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The Business Of Free Enterprise. Enterprise Vs. Entrepreneur. Enterprise Business organization Entrepreneur Introduce new and better goods and services or ways of doing things. Characteristics Of Entrepreneurs . Creative individualistic official thinkers Start at an early age

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Presentation Transcript
enterprise vs entrepreneur
Enterprise Vs. Entrepreneur
  • Enterprise
  • Business organization
  • Entrepreneur
  • Introduce new and better goods and services or ways of doing things
characteristics of entrepreneurs
Characteristics Of Entrepreneurs
  • Creative individualistic official thinkers
  • Start at an early age
  • Develop and sell ordinary products
  • Find new ways to sell
  • Spot new markets and develop new products
  • Work to perfect their own idea
  • Work within an existing business
strategies used by entrepreneurs
Strategies used by entrepreneurs
  • Take advantage of unexpected opportunities
  • Respond to changing market conditions
  • Improve a product or process
  • Provide alternative goods/services
  • Identify population trends
economic role of a small business
Economic role of a small business
  • Small business
  • Independently owned and operated and is not dominate in its field of operation
  • Industry
  • Group of one or more firms that produce identical or similar products
  • Small businesses are the largest percentage of our economy
advantage of small business
Advantage of small business
  • Can add or discontinue merchandise line quickly
  • Change hours of operation
  • Alter pricing
  • Can profit in small markets
  • Suited to time-stressed consumers
  • Appeal to specific demographic groups
disadvantage of small business
Disadvantage of small business
  • Higher failure rate than large firms for three reasons:
  • Poor management
  • Inadequate financing
  • Insufficient capital slow sales heavy debt
  • Inability to hire highly qualified workers
  • Problem with salary and benefits
reasons for owning your own business
Reasons for owning your own business
  • Personal independence
  • Profits are all yours BUT so are the debts
  • Opportunity to work hours they choose
forms of business organization sole proprietorship
Forms of business organization Sole Proprietorship
  • Advantages
  • Easy to start, few regulations and forms
  • Free to make all decisions
  • All profits are yours
  • No separate taxes
  • Can reach quickly to problems
  • Personal satisfaction
  • Disadvantages
  • Unlimited liability
  • Limited funds
  • Lack of opportunities for employees
  • Competitors and ability of owner can change
forms of business organization partnership
Forms of business organizationPartnership
  • Advantages
  • Easy to form no special tax
  • Partners bring more money to business
  • New and different ideas
  • Disadvantage
  • Unlimited liability
  • If partner dies or leaves business
  • Limited funds
  • Conflicts arise if partner disagrees
corporations
Corporations
  • Must obtain a state charter
  • Represented by shares of stock
  • Stockholders are the owners
  • Privately held stocks are owned by a small group or family
  • Can be sued, can sue, and enter into contractual agreements
forms of business organization corporation
Forms of business organizationCorporation
  • Advantage
  • Shareholders are responsible only for a debt up to their investment
  • Ease of transfer of stocks buy or sell)
  • Stockholder dies corporation doesn’t dissolve
  • Raise money by selling stocks or issuing bonds
  • Disadvantages
  • Complicated and costly
  • Taxed twice: Tax on profits, stockholders pay taxes on dividends
  • When selling stocks to the public, must disclose finances and operations
s corporations
S. Corporations
  • Don’t pay corporate income tax
  • Stockholders pay tax on dividends
  • May not have more than 35 stockholders and may not own 80% or more of another corporation
limited liability companies llc
Limited Liability Companies (LLC)
  • Must have two or more members who function as a partner or stockholder
  • Hold property in name of LLC rather than members names
  • Advantage Don’t risk personal assets
  • Disadvantage state regulations and strict tax rules limited life
non profit corporations
Non-Profit Corporations
  • Cover operation expenses including wages and benefits
  • Normally serves educational, social, charitable, religious purposes
government owned corporations
Government-owned Corporations
  • Undertaken when the market doesn’t adequately supply a needed good or service
cooperatives
Cooperatives
  • Individuals or companies that perform functions for the members
  • Housing are multiple dwelling units owned by the tenants
  • Consumer are retail businesses owned by the people who share in the profits and purchase goods/services at lower costs
  • Producer Companies that manufacture and market products on behalf of the members
franchises
Franchises
  • Is a license that entitles its holder to operate his or her individually owned business as if it were part of large chain of stores
franchises1
Franchises
  • Advantage
  • Company can expand with little cost to itself
  • Have the incentive to increase efficiency, sales, profits
  • Provide training programs, financial assistance, advertising
how large corporations are organized
How large corporations are organized
  • Charter
  • Stockholders
  • Board of directors
  • Annual Corporation report