1. SMALL BUSINESS MANAGEMENT
Lesson 3.1
5/19/2019
LESSON 3.1
SMALL BUSINESS MANAGEMENT
Explain the advantages a small business has over a large business
Describe the key elements of a business plan
INTRO TO BUSINESS

2. 3.1
Small Businesses
A small business is an independent business with fewer than 500 employees.
The greatest percentage of businesses in the United States are small businesses, and they employ half of all private sector employees.

3. Meeting Customer Needs
3.1
Meeting Customer Needs
Small Businesses:
can be more specialized and adapt to meet specific customer needs
usually serve fewer customers and have more personal contact
provide unique services
are seen as more “caring” and are typically able to provide more of what customers want

4. Starting a Small Business
3.1
Starting a Small Business
Characteristics of small business owners
Hard working, independent, persistent, self-motivated, energetic, etc.
Ideas
Developing ideas: hobbies, activities, websites, etc.
Acting on idea: find location, timing, etc.
Preparation and research
Obtain information about product/service and the competition

5. Small Business Problems
3.1
Small Business Problems
The failure rate for small businesses is quite high.
The most common reasons for failure:
Not keeping adequate records
Not having enough start-up money
Having a poor location
Lacking management experience or experience with the type of business being managed
Not controlling business expenses or managing credit to customers
Failing to have a business plan

6. 3.1
CheckPOINT
What are some characteristics of successful small business owners?

7. 3.1
The Business Plan
When successful small businesses are compared to those that fail, one thing stands out—the successful businesses developed and followed a business plan.
All major activities and management functions are included in the plan.

8. Elements of a Business Plan
3.1
Elements of a Business Plan
Description of the business
Description of the competition
Marketing plan
Customer analysis
Operations plan
Financial plan

9. Elements of a Business Plan Description of the Business
3.1
Elements of a Business Plan Description of the Business
The business idea
Major products and services
Ownership structure
Owner’s qualifications
Strengths and weaknesses
Long- and short-term goals

10. Elements of a Business Plan Description of the Competition
3.1
Elements of a Business Plan Description of the Competition
Industry characteristics
Condition of the economy
Strengths and weaknesses of competitors

11. Elements of a Business Plan Marketing Plan
3.1
Elements of a Business Plan Marketing Plan
Description of marketing activities
Description of resources needed
Schedule of marketing activities

12. Elements of a Business Plan Customer Analysis
3.1
Elements of a Business Plan Customer Analysis
Description of customers
Location, number, and resources of customers
Sales forecasts

13. Elements of a Business Plan Operations Plan
3.1
Elements of a Business Plan Operations Plan
Organization of the company
Description of major operations
Analysis of resources needed
Human resource plan

14. Elements of a Business Plan Financial Plan
3.1
Elements of a Business Plan Financial Plan
Start-up costs
Long- and short-term financial needs
Sources of financing
Budgets and financial statements

15. 3.1
What Is a Business Plan?
A business plan is a written description of the business idea and how it will be carried out, including all major activities.
Key Features:
General description of the company
Owner’s qualifications
Description of the product or service
Analysis of the market
Financial plan
Developing a business plan forces the owner to think about important aspects of the business. Potential problems can also be identified

16. Developing a Business Plan
3.1
Developing a Business Plan
The business owner is responsible for developing the business plan.
A well-developed plan will lay out an idea, require an owner to analyze their concept, and make decisions about key business activities such as production, marketing, staffing, and financing.

17. 3.1
CheckPOINT
What are an owner’s responsibilities in developing a business plan?