Entrepreneurship Fundamentals

Census Data includes

# of homes in area Value of homes Number of vehicles owned Age distributions Occupational Data Income levels Education Levels

Know some examples of stockholders.

1. Common Stock 2. Retained Earnings 3. Paid- in Capital 4. Treasury Stock

What are the parameters used in a sketchpad?

1. Customers (who is the target audience for the product?) 2. Offering (what will the company offer its customers?) 3. Value proposition (why is the product important to the customer?) 4. Core competencies (do you have any core differences in science or technology?) 5. People (who are going to help start the organization?)

Entrepreneurs are characterized by several things. Know your own list of characteristics.

1. Dedicated 2. Creative 3. Innovative 4. Risk-Taking 5. Humble 6. Learning from mistakes 7. Learning from others

What are the advantages of a partnership?

1. Easy to Establish 2. Complementary Skills 3. Division of profits 4. Larger pool of capital 5. Ability to attract limited partners 6. Minimal Government Regulation 7. Flexibility 8. Taxation

What are the three parts of the triple bottom line?

1. Economic Objectives 2. Social Objectives 3. Environmental Objectives

What does the profile of an entrepreneur look like

1. Risk-Taking 2. Patient 3. Not afraid of failure 4. Creates new business in face of risk and keeps profit in mind when doing so.

Know types of business ownership.

1. Sole proprietorship 2. Partnership 3. LLC (Limited Liability Corporation) 4. Corporation

What percent of people in the US become entrepreneurs because they cannot find a job?

25%

how many levels of ethical standards

3

Multichannel sales account for ___% of all retail sales

38

More than ___ % of the world online population has bought on the internet

51.5

__% of business owners have Web sites

54

Online sales account for __% of total retail sales

60

how many percent of workers have had ethical lapses in their companies

73

Sole proprietorship

A business owned and managed by one individual.

What is innovation?

Ability to apply creative solutions to problems and opportunities to enhance or enrich people's lives.

What is a feasibility analysis? Know this well and be able to explain.

An analysis of the viability of a business idea that includes 4 interrelated components: an industry and market analysis, product and service analysis, a financial analysis, and an entrepreneur analysis. Process of determining whether an entrepreneur's idea is a viable foundation for creating a successful business. Purpose to determine whether the business idea is worth pursuing.

partnership

An association of two or more people who co-own a business for the purpose of making a profit

First section of balance sheet

Assets

Unconventional, low cost creative techniques

Bootstrap Marketing Strategies

most important asset

Cash

Define creativity in Ted Levitt's words. He is a graduate of Harvard.

Creativity is thinking new things and that innovation is doing new things.

EX of stakeholders

Creditors Employees Suppliers

report giving details about typical consumer

Customer profile

Takes out loans to finance business

Debt Financing

Amount of goods wanted

Demand

10. Generation X and Y are examples of ___________ changes.

Demographic

Not one of the objectives a bootstrap marketing plan should accomplish

Determine how the company will be able to serve all its customers

Path a good must follow in order to reach customer

Distribution channel

Adding new products to grow a business

Diversification

Define ethical behavior.

Doing what is right

Regulations that influence bsusiness operation online

E-commerce law

Goods and service businesses use to meet consumer wants and needs

Economic resource

Value and usefulness created by business activities

Economic utility

Unlimited wants with limited resources

Economics

Self- aware of ones emotions

Emotional Intelligence

One of the most significant economical developments in recent business history.

Entrepreneurial Spirit

behavioral boundaries for decision-makers

Ethics

Current competitive conditions favor large companies over smaller ones because of their flexibility combined with their ability to use their size to achieve efficiency and economies of scale

False

Increased EPT Activity is a phenomenon unique to the US.

False

Small companies are powerless when it comes to developing market strategies

False

Frequently convey the idea, quality, prestige, and uniqueness to customers

High Prices

Cost of goods sold is located where

INcome statement

Effective tool to help assess ideas

Idea Sketch Pad

Current Assets goes with

Inventory

What does a feasibility study do and what questions does it answer?

Investigative tool to answer the picture of the market and the sales and profit potential of a business idea.

Business ethics

Involves moral values and behavioral standards that businesspeople draw on as they make decisions and solve problems.

What is the main reason to have a partnership?

Less Liability on one person and it is divided amongst two people.

Published annually, matches population demographics with lifestyle interests

Lifestyle Market Analyst

process of creating and delivering desired goods and services to customers and involves all the activities associated with winning and retaining loyal customers

Marketing

Entrepreneurs who start business because there is no other work

Necessity EPTs

Be aware of

Overall financial position and changes in financial status

limited partnership

Partners who are financial investors in a partnership, cannot participate in the day-to-day management of a company and have limited liability for the partnership's debts.

general partnership

Partners who have unlimited liability for the partnership's debts and usually take an active role in managing the business.

1. What is a problem in using creativity even if people have it?

People do not use that creativity to solve their problem

Challenge that drives pricing decisions

Price sensitivity of customers (elasticity)

Define idea assessment

Process of examining a need in the market, developing a solution for that need, and determining the entrepreneur's ability to successfully turn the idea into a business.

3 parts of the triple bottom line

Profit people planet

Most valuable attributes of the Web is the ability to

Provide companies with instantaneous customer feedback

19. Mc Donald's is an example of what type of franchise?

Pure Franchising

Entrepreneurs who keep starting businesses and grow them to a sustainable size and strike out

Serial Entrepreneur

What is the entrepreneurial spirit?

Set of characteristics that determine our attitude and approach to life. One of the most significant economic developments in recent business history relates to the entrepreneurial spirit.

Statement of cash flows

Shows changes in working capital by listing sources and uses of funds

boot strap marketing gives _____ companies advantages over ____ companies

Smaller; larger

How organization needs to respond to the needs of the many elements in a society

Social Responsibility

18. Women entering the workforce are an example of what type of change?

Sociocultural

What is creativity?

The ability to develop new ideas and to discover new ways of looking at problems and opportunities.

What is the entrepreneurial secret in the marketplace?

There is no secret, It is applying creativity and innovation to solve problems and to exploit opportunities that people face every day.

1 in 8 adults are active in launching a business

True

Key ingredient to setting prices properly

Understand target market

Define stockholders.

an individual or legal entity that is registered by the corporation as the legal owner of shares of the share capital of a public or private corporation.

A business plan

contains both a marketing and financial plan

What do entrepreneurs do?

create a business plan, hire labor, acquire resources and financing, and provide leadership and management for the business.

Entrepreneurship is a constant process that relies on ____________

creativity, innovation, and application in the marketplace

Define product and service feasibility.

determines the degree to which a product or service ideas appeals to potential customers and identifies the resources necessary to produce the product or provide the service.

Branch of philosophy that studies and makes theories about the basic right of nature of right wrong duty obligation and virtue

ethics

Narrowest level of ethical standards

law

various groups who affect and are affected by a business are

stakeholders

focus of small companys marketing plan

the customer

1st step in managing cash more effectively

understanding the company's cash flow cycle

Characteristics of entrepreneur except

value of money over achievement

16. What is a disadvantage of purchasing existing businesses?

· Cash Requirement · Business is losing money · Employees may not be up to standard · Ill Will (Bad reputation) · Bad Location · Old Equipment · Needing to make a change · Business May be overpriced

7. Demographic changes. Define and give examples

· Changing demographics create opportunities for entrepreneurs. · EX: Gen Y (Millennials) reaches adulthood, businesses will begin to pay attention to the next generation, Gen Z

21. What information is available from census data?

· Form of secondary research. Use this data to make wages competitive compared to other jobs in the area.

Stakeholders

· Group of individuals who affect and are affected by a business.

Social Responsibility

· Individuals and companies must act in the best interests of their environment and society.

15. What four interrelated components make up a feasability study?

· Industry/Market Analysis · Financial Analysis · Product and service analysis · Entrepreneur Analysis

20. Define inventory and have an understanding of how it is used to evaluate a business's assets.

· Inventory- what a business owns to sell to its customers.

12. Define the diligence process and how and when it works.

· Involves studying, reviewing, and verifying all of the relevant information concerning an acquisition. The goal of the process is to discover exactly what the buyer is purchasing and avoid any unpleasant surprises after the deal is closed.

Technological changes. Define and know examples.

· Lead to development of new products and entirely new industries. · EX: Internet

Economic changes

· Most businesses financial fortunes are tied to the performance of the overall company. · EX: Businesses in the e-learning industry thrived during the Great recession

14. Is history always a reliable predictor of a future business?

· Most of the time it is pretty accurate, but nothing is a perfect indicator.

8. What is the entrepreneurial spirit?

· Set of characteristics that determine our attitude and approach to life. · One of the most significant economic developments in recent business history relates to the entrepreneurial spirit.

17. How are entrepreneurs of today different from entrepreneurs of the past?

· They realize that customer loyalty and satisfaction is more important than profitability, since that loyalty will lead to sustainable profits in the future.

3. Types of franchises

· Trade Name Franchising- System of franchising in which the franchisee purchases the right to use the franchisors trade name without distributing particular products exclusively under the franchisors name · Product Distribution Franchising - a system of franchising in which a franchisor licenses a franchisee to sell its products under the franchisors brand name and trademark through a selective, limited distribution network. · Pure Franchising - system of franchising in which a franchisor sells a franchisee a complete business format and system.

Sociocultural Changes

· dramatic changes that can create whole new industries and fundamentally transform existing industries · EX: Women entering the workforce.