1. Planning and Organizing a Business
Developing a Business Plan

2. Small Businesses
Business that is independently operated, is not dominant in its field, and meets certain size standards in terms of number of employees and annual receipts
Fill niche markets
Niche: a place or position in the community or industry suitable for a person or thing

3. Entrepreneurship
The American economy is based on the free enterprise system, or capitalism
Means we have the right to own our own business and to make a profit, also means we can lose money

4. Entrepreneurs
People who have the initial vision, diligence, and persistence to follow through
Accepts all risks pertaining to forming and operating a small business
Performs all business functions associated with a product/ service, fulfilling social responsibilities, and meeting legal requirements

5. Reasons to take risk of starting own business
Work for yourself, make own decisions
Income is all yours
Can test own theories and ideas on how to run a business
Set own hours
Set prices and control inventory
Solve own problems
Perform all human resources functions: hiring, training, firing

6. Personal Characteristics of Entrepreneurs
Independent
Self- Confident
Energetic
Organized
Visionary
Persistent
Optimistic
Committed
Problem Solver
Self- Nurturing
Risk Taker
Flexible
Emotionally Stable
Action- Oriented

7. Challenges of Entrepreneurship
Total responsibility
In charge of everything, success or failure depends on 1 person (the owner)
Long, Irregular Hours
Financial Risks

8. Analyzing Your Business Venture
Recognizing a need
Determine what types of businesses are needed
Thousands of firms go bankrupt each year because they provided the wrong type of product or service
Most people would like to become wealthy by starting a business that proves to be successful. However, it is one thing to dream; it is another to make that dream become a reality. Careful planning from the beginning is one way to ensure the success of your business. Planning includes: recognizing a need, considering startup factors, applying business fundamentals, conducting business survey

9. Start Up Factors to Consider
What financial resources are needed to get started?
What labor does the business need?
What management requirements exist?
Does a market exist for the product/service?
Where should the business be located?
Should you buy a business or start a new one?

10. Applying Business Fundamentals
Entrepreneurs must learn some business basics
Keep size of the business consistent with the capital resources available.
Devote adequate time to the development of management capabilities.
Keep all employees fully employed.
Study and improve the business continually.
Maintain an adequate cash operating fund so that you will not have to borrow at high interest rates.
Use as much of the profits as possible to expand the business.
Set the prices at a level that will result in reasonable profit while still being lower than your competition.
Treat customers courteously and fairly
Treat employees fairly.

11. Conducting a Business Survey
Survey that a business conducts to determine that market potential for a selected business
Questions to answer:
What resources are needed?
Are these resources available?
What are the costs of these resources?
What level of management is required?
Does the prospective owner have the experience necessary to operate the business?
Are there 1 or more markets for the product?
At what prices can the products/services be sold?
How reliable are the potential markets?
What is the potential for future growth?

12. Preparing a Business Plan
Written description of a new business venture that describes all aspects of the proposed business
Helps you focus on exactly what you want to do, how you will do it, and what you expect to accomplish
Essential for receiving help from potential investors and financial institutions

13. Business Plan Outline Introduction Company Description
Product and/or Service
Management Plan
Marketing Plan
Legal Plan
Location Analysis
Business Regulations
Capital Required
Financial Plan
Financing Arrangements
Competition
Operating Plan
Appendix.

14. Cover Sheet Acts as a title page Should include:
Name, address, telephone number of the company
Names, titles, addresses, telephone numbers of the owners
Month and year the plan was prepared
Name of the person who prepared the plan

15. Introduction Aka: statement of purpose Summarize:
Keywords= who, what, where, when, why, how
Summarize:
Your company
Who the management is and what each manager’s strengths are
What your objectives are and why you will be successful
If you need financing, why you need it, how much you need, and how you intend to repay the loan or investors

16. Table of Contents Lists the major topics in your business plan
Makes it easier for lenders or investors to review your plan quickly and find areas of particular interest

17. Summary description of the business
In a couple of paragraphs, give a broad overview of the nature of your business
Tell why and when the company was formed
Mission (project short and long term goals)
Business Model (describe the model for your company and why it is appropriate)
SWOT Analysis (identify and describe strengths, weaknesses, opportunities, and treats that will be faced)
SWOT will be looked at more during marketing unit

18. Products or Services Describe what you sell
Include information about your sources of supply

19. Intellectual Property
Address issues concerning copyrights, trademarks, and patents
Back up your statements with supporting documents such as registrations, photographs, licenses

20. Location
Describe your projected or current location, including advantages and disadvantages
Project costs associated with that location

21. Legal Structure
Describe the legal structure of your business and why it is advantageous
List owners

22. Management List the people who are or will be running the business
Describe their responsibilities and abilities
Project their salaries

23. Personnel
Detail how many employees you will have, and in what positions
What are the necessary qualifications for each position?
How many hours will employees work, and at what wage?
Project future need for additional employees

24. Accounting What system will you use for daily accounting?
Who will you use as a tax accountant?
Who will be responsible for periodic analysis of financial statements?

25. Legal
Who will you retain as an attorney?

26. Insurance What kinds of insurance will you carry?
Consider property, liability, life, health, and disability)
What will this coverage cost?
Who will you use as a carrier? Will you use an insurance agent?

27. Security Address inventory control and theft of information
What will it cost?

28. Goal Setting Write down your goals Organize your goals Immediate goals
Short-term goals
Long-term goals
Immediate- accomplish within a day, week, or a month or two
Short term- accomplish in a year or two
Long term- many years, idea of what want to do with business several years from now

29. Reaching your Goals Manage your time Avoid procrastinating
Judge your time
Schedule your time
Establish priorities
Break goals into manageable units

30. SMART Goals
Specific Measurable Attainable Realistic Timely

31. Specific: answer
Who is involved?
What do I want to accomplish?
Where (Identify a location)
When (Establish a time frame)
Which (Identify requirements)
Why (specific reasons, purpose or benefits of accomplishing the goal.

32. Measurable: establish concrete criteria for measuring progress toward the attainment of the goal
How much? How many?
Attainable: make sure they can come true
Realistic: must be a goal which you are both willing and able to work towards.
Timely: give a time frame