Entrepreneurs

Chapter 6 Becoming an Entrepreneur Small Business Basics Starting a Small Business

Objectives Students will be able too:  Identify the characteristics of today’s entrepreneurs and what it takes to start their own business.  List the advantages and disadvantages of small business ownership and resources available to small business owners.  Identify and explain the elements of a business plan and the sources of financing for a new business.

Entrepreneur An individual who takes a risk in starting a business to earn a profit. Must be….  Passionate  Creative  A Leader

Entrepreneurship Process of starting, organizing, managing, and assuming the responsibility for a business. Let’s take a look at some famous Entrepreneurs…..

Ben and Jerry Ben and Jerry is created by two childhood friends Ben Cohen and Jerry Greenfield. They both took a $5 correspondence in ice cream-making. After a failed attempt by Ben Cohen to return the company to private ownership, Ben and Jerry's was purchased in August 2000 by the Unilever conglomerate for slightly over $ million. Jerry made about $19 million dollars through the deal, and Ben about $46 million.

By the lack of education Milton S. Hershey went nearly bankrupt at age 30 and then went on to become not only one of Americas wealthiest individual but also a successful entrepreneur.

6 Types of Entrepreneurial Business Manufacturing- actually produce the products they sell Wholesaling- sell the products to people other than the final customer Mining & extracting- take resources like coal out of the ground so they can be consumed Retailing- selling products to people Service- sell services Agricultural- generate fresh produce & other farm products

Characteristics of successful Entrepreneurs Independence Self-confident Determination & perseverance Goal-orientated The need to achieve & set high standards for themselves Are able to act quickly

Advantages of Entrepreneurship They are their own boss They can choose a business that interest them They can be creative They can make lots of money

Disadvantages of Entrepreneurship Entrepreneurship is risky Entrepreneurs face uncertain an irregular incomes Entrepreneurs work long hours Entrepreneurs must make all decisions by themselves

THINK CRITICALLY!! Entrepreneurs can fail even if they are committed and have the characteristics needed to be successful. Why do you think this can happen? Why is it important for entrepreneurs to choose a field that they will enjoy? Do you think the advantages of entrepreneurship outweigh the disadvantages? Why or why not?

New Business Opportunities With our ability to buy and sell anything we want, our economy promotes innovation and business development.  Innovation: Creation of a new or improved products and/or services.  Business Development: Designed change that increases the usefulness of a product, service, or process.

Small Business Ownership Is an independent business with fewer then 500 employees. Identify a Small Business:  Owner is the manager  One or fewer locations  Serves a small market  Not dominate in its field

Employment Small businesses are responsible for 60-80% of all new jobs.

Small Business Advantages Meeting Customers Needs  Serves customers where the # of products and services needed smaller or are to specialized for larger business.  Convenient for customers (Location) Uniqueness  Provide services that take special interest on what the consumer wants.

Common Small Business Problems Reasons for Failure:  Not keeping adequate records  Not having enough start-up money  Lack of management experience and within the type of business  Not controlling operating expenses  Poor Location  Failure to manage credit offered to customers.

Small Business Administration Government agency that helps small business owners develop business plans and obtain financing and other support for their companies.

Starting a Small Business An idea plus experience  Every business comes from an idea  Hobbies, interest, and business experience give people ideas for new business. Right Place and Time  Making sure you are in an ideal location and within a reasonable distance for you customers to visit.

Starting a Small Business Team Approach  Hiring people who you can rely on.  Also known people with specialized features, such as; bankers, lawyers, and accountants. Preparation and Research:  Be prepared (Obtain necessary info.)  Research info. Needed to be successful Consumer, competition, operations, government regulation, etc…