Intro To Business Chapter 6

Front 1

Entrepreneurship

Back 1

accepting the risk of starting and running a business

Front 2

Why take the risk of entrepreneurship?

Back 2

opportunity, profit, independence, and challenge

Front 3

What does it take to be an entrepreneur?

Back 3

self-directed, self-nurturing, action-oriented, highly energetic, tolerant of uncertainty

Front 4

Entrepreneurial teams

Back 4

a group of experienced people from different areas of business who join to form a managerial team with the skills to develop, make and market a new product.

Front 5

Micropreneurs

Back 5

entrepreneurs willing to accept the risk of starting and managing a business that remains small, lets them do the work they want to do, and offers a balanced lifestyle

Front 6

Home-based Business Growth

Back 6

computers technology leveled the playing field, corporate downsizing, change in social attitudes, new tax laws loosened restrictions on deducting expenses for home offices

Front 7

Benefits of home-based businesses

Back 7

immediately start business, minimal start-up capital needed, no rent or excessive set-up charges, comfortable working conditions, reduced wardrobe expenses, no commuting, tax benefits, elimination of office politics, low risk for trial and error

Front 8

Downsides of Home-based businesses

Back 8

difficult to establish work habits, limited support system, isolation, limited work space, clients uncomfortable coming to home, zoning restrictions, success 100% based on personal effort

Front 9

Affiliate Marketing

Back 9

an online marketing strategy in which a business rewards individuals or other businesses for each visitor or customer the affiliate sends to its website

Front 10

Intrapreneur

Back 10

a creative person who works as an entrepreneur within a corporation (launch new products using a company’s existing resources

Front 11

Immigration Act (1990)

Back 11

created “investor visas” that encourage entrepreneurs to come to the U.S.

Front 12

Enterprise Zones

Back 12

geographic areas where governments attract private business investment by offering lower taxes and other forms of gov support

Front 13

Incubators

Back 13

offer new businesses low-cost offices with basic services

Front 14

Small business

Back 14

independently owned and operated, not dominant in its field of operation and meets certain standards of size

Front 15

Advantages of small business over big business

Back 15

more personal customer service and quick response time

Front 16

Increase chances of small business success

Back 16

pay attention to customers, choose “unattractive: neighborhoods, product cannot be easily mass produced, business is in a growth industry, owner pays attention to new competitors

Front 17

Major business functions

Back 17

planning, financing, knowing customers, managing employees, and keeping records

Front 18

Business plan

Back 18

a detailed, written statement that describes the nature of the business, the target market, the advantage the business will have over competition and the resources and owners’ qualifications

Front 19

Sources of capital

Back 19

personal savings, relatives, former employers, banks and finance companies, government agencies, angel investors, and venture capitalists

Front 20

Venture capitalists

Back 20

individuals or companies that invest in new businesses in exchange for partial ownership

Front 21

Community Development Financial Institutions (CDFIs)

Back 21

(1980s) play huge role in economic recovery

Front 22

JOBS Act (2012)

Back 22

make crowdfunding more accessible (Kickstarter, Indiegogo)

Front 23

Small Business Administration (SBA)

Back 23

U.S. gov agency that advises and assists small businesses by providing management training and financial advice (SBA microloan program = 1991, provide very small loans to small business owners)

Front 24

Small Business Investment Company (SBIC)

Back 24

a program through which private investment companies licensed by the SBA lend money to small businesses (must have minimum $5 million in capital an can borrow $2 for every $1 of capital)

Front 25

Small Business Development Centers (SBDCs)

Back 25

funded jointly by the federal government and individual states = evaluate feasibility of your idea, develop your business plan, and complete your funding application free of charge

Front 26

Market

Back 26

consumers with unsatisfied wants and needs who have both resources and willingness to buy

Front 27

Business plan sections

Back 27

strong cover letter, executive summary, company background, management team, financial plan, capital required, marketing plan, location analysis, manufacturing plan, and appendix.

Front 28

Advantages of global trade for small businesses

Back 28

faster shipping, wide variety of suppliers, more personal service and attention, deal with individuals

Front 29

Disadvantages to small businesses doing business globally

Back 29

difficulty in finding financing, lack of knowledge on exporting goods, cultural differences between markets, bureaucratic paperwork