Chapter 5--Entrepreneurship

34 terms by Mr_Barr

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Entrepreneurship

process of 1)recognizing a business opportunity, 2) using market research to determine if there is a market for a product or service, and 3) gathering the resources needed to go into business.

Venture

A new business undertaking that involves risk

Recommended traits for entrepreneurs

1) risk-taker, 2)

Virtual business

business that operates on the Internet

Most US businesses are

sole proprietorships

One of the biggest obstacles in starting a business

obtaining financing

Business Plan

a written description of a business venture that describes all aspects of the business

A business plan is used by

1) potential investors to see if they want to invest in the business, 2) top management involved in the start-up of a new business, and 3) the entrepreneur to keep focused on the goals of the business

The company description section of a business plan

helps investors understand 1) the size of the business, 2) the scope of the business, and 3) the type of the business

Vision Statement

establishes the scope and purpose of the company

Market Analysis

in a business plan, it includes research about the business' customers

Executive Summary

a brief account of the key points contained in a business plan

Media Plan

in a business plan, this is included in the marketing plan

SBA

Small Business Administration

Entrepreneurs

unlike people who run corporations or partnerships, these people do not have to consult with others before making a decision

partnership

is owned and run by two or more people

4 out 5 businesses

fail in their first 5 years

market research

research that is done to determine if there is a demand for your product or service

small business

an independently owned business that usually has the owner as its manager

significant

having a special meaning or importance

concept

a general idea

Mission statement

a statement that expresses the specific aspirations of the company

Characteristics of successful entrepreneurs

1) persistent, 2) goal-oriented, 3) creative, 4) risk-taking, 5) action-oriented, 6) independent, 7) self-confident, 8) responsible, 9) inquisitive, 10) restless, 11) self-demanding, 12) enthusiastic

Rewards for entrepreneurship

1) being the boss, 2) doing what you enjoy, 3) having the opportunity to be creative, 4) building an enterprise, 5) developing your own schedule

Challenges of entrepreneurship

1) getting funds to start the business, 2) being fully responsible for the business, 3) feeling alone and insecure about making the right decisions, 4) working long hours, 5) facing uncertain income levels; risking loss of the investment if the business fails

Questions to be included in checklist before starting a venture

1) What will I produce? 2) Who are my main competitors? 3) Why is my product or service needed? 4) How much will my product or service cost to produce? 5) How many people will I need to run the business? 6) What physical facilities will I need? 7) What licenses, permits, or other legal documents do I need? 8) How much money will I need to get started?

Contingency plan portion of business plan

This looks at likely risks to the business ( such as lower-than-expected sales and emergencies) and then suggests a way to minimize the risk

Knowing about business

benefits you as an employee AND a consumer

virtual business

IS a real business

small businesses that use the internet

have grown 45% faster than those that do not

Many successful entrepreneurs

work in a related business before starting their own company

Before starting a business

one needs to do market research to see if there is a demand for a product or service

executive summary of business plan

should be no more than 2 pages in length and include important information from each section of the plan

vision and mission statements

state the guiding principles by which a business functions

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