1. BUSINESS ORGANIZATION
Business in the U.S. Economy
Forms of Business Ownership
Organizational Structure for Businesses

2. Contingent worker- employee with no long term obligation (short term or temporary worker) PERCENT OF BUSINESSES BY EMPLOYEE SIZE

3. BUSINESS ACTIVITIES Generating ideas Raising capital
Employing and training personnel
Buying goods and services
Marketing goods and services
Maintaining business records

4. TYPES OF BUSINESSES Producer- Create products and services
Example: Extractor, Farmer, manufacturers
Intermediaries- Selling goods & services
Example: Retail clothing store, COSTCO
Service business- Offer something intangible
Example: Dentist, Teacher

5. 3 TYPES OF BUSINESS OWNERSHIP
Sole Proprietorship- 1 owner
Example: Duncan’s Landscape (small business)
Partnership- 2 or more owners
Example: Law office of Smith & Williams
Corporation- A legal entity where the owners are shareholders (stock ownership)
Example: Apple, Wal-Mart

6. 3 TYPES OF BUSINESS OWNERSHIP
Sole Proprietorship-
Unlimited Liability- Owner is 100% responsible for the business
Partnership-
Partnership Agreement- Legal Document that defines the details of each partner
Corporation-
Articles of Incorporation- Legal documents that defines the details of the corporation.
Stock- shares of ownership in a corporation
Limited Liability- The risk is limited to your investment.

7. Forms of Ownership U.S. Business Comparison by Form of Ownership
Number of Businesses (2006)
Total Revenue (Thousands)
Percent of All Businesses
Percent of Total Revenue
Proprietorship
22,075,000
1,278,000,000
71.53%
4.06%
Corporation
5,841,000
26,070,000,000
18.93%
82.82%
Partnership
2,947,000
4,131,000,000
9.55%
13.12%
Total
30,863,000
31,479,000,000
100.00%

8. Checkpoint 
Which form of business ownership is the most complex and difficult to form?
The corporation is more complex to begin than other business forms.
Forming a corporation requires much more bureaucracy, is more subject to government regulations, requires the organization of a board, and must have clearly defined bylaws.

9. OTHER FORMS OF OWNERSHIP
Franchise- a chain business that you can purchase for a fee. Any 3 of the ownerships can invest in a franchise
EXAMPLE: McDonalds, Sport Clips,

10. Checkpoint 
What are the other specialized forms of business ownership?
Limited liability partnership
Joint venture
S corporation
Limited liability company (LLC)
Nonprofit corporation

11. KEY TERMS
Mission Statement- a written objective of the company’s goals and vision
Goal- the objective, what are you wanting to accomplish
Policies- rules of the business
Procedures- methods of activities that support the mission statement and goals.
Organization chart- chain of command chart, who is in charge of who and what

12. BUSINESS ORGANIZATION CHART

13. (3 types of ownership, advantages/ disadvantages/legal documents) Sole Proprietorship Advantage- 100% profit, easy to start Disadvantage- 100% liability & risk, long hours Legal Docs: Assumed Name Certificate, SS# or Tax ID Partnership Advantage- shared responsibility and risk Disadvantage- shared profits Legal Docs: Partnership Agreement, Tax ID Corporation- Advantage – limited liability, more resources Disadvantage- double taxation, limited profits Legal Docs: Corporate Resolution, Articles of Incorporation, Tax ID

14. Page 2A (ONLINE RESEARCH) Select 2 companies in the Dow Jones Industrial Average (top 30 US companies) RESEARCH

15. Entrepreneurship and Small Business Management
PAGE 2B
Entrepreneurship and Small Business Management
Becoming an Entrepreneur
Small Business Basics
Starting a Small Business

16. KEY TERMS
Entrepreneur- the individual that is a risk taker and innovator.
Entrepreneurship- the business that is creative and risky.
Characteristics: Creative, confident, goal-oriented, motivated, hard-working
Risks: Unproven idea, little management experience, long-hours with no guarantee of a profit

17. KEY TERMS
Venture Capital- Money provided by large investors to finance new products and new businesses that have a good chance to be very profitable
*Innovation- a brand new creation or invention
*Improvements- a significant design change or addition on an existing product

18. Small Business- a business with less than 500 employees (typically just a few people)
Not all business owners and managers are entrepreneurs.
Entrepreneurs have unique skills and personal characteristics.
3 CHARACTERISTICS OF A SMALL BUSINESS:
The owner is usually the manager
Usually only 1 or 2 locations
Typically serves a small market

19. 3 Reasons most small businesses fail
Lack of money
Lack of management experience
Not keeping adequate records

20. Employment Growth by Business Size, 1990–2005

21. Checkpoint 
What are the sources of financing that entrepreneurs use for their new businesses?
Personal savings
Friends and family
Venture capital
Bank loans

22. KEY TERMS
Small Business Administration (SBA)- a government agency that helps small business owners develop business plans and obtain financing

23. Common Types of Small Businesses as Percent of All Small Businesses

24. BUSINESS PLAN
Business Plan- a written description of the business idea and how it will be carried out.
5 ELEMENTS
1)Description of the business & goals
2)Customer Analysis- knowing your customer
3)Operations Plan- organizing the business
4)Marketing Plan- marketing & advertising
5)Financial Plan- Creating a Budget:
start up, short term & long term

25. Checkpoint  What are the “strategic alternatives” in a business plan?
Strategic alternatives are alternative plans for production, staffing, financing, and so on.
Even the best business plan cannot predict every possible circumstance.
An alternate plan allows a business to be prepared for the unforeseeable.

26. FINANCING THE SMALL BUSINESS
Types of financing
Start-up financing- the money and details of getting the business started: inventory, supplies
Short-term financing- the money needed for the first year of expenses
Long-term financing- a 3-5 year plan of success for the business, identify long term financial needs.

27. Checkpoint 
In addition to owner-supplied capital, what are several other sources of financing for a small business?
Borrowed money may come from banks, finance companies, or other individuals, such as friends and family.
Some suppliers may also be willing to extend credit.

28. Entrepreneur- ONLINE RESEARCH
WHO INSPIRES YOU?
WHAT IDEAS INSPIRE YOU?
PAGE 3B> ONLINE RESEARCH (Various)
PLUS SHARK TANK ONLINE RESEARCH