Third “Live” Seminar AB209, Small Business Management.

Third “Live” Seminar

AB209, Small Business Management

Unit 5 Seminar Game Plan Course Check-In

Course Website Check-InCourse Activities & Assignments Check-In

Review Unit 3 & 4 ContentContent ReviewAssignment Review

Unit 5 Check-InLook Ahead to the Unit 7 Seminar

Course Check-In

Assignments ReviewDiscussion Boards: We have graded DBs in

Units 1 through 9 (40 points each)Reviews: We have graded Review exercises in

Units 1, 2, 5, 7, & 9 (50 points each)Case Studies: We have graded Case Studies in

Units 3, 4, 6, & 8 (50 points each)Activity: Unit 5 Financial Planning (60 points)Final Project - Business Plan: Our graded final

project (Business Plan) is due in Unit 9 (140 points); please note that in Units 2, 4, 5, 6, & 8 you are encouraged to work on specific sections of this plan

Writing Assignment: Written reflection paper due in Unit 10 (40 points)

Final ProjectOur graded Final Project (Business Plan)

is due no later than the end of Unit 9To complete our Final Project, please

refer to Final Project Template in Doc Sharing:

In Units 2, 4, 5, 6, & 8, students are encouraged to work on specific elements of the Final Project

Completed Business Plans should be submitted via the DropBox (name file: Final Project Your Name)

The Final Project is worth 180 points

AB209 Final ProjectMini-Business Plan Outline for the

AB209 Final Project:Executive SummaryManagement Team & AdvisorsDefinition of the Market & Products/Services

Marketing & Sales StrategyFinancial InformationAnd, be sure to add a cover page and references page

© 2010 South-Western, Cengage Learning, Inc. All

rights reserved.6–7

Exhibit 6.3 Abbreviated Business Plan Outline

Section Heading• Cover Page

• Table of Contents

• Executive Summary

• Industry, Target Customer, and Competitor Analysis

• Company Description

• Product/Service Plan

• Marketing Plan

• Operations and Development Plan

• Management Team

• Critical Risks

• Offering

• Financial Plan

• Appendix of Supporting Documents

Introduction to Small Business

Our exploration of Small Business Management will focus on the five (5) parts:o Entrepreneurship: A World of Opportunity

o Unit 1 (Chapters 1 & 2)o Starting From Scratch or Joining an Existing Business

o Unit 2 (Chapters 3, 4, & 5)o Developing the New Venture Business Plan

o Unit 3 (Chapters 6 & 7)o Unit 4 (Chapters 8 & 9)o Unit 5 (Chapters 10, 11, & 12)

o Focusing on the Customer: Marketing Growth Strategieso Unit 6 (Chapters 14 & 15)o Unit 7 (Chapters 16, 17, & 18)

o Managing Growth in the Small Businesso Unit 8 (Chapters 19 & 20)o Unit 9 (Chapters 21, 22, & 23)

Unit 3 Review



What is Small Business Marketing?

Small Business MarketingBusiness activities that direct the creation,

development, and delivery of a bundle of satisfaction from the creator to the targeted user and that satisfy the targeted user.

Small Business Marketing ActivitiesIdentification of the target marketDetermining target market’s potentialPreparing, communicating, and delivering a

bundle of satisfaction to the target market



Exhibit 7.2 The Marketing Plan and Supporting Marketing Activities



Marketing Research ActivitiesMarket Analysis

An evaluation process that encompasses market segmentation, marketing research, and sales forecasting

Developing the Marketing MixThe combination of product, pricing,

promotion, and distribution activities.



The Formal Marketing PlanMarket Analysis

Customer profileA description of potential customers in a target

marketSales forecasts

“Most likely,” “pessimistic,” and “optimistic

The CompetitionProfile of key management personnelOverall strengths and weaknesses (SWOT)Related products being marketed or testedLikelihood of competitors’ entry into target

market



The Formal Marketing Plan (cont’d)

Marketing StrategyProduct and/or service section

Decisions affecting the total productDistribution section

Decisions regarding product delivery to customersPricing section

Setting an acceptable value on the productPromotional section

Communicating information to the target market

Unit 3 DB: Stella & DotOn page 148 of our textbook, read the “in the

spotlight” mini-case study on Stella & Dot, and feel free to visit their website for more information on the company: www.stelladot.com Then, answer the following questions:Jessica Herrin struggled with her initial attempts in

creating a business plan. Her lack of experience led her to misunderstand a critical risk or fatal flaw that might have led to failure.

Discuss the impact of a business plan's accuracy on investors and lenders.

What are the potential ethical implications of providing misinformation or incomplete information?

What is the ethical dilemma? Specify the potential impact on all parties affected.

Case Study #1: Firewire Surfboards

Please answer the following questions in your case study analysis:Identify and describe Firewire Surfboard’s

major competitors. How are these rivals positioned in the marketplace?

Put yourself in the role of Firewire’s entrepreneurial team at the time of the company’s founding. What should they have anticipated in the way of competitor reaction and the response of prospective customers?

What is Firewire’s core competency? Is it sustainable?

Given the company’s recent shift in strategy, what do you think its major challenges will be?

Unit 4 Review



Building a Management TeamManagement Team

Managers and other key persons who give a company its general direction

Characteristics of a Strong Management TeamCapable of securing the resources needed to

make business a successReassures investors about the their investment

and the continuity of businessDiversity of talent makes the team stronger than

an individual entrepreneur



Building a Management Team (cont’d)

Team Building and StructureThe required combination of education and

experience depends on the type of business and the nature of its operations

The key: achieving a balance of skills and competencies in functional areas

Designing an internal management structure that defines relationships and responsibilitiesOutside professional support can supplement the

skills of a management teamAn active board of directors can provide counsel and

guidance.



Exhibit 8.2 Percentage of Small Businesses by Legal Form of Organization15

Sources: Table 1A, Internal Revenue Service, http://www.irs.gov/pub/irs-soi/d6187.pdf, accessed December 5, 2008; and Table 1, Internal Revenue Service, http://www.irs.gov/pub/irs-soi/d6292.pdf, accessed January 13, 2009.



The Sole Proprietorship OptionSole Proprietorship

A business owned by one person, who bears unlimited liability for the enterprise.

AdvantagesReceives all of the firm’s profits.Holds title to all of the firm’s assets.Can easily sell or transfer ownership of the

company name and assets.Requires no registration or filing fee.Has absolute freedom from interference by

other stakeholders.



The Sole Proprietorship Option (cont’d)

DisadvantagesBears all business risk.Is subject to all claims of creditors.Has unlimited personal liability for business.Receives no tax free benefits as an employee.Death/incapacity of owner terminates

business.Is limited to the proprietor’s personal capital.Is taxed on business income as personal

income.



Exhibit 8.3 The Advantages and Disadvantages of Partnerships



The C Corporation OptionCorporation

A business organization that exists as a legal entity and provides limited liability for its owners.

Legal EntityA business organization recognized by the

law as having a separate legal existence (“artificial being”); can be sued, hold property, and incur debt.

The C CorporationAn ordinary, or regular, corporation chartered

by the state and taxed by the federal government as a separate legal entity.



Exhibit 9.1 Location Options for the Startup



Exhibit 9.2 Five Key Factors in Determining a Good Business Location



Other Factors in Selecting a Location

Neighbor MixWho’s next door?

Security and SafetyHow safe is the

neighborhood?

ServicesIs there municipal trash

pickup?

Past Tenants’ Fate What happened to them?The Life-cycle Stage

of the Area Is the site in the

embryonic, mature, or declining stage?



Locating the Startup in the Entrepreneur’s Home

Home-Based BusinessA business that maintains its primary facility in

the residence of its ownerAttraction of a Home-Based Business

Low start-up and overhead costsConvenience for family and lifestyleTechnology

Advances in office equipment and connectivity allow home-based business to compete with commercial sites.



Exhibit 9.4 Some Common Reasons for Starting a Home-Based Business

Source: Adapted from “Potential Reasons for Starting a Home Based Business,” http://www.perfectsystem.co.uk, accessed January 13, 2009.



The Challenges of Home-Based Businesses

Business ImageA professional business image is difficult to maintain in a home environment.

Legal ConsiderationsLocal laws and zoning ordinances prohibit many types of home-based businesses.

Family and Business ConflictsThe need to observe regular business hours and establish spatial boundaries (specific work areas) to avoid distractions.



Locating the Startup on the Internet

E-CommerceThe paperless exchange of business

information via the Internet.Benefits of E-Commerce to Startups

Allows for competition with larger firms in larger markets.

Helps with cash flow problems by compressing the sales cycle.

Builds better customer relationships through better service.Electronic Customer Relationship Marketing (eCRM)



Factors Affecting the E-Commerce Choice

Technical LimitationsWebsite development

and maintenance costsInsufficient bandwidthUpgrading softwareIntegration of e-

commerce with brick-and-mortar operations

Customer access to the Internet and connectivity limitations

Non-Technical Limitations

Privacy of customer transactions

Customer information security

Inability of customers to touch or try on products

Unit 4 DB: Biosite, Inc.On page 200 of our textbook, read

the “in the spotlight” mini-case study on Biosite, Inc., and feel free to visit their website for more information on the company: www.biosite.com Then, answer the following questions:What factors made the Biosite management team so effective?

As the company prepared for their initial public offering, what new focus did the day-to-day work of the owners take? Why?

Case Study #2: Le Travel Store

Please answer the following questions in your case study analysis:Review the five key factors in selecting a good business location. Which of those factors guided the Kellers’ choice for the site of the original Le Travel Store? Explain.

Which factors or combination of factors were the Kellers’ most excited about in their newest location?

Recall how the textbook describes the importance of a building’s “image”. Describe how each of the Kellers’ locations reflects the evolution of their business plan.

Final Project Activity: Management Team & Advisors

Management Team & AdvisorsThis portion of your mini-business plan should

contain information on your proposed management team and the advisors you plan to retain. Be as specific in identifying members of your management team and/or explaining their required skills and abilities. For advisors, share information on the types of advisors you will require: accounting, legal, business management, etc.

Please remember: As a guide to help you develop your mini-business plan, please refer to the content of the Atayne, LLC business plan on pages 675 to 695 of our textbook.

Unit 5 Check-In

Look Ahead to Fourth “Live” Seminar Seminar

Unit 5 InformationTheme: The Financial Plan & a Firms

Sources of FinancingReadings: Longenecker – Chapters

10, 11, & 12 (pages 258 to 337)Discussion Board: BuiltNY (page

286) (40 points)Activity- Financial activity (60 points)Review: Chapters 6 through 12 (Part

3 of textbook) (40 points)Seminar: Conducted on Scheduled

Day/Time

Unit 6 InformationTheme: Building Customer Relationships

& Pricing and Supply Chain ManagementReadings: Longenecker – Chapters 14 &

15 (361 to 417)Discussion Board: Horse (page 389) (40

points)Case Study #3: eHarmony (pages 636 to

637) (50 points)Final Project Activity: Definition of the

Market, Product/Services, & Marketing & Sales Strategy (ungraded)

Seminar: No Seminar in Unit 6

Unit 7 InformationTheme: Pricing & Credit Decisions,

Promotional Planning, & Global Marketing

Readings: Longenecker – Chapters 16, 17, & 18 (pages 418 to 492)

Discussion Board: Foley’s NY Pub & Restaurant (page 440) (40 points)

Review: Chapters 14 through 18 (Part 4 of textbook) (40 points)

Seminar: Conducted on Scheduled Day/Time

3rd “Live” Seminar Wrap-Up

If you need assistance:o Contact instructor at their KU email addresso Post message to “Instructor’s Office”o Meet with instructor during Virtual Office Hourso KU Tech Support: 1-866-522-7747o Academic Advisor: If you have any challenges

that prevent you from succeeding this term or at KU in general

o Other KU Resources: Writing Center, etc.Our next “live” seminar: Unit 7Questions?

o Course Website or Content?o Assignments?o Other issues?

Third “Live” Seminar AB209, Small Business Management.

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Transcript of Third “Live” Seminar AB209, Small Business Management.