Chapter 21 WHAT SKILLS DO ENTREPRENEURS NEED? Communication Skills Math Skills Problem-Solving Skills

Lesson 2.1 COMMUNICATION SKILLS Develop good skills for writing, speaking, and listening. GOALS

WRITING SKILLS Effective business letters Effective business memos

RULES FOR WRITING BUSINESS LETTERS 1. 1.Key all formal correspondence Spell names correctly and have the correct address Always date your business correspondence Use names and titles appropriately Be direct and positive Be persuasive and specific Avoid using fancy language Be polite Use an appropriate closing Proofread for spelling and grammatical errors.

SPEAKING SKILLS Telephone conversations Meeting with customers and suppliers

TELEPHONE TIPS 1. 1.Speak clearly, and talk directly into the receiver Be cheerful Always speak politely Think about what you are going to say before you make a call Take notes.

MAKING THE MOST OF PERSONAL CONTACTS 1. 1.Shake hands and make eye contact with the person you are meeting Show an interest in what the other person is saying Speak clearly Do not appear rushed or anxious to be somewhere else Thank the person at the end of the meeting.

LISTENING SKILLS 1. 1.Focus your attention on the person who is speaking Think about and try to understand what the other person is saying Ask questions to make sure you understand what the person is saying Take notes to confirm what you are hearing.

Problem Solving Steps 1)Define the problem—What is the problem? 2)Gather information—Speak to people, check records, etc. 3)Come up with various solutions—Do it yourself or use consensus building or brainstorming 4)Evaluate your solutions—List the good and bad for each possibility and rank them 5)Take action—Do the best solution 6)Evaluate the action—Did your solution work or do you need to try something else

Consensus Building Used when two or more different groups of people are affected. –For example: salespeople and office staff or designers and seamstresses

Brainstorming is a creative group problem-solving technique that involves generating a large number of fresh ideas.

Math Calculations Profit –S–Sell 25/month, make $2 profit per item what is yearly profit? 25 x $2 x 12 months=$600 –O–Or sales for the year are $2000, expenses for the year are $1400, what is yearly profit? $2000 sales - $1400 expenses= $600 profit

Growth Rate Total Growth Rate –N–November sales were $4000, December sales were $4500, what is the growth rate? December $4500 – November $4000 =$500 Growth $500 / November $4000 =.125 or 12.5% Average Monthly Growth Rate –O–October growth rate 1.6%, November growth rate 2%, December growth rate 1.3%, what is the average monthly growth rate? = / 3 months =.016 or 1.6%

Projected Sales Average monthly growth rate is 1.5%, and December sales were $25,000, what is the projected January sales? –December $25,000 x monthly growth rate.015 = $375 growth –$375 growth + December $25,000 = $25,375

Markup/Markdown Cost $5, marking product up 40%, what’s selling price? –$–$5 cost x.40 markup = $2 markup –$–$2 markup + $5 cost = $7 selling price Original selling price $8, lower price to $6, what’s the markdown percentage? –$–$8 original - $6 sale = $2 markdown –$–$2 markdown / $8 original =.25 or 25%

Selling Prices Selling price $16.50, sales tax rate 7%, what is tax? What is final sale? –$16.50 x.07 = or rounding to $ & ¢ $1.16 tax –$ $1.16 = $17.66

Interest Rates Simple Interest –$400 in savings, 3% interest, what is the interest for the year? $400 x.03 = $12

Interest Rates Compound Interest –$–$400 in savings, 3% interest, what is the interest for the year compounded semiannually (2 times per year), what is the interest for the year? $400 x.03 = $12 for a year $12 x ½ a year = $6 $400 + $6 = $406 $406 x.03 = $12.18 for a year $12.18 x ½ a year = $6.09 $6 for first half of year + $6.09 for second half of year = $12.09

Cash Drawer Start with $100 Get checks of $75 Give refunds of $30 Have credit card sales of $90 Have cash sales of $80 What is the actual receipts? – – 100= $115