(1.5) Entrepreneurs & Leaders Flashcards
What is an entrepreneur?
People who have a business idea and want ti make money working for themselves
What is the 7 stages of setting up a business?
Idea Research Planning Financing Location Resources Launch
What is an intrapreneur?
Employees who use entrepreneurial skills to find and develop ideas that’ll have financial benefits for the business
What are the advantages of the intrapreneurs?
Increase innovation in the business
Awards can be won if unique products are made - Improves business image/ reputation
What are the financial and non financial reasons of people starting a business?
Financial
- Profit maximisation
- Profit satisficing (making enough to satisfy the needs of an business owner)
Non-Financial
- Ethical stance
- Social entrepreneurship (charity)
- Independence
- ome working
What are entrepreneur characteristics?
- Self confidence
- Self determination
- Perseverance
- Commitment
- Initiative
- Judgment
- Being a self starter
What are the required skills of an entrepreneur?
- Communication
- Financial management
- Organising
- Decision making
- Negotiating
- IT skilss
What is a sole trader and the advantages and disadvantages?
When a business is owned and run by one person
+Owner keeps all profits
+Owner has complete control
- Unlimited liability
- May struggle to raise finance as investors many think they’re too risky
What is a partnership form of business and the advantages and disadvantages?
A business that has more than one owner
+Can raise more capital
+Shared responsibility
- Unlimited liability (They can become a limited partnership)
- Shared profits
What is a private limited company (LTD) and the advantages and disadvantages?
A business owned by shareholders protected by limited liability
+Limited liability
+Control over who buys shares
+Perceived as more reputable
+Raising capital
-Shared profits
-Financial documents are published
-Shares can only be traded privately
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What is a public limited company (PLC) and the advantages and disadvantages?
A business owned by public shareholders on the stock market who are protected by limited liability
+Raise large amounts of capital
+Has greater media exposure
- Volatile share prices
- Directors are accountable to thousands of shareholders
- PLCs news can spread fast (negative or positive)
What is a franchisee and the advantages and disadvantages?
A business that is allowed to use another businesses identity
+Lower risk as they are using someone else’s idea
+Are supported from the franchisor
+Start up costs are predictable
+Can benefit from the franchisors marketing
- Have to pay royalty (Pay the franchisor their share)
- Have to sign contacts which may reduce their independence
- Can have high start up costs
What is a franchisor and the advantages and disadvantages?
A company that owns the franchise and allows other business to use there identity
+Fast growth
+Less expensive as the franchisee takes some of the financial risk
- Less profits as its shared with the franchisee
- Franchisee may damage the reputation
- Cost to support the franchisee may be high
What are social enterprises?
Businesses that trade with the aim of improving human and environmental well being. (Just think of a charity)
What is a lifestyle business?
A individual who aims to make enough money to sustain a particular lifestyle
-Small
What are the cost/ process associated with the stock market floatation?
Lawyers
Business must have a minimum of £50,000 share capital
(Basically a lot of documentation is required)
