1. Unit 5 Seminar AB209, Small Business Management

2. Unit 5 Seminar Game Plan Course Check-In Course Website Check-In Course Activities & Assignments Check-In Review Unit 3 & 4 Content Content Review Assignment Review Unit 5 Check-In Look Ahead to the Unit 7 Seminar

3. Course Check-In

4. Assignments Review Discussion Boards: We have graded DBs in Units 1 through 9 (40 points each) Reviews: We have graded Review exercises in Units 1, 2, 5, 7, & 9 (50 points each) Case Studies: We have graded Case Studies in Units 3, 4, 6, & 8 (50 points each) Final Project - Business Plan: Our graded final project (Business Plan) is due in Unit 9 (140 points); please note that in Units 2, 4, 5, 6, & 8 you are encouraged to work on specific sections of this plan Writing Assignment: Written reflection paper due in Unit 10 (40 points each)

5. Final Project Our graded Final Project (Business Plan) is due no later than the end of Unit 9 To complete our Final Project, please refer to Final Project Template in Doc Sharing: In Units 2, 4, 5, 6, & 8, you are encouraged to work on specific elements of the Final Project Completed Business Plans should be submitted via the DropBox (name file: Final Project Your Name) The Final Project is worth 140 points

6. Introduction to Small Business Our exploration of Small Business Management will focus on the five (5) parts: o Entrepreneurship: A World of Opportunity o Unit 1 (Chapters 1 & 2) o Starting From Scratch or Joining an Existing Business o Unit 2 (Chapters 3, 4, & 5) o Developing the New Venture Business Plan o Unit 3 (Chapters 6 & 7) o Unit 4 (Chapters 8 & 9) o Unit 5 (Chapters 10, 11, & 12) o Focusing on the Customer: Marketing Growth Strategies o Unit 6 (Chapters 14 & 15) o Unit 7 (Chapters 16, 17, & 18) o Managing Growth in the Small Business o Unit 8 (Chapters 19 & 20) o Unit 9 (Chapters 21, 22, & 23)

7. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 6–7 Exhibit 6.3Abbreviated Business Plan Outline Section Heading Cover Page Table of Contents Executive Summary Industry, Target Customer, and Competitor Analysis Company Description Product/Service Plan Marketing Plan Operations and Development Plan Management Team Critical Risks Offering Financial Plan Appendix of Supporting Documents

8. MT209 Final Project Mini-Business Plan Outline for the MT209 Final Project: Executive Summary Management Team & Advisors Definition of the Market & Products/Services Marketing & Sales Strategy Financial Information And, be sure to add a cover page and references page

9. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 7–9 What is Small Business Marketing? Small Business Marketing Business activities that direct the creation, development, and delivery of a bundle of satisfaction from the creator to the targeted user and that satisfy the targeted user. Small Business Marketing Activities Identification of the target market Determining target market’s potential Preparing, communicating, and delivering a bundle of satisfaction to the target market

10. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 7–10 Exhibit 7.2The Marketing Plan and Supporting Marketing Activities

11. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 7–11 Marketing Research Activities Market Analysis An evaluation process that encompasses market segmentation, marketing research, and sales forecasting Developing the Marketing Mix The combination of product, pricing, promotion, and distribution activities.

12. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 7–12 The Formal Marketing Plan Market Analysis Customer profile A description of potential customers in a target market Sales forecasts “Most likely,” “pessimistic,” and “optimistic The Competition Profile of key management personnel Overall strengths and weaknesses (SWOT) Related products being marketed or tested Likelihood of competitors’ entry into target market

13. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 7–13 The Formal Marketing Plan (cont’d) Marketing Strategy Product and/or service section Decisions affecting the total product Distribution section Decisions regarding product delivery to customers Pricing section Setting an acceptable value on the product Promotional section Communicating information to the target market

14. Case Study #1: Firewire Surfboards Please answer the following questions in your case study analysis: Identify and describe Firewire Surfboard’s major competitors. How are these rivals positioned in the marketplace? Put yourself in the role of Firewire’s entrepreneurial team at the time of the company’s founding. What should they have anticipated in the way of competitor reaction and the response of prospective customers? What is Firewire’s core competency? Is it sustainable? Given the company’s recent shift in strategy, what do you think its major challenges will be?

15. Unit 4 Review

16. Unit 4 Information Theme: The Human Resources & Location Plans Readings: Longenecker – Chapters 8 & 9 (pages 200 to 257) Discussion Board: Biosite, Inc. (page 200) (40 points) Case Study #2: Le Travel Store (page 641) (50 points) Final Project Activity: Management Team & Advisors (ungraded) Seminar: No Seminar in Unit 4

17. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–17 Building a Management Team Management Team Managers and other key persons who give a company its general direction Characteristics of a Strong Management Team Capable of securing the resources needed to make business a success Reassures investors about the their investment and the continuity of business Diversity of talent makes the team stronger than an individual entrepreneur

18. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–18 Building a Management Team (cont’d) Team Building and Structure The required combination of education and experience depends on the type of business and the nature of its operations The key: achieving a balance of skills and competencies in functional areas Designing an internal management structure that defines relationships and responsibilities Outside professional support can supplement the skills of a management team An active board of directors can provide counsel and guidance.

19. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–19 Exhibit 8.2Percentage of Small Businesses by Legal Form of Organization 15 Sources: Table 1A, Internal Revenue Service, http://www.irs.gov/pub/irs-soi/d6187.pdf, accessed December 5, 2008; and Table 1, Internal Revenue Service, http://www.irs.gov/pub/irs-soi/d6292.pdf, accessed January 13, 2009.

20. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–20 The Sole Proprietorship Option Sole Proprietorship A business owned by one person, who bears unlimited liability for the enterprise. Advantages Receives all of the firm’s profits. Holds title to all of the firm’s assets. Can easily sell or transfer ownership of the company name and assets. Requires no registration or filing fee. Has absolute freedom from interference by other stakeholders.

21. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–21 The Sole Proprietorship Option (cont’d) Disadvantages Bears all business risk. Is subject to all claims of creditors. Has unlimited personal liability for business. Receives no tax free benefits as an employee. Death/incapacity of owner terminates business. Is limited to the proprietor’s personal capital. Is taxed on business income as personal income.

22. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–22 Exhibit 8.3The Advantages and Disadvantages of Partnerships

23. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 8–23 The C Corporation Option Corporation A business organization that exists as a legal entity and provides limited liability for its owners. Legal Entity A business organization recognized by the law as having a separate legal existence (“artificial being”); can be sued, hold property, and incur debt. The C Corporation An ordinary, or regular, corporation chartered by the state and taxed by the federal government as a separate legal entity.

24. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–24 Exhibit 9.1Location Options for the Startup

25. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–25 Exhibit 9.2Five Key Factors in Determining a Good Business Location

26. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–26 Other Factors in Selecting a Location Neighbor Mix Who’s next door? Security and Safety How safe is the neighborhood? Services Is there municipal trash pickup? Past Tenants’ Fate What happened to them? The Life-cycle Stage of the Area Is the site in the embryonic, mature, or declining stage?

27. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–27 Locating the Startup in the Entrepreneur’s Home Home-Based Business A business that maintains its primary facility in the residence of its owner Attraction of a Home-Based Business Low start-up and overhead costs Convenience for family and lifestyle Technology Advances in office equipment and connectivity allow home-based business to compete with commercial sites.

28. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–28 Exhibit 9.4 Some Common Reasons for Starting a Home-Based Business Source: Adapted from “Potential Reasons for Starting a Home Based Business,” http://www.perfectsystem.co.uk, accessed January 13, 2009.

29. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–29 The Challenges of Home-Based Businesses Business Image A professional business image is difficult to maintain in a home environment. Legal Considerations Local laws and zoning ordinances prohibit many types of home- based businesses. Family and Business Conflicts The need to observe regular business hours and establish spatial boundaries (specific work areas) to avoid distractions.

30. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–30 Locating the Startup on the Internet E-Commerce The paperless exchange of business information via the Internet. Benefits of E-Commerce to Startups Allows for competition with larger firms in larger markets. Helps with cash flow problems by compressing the sales cycle. Builds better customer relationships through better service. Electronic Customer Relationship Marketing (eCRM)

31. © 2010 South-Western, Cengage Learning, Inc. All rights reserved. 9–31 Factors Affecting the E-Commerce Choice Technical Limitations Website development and maintenance costs Insufficient bandwidth Upgrading software Integration of e-commerce with brick-and-mortar operations Customer access to the Internet and connectivity limitations Non-Technical Limitations Privacy of customer transactions Customer information security Inability of customers to touch or try on products

32. Unit 5 Check-In

33. Unit 5 Information Theme: The Financial Plan & a Firms Sources of Financing Readings: Longenecker – Chapters 10, 11, & 12 (pages 258 to 337) Discussion Board: Built NY (page 286) (40 points) Activity- Financial activity – for submission grade Review: Chapters 6 through 12 (Part 3 of textbook) (40 points) Seminar: Conducted on Scheduled Day/Time

34. Look Ahead to Unit 7 Seminar

35. Unit 6 Information Theme: Building Customer Relationships & Pricing and Supply Chain Management Readings: Longenecker – Chapters 14 & 15 (361 to 417) Discussion Board: Horse (page 389) (40 points) Case Study #3: eHarmony (pages 636 to 637) (50 points) Final Project Activity: Definition of the Market, Product/Services, & Marketing & Sales Strategy (ungraded) Seminar: No Seminar in Unit 6

36. Unit 7 Information Theme: Pricing & Credit Decisions, Promotional Planning, & Global Marketing Readings: Longenecker – Chapters 16, 17, & 18 (pages 418 to 492) Discussion Board: Foley’s NY Pub & Restaurant (page 440) (40 points) Review: Chapters 14 through 18 (Part 4 of textbook) (40 points) Seminar: Conducted on Scheduled Day/Time

37. Unit 5 Seminar Wrap-Up If you need assistance: o Contact instructor at their KU email address o Post message to “Instructor’s Office” o Meet with instructor during Virtual Office Hours o KU Tech Support: 1-866-522-7747 o 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 7 Questions? o Course Website or Content? o Assignments? o Other issues?