Business Ch. 6 Entrepreneurship
Outline of a Comprehensive Business Plan
- Between 25-50 pages and takes 6+ months to write - Cover Letter - Executive Summary - Company Background - Management Team - Financial Plan - Capital Required - Marketing Plan - Location Analysis - Manufacturing Plan - Appendix
A good business plan is between 25 and 50 pages long and takes many months to write. A comprehensive business plan will include which of the following?
- Cover letter - Executive summary - Company background
Advantages of small businesses in international trade
- Overseas buyers prefer dealing with individuals rather than large bureaucracies - Small companies can usually begin shipping much faster - Small companies can provide a wide variety of suppliers - Small companies can give customers personal service & undivided attention because each overseas account is a major source of business to them
Why small businesses have difficulty getting started in global markets
1. financing is difficult to find 2. potential exporters don't know how to get started and don't understand cultural differences between markets 3. the bureaucratic paperwork can threaten to bury a small business
Small Business Administration (SBA)
A U.S. government agency that advises and assists small businesses by providing management training and financial advice and loans.
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).
entrepreneurial teams
A group of experienced people from different areas of business who join together to form a managerial team with the 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.
Incubators
Centers that offer new businesses low-cost offices with basic business services
venture capitalists
Individuals or companies that invest in new businesses in exchange for partial ownership of those businesses.
why people take the entrepreneurial challenge/risk
Opportunity, profit, independence, and challenge
Why are small businesses important to the U.S. economy?
Small business accounts for 43% of gross domestic product (GDP)
enterprise zones
Specific geographic areas to which governments try to attract private business investment by offering lower taxes and other government support
There are a few hurdles that prevent many small businesses from engaging in the global market. Which of the following are examples of such problems?
Would-be exporters do not know how to get started and financing is often difficult to find
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
To keep track of daily sales, expenses, profits, inventory control, customer records, and payroll a small business needs a good
accounting system
Understanding where to locate your business, who your target market is, and how to reach them, can be accomplished through
an inexpensive market research study
In 2019, online retail sales reached over $365 ______, or approximately ______ percent of all retail sales.
billion; 12
Mark recently started a small consulting firm. He is drafting a detailed written statement that describes the nature of the business, the target market, the advantages the business will have over competition, and the resources and qualifications of the owner(s). Mark is writing a(n)
business plan
Since the Executive Summary is the summary of the proposed business venture, it should include parts of the entire
business plan
intrapreneurs
creative people who work as entrepreneurs within corporations
A(n) ______ team is a group of experienced people from different areas of business who join together to form a managerial team with the skills needed to develop, make, and market a new product.
entrepreneurial
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.
Some causes of small-business ______ include underpricing or overpricing goods or services, starting with too little capital, going into business without first learning something about the industry or market, and underestimating how much time it will take to build a market.
failure
Gaining financing, knowing how to get started in exporting, and navigating bureaucratic paperwork are major hurdles to consider when getting started in _______ business.
global or international
As a small business grows, it is ______ to oversee every detail; entrepreneurs must train and motivate employees.
impossible, difficult, or hard
Which of these are centers that offer new businesses in the critical stage of early development low-cost offices with basic services such as accounting, legal advice, and secretarial help?
incubators
Managing a small business became relatively easy with the advent of inexpensive personal computers. Inexpensive computer systems and off-the-shelf or even free, open-source software make it easy for the small business manager to
manage customer records and follow the daily sales & expenses
Two advantages small firms have over large firms include more personal customer service and the ability to respond quickly to
opportunities
market
people with unsatisfied wants and needs who have both the resources and the willingness to buy
What are potential sources of capital?
personal savings, family/business associates, bank and finance institutions, angels, crowdfunding, venture capitalists, government agencies, etc.
traits of an entrepreneur
self-directed, self-nurturing, action-oriented, highly energetic, and tolerant of uncertainty