1. Entrepreneurship and Small and Medium Enterprises Management
Chapter 8
Entrepreneurship and Small and Medium Enterprises Management

2. Entrepreneurs
An entrepreneur takes ______ to start a business for the purpose of making a _______.
Entrepreneurs are able to transform their dreams into successful business ________.
risks
profit
ventures

3. We must achieve the goal!
Entrepreneurs
Characteristics and aptitudes of entrepreneurs
A strong motivation to succeed
Entrepreneurs have a strong desire for excellence and success in competitive situations. The desire becomes a powerful ________ for them.
They often set _________ goals for themselves and their companies.
motivator
We must achieve the goal!
challenging

4. Characteristics and aptitudes of entrepreneurs
Willing to take initiatives
Entrepreneurs want everything under their own ________ and make all possible efforts to achieve their goals.
control
To reduce production cost and time, I want to acquire a factory in the Mainland.

5. Entrepreneurs A strong desire for independence
Characteristics and aptitudes of entrepreneurs
A strong desire for independence
Entrepreneurs do not like to be bound by ______ and ________.
They have their own thoughts and ideas on how things should be done.
rules
policies
I won’t follow what the others did!

6. Characteristics and aptitudes of entrepreneurs
Energetic
They are more energetic than average people.
They often spend long hours managing their businesses.

7. Entrepreneurs Self-confident
We will be the market leader within 3 years!
Entrepreneurs
Characteristics and aptitudes of entrepreneurs
Self-confident
They are confident of their own _________.
They are willing to set _____ and difficult goals.
They are __________ and enthusiastic about their businesses, even in difficult times.
abilities
risky
optimistic

8. Characteristics and aptitudes of entrepreneurs
I will overcome!
Entrepreneurs
Characteristics and aptitudes of entrepreneurs
Persistent and determined
They are willing to bear extreme _________ in order to achieve their goals.
They persist and are not __________ by adverse situations.
They have the _________ to overcome barriers that stand in the way of success.
hardships
discouraged
willpower

9. Characteristics and aptitudes of entrepreneurs
Initiating changes to stay ahead of competitors
They understand the importance of initiating _______ in the market.
They are willing to take risks and introduce ______ products and services before their competitors do.
changes
new

10. Characteristics and aptitudes of entrepreneurs
Eager to seek new opportunities
They always look for new ___________ in the market rather than following ________.
New opportunities can provide more _________ and room for ________ in their businesses.
opportunities
trends
challenges
growth

11. Entrepreneurs Receptive to innovative ideas
Characteristics and aptitudes of entrepreneurs
Receptive to innovative ideas
They like to create ____ ideas for their businesses.
They see things from different _______ and are willing to accept new ways of ________.
new
angles
thinking
We can try to sell our products through the Internet.

12. Importance of entrepreneurship to business and economy
Competition
Entrepreneurship brings more and newer ________ and _________ to us.
It creates better ways of using _________ and promotes __________ in the market.
 Companies operate more ________ and make _____________ continuously.
products
services
resources
competition
efficiently
improvements

13. Importance of entrepreneurship to business and economy
Competition
Consumers benefit because they enjoy not only a ________ of products and services but also ______ prices and ______ quality.
Entrepreneurship leads to ________ growth.
diversity
lower
better
economic

14. Importance of entrepreneurship to business and economy
Production
Entrepreneurs play an important role in society because they organise _________ for goods and services.
They put ________ and _________ together to start a business.
Entrepreneurship makes business ________ and _________ our economy.
production
people
resources
flourish
supports

15. Importance of entrepreneurship to business and economy
Innovation
Innovation is important for business because new products and services are created to satisfy customer ________.
Entrepreneurship is an important force behind innovation in business.
They always look for and are able to seize market ____________ before other people.
demand
opportunities

16. Importance of entrepreneurship to business and economy
Innovation
Innovative products or services can create a new _________ and even an entirely new _________.
Entrepreneurship not only enables _________ to prosper but also stimulates economic _______.
business
market
businesses
growth

17. Business Plan
A business plan sets out the _____ ideas behind a business and describes the related _______ arrangements.
The owner of a startup company should state clearly what he wants to achieve and how he can reach these goals.
basic
startup

18. Importance of a business plan
To the company
It provides a statement of ______ of the company and the ________ to be used to achieve those goals.
goals
strategies

19. Importance of a business plan
To the company
The company can provide __________ of the business to outsiders including __________ customers, suppliers, lenders and investors.
information
prospective
Lender
Investor
Supplier

20. Importance of a business plan
To an entrepreneur
A business plan forces the entrepreneur to think about issues that are important for the ________ of the business.
He has to determine the products or services to be offered, analyse the competition, calculate how much money he needs, and think through the __________ details.
success
operational

21. Importance of a business plan
To an entrepreneur
Possible _____ and ________ that may arise are also identified in advance.
The entrepreneur can then take ________ immediately to deal with the problems when they arise and minimise losses.
risks
problems
measures

22. Contents of a business plan
Title page
Table of contents
name and address of the company
names of the owner(s) and the management team
the contact person(s)
date of the prepared plan
sections of the plan with page numbers

23. Contents of a business plan
Executive summary
Vision and mission statement
an overview of the plan with highlights on
important points and issues.
the values, principles and philosophy of the company

24. Contents of a business plan
Company and industry
the nature of business
forms of ownership
company objectives
products and services
strengths and weaknesses
market analysis
existing competitors
government policies
analysis of business
opportunities

25. Contents of a business plan
6 Marketing plan
an analysis of target market and opportunities
profile of target customers
methods of attracting customers
selling strategies
sales promotion and advertising strategies
distribution channels
pricing strategies

26. Contents of a business plan
7 Operating plan
the production location(s)
production process(es)
major types of operating equipment
quality control mechanisms
sources of supply
purchasing procedures
inventory control

27. Contents of a business plan
8 Financial plan
the projected financial statements for the next
3-5 years
projected capital expenditure
breakeven analysis
planned sources of financing

28. Contents of a business plan
9 Management plan
information on the management team
organisational structure
employee recruitment and training

29. Process of developing of a business plan
Queen’s Road
West
Gather information about the company and industry relevant to the business.
Evaluate market opportunities for the business.

30. Process of developing of a business plan
Queen’s Road
West
Examine market threats, identify major competitors in the market and study changes which may adversely affect the business.
Decide the company’s vision, mission and objectives.

31. Process of developing of a business plan
Develop business strategies, project that financial resources needed and plan what to do in terms of marketing, operations and management.
Compile and analyse all the information and write up the business plan.

32. Small and Medium Enterprise
In Hong Kong, according to the definition by the Trade and Industry Department,
in the manufacturing sector, an SME is an enterprise which employs fewer than ____ persons.
in the non-manufacturing sector, an enterprise that employs fewer than ____ persons is considered as an SME.
100 50

33. Small and Medium Enterprise
Forms of business ownership for SMEs
SMEs can operate as ______________, __________ or ________________.
SMEs can be found in both the secondary and _______ industries.
The majority of SMEs in HK is in the ______ and ________ business.
Most entrepreneurs start from SMEs
It is because they have ______ capital and are unable to get ________ from banks.
sole proprietors
partnerships
limited companies
tertiary
import
export
little
loans

34. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Owned and managed by single individuals
Most SMEs are owned by _______________ who also manage the businesses.
Some SMEs are partnerships and ________ companies.
It is common for owners to work _____ hours.
single individuals
limited
long

35. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Limited resources and capital
Most SMEs are financed by their ______ only.
They have limited resources and capital to finance their __________ and _______ their businesses.
It is also difficult for them to get ______ from banks because of their small size.
owners
operations
expand
loans

36. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Family members are involved in managing the business
The owners often seek support from their _______ members.
The owner’s _______ and ________ usually take up important management positions in the business.
family
spouse
children

37. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Focus on narrow markets
SMEs often focus on _______ markets in which ______ companies are not interested.
They can tailor their products and services to cater for the ______ of a particular group of customers.
narrow
large
needs

38. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Innovative
SMEs are eager to explore new ___________ in the market and are more ________ to new ideas.
To attract customers, they are willing to introduce ______ products and services.
opportunities
receptive
new

39. Small and Medium Enterprise
Characteristics of SMEs in Hong Kong
Greater flexibility
SMEs are _____ and have _______ flexibility than large companies.
Since the owners can make decisions _______, SMEs are able to make changes ________.
small
greater
quickly
promptly

40. Small and Medium Enterprise
Contributions of SMEs to the local economy
Providing specialised goods and services
______ companies do not produce all goods and services society needs.
As SMEs are _____ in scale and their operating costs are usually ______, they can specialise in serving _____ markets and still make a ______.
Large
small
lower
small
profit

41. Small and Medium Enterprise
Contributions of SMEs to the local economy
Providing jobs
SMEs are important to a society because they offer jobs to _______ and ____________ labour.
The owners of SMEs are ____________ as they manage the companies themselves.
unskilled
inexperienced
self-employed

42. Small and Medium Enterprise
Contributions of SMEs to the local economy
Introducing new products and services
SMEs are more willing to be _________ to compete with large companies.
e.g. in recent years, some bookstores in Hong Kong not only sell books but also provide snacks and drinks.
This creates a more relaxing environment to customers.
innovative

43. Small and Medium Enterprise
Contributions of SMEs to the local economy
Supporting large companies
Large companies rely on _______ to provide goods and services.
Many SMEs are _____________ of large companies.
They are hired by large companies to perform _______ tasks.
 The large companies can reduce their ________ and enhance __________.
SMEs
subcontractors
specific
workload
efficiency

44. Differences between Small and Large Businesses
Small business
Large business
Scope of business
Company management
Produce or sell one type of product or service
Simple business
operations
Produce or sell many types of products and services
Complex business
operations
Professional
managers with
specialised roles
and duties
Different levels
of management
Managed by the
owners themselves
Perform a variety
of job functions

45. Differences between Small and Large Businesses
Small business
Large business
Planning
Organising
Loose and informal
planning process
Make short-term
and operational
plans.
Systematic and
formal planning
process
Have long-term goals and develop
strategic plans
Flat structure
Various job duties
Face-to-face
communication
Tall structure
Highly-specialised
job duties
Written and
electronic means
of communication

46. Differences between Small and Large Businesses
Small business
Large business
Leading
Controlling
Autocratic owners
Simpler and faster
decision-making
Delegation is
common
Slow decision-
making
Fewer rules and
regulations
Loose and informal
control
Mainly done by the
owners
Many rules and
regulations
Formal control
mechanisms and
processes
Done by a specific
department or a
unit

47. Government Support for SMEs
No sufficient funds!
Difficult to get bank loans!
Lack management skills!
No expertise to conduct market analysis!
How can my SME survive?
You can seek government support.

48. Government Support for SMEs
Provide supplementary functions
Business Start-up Centre
Provides office facilities and administrative assistance to business starters
Hong Kong Productivity Council
Offers customised business solutions and management training to SMEs

49. Government Support for SMEs
Provide supplementary functions
Hong Kong Trade Development Council
Provides SMEs with useful market information and analysis

50. Government Support for SMEs
Set up funding schemes
SME Loan Guarantee Scheme
Aim: to help SMEs enhance productivity and
_____________.
Helps SMES obtain loans from _______ institutions which participate in the scheme with the government acting as the _________.
competitiveness
lending
guarantor

51. Government Support for SMEs
Set up funding schemes
SME Export Marketing Fund
Aim: to help SMEs expand their businesses
through participation in _______
promotion activities.
Provides grants to SMEs for their particpation in ________ trade fairs and _________ and study missions, as well as local trade fairs and exhibitions which are _______-oriented.
export
overseas
exhibitions
export

52. Government Support for SMEs
Set up funding schemes
SME Development Fund
Aim: to provide financial support to projects
which can enhance the _____________
of HK’s SMEs.
Projects to be supported include award schemes, best practices, conferences, seminars, databases etc.
competitiveness

53. Government Support for SMEs
Set up funding schemes
The Funding Scheme for Workplace English Training
Aim: to subsidise employees who need to use
_______ in the workplace to reach the
relevant benchmark for their job type.
Funding is granted to employees for taking an English training course commissioned by their ________.
It can also be used for a specified __________ business English examination.
English
company
international

54. Government Support for SMEs
Set up funding schemes
Small Entrepreneur Research Assistance Programme
Aim: to finance entrepreneurs in the _________ sector to start up, carry out R&D, and conduct market ______ before they can raise funds from _______ capitalists.
Technology entrepreneurs of a locally incorporated company with less than _____ employees can apply for this fund.
technology
studies
venture
100