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*. *. Nickels McHugh McHugh. *. Entrepreneurship and starting a small Business. CHAPTER. 6. *. *. 1- 1. Entrepreneurship. Accepting the risk of starting and running a business. Entrepreneurs prefer to have more control over their destiny.
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* * Nickels McHugh McHugh * Entrepreneurship and starting a small Business CHAPTER 6 * * 1-1
Entrepreneurship • Accepting the risk of starting and running a business. • Entrepreneurs prefer to have more control over their destiny.
Reasons for taking entrepreneurial risks • Opportunity • Profit • Independence • Challenge
What you need to be an Entrepreneur • Self-directed • Self-nurturing • Action-oriented • Highly energetic • Tolerant of uncertainty
Important Terms to Know • Entrepreneurial Teams -- A group of experienced people from different areas of business who join to form a managerial team with the skills to develop, make and market a new product. • Micro Preneurs -- Entrepreneurs willing to accept the risk of starting and managing a business that remains small, lets them do the work they want to do, and offers a balanced lifestyle.
Reasons for home based business growth • Computer technology • Corporate downsizing • Change in social attitudes • Tax benefits
Challenges for home based business • Getting new customers • Managing your time • Separating work and family tasks • Government ordinances • Managing risk
Web-based business • Affiliate Marketing -- An Internet-based marketing strategy in which a business rewards individuals or other businesses for each visitor or customer the affiliate sends to its website.
Intrapreneur • A creative person who works as an entrepreneur within a corporation. • Intrapreneurs use a company’s existing resources to launch new products for the company.
Small Businesses • Independently owned and operated, not dominant in its field of operation and meets certain standards of size. • Businesses are “small” in relation to other businesses in their industries.
Small-business success and failure • Figure 6.3 (from Text Book) • Figure 6.4 (From Text Book)
Learning about small-business operations • Learn from Others – Investigate your local colleges for classes on small business and entrepreneurship; talk to and work for successful local entrepreneurs. • Get Some Experience – Gain three years experience in the field; then start a part-time small business. • Take Over a Successful Firm – Serve as an apprentice and eventually take over once the owner steps down.
Managing a small business • Begin with planning • Writing business plan • Getting money to fund the business • Knowing your customers • Managing employees • Keeping records • Looking for help
Business Plan • 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 owners’ qualifications. • A business plan forces potential owners to be specific about what they will offer. • A business plan is mandatory for talking with bankers or investors.
Sources of Fund/Capital • Personal savings • Relatives • Former employers • Banks & finance companies • Government agencies • Angel investors • Venture capitalists -- Individuals or companies that invest in new businesses in exchange for partial ownership.
Knowing your customers • Market -- Consumers with unsatisfied wants and needs who have both resources and willingness to buy. • Set out to fill the market’s needs by offering top quality and great service at a fair price. • One of the great advantages of small businesses is the ability to know the market and quickly adapt to market needs.
