Chapter5: The Challenges of Starting a Business Notes

6 Pages
124 Views
Unlock Document

Department
International Business
Course
INTB 1202
Professor
Ronald S.Thomas
Semester
Fall

Description
Chapter 5: The Challenges of Starting a Business 5.1 What is an Entrepreneur? A. entrepreneur- someone who identifies a business opportunity and assumes the risk of creating and running a business to take advantage of it a. 3 characteristics i. innovation: thinking up new product/service ii. running a business: setting up business to make profit iii. risk taking: working under uncertainty b. famous entrepreneurs i. Larry Page & Sergey Brin: founders of Google ii. Pierre Omidyar: founder of eBay iii. Marcia Kilgore: founder of Bliss Spa, Soap and Glory, & FitFlops B. starting your own business a. Small Business Administration (SBA)- helps prospective owners set up small businesses, get financing, & manage operations b. you should be: i. self-starter ii. compatible/can work with people iii. good decision maker iv. physical & emotional stamina v. organized, good at planning vi. strong drive vii. aware it can affect family C. entrepreneurs vs. small business owners a. entrepreneurs: innovators, start companies to create new/improved products b. small business owners: “lifestyle business”; start businesses to provide income 5.2 The Importance of Small Business to the US Economy A. small business- independently owned & operated, little influence in industry, employs fewer than 500 people a. generate about 50% of our GDP b. famous small business founders i. Sam Walton: founder of Walmart ii. Steve Case: AOL c. inc. economic development i. create jobs ii. spark innovation iii. provide opportunities for financial success & independence B. job creation a. ½ of US adults self-employed/work for small businesses b. small businesses hire/fire more frequently than big businesses c. strong economy encourages start-ups & expansion C. innovation a. small businesses develop more patents/employee b. discovers better ways to do old things i. ex: Jeff Bezos (founder of Amazon) sold books on Internet D. opportunities for women & minorities a. incr. in # of businesses owned by women & minorities E. small businesses helping big businesses a. supply components i. ex: provide car parts to automobile companies b. provide outsourcing (hire themselves out to help w/ special projects/business functions) i. ex: big company hiring small one to manage health care benefits c. sales agents i. ex: local sporting goods stores selling Adidas and Nike 5.3 What Industries are Small Businesses In? A. industry- group of companies that compete w/ one another to sell similar products a. types of industries (sectors) i. goods-producing: primary purpose is to produce tangible goods 1. ex: manufacturing & construction (2 biggest), agriculture 2. 20% of businesses in US 3. small business manufacturers: EcoScraps, Reveal Entertainment ii. service-producing: primary purpose to provide services 1. ex: retail/wholesale trade, transportation, finance, insurance 2. produces most of GDP 3. most small businesses are retailers a. buy goods from firms & sell -> consumers 4. turning to Internet for start-ups a. Mark Zuckerberg 5. small business owners as wholesalers small businesses by industry 5.4 Advantages and Disadvantages of Small Business Ownership A. advantages a. independence: you’re your own boss b. lifestyle: choose own hours c. financial rewards: can make more money than being employee d. learning opportunities: gain understanding of business functions e. creative freedom & personal satisfaction: work in a field you enjoy B. disadvantages a. financial risk: can face losses b. stress: responsibilities c. time commitment: time-consuming d. undesirable duties: have to do everything/unpleasant things included 5.5 Starting a Business A. ?s to ask before starting a. business idea? feasible? b. type? industry? c. similar to others or innovative? d. start/buy? e. by self or w/ others? f. form of business organization? B. business plan- formal doc that identifies the goals of proposed business and explanation of how goals will be achieved a. description of business b. industry analysis c. mission stmt & core values d. management plan e. description of goods/services f. description of production processes g. marketing & financial plans C. the business idea- identifying something customers w
More Less

Related notes for INTB 1202

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit