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Intro To Business > Chapter 6 Starting a Small Business > Flashcards

Chapter 6 Starting a Small Business Flashcards

Starting a small business.

1
Q

Affiliate Marketing:

A

Internet-marketing strategy where business rewards its customers or other business affiliates for each visitor/customer they send to the business website

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2
Q

Angel Investors

A

Private people who invest their own private money in hot new companies before they go public

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3
Q

Business Plan Explanation: Company Background

A
  1. Company Operations to Date 2. Any legal issues 3. Risks/Opportunities 4. Financial Health 5. Balance Sheets/Cash Flow 6. Insurance coverage
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3
Q

Business Plan Explanation: Capital Required

A
  1. amount of capital needed to commence & continue
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3
Q

Business Plan Explanation: Appendix

A
  1. Marketing research on goods/services 2. References to research
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4
Q

Business Plan Explanation: Executive Summary:

A

5 Minutes to Impress Major goals/objectives Business Summary

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5
Q

Business Plan Explanation: Financial Plan

A
  1. Five year projections for income/expenses/financial 2. Assumptions Based on Industry/Historcial Trends 3. Offer Scenarios: Best Case & Worst Case
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5
Q

Business Plan Explanation: Location Plan

A
  1. Most important: Location 2. Demographic of consumers 3. Traffic Patterns 4. Vehicle/Pedestrian Counts
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6
Q

Business Plan Explanation: Management Team

A
  1. List positions/job descriptions/resumes 2. Organization Chart 3. Outside Consultants & Their Qualifications (If used)
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7
Q

Business Plan Explanation: Manufacturing Plan

A
  1. Plant Size 2. Machinery Required 3. Inventory Methods/Quality Control 4. Production Capacity 5. Personnel Requirements
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7
Q

CDFI (Community Development Financial Institutions)

A

Funding for lower-income businesses

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8
Q

Entrepreneurial Risk Includes:

A

Opportunity, Profit, Independence, Challenge

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8
Q

Good Reasons for Small Business to Go Global

A
  1. Absorbs excess inventory 2. Softens downturns in domestic markets 3. Extends products lives
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9
Q

Home-Based Business Challenges:

A

Getting New Customers, Managing Time, Keeping Work/Family Tasks Separate, Abiding By City Ordianances (Licensing, etc)

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10
Q

Intrapreneurs

A

Creative people who work as Entrepreneurs within larger corporations

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11
Q

List of Entrepreneurial Attributes:

A

Self Directed, Self Nurturing, Action-Oriented, Highly Energetic, Tolerant of Uncertainty

12
Q

Peer-to-Peer Lending (P2P)

A

Online Idea: Companies that match up people who want money with people who want to lend it via websites

14
Q

Reasons for Growth of Home-Based Businesses:

A

Technology Advancements, Corporate Downsizing, Social Attitudes Have Changed, New Laws Allow Expenses of Deductions for Home Offices

14
Q

Service Corps of Retired Executives (SCORE)

A

SBA office with volunteers from industry, trade associations & education who council small businesses at no cost

15
Q

Small Business Advantages Are:

A
  1. Offer other advantages over large companies 2. More personal customer service 3. Ability to respond quickly to opportunities
15
Q

Several Advantages to Small Biz vs Big Biz Overseas

A
  1. Global buyers like dealing with individuals instead of large companies 2. Small biz can start shipping much faster 3. Can provide a wide variety of suppliers 4. Can provide personal service
16
Q

Small Business Difficulties Getting Into the Global Market

A
  1. Financing 2. Don’t Know how to get started 3. Don’t know cultural differences 4. Paperwork/Bureauracy
17
Q

Small Business Investment Company Program (SBIC)

A

Private investment companies licensed by the SBA to loan money

19
Q

Two Primary Concerns Starting Your Small Business:

A
  1. Planning 2 Financing All functions are important, but these are the top two.
20
Q

Venture Capitalist

A

Individuals or companies that invest in new business in exchange for a part ownership (hefty portion) of the business usually 60% or more (ex: Shark Tank)

22
Q

What are an Entrepreneur’s Sources of Capital?

A
  1. Personal Savings 2. Relatives 3. Former Employers 4. Banks 5. Finance Companies 6. Venture Capitalists 7. Govt Agencies (SBA) 8. A Future Supplier (McDonalds Model)
24
Q

What Are Enterprise Zones?

A

Specific geographic areas to which governments attract private business investment by offering lower taxes & other govt support to encourage entrepreneurship

25
Q

What Defines a Small Business According to the SBA?

A

A business that is: 1. Independently Owned/Operated 2. Not dominant in its Field of Operation 3. Meets Certain Standards of Size in terms of Employees or Annual Receipts (Set by SBA)

27
Q

What Do Intrapreneurs Use For Resources?

A

They use the corporations resources (human/financial/physical) to launch new products & generate new profits (ex: 3M & Sticky Notes)

29
Q

What Do Investor Visas Allow?

A

* Allows 10,000 people to come to the US each year if the invest $1million in an enterprise that creates or preserves 10 jobs (Arcadia Housing Boom) * Part of the Immigration Act in 1990 to encourage entrepreneurs to come to the US

30
Q

What Do Small Biz & Global Firms Have In Common?

A

They both have similar principles of management

31
Q

What Does a Business Plan Do?

A

It’s a writte/detailed statement that describes: 1. The nature of business 2. The Target market 3. The advantages in relation to competition 4. Lists resources/qualifications of the owner

31
Q

What Do You Need for Small Business Success?

A
  1. Planning 2. Financing 3. Knowing You Customers (marketing) 4. Managing Your Employees (HR Dept) 5. Keeping Good Records (Accounting)
32
Q

What is a Market?

A

People with unsatisfied needs who have both the resources ($) and willingness to buy (demand)

34
Q

What Is Poor Management?

A
  1. Poor Planning 2. Poor Record Keeping 3. Poor Inventory Control 4. Poor Promotion/Marketing 5. Poor Employee Relations
36
Q

What is the SBA?

A

A US Govt Agency that advises & assists small business by providing management training, financial advice & loans

37
Q

What’s a Major Cause of Business Failures?

A

Poor Management

38
Q

Who Are Valuable Experts to Have In Your Business?

A
  1. Lawyer 2. Commercial Loan Officer 3. Insurance Agent

Intro To Business (9 decks)

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