1. Small Business Strategies: Imitation with a Twist
Chapter 7
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2. Learning Objectives
LO1 Describe the decisions needed to establish a foundation for strategic planning.
LO2 Identify the forms of imitative and innovative businesses.
LO3 Articulate the benefits that win over customers.
LO4 Assess how have industry changes affect strategy.
LO5 Explain the major strategies of business—differentiation, cost, and focus.
LO6 Determine how to sustain competitive advantage through attracting customers and discouraging competition.
© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.

3. Strategy in the Small Business
the ideas and actions that explain how a firm will make its profit
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4. The Small Business Strategy Process
Figure 7.1
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5. Owner Rewards Magic number
The post-tax income the entrepreneur personally seeks from the business.
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6. Industry
Industry
The general name for the line of product or service being sold, or the firms in that line of business
Key is selecting an industry that offers good potential for making a profit
Also needs to offer attractive opportunities to work with a minimum of risk and competition
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7. Attractiveness of Selected Industries and Lines of Business
Figure 7.2
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8. Imitation and Innovation
Incremental innovation
An overall strategic approach in which a firm patterns itself on other firms, with the exception of one or two key areas.
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9. Industry Dynamics and Analysis
Introduction stage
The life cycle stage in which the product or service is being invented and initially developed.
Growth stage
An industry life cycle stage in which customer purchases increase at a dramatic rate.
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10. Industry Dynamics and Analysis
Retrenchment
An organizational life cycle stage in which established firms must find new approaches to improve the business and its chances for survival.
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11. The Industry Life Cycle
Figure 7.3
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12. Strategy Selection Supra-strategies
classic benefit combinations which are designed to work where there are many small businesses in an industry, along with a few larger firms
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13. Typical Strategies for Small Business Start-Ups
Table 7.2
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14. Post Start-Up Tactics Competitive advantage
The particular way a firm implements customer benefits that keeps the firm ahead of other firms in the industry.
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15. Porter’s Five-Forces Model of Industry Competition
Figure 7.4
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