Entrepreneurship & Small Business

1. Entrepreneurship & Small Business Entrepreneurship The process of creating and managing a business to achieve desired objectives is our working definition for entrepreneurship.

2. Entrepreneurship & Small Business Entrepreneurship & Entrepreneurs Ability to see emerging trends & create company that satisfies those consumer needs. (Dell Computers) Create new markets (Amazon.com) Improve or re-package existing products (Starbucks)

3. What is a Small Business? Entrepreneurship & Small Business “Smallness” is relative. Defined, small business is any independently owned and operated business, not dominant in its competitive area, employing less than 500 people.

4. Impact of Small Business

5. Impact of Small Business 60-80% of all new jobs, annually, created by small business in the last 10 years.

6. 55% of all innovations Small Business & Innovation Airplane Audio tap recorder Double-knit fabric Fiber-optic examining equipment Heart valve Optical scanner Personal computer Soft contact lenses Zipper

7. Small Business Industries that Attract Small Business Retailing and wholesaling, services, manufacturing and high technology are especially attractive to entrepreneurs.

8. Retailing & Wholesaling Selling directly to the consumer Music stores Sporting-goods shops Dry cleaners Boutiques Drugstores Restaurants Hardware stores

9. Small Business Services 66% of the economy Employs 70% of workforce

10. Small Business Manufacturing Small business advantage over large firms –product customization Artwork, clothing, jewelry, clothing, furniture

11. High Technology Small Business Businesses that depend heavily on advanced scientific and engineering knowledge. 39% of high-tech jobs are in small business

12. Advantages of Small Business Ownership Independence Costs Flexibility Focus Reputation

13. Disadvantages of Small-Business Ownership High Stress Level High Failure Rate 90% of all new businesses fail within the first 5 years Undercapitalization Lack of funds to operate a business normally

14. Disadvantages of Small-Business Ownership Managerial Inexperience or Incompetence Inability to Cope with Growth

15. Starting the Small Business Start with a concept or general idea Devise a strategy to guide planning & development Make Decisions Form of ownership Financial resources needed Acquire existing business Start a new business Buy a franchise

16. Business Plan – a precise statement of the rationale for the business and a step-by-step explanation of how it will achieve its goals. Acts as a guide and reference document. • Explanation of the business • Analysis of competition • Income/Expense estimates The Business Plan

17. Forms of Business Ownership Sole Proprietorship Partnership Corporation

18. Financial Resources Provide your own personal capital (money) Obtain capital (Financing options)

19. Starting a Small Business Do I start from scratch? Do I buy an existing business? Do I buy a franchise?

20. Starting a Small Business Franchising A license to sell another’s products or to use another’s name in business, or both

21. Starting a Small Business Franchising Franchiser – the company that sells a franchise (e.g. Dunkin’ Donuts, McDonald’s, Subway, Re/Max) Franchisee – the purchaser of a franchise

22. Franchise – Advantages & Disadvantages