Entrepreneurship: Ideas in Action © Cengage Learning/South-Western ChapterChapter Management for the Future 13.1 Growth Strategies 13.2 Ethical and Social Issues 13.3 Global Trends and Opportunities 13

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 2 Ideas in Action Joseph Pascaretta has learned to adapt his product offerings to a changing business climate. web design database integration services computer-aided design to highlight landscaping outcomes Joseph knows a college degree is a valuable asset. Starting Young and Moving Up

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 3 Lesson 13.1 Growth Strategies Goals Determine when a business is ready to expand. Explain the importance of planning for growth. Identify and describe three growth strategies. Describe the product life cycle and product development stages.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 4 Terms market penetration market development product life cycle prototype

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 5 Determine When to Expand Consider the condition of your business. recognition by community and industry rising sales regular customer base hiring more staff need more space

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 6 How is the national economy doing? What are the economic conditions in your industry or region? Have the demographics of your market changed? Is demand for your product or service expected to remain strong? Does your business face new competition? Assess Economic Conditions

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 7 What factors should you consider before deciding to expand your business?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 8 Control Your Growth Create a plan for growth that includes strategies for the following: attaining measurable objectives and goals hiring managers and supervisors financing expansion obtaining resources for expansion

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 9 Why is it important to control the growth of your business?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 10 Choose a Growth Strategy Penetrate the Market market penetration increasing market share for a product or service within a given market within a given area Market share can be increased by: increasing advertising offering special deals providing superior customer service

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 11 Diversify with New Products or Services market development a strategy for expanding the target market of a business Expand Geographically

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 12 Focus on areas where you have knowledge. Choose a product or service that complements current inventory. Avoid investing too much capital in new areas before you know if they will be profitable. Don’t neglect your original product or service line. Use the following guidelines to make sure that your business diversifies successfully.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 13 What are some ways you can expand your business?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 14 Product Life Cycle and Development Stages of a Product Life Cycle product life cycle the stages a product goes through from the time it is introduced to when it is no longer sold can be determined by the type of competition the product is facing

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 15 novel customers don’t know how the product will meet their needs high price competition is older, established products Growth sales growth expanded distribution new, competitive products Introduction

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 16 sales peek profits begin to decline intense competition Decline customers find replacement products sales and profits drop no more money is invested in the product marketplace withdrawal begins Maturity

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 17 New Product Development

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 18 finding ideas for new products Idea Screening Has a market been identified for the product? Is the competition in the market reasonable? Are resources available to produce the product? Is the product legal and safe? Can a quality product be produced at a reasonable cost? Idea Development

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 19 What is the likely demand for the product? How would the introduction of the product affect existing products? Would current customers benefit from the product? Would the product enhance the image of the company’s overall product mix? Strategy Development

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 20 What impact could the new product have on total sales, profits, market share, and return on investment? Would the new product affect current employees in any way? What new facilities, if any, would be needed? How might competitors respond? What is the risk of failure? Financial Analysis

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 21 prototype full-scale model of a new product production process is designed a small volume of product is produced test-marketed Product Marketing introduce the product into the target market Product Development and Testing

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 22 Why must a business be concerned with the life cycle of a product and with new product development?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 23 Lesson 13.2 Ethical and Social Issues Goals Define ethics. Recognize the need for ethical practices in business. Discuss an entrepreneur’s social responsibilities. List ways to meet a business’s environmental responsibilities.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 24 Terms ethics code of ethics business ethics

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 25 What is Ethics? ethics the study of moral choices and values choosing between right and wrong

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 26 Culture and Ethics Ethical behavior varies by culture. bribes treatment of employees

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 27 Codes of Ethics code of ethics a set of standards or rules that outlines the ethical behavior demanded by: an individual a business a culture

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 28 What does it mean to have a high code of ethics?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 29 Ethics and Business business ethics the application of the principles of right and wrong to issues that arise in the workplace Set High Standards Treat business associates fairly and ethically. Inform your customers of your ethical business practices.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 30 Establish an Ethical Workplace Create a Written Code of Ethics Establish procedures to guide employee behavior in various situations.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 31 Why is it important for entrepreneurs to establish and write a code of ethics?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 32 Social Responsibilities Responsibilities to Customers Treat all customers with respect. Be honest. Avoid exaggerating the merits of your products or services. Inform customers of possible product dangers. Resolve disputes fairly.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 33 Treat all suppliers with respect. Avoid spreading rumors about suppliers. Give suppliers time to fill your order. Handle all disputes fairly. Let your current supplier know the reason for your decision if you change suppliers. Responsibilities to Suppliers

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 34 Never conceal risks you are facing. Responsibilities to Your Community Contribute Money Donate Products or Services Get Involved Responsibilities to Creditors and Investors

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 35 What are some responsibilities entrepreneurs have to suppliers, customers, and the community?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 36 Respect the Environment Protect the environment from pollutants. Conserve nonrenewable resources, such as coal and oil, by using them efficiently.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 37 Use environmentally safe and sustainable energy sources to meet your business needs. Sell products that cause as little damage to the environment as possible. Reduce waste and dispose of waste responsibly.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 38 Environmental Protection Agency (EPA) enforces federal law concerning clean air and water Laws Governing the Environment

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 39 As a business owner, what are some things you can do to protect the environment?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 40 Lesson 13.3 Global Trends and Opportunities Goals Discuss the reasons and methods for participating in the global economy. Explain how to determine whether international business is right for you. Identify trade regulations that affect international business.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 41 Terms exports imports trade barriers quota tariff qualitative restriction

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 42 Exports and Imports Exporting exports products and services that are produced in one country and shipped to another Direct Exporting ship your products directly to buyers or distributors in foreign markets hire salespeople in the foreign markets

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 43 commissioned agents brokers who find foreign buyers for products and services Selling Worldwide through the Web customize websites for foreign markets Indirect Exporting

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 44 imports products and services that are brought in from another country to be sold Importing

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 45 Why do entrepreneurs choose to participate in the global marketplace by exporting and importing products and services?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 46 Is International Business Right for You? Reasons for Competing Globally Increased sales Reduced costs Decreased dependence on current markets and suppliers

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 47 In addition to a target market analysis, you will need to consider: political issues economic issues social issues cultural issues Analyze the Market

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 48 Why you want to enter the global marketplace Which foreign markets you plan to enter Anticipated revenues Financing sources Expected costs International marketing and sales International delivery Legal requirements Write an International Business Plan

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 49 What are some sources of information that can help you learn about doing business abroad?

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 50 Government Regulation of International Trade trade barriers methods for keeping foreign businesses from competing with domestic producers quota a limit on the amount of a product that can be imported into a country over a particular period of time

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 51 a tax on imports qualitative restriction a quality standard that must be met before an imported product can be sold North American Free Trade Act (NAFTA) removed most trade barriers between the U.S., Canada, and Mexico no quotas or tariffs tariff

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 52 The Office of International Trade of the Small Business Administration The International Trade Administration Bureau of Industry and Security Government Assistance to Companies Operating Abroad

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 53 Name three methods that governments use to regulate international trade.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 54 PERFORMANCE INDICATORS EVALUATED Evaluate and delegate responsibilities needed to perform required tasks. Demonstrate teamwork skills needed to function in a business setting.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 55 Demonstrate a working knowledge of business management concepts. Demonstrate critical thinking skills to make decisions and solve problems. Demonstrate a working knowledge of entrepreneurial concepts. Demonstrate self-esteem, self- and team- management, and integrity.

Entrepreneurship: Ideas in Action © Cengage Learning/South-Western Chapter 13 Slide 56 THINK CRITICALLY 1.How can the proposed business save school districts money? 2.What statistics can be used to prove the need for this business? 3.What is the potential growth for this business? 4.Why should school districts use the services offered by this business?