Part 1: Dynamic Role of Small Business Starting Your Small Business Family-Owned Businesses Forms of Ownership of Small Business Maintaining Good Government Relations and Business Ethics Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Part I: Chapter 1 Chapter 1 covers material to help you decide whether pursuing a career in small business is the right course of action for you Chapter 1 SW Productions/Getty Images Starting Your Small Business Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Learning Objectives 1 Chapter Define ‘business’ Contributions of small business Current problems small business face Current trends challenging entrepreneurs & small business Why do people start small business? Characteristics of ‘entrepreneurs’ Opportunities & concerns of small business Ryan McVay/Getty Images Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin 1 - 3

Business classification by size Under 20 employees Very Small 20 - 99 Small 100 – 499 Medium 500 Or More Large

Terms in SBA: small business administration pg. 9 Small business (micro business) Small business owner Establishes a business to further personal goals, such as profitability and fame Entrepreneur: Business owner whose goals include achievement, profit, growth, achieved through innovation and strategic management Entrepreneurial venture: Business owner’s principal objectives are profitability and growth Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Define ‘Small Business’ It is independently owned and operated and is not dominant in its field of operation. Independent Management Capital/Ownership = Few Individuals Operations are primarily local but market may have global branches Business is small compared to its competitors Hisham F. Ibrahim/Getty Images Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Why interest in Small Business? pg.4-8 Number of small businesses are growing rapidly 23 million small business in USA Small firms generate new private employment Public favors small business Interest increased at high schools, colleges, and universities Trend towards self employment Entrepreneurship is attractive to all ages Real world example 1.1, 1.2, 1.3 Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Contributions of Small Business pg.9-12 Encourage innovation & flexibility Maintain close relationship with customers & community Keep larger firms competitive Provide employees with comprehensive learning experience Develop risk takers Generate new employment Greater employee job satisfaction Real world example 1.4, 1.5, 1.6 Royalty-Free/CORBIS Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Most Common Home-Based Businesses Source: Independent Insurance Agents of America

Current problems facing small business pg. 12-13 Recession/Current Economy Retirement/Transition Capital/Financing Unexpected Growth Succession Inadequate Financing Inadequate Management Government Regulations/Paperwork Royalty-Free/CORBIS Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Challenges to small business pg. 14-15 Exploding technology Occupational and industry shifts Reinvention Reengineered Downsizing/Rightsizing Global challenges Real world example 1.7 Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Factors Affecting Industry/Business Table 1.4 pg. 23 Economics Technology Lifestyle Political/Legal Demographics Royalty-Free/CORBIS Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Declining Job Types Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Why Start A Small Business?

Why To Not Start A Small Business?

Small Business Concerns pg. 25 Poorly planned growth Loss of independence Threat of failure Discontinuance Failure Formal Personal/Informal Failure occurs due to Lack of managerial experience & financial backing Poor location Unexpected growth Communication skills Jim Arbogast/Getty Images Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Job Satisfaction

Objectives of Small Business Owners pg. 15-19 Achieve independence Additional income Help families Provide products not available elsewhere Expertise specialty Ryan McVay/Getty Images Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Checklist For Aspiring Entrepreneurs pg. 15-19 Passion Not Money Something You Know Patience Mentor Funding Cash Manager Build Sales Don’t Rush Wary of bad advice & suppliers/creditors Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Business Objectives pg. 15-19 Service Profit Social Growth Mesh objectives (network) Nick Rowe/Getty Images Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Characteristics Of Successful Owners pg. 20 Able To React Quickly Dedicated To Business Enter Business By Chance And/Or Design Desire Independence Strong Sense Of Initiative Personal/Family Motivation Quick/Concrete Results Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

What leads to successful SBM? pg. 21 Ryan McVay/Getty Images Adequate market Sufficient capital Recruit effectively Timely information Cope with government regulations Expertise Flexible NBIA – Business incubators Nurture young firms and help them to survive and grow during the startup period when they are most vulnerable Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Personal Analysis Mel Curtis/Getty Images Values Mental Abilities Attitudes Real world example 1.7, 1.8, 1.9, 1.10 Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Stages in the Development of Business Figure 1.5 Pg. 25 Owner Hire manager, workers and delegates Stage 2: Owner-manager workers Stage 3 Owner – managers – workers Size increases Positions open up Branch extends Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Ideas For Small Business Career Counseling Catering Computer & Office Machine Repair Day Care Education Financial Planning Home Health Marketing Senior Fitness & Recreation Specialized Delivery Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Where Are the New Jobs? Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin

Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin Chapter 1 Review Summary page 26-27 Learn key terms page 27 Attempt questions page 28 Case Study 1.1 page. 28 Case Study 1.2 page 29 Copyright © 2009 McGraw-Hill Companies, Inc.: BE 322 Ms Tabinda Zabin