Unit 1 Introduction to Small Business Operations
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Transcript of Unit 1 Introduction to Small Business Operations
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Unit 1
Introduction to Small Business Operations
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• DECA’s House of Grounds is a School Based Enterprise (SBE).
• This specialty coffee shop opened for business in January 2009.
The School Based Enterprise (SBE)
Frameworks 1.2
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Before and After
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What is a School Based Enterprise?
“School-based enterprises are effective educational tools in helping to prepare students for the transition from school to work or college. For many students, they provide the first work experience; for
others, they provide an opportunity to build management, supervision and leadership
skills.”
Frameworks 1.2Source: www.schoolbasedenterprises.org
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Gold Level Certification
www.schoolbasedenterprises.org
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The SBE Funds Scholarships
• Students who operate the SBE receive the profits in the form of scholarship payments.
• Scholarship payments are NOT distributed evenly.
• The scholarship amounts are based on quality of work, amount of work time, attitude, and initiative.
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DECA• DECA prepares emerging leaders and
entrepreneurs in marketing, finance, hospitality and management in high schools and colleges around the globe.
• DECA enhances the preparation for college and careers by providing co-curricular programs that integrate into classroom instruction.
• DECA is a co-curricular student organization.• Co-curricular means that DECA activities are
directly related to classroom instruction.
Frameworks 1.3Source: www.deca.org
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DECA’s Guiding Principles
DECA prepares the next generation to be:• Academically Prepared
– DECA members are ambitious, high-achieving leaders equipped to conquer the challenges of their aspirations.
Frameworks 1.3Source: www.deca.org
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DECA’s Guiding Principles
Frameworks 1.3Source: www.deca.org
DECA prepares the next generation to be:• Community Oriented
– Recognizing the benefit of service and responsibility to the community, DECA members continually impact and improve their local and broader communities.
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DECA’s Guiding Principles
Frameworks 1.3Source: www.deca.org
DECA prepares the next generation to be:• Professionally Responsible
– DECA members are poised professionals with ethics, integrity and high standards.
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DECA’s Guiding Principles
Frameworks 1.3Source: www.deca.org
DECA prepares the next generation to be:• Experienced Leaders
– DECA members are empowered through experience to provide effective leadership through goal setting, consensus building and project implementation.
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• DECA was officially founded in 1946 at the National level.
This photograph is from one of the early National DECA meetings.
History and Growth of DECA
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History and Growth of DECA
• The Harrison DECA Chapter was officially chartered in 1957.– Dwight Eisenhower was President of the United States.– The Soviets launched the first artificial satellite – Sputnik.– The Brooklyn Dodgers moved to Los Angeles.
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Harrison’s Original Charter
from 1957
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DECA
• There are over 185,000 high school DECA students in 5,000 chapters, located in the U.S., Canada, Germany, Mexico, Puerto Rico and Guam.
• DECA helps students to develop skills for successful business careers, build self–esteem, experience leadership and practice community service.
Frameworks 1.3Source: www.deca.org
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The DECA Theme Changes Each Year
Our Theme for 2011-12
“DECA: Aspire Higher”
DECA Facts and Information
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• Arkansas DECA– The State DECA
Advisor is Mr. Jim Brock.
– There are 35 DECA chapters in Arkansas.
– The State DECA Publication is called the Arkansas DECA Chronicle. Mr. Jim Brock also serves as the
President of the National DECA Board of Directors this year.
DECA Facts and Information
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International Career Development Conference
April 28 – May 1, 2012
Salt Lake City, Utah
DECA Facts and Information
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State DECA CompetitionArkansas State Career Development Conference
Holiday Inn Convention Center
Springdale, Arkansas
February 21 & 22, 2012
DECA Facts and Information
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2012 State DECA Competition
The Holiday Inn
Springdale
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2012 State DECA
Competition
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In order to participate in any DECA activities you must pay your dues!
$18 due Friday September 2
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The Entrepreneur
An entrepreneur is someone who takes the risk to start a new business.
Entrepreneurship is the process of planning, creating, and managing a new business.
Fred Smith, founder of FedEx, wrote a business plan as a student at Yale University outlining his business idea for transporting packages overnight throughout the United States. Frameworks 1.4Source: Marketing, 3e, page 587
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Benefits of an Entrepreneurial Career
Entrepreneurs often start their businesses while working for another company, this allows them to add to their income while still employed with another company.
Personal satisfaction from developing an idea into a business, providing jobs for people in the community, completing work that is interesting, and being able to control the profits of the company.
Frameworks 1.4Source: Marketing, 3e, page 587
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Entrepreneurs Develop Small Businesses
Over 600,000 small businesses (with 20 or fewer employees) are started each year.
Over 10% of the working population of the US is self-employed.
Small businesses make up 97% of all businesses. Small businesses employ 52% of all non-government
workers and 38% of workers in high-tech occupations.
Small businesses are responsible for over half of all goods and services produced.
Over 95% of all companies involved in exporting are small businesses.
Frameworks 1.4Source: Marketing, 3e, page 590 – Figure 21-1
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Characteristics of Entrepreneurs
Focused and goal oriented.Risk-taking – a willingness to risk the
chance of failure in order to be successful.Driven to achieve. Independent minded.Self-confident – believe in themselves and
their abilities and expect to be successful.Creativity – the ability to use imaginative
skills to find unique ways to solve problems.
Frameworks 1.6Source: Marketing, 3e, page 593
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Forms of Business Ownership
Proprietorship – a business owned and managed by one person. A proprietor is a person who has sole ownership of a business.
Partnership – a business that is owned and operated by two or more people who share in the decision making and profitability of the company. A partnership agreement is a legal document that specifies the responsibilities and financial relationships of the partners.
Corporation – a business owned by people who purchase stock in the company. Corporations are granted a charter by the state in which they are formed.
Frameworks 1.7Source: Marketing, 3e, page 603
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Corporation
A charter is a legal document allowing the corporation to operate as if it were a person.
Source: Marketing, 3e, pages 605-606
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Proprietorship: Advantages
The proprietorship is the most common form of small business ownership.
The owner is the boss and makes all decisions.
The proprietor receives all profits from the operation of the business.
This is the most flexible form of ownership.This is the easiest form of ownership to
create.
Frameworks 1.7.1Source: Marketing, 3e, page 604
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Proprietorship: Disadvantages
The proprietor may not have all the skills needed to run the business.
Most new businesses require a lot of money to start, this could be more than one owner can provide.
The risk can be great and must be carried by the proprietor, includes personal liability.
The business will not be able to continue if the owner becomes ill or dies.
Frameworks 1.7.1Source: Marketing, 3e, page 604
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Proprietorship
Little Bell Wedding Chapel
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Proprietorship
The Queen Anne House Bed & Breakfast
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Proprietorship
Shelby's, a family owned and operated business, is a 25-year tradition in the Ozark area. Pictured left to right: Shirley, Heidi, Erin, Shelby (owner), Susan, Ada and Genie.
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Partnership: Advantages
Partners are able to combine their knowledge, skills, and abilities.
Partners usually will have greater financial resources to bring to the business.
If one partner decides to leave the business, the business does not have to close.
Frameworks 1.7.1Source: Marketing, 3e, page 605
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Partnership: Disadvantages
Disagreements on important decisions can occur among partners.
All partners are responsible for any actions and decisions made by another partner.
Profits, as well as losses, are shared by the partners.
Frameworks 1.7.1Source: Marketing, 3e, page 605
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Partnerships
Neighbor's Mill Bakery & Café is owned by Mike and
Karin Nabors. The business specializes in handcrafted, all-natural breads, grilled and cold
sandwiches, soups, salads, pizzas, desserts and espresso coffees.
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Corporation: Advantages
Offers the owners limited liability.The business can exist indefinitely, beyond
the life of the owners.Ownership is easy to transfer by the selling
of stock.
Frameworks 1.7.1Source: Marketing, 3e, page 606
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Corporation: Disadvantages
Corporations face more government rules and regulations than other forms of business ownership.
Stockholders tend to be focused only profits. Individuals tend to avoid responsibility for the
actions of the corporation.Corporations are usually taxed at a higher
rate than other forms of ownership.
Frameworks 1.7.1Source: Marketing, 3e, page 606
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Corporation
The world’s largest retailer and private employer.
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Corporation
FedEx Express was founded in 1971 by Fred Smith. The corporation was created in 1998 as FDX Corp. and became FedEx Corp. in January 2000. The company handles more than 6 million shipments daily. FedEx has more than 250,000 employees.
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Corporation
Pace Industries, Inc., is a 635,000 square foot facility located in Harrison, Arkansas that specializes in commercial and consumer castings.
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Developing a Business Plan
A business plan is a written document prepared to guide the development and operation of a new business.– The sections of a business plan usually include:
• An executive summary – which provides an overview of the business concept and the important points covered in the business plan.
• Description of the proposed business, product/service, community, potential target market, organizational structure, and owners.
• Description of the proposed marketing activities.• Description of the proposed financial plans.
Frameworks 1.8Source: Marketing, 3e, page 609
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End of Unit 1
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