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1-1 McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved

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Transcript of 1-1 McGraw-Hill/Irwin© 2006 The McGraw-Hill Companies, Inc. All rights reserved.

Page 1: 1-1 McGraw-Hill/Irwin© 2006 The McGraw-Hill Companies, Inc. All rights reserved.

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Page 2: 1-1 McGraw-Hill/Irwin© 2006 The McGraw-Hill Companies, Inc. All rights reserved.

1-2

Starting YourSmall Business

Business v. Small BusinessBusiness v. Small Business Trends, Challenges, Trends, Challenges,

Opportunities, & Opportunities, & Concerns of Small Concerns of Small BusinessBusiness

Characteristics of Characteristics of EntrepreneursEntrepreneurs

Ch

ap

ter

11

Ryan McVay/Getty Images

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Rapid SmallRapid SmallBusiness GrowthBusiness Growth

23 Million23 MillionEmploymentEmployment

75% Of New Jobs75% Of New Jobs50% Of Private Employment50% Of Private Employment99% Of Employers99% Of Employers

97% Of Exporters97% Of Exporters

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Entrepreneurship TodayEntrepreneurship Today

Male- 1.9 Men Per WomanMale- 1.9 Men Per WomanEthnically DiverseEthnically Diverse25-3425-34Specialty ExpertiseSpecialty Expertise$100 B For 3.5 M Startup/Small $100 B For 3.5 M Startup/Small BusinessesBusinesses

Rim Light/PhotoLink/Getty Images

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Public FavorsPublic FavorsSmall BusinessSmall Business

Black EnterpriseBlack Enterprise- - http://www.blackenterprise.comhttp://www.blackenterprise.com

EntrepreneurEntrepreneurInc.Inc.Hispanic BusinessHispanic Business- -

http://www.hispanicbusiness.comhttp://www.hispanicbusiness.comFamily BusinessFamily BusinessEntrepreneurial WomanEntrepreneurial WomanYour CompanyYour CompanyEtc.Etc.

Royalty-Free/CORBIS

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Interest At SchoolsInterest At SchoolsCoursesCourses

20 Years Ago- None20 Years Ago- NoneNow- HundredsNow- Hundreds

Ages 13-18 = Positive Ages 13-18 = Positive PotentialPotential

Business CareerBusiness CareerMales = 13%Males = 13%Females = 10%Females = 10%

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EntrepreneurialEntrepreneurialStudent Organizations Student Organizations

Association of College Association of College EntrepreneursEntrepreneurs

University Entrepreneurial University Entrepreneurial AssociationAssociation

Students in Free Enterprise - Students in Free Enterprise - http://http://www.sife.orgwww.sife.org

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Self-Employment TrendSelf-Employment Trend

Increased Investor Increased Investor InterestInterest

Executives Taking Executives Taking Early RetirementEarly Retirement

55% Want To Be Own 55% Want To Be Own BossBoss

Technological AdvancesTechnological Advances

Photodisc Collection/Getty Images

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Attractive To All AgesAttractive To All AgesMore Than ½ Of Independent More Than ½ Of Independent

Workers In NYCWorkers In NYCCollege-EducatedCollege-Educated25- 40 Years Old25- 40 Years Old

84% Of Entrepreneurs “Not Worried 84% Of Entrepreneurs “Not Worried About Future”About Future”

40% Have Management Experience40% Have Management Experience¼ Managed/Owned Business Before¼ Managed/Owned Business Before

Doug Menuez/Getty Images

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Small Business?Small Business?

Independent ManagementIndependent ManagementCapital/Ownership = Few Capital/Ownership = Few IndividualsIndividuals

Operations Are LocalOperations Are LocalBusiness = Small But Business = Small But Competitors = LargeCompetitors = Large Hisham F. Ibrahim/Getty Images

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SBA DefinitionSBA Definition

“…“…a small business is one a small business is one that is independently owned that is independently owned

and operated and is not and operated and is not dominant in its field of dominant in its field of

operation.”operation.”

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Classification By SizeClassification By Size

<20 Employees<20 Employees Very SmallVery Small

20 - 9920 - 99 SmallSmall

100 – 499100 – 499 MediumMedium

500 Or More500 Or More LargeLarge

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ObjectivesObjectives

VentureVenture

1.1. ProfitProfit

2.2. GrowthGrowth

3.3. Quick SelloutQuick Sellout

Small/MicroSmall/Micro1.1. No New Or No New Or

Innovative Innovative ActivitiesActivities

2.2. Provide Owner Provide Owner LivingLiving

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Most CommonMost CommonHome-Based BusinessesHome-Based Businesses

Personal Svcs.14%

Bus. Services

27%

Bldg. Trades31%

Financial & Real Estate

5%Sales & Distribution

10%Arts/ Design

Creative13%

Source: Independent Insurance Agents of America

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Contributions OfContributions OfSmall BusinessSmall Business

Encourage Innovation & FlexibilityEncourage Innovation & FlexibilityClose Relationship With Close Relationship With Customers/CommunityCustomers/Community

Force Large Firms To Be Force Large Firms To Be CompetitiveCompetitive

Provide Employees Provide Employees Learning ExperienceLearning Experience

Develop Risk TakersDevelop Risk TakersNew EmploymentNew EmploymentGreater Employee Job SatisfactionGreater Employee Job Satisfaction

Royalty-Free/CORBIS

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Problems ForProblems ForSmall BusinessSmall Business

Recession/Current EconomyRecession/Current EconomyRetirement/TransitionRetirement/TransitionCapital/FinancingCapital/FinancingUnexpected GrowthUnexpected GrowthSuccessionSuccessionInadequate FinancingInadequate FinancingInadequate ManagementInadequate ManagementGovernment Regulations/PaperworkGovernment Regulations/Paperwork

Royalty-Free/CORBIS

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Challenges ToChallenges ToSmall BusinessSmall Business

Exploding TechnologyExploding TechnologyOccupational/Industry Occupational/Industry ShiftsShiftsReinventionReinventionReengineeredReengineeredDownsizing/RightsizingDownsizing/Rightsizing

GlobalGlobal

Chad Baker/Ryan McVay/Getty Images

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Declining Job TypesDeclining Job Types

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Why Start AWhy Start ASmall Business?Small Business?

72%

10%

10%

8%

Independence

Control

Satisfaction

Other

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Why To Not StartWhy To Not StartA Small Business?A Small Business?

13%25%

24%19%

19%

Long Hours

Taxes

Risk

Responsibility

Other

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Job SatisfactionJob Satisfaction

0%

10%

20%

30%

40%

50%

60%

70%

Self-Employed Working For Others

Great Britain

U.S.

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Objectives OfObjectives OfSmall Business OwnersSmall Business Owners

Achieve IndependenceAchieve Independence

Additional IncomeAdditional Income

Help FamiliesHelp Families

Products Not AvailableProducts Not Available

Ryan McVay/Getty Images

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Checklist ForChecklist ForAspiring EntrepreneursAspiring Entrepreneurs

Passion Not Passion Not MoneyMoney

Something You Something You KnowKnow

PatiencePatienceMentorMentorFundingFunding

Cash ManagerCash Manager

Build SalesBuild Sales

Don’t RushDon’t Rush

Wary Of Bad Wary Of Bad

Advice/SuppliersAdvice/Suppliers

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Business ObjectivesBusiness Objectives

ServiceServiceProfitProfitSocialSocialGrowthGrowthMesh ObjectivesMesh Objectives

Nick Rowe/Getty Images

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Characteristics OfCharacteristics OfSuccessfulSuccessful Owners Owners

+Desire Desire IndependenceIndependence

+Strong Sense Of Strong Sense Of InitiativeInitiative

+Personal/Family Personal/Family MotivationMotivation

+Quick/Concrete Quick/Concrete ResultsResults

+Able To React Able To React QuicklyQuickly

+Dedicated To Dedicated To BusinessBusiness

+Enter Business Enter Business By Chance By Chance And/Or DesignAnd/Or Design

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Successful SmallSuccessful SmallBusiness ManagementBusiness Management

Adequate MarketAdequate MarketSufficient CapitalSufficient CapitalRecruit EffectivelyRecruit EffectivelyTimely InformationTimely InformationCope With Gov’t Regs.Cope With Gov’t Regs.ExpertiseExpertiseFlexibleFlexible

Ryan McVay/Getty Images

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Personal AnalysisPersonal Analysis

ValuesValues

Mental AbilitiesMental Abilities

AttitudesAttitudes Mel Curtis/Getty Images

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Where Are the New Jobs?Where Are the New Jobs?

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Factors Affecting Factors Affecting Industry/BusinessIndustry/Business

1)1) EconomicsEconomics

2)2) TechnologyTechnology

3)3) LifestyleLifestyle

4)4) PoliticalPolitical

5)5) DemographicsDemographicsRoyalty-Free/CORBIS

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Ideas For Small BusinessIdeas For Small Business

Career Career CounselingCounseling

CateringCatering Computer & Computer & Office Machine Office Machine RepairRepair

Day CareDay Care EducationEducation

Financial Financial PlanningPlanning

Home HealthHome Health MarketingMarketing Senior Fitness & Senior Fitness & RecreationRecreation

Specialized Specialized DeliveryDelivery

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Small Business ConcernsSmall Business Concerns

Poorly Planned GrowthPoorly Planned GrowthLoss Of IndependenceLoss Of IndependenceThreat Of FailureThreat Of FailureDiscontinuanceDiscontinuanceTypesTypesFormalFormalPersonal/InformalPersonal/Informal

Jim Arbogast/Getty Images


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