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21 Cards in this Set
- Front
- Back
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Entrepeneurship
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the process of creating and managing a business to achieve desired objectives
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Small business
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-"smallness" is relative
-independently owned and operated business, not dominant in its competitive area -employs less than 500 people |
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Popular industries for small businesses
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reatailing and wholesaling, services, manufacturing, high technology
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Advantages of small business ownership
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independence, costs, flexibility, focus, reputation
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Disadvantages of small business ownership
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high stress level, high failure rate, undercapitalization, managerial inexperience or incompentence, inability to cope with growth
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Starting a business
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-start with a concept or general idea
-creative a business plan -devise a strategy to guide planning and development -make decisions (form of ownership, financing, acquire existing business or start a new business, buy a franshise) |
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The business plan
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a precise statement of the rationale for the business and a step-by-step explanation of how it will achieve its goals - act as a guide and reference document
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Forms of business ownership
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-sole proprieorship
-partnership -corporation |
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Financial resources
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-provide your own personal capital (cash money, obtain capital)
-financing options (loans, stocks, equity financing) |
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Equity financing
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selling or borrowing against the value of an asset such as an (automobile, insurance policy, savings account) to obtain funds to operate a business
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Venture capitalists
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persons/organizations that agree to provide funding for a new business in exchange for an ownership interest or stock - usually requires a sharing of ownership/control
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Debt financing
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borrowing financial resources typically from a bank or lending institution - often collateral is needed
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Line of credit
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any agreement by which a financial institution promises to lend a business a predetermined sum on demand
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Franchising
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a license to sell another's product to use another's name in business, or both
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Franchiser
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the company that sells the franchise
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Franchisee
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the purchaser of a franchise
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Franchises - advantages
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training and support, brand name appeal, national advertising, financial assistance, proven products, greater chance for success
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Franshises - disadvantages
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fees and profit sharing, standarized operations, restrictions on purchasing, limited product line, possible market saturation, less freedom in decisions
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Future for small businesses
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demographic trends, technological and economic trends
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Downsizing (rightsizing)
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acting small from inception - Southwest Airlines
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Intrapreneurs
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individuals in large firms who take responsibility for the development of innovations within the organization
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