Unit 7 Seminar AB209, Small Business Management. Unit 7 Seminar Game Plan Course Check-In Course...
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Transcript of Unit 7 Seminar AB209, Small Business Management. Unit 7 Seminar Game Plan Course Check-In Course...
Unit 7 Seminar
AB209, Small Business Management
Unit 7 Seminar Game Plan Course Check-In
Course Website Check-InCourse Activities & Assignments Check-In
Review Unit 5 & 6 ContentContent ReviewAssignment Review
Unit 7 Check-InLook Ahead to the Unit 9 Seminar
Review of Financial Management from Unit 5
Understanding Financial Statements
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.10–4
Financial Statements (Accounting Statements)Reports of a firm’s financial performance and
resourcesHelps determine a startup’s financial requirementsAssesses the financial implications
of a business plan
Basic Financial StatementsIncome statementBalance sheetCash flow statement
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.10–5
Exhibit 10.3 The Balance Sheet: An Overview
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.10–6
Exhibit 10.5 The Fit of the Income Statement and Balance Sheet
The Cash Flow Statement
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.10–7
Cash Flow Statement
A financial report showing a firm’s income (cash) when it is received and expenses when they are paid.Cash flows from normal operations (operating activities)
Cash flows related to the investment in or sale of assets (investment activities)
Cash flows related to financing the firm (financing activities)
Determining Financing Requirements
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.11–8
Basic Principles for Financing of FirmsThe more assets a firm needs, the greater the
firm’s financial requirements.A firm should finance its growth in such a way
as to maintain proper liquidity.The amount of total debt used in financing a
business is limited by the funds provided by the owners.
Some types of short-term debt maintain a relatively constant relationship with sales.
Equity ownership comes the investments of owners, and retained earnings (profits).
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.12–9
Exhibit 12.3 Sources of Financing Funds
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.12–10
Exhibit 12.4 Startup Financing for Inc. 500 Companies in 2003
Source: Mike Hofman, “The Big Picture,” Inc. Magazine, Vol. 25, No. 12 (October 2003), p. 87. Copyright 2003 by Mansueto Ventures LLC. Reproduced with permission of Mansueto Ventures LLC in the format Textbook via Copyright Clearance Center.
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.12–11
Exhibit 12.5 Sources of Personal Capital for Small Firms
Source: Republished with permission of Dow Jones Inc. from Staff, “Entrepreneurship Monitor 2002,” Wall Street Journal, August 26, 2003, p. B8; permission conveyed through Copyright Clearance Center, Inc.
The Government
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.12–12
Small Business Administration (SBA) loansThe 7 (a) Guaranty Loan Program
SBA guarantees repayment of loan to lenderThe Certified Development Company (CDC) 504
Loan ProgramThe 7(m) Microloan ProgramSmall Business Investment Companies (SBICs)Small Business Innovative Research (SBIR)
Unit 6 Review Information
Unit 6: Building Customer Relationships & Pricing and Supply Chain Management
Reading Discussion AssignmentFinal Project – Marketing and Sales Review
Discussion PostsVideo Case Study questionsReview Multiple Choice
What is Customer Relationship Management?
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.14–14
Customer Relationship Management (CRM)A company-wide business strategy designed to
optimize profitability and customer satisfaction by focusing on highly defined and precise customer groups.
Focus of CRM:Customers rather than productsChanges in processes, systems, and cultureAll channels and media involved in the
marketing effort, from the Internet to field sales.
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.14–15
Exhibit 14.1 Sources of the Next Sale
Importance of CRM to the Small Firm
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.14–16
Economic benefits of maintaining relationships with current customers:
1. Acquisition costs for new customers are high.2. Long-time customers spend more money
than new ones.3. Happy customers refer their friends and
colleagues.4. Order-processing costs are lower for
established customers.5. Current customers are willing to pay more
for products.
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.14–17
Extraordinary Service
Do Business on First-
name Basis
Do Business on First-
name Basis
Address Problems Promptly
Address Problems Promptly
Keep in Touch
Keep in Touch
Ways to Provide Extraordinary Service
Ways to Provide Extraordinary Service
Find Ways to Help
Find Ways to Help
Provide Custom Service
Provide Custom Service
Final Project Activity: Marketing
Definition of the Market & Products/ServicesThis portion of your mini-business plan should contain
information on the market you plan to serve. Include summary information on the size and composition of your target market and your business competitors. Briefly describe your products/services, including their unique features.
Marketing & Sales StrategyThis portion of your mini-business plan should contain
information on how you will market, sell, and distribute your products/services.
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 7 Information
Unit 7: Pricing and Credit Decisions, Promotional Planning and Global Marketing
Reading Discussion Final Project: Finish Marketing and Sales StrategiesReview Seminar
Discussion PostsReview – 20 questions
Innovation: A Path to Growth
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–20
Competitive Advantage and InnovationInnovation and entrepreneurship often go
hand-in-hand.Coming up with and perfecting new products
or services is often not easy.The risk of failure increases when innovation is
the goal.Innovation is a means by which a firm can
sustain its competitive advantage.
Sustainability and Innovation
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–21
Sustainable Competitive AdvantageA value-creating position likely to endure over
timeIs difficult to imitateCreates high barriers to market entryCan be patented or copyrightedIs renewable at higher performance capabilities
Stages in the Competitive Advantage Life CycleDevelop: invest resourcesDeploy: boost performanceDecline: competitors overcome advantage
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–22
Exhibit 15.1 The Competitive Advantage Life Cycle
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–23
Exhibit 15.2 Sustaining Competitive Advantages
The Product Life Cycle and New Product Development
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–24
Product Life CycleA detailed picture of what happens to a specific
product’s sales and profits over time
Promotion, pricing, and distribution policies must be adjusted to the product’s position on the curve.
It is important to rejuvenate product lines before they die.
The life cycle of a product follows the classic sigmoid curve—innovation is necessary for a firm’s survival.
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–25
Exhibit 15.3 The Product Life Cycle
Supply Chain Management
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–26
Supply Chain ManagementIntegrates and coordinates the means by which
a firm creates or develops a product or service and delivers it to customers.
DistributionPhysically moving products and establishing
intermediary relationships to support such movement.
Physical Distribution (Logistics)The activities of distribution involved in the
physical relocation of products.Channel of Distribution
The system of relationships established to guide the movement of a product.
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–27
Exhibit 15.8 Alternative Channels of Distribution
Scope of Physical Distribution
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–28
StorageLack of storage space is a common problem.
Materials HandlingProtecting the firm’s output during
warehousing.Specifying Responsibility for Delivery Terms
Paying freight costs—F.O.B. origin, freight collect.
Selecting the carriers.Bearing the risk of damage.Selecting the modes of transport.
Scope of Physical Distribution (cont’d)
© 2010 South-Western, Cengage Learning, Inc.
All rights reserved.15–29
Logistics CompaniesFirms which specialize in providing cost-effective
transportation, storage, and distribution services to small companies.TruckingPackagingWarehousing
Look Ahead
Unit 8 Information
Unit 8: Professional Management & Managing Human Resources
Reading Discussion AssignmentProject: Finish Org./Mgmt.
Discussion PostsVideo Case Study questions
Unit 7 Seminar Wrap-UpIf 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 9Questions?
o Course Website or Content?o Assignments?o Other issues?