, and describe how these funds are to be used.
enterprise zones
Specific geographic areas to which governments try to attract private business investment by offering lower taxes and other government support.
What are the advantages of entrepreneurial teams?
Team members can combine creative skills with production and marketing skills right from the start. Entrepreneurial teams can also ensure more cooperation and coordination later among functions in the business.