1. SMALL BUSINESS MANAGEMENT
Lesson 3.1
11/24/2018
LESSON 3.1
SMALL BUSINESS MANAGEMENT
Explain the advantages a small business has over a large business
Describe the key elements of a business plan
INTRO TO BUSINESS

2. 3.1
Small Businesses
A small business is an independent business with fewer than 500 employees.
The greatest percentage of businesses in the United States are small businesses, and they employ half of all private sector employees.

3. Starting a Small Business
3.1
Starting a Small Business
Characteristics of small business owners
Ideas
Preparation and research

4. Small Business Problems
3.1
Small Business Problems
The failure rate for small businesses is quite high.
The most common reasons for failure:
Not keeping adequate records
Not having enough start-up money
Having a poor location
Lacking management experience or experience with the type of business being managed
Not controlling business expenses or managing credit to customers
Failing to have a business plan

5. 3.1
The Business Plan
When successful small businesses are compared to those that fail, one thing stands out—the successful businesses developed and followed a business plan.
All major activities and management functions are included in the plan.

6. 3.1
What Is a Business Plan?
A business plan is a written description of the business idea and how it will be carried out, including all major activities.

7. Elements of a Business Plan
3.1
Elements of a Business Plan
Description of the business
Description of the competition
Marketing plan
Customer analysis
Operations plan
Financial plan

8. Elements of a Business Plan Description of the Business
3.1
Elements of a Business Plan Description of the Business
The business idea
Major products and services
Ownership structure
Owner’s qualifications
Strengths and weaknesses
Long- and short-term goals

9. Elements of a Business Plan Description of the Competition
3.1
Elements of a Business Plan Description of the Competition
Industry characteristics
Condition of the economy
Strengths and weaknesses of competitors

10. Elements of a Business Plan Marketing Plan
3.1
Elements of a Business Plan Marketing Plan
Description of marketing activities
Description of resources needed
Schedule of marketing activities

11. Elements of a Business Plan Customer Analysis
3.1
Elements of a Business Plan Customer Analysis
Description of customers
Location, number, and resources of customers
Sales forecasts

12. Elements of a Business Plan Operations Plan
3.1
Elements of a Business Plan Operations Plan
Organization of the company
Description of major operations
Analysis of resources needed
Human resource plan

13. Elements of a Business Plan Financial Plan
3.1
Elements of a Business Plan Financial Plan
Start-up costs
Long- and short-term financial needs
Sources of financing
Budgets and financial statements

14. Developing a Business Plan
3.1
Developing a Business Plan
The business owner is responsible for developing the business plan.
A well-developed plan will lay out an idea, require an owner to analyze her or his concept, and make decisions about key business activities such as production, marketing, staffing, and financing.

15. BUSINESS LEADERSHIP Describe leadership traits and actions
Lesson 3.2
11/24/2018
LESSON 3.2
BUSINESS LEADERSHIP
Describe leadership traits and actions
Explain five human relations activities that are important in business
INTRO TO BUSINESS

16. Leadership in the Workplace
3.2
Leadership in the Workplace
Successful businesses depend on effective leaders to make sure that work gets done correctly, on time, and profitably.
Employees who believe that their leaders respect them have more commitment to their jobs and perform their work tasks better.
Becoming a good leader involves learning about and adopting leadership traits and developing human relations skills.

17. 3.2
What is Leadership?
Leadership is the ability to influence individuals, groups, or teams to accomplish important goals.
Business leadership includes improving profits, the “bottom line” of the business.

18. Traits of an Effective Business Leader
3.2
Traits of an Effective Business Leader
Communication
Confidence
Cooperation
Courage
Dependability
Honesty
Initiative
Intelligence
Judgment
Objectivity
Stability
Understanding

19. Leadership Traits and Actions
3.2
Leadership Traits and Actions
Communication - Listens, speaks, and writes effectively
Formal & Informal
Internal & External
Vertical and Horizontal
Oral & Written
Confidence - Willing to make decisions and take responsibility

20. Leadership Traits and Actions
3.2
Leadership Traits and Actions
Cooperation - Works well with others; develops group relationships
Courage - Takes responsible risks; makes unpopular decisions
Dependability - Follows through on commitments
Honesty - Is ethical in decisions and treatment of others

21. Leadership Traits and Actions
3.2
Leadership Traits and Actions
Initiative - Has ambition and motivation to get tasks done
Intelligence - Has knowledge and understanding
Judgment - Makes decisions carefully and objectively
Objectivity - Looks at all sides of an issue before making a decision

22. Leadership Traits and Actions
3.2
Leadership Traits and Actions
Stability - Is not too emotional or unpredictable
Understanding - Respects the feelings and needs of others

23. Importance of Human Relations
3.2
Importance of Human Relations
Business managers spend more than half their time in human relations activities, that is, interacting with people.
Five basic human relations skills
Self-understanding
Understanding others
Communicating
Team building
Developing job satisfaction

24. HUMAN RESOURCES MANAGEMENT
Lesson 3.3
11/24/2018
LESSON 3.3
HUMAN RESOURCES MANAGEMENT
Define human resources management
Understand employee compensation, benefits, and evaluation
INTRO TO BUSINESS

25. Manage Human Resources
3.3
Manage Human Resources
Human resources management involves all aspects of recruiting, hiring, training, compensating, and evaluating employees.
Analyze staff needs
Determine employee qualifications
Find new employees

26. 3.3
Compensation
Compensation is the amount of money paid to an employee for work performed.
Compensation is made up of two parts:
Salary and wages
Benefits

27. 3.3
Salary and Wages
Salary and wages are direct payments to employees for work completed.
A salary is a fixed amount of money paid to an employee regardless of the number of hours worked.
Wages are payments for labor made on an hourly, daily, or per-unit basis; for example, $8 per hour.

28. 3.3
Benefits
Benefits include compensation in forms other than a direct payment to the employee.
Vacations
Insurance
Other benefits

29. Evaluation Evaluation process
3.3
Evaluation
Evaluation process
Focus on the specific job duties of each employee
Review of important work traits expected of employees
Communication, interpersonal relationships, quality and quantity of work, and ethical behavior

30. Evaluation Evaluation conference Discuss the results of the evaluation
3.3
Evaluation
Evaluation conference
Discuss the results of the evaluation
Plan for any needed improvement
End result: reasonable agreement on the employee’s performance, goals, and plans for the future
Identify the support for the employee to help him/her improve performance

31. FINANCIAL RESOURCES MANAGEMENT
Lesson 3.4
11/24/2018
LESSON 3.4
FINANCIAL RESOURCES MANAGEMENT
Explain how budgeting relates to financial planning
Describe two kinds of financial reports prepared by businesses
INTRO TO BUSINESS

32. 3.4
Financial Management
One of the reasons why small businesses often fail is that they do not manage their finances properly.
Businesses must wisely manage the money they take in and pay out to become profitable and to stay in business.

33. 3.4
Financial Planning
A business budget is a detailed plan for meeting the financial needs of the business.
Two main purposes:
1. Anticipating sources and amounts of income
2. Predicting the types and amounts of expenses for a specific business activity or for the entire business

34. 3.4
Types of Budgets
Start-up budget
Operating budget
Cash budget

35. 3.4
Financial Records
A financial record shows the financial performance of a business.

36. 3.4
The Income Statement
An income statement is a financial statement that shows revenues, expenses, and net income profit or (loss) for a period of time.
Revenue – Expenses = Net Income or Loss

37. 3.4
The Balance Sheet
A balance sheet is a financial statement that lists a business’s assets, liabilities, and owner’s equity.
Assets = Liabilities + Owner’s Equity

38. Maintaining Financial Records
3.4
Maintaining Financial Records
Collecting information
Preparing financial records
Maintaining financial records