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Intro to Business > Chapter 6 Starting A Small Business > Flashcards

Chapter 6 Starting A Small Business Flashcards

1
Q

Entrepreneurial Risk Includes:

A

Opportunity, Profit, Independence, Challenge

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2
Q

List of Entrepreneurial Attributes:

A

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

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3
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

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4
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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5
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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6
Q

Intrapreneurs

A

Creative people who work as Entrepreneurs within larger corporations

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7
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)

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8
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
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9
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

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10
Q

What Do Small Biz & Global Firms Have In Common?

A

They both have similar principles of management

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11
Q

What Defines a Small Business According to the SBA?

A

A business that is:1. Independently Owned/Operated2. Not dominant in its Field of Operation3. Meets Certain Standards of Size in terms of Employees or Annual Receipts (Set by SBA)

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12
Q

Small Business Advantages Are:

A
  1. Offer other advantages over large companies2. More personal customer service3. Ability to respond quickly to opportunities
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13
Q

What Does a Business Plan Do?

A

It’s a writte/detailed statement that describes:1. The nature of business2. The Target market3. The advantages in relation to competition4. Lists resources/qualifications of the owner

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14
Q

What’s a Major Cause of Business Failures?

A

Poor Management

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15
Q

What Is Poor Management?

A
  1. Poor Planning2. Poor Record Keeping3. Poor Inventory Control4. Poor Promotion/Marketing5. Poor Employee Relations
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16
Q

What Do You Need for Small Business Success?

A
  1. Planning2. Financing3. Knowing You Customers (marketing)4. Managing Your Employees (HR Dept)5. Keeping Good Records (Accounting)
17
Q

Two Primary Concerns Starting Your Small Business:

A
  1. Planning2 FinancingAll functions are important, but these are the top two.
18
Q

Business Plan Explanation: Executive Summary:

A

5 Minutes to ImpressMajor goals/objectivesBusiness Summary

19
Q

What are an Entrepreneur’s Sources of Capital?

A
  1. Personal Savings2. Relatives3. Former Employers4. Banks5. Finance Companies6. Venture Capitalists7. Govt Agencies (SBA)8. A Future Supplier (McDonalds Model)
20
Q

Business Plan Explanation: Company Background

A
  1. Company Operations to Date2. Any legal issues3. Risks/Opportunities4. Financial Health5. Balance Sheets/Cash Flow6. Insurance coverage
21
Q

Business Plan Explanation: Management Team

A
  1. List positions/job descriptions/resumes2. Organization Chart3. Outside Consultants & Their Qualifications (If used)
22
Q

Business Plan Explanation: Financial Plan

A
  1. Five year projections for income/expenses/financial2. Assumptions Based on Industry/Historcial Trends3. Offer Scenarios: Best Case & Worst Case
23
Q

Business Plan Explanation: Capital Required

A
  1. amount of capital needed to commence & continue
24
Q

Business Plan Explanation: Location Plan

A
  1. Most important: Location2. Demographic of consumers3. Traffic Patterns4. Vehicle/Pedestrian Counts
25
Q

Business Plan Explanation: Manufacturing Plan

A
  1. Plant Size2. Machinery Required3. Inventory Methods/Quality Control4. Production Capacity5. Personnel Requirements
26
Q

Business Plan Explanation: Appendix

A
  1. Marketing research on goods/services2. References to research
27
Q

Angel Investors

A

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

28
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

29
Q

CDFI (Community Development Financial Institutions)

A

Funding for lower-income businesses

30
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)

31
Q

What is the SBA?

A

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

32
Q

Small Business Investment Company Program (SBIC)

A

Private investment companies licensed by the SBA to loan money

33
Q

What is a Market?

A

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

34
Q

Who Are Valuable Experts to Have In Your Business?

A
  1. Lawyer2. Commercial Loan Officer3. Insurance Agent
35
Q

Service Corps of Retired Executives (SCORE)

A

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

36
Q

Small Business Difficulties Getting Into the Global Market

A
  1. Financing2. Don’t Know how to get started3. Don’t know cultural differences4. Paperwork/Bureauracy
37
Q

Good Reasons for Small Business to Go Global

A
  1. Absorbs excess inventory2. Softens downturns in domestic markets3. Extends products lives
38
Q

Several Advantages to Small Biz vs Big Biz Overseas

A
  1. Global buyers like dealing with individuals instead of large companies2. Small biz can start shipping much faster3. Can provide a wide variety of suppliers4. Can provide personal service

Intro to Business (13 decks)

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