1. Recognizing Opportunity Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends Starting Versus Buying a Business 3.1 Section 3.2 Section 3 3

2. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Examine current trends that provide opportunities for entrepreneurs. Identify ways to recognize opportunity. Explain how to think creatively about opportunity. Determine ways to find creative business ideas. Section Objectives

3. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity The ability to recognize new opportunities and to think creatively is essential for success in today’s global market. The Main Idea

4. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Content Vocabulary online business services sustainability social entrepreneurs outsourcing strategic alliance corporate venture innovation niche brainstorm demographics trade magazine specialty magazine trade show

5. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity One way to identify business opportunities is to study current trends that provide opportunities for entrepreneurs. Current Entrepreneurial Trends

6. 6 Internet businesses service businesses home-based businesses green businesses social entrepreneurship focus on technology outsourcing and strategic alliances corporate ventures

7. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Internet Businesses The Internet has transformed the way business is conducted. An online business can reach customers around the world. online business a company that conducts business by means of the Internet

8. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Service Businesses Service businesses dominate the American economy. Business services account for the largest part of U.S. economic growth. services intangible things that businesses do for consumers that enhance their lives

9. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Outsourcing Outsourcing is hiring people and other companies to handle tasks that a business can not do or chooses not to do itself. outsourcing contracting with other companies for services

10. Outsourcing 10 Benefits of Outsourcing more efficient saves time saves money lowers regulatory burden speeds up projects attracts investors

11. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Strategic Alliances A strategic alliance is a partnership among companies. strategic alliance a partnership formed with another company for the purpose of supplying a product or service

12. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Corporate Ventures A corporate venture is formed within a company. corporate venture a new venture started inside a larger company

13. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Entrepreneurial thinking is about generating ideas and recognizing opportunities. Learning to Recognize Opportunity

14. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Creativity and Innovation Creativity is the activity that results in innovation. innovation a new way of doing things

15. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity You generate ideas by thinking creatively. Opportunities are ideas that have commercial potential. Section 3.1 Understanding Entrepreneurial Trends Idea Versus Opportunity

16. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Idea Versus Opportunity You can find a good business opportunity by recognizing an unfilled market niche. niche a small specialized market

17. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity If you understand an industry, you can identify opportunities within that industry. Finding Opportunities by Understanding Industries

18. Thinking Creatively About Opportunity 18 Practice brainstorming. Find creative solutions to common problems. Look at ordinary items in new ways. Connect unrelated items.

19. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Thinking Creatively About Opportunity During brainstorming, ideas are not judged as good or bad. brainstorming to think freely in order to generate ideas

20. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Entrepreneurs can stimulate and encourage creativity in many ways. The most difficult challenges to creativity are the challenges you bring upon yourself. Challenges to Creativity

21. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity To identify creative ideas: Observe the world around you. Watch for demographic changes. Be an avid reader. Consider your own experiences – interests, hobbies, and work experiences. Consult outside sources of information. Creative Sources of Ideas

22. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Watch for Demographic Changes It is important for entrepreneurs to understand demographics and demographic trends. demographics personal characteristics that describe a population by age, gender, income, ethnic background, education, and occupation, among others

23. Sources of Information 23 Sources of Information trade magazines specialty magazines trade shows exhibitions newspapers the Internet government agencies

24. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Consult Outside Sources A trade magazine offers current, industry-specific news. trade magazine a periodical published for a specific type of business or industry

25. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Consult Outside Sources A specialty magazine offers information about specific topics. You can use specialty magazines to identify the interests and needs of potential consumers. specialty magazine a periodical published for people with special interests, such as sports, camping, or fashion

26. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity Consult Outside Sources At a trade show, you can learn about new goods and services in a field. trade show a gathering or exhibition where vendors and manufacturers introduce new items and promote established products and services

27. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity After You Read 1.Discuss current trends that provide opportunity for entrepreneurs. Current trends that provide opportunity for entrepreneurs include Internet businesses, service businesses, home-based businesses, socially responsible nonprofit businesses, corporate ventures, strategic alliances, and an increased emphasis on technology and outsourcing.

28. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity After You Read 2.Explain ways to recognize opportunity. Most good business opportunities result from the entrepreneur’s ability to recognize unmet consumer needs and unique and unfilled market niches. One way to identify opportunities is to understand industries and examine and analyze industry trends.

29. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity After You Read 3.Explain how to think creatively about opportunity. There are several ways to think creatively about opportunity, including practicing brainstorming, looking at ordinary items in new ways, finding creative solutions to common problems, and connecting unrelated items.

30. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity After You Read 4.Discuss ways to overcome challenges to creativity. To overcome challenges to creativity, believe in yourself, use nonlogical thinking, don’t think of everything in practical terms, view problems as challenges that offer the opportunity to innovate, entertain all ideas, relax, have a playful attitude, look at failure as a learning experience that will lead to success, model creative behavior, and develop listening skills.

31. Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends SECTION SECTION 3.1 Chapter 3 Recognizing Opportunity After You Read 5.Explain ways to find creative business ideas. You can generate creative business ideas by watching people; watching for demographic changes; reading; considering his or her own experiences; and consulting outside sources such as trade magazines, trade shows, newspapers, the Internet, and government agencies.

32. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Identify the importance of personal values and goals in choosing an entrepreneurial pursuit. Describe the challenges and rewards of entering a family business. List the benefits and drawbacks of buying a business. Describe how you can evaluate a business opportunity. Compare the advantages and disadvantages of starting your own business. Section Objectives

33. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Whether you start a business or buy an existing one, make sure it is compatible with your personal values and goals. The Main Idea

34. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Content Vocabulary values goodwill franchise franchisee franchisor business broker

35. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Personal Values and Goals Personal values and goals should be used as a guide when choosing entrepreneurial pursuits. values the beliefs and principles by which you choose to live that define who you are, shape your attitudes and choices, and help you identify your priorities

36. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity The greatest advantage of a family business is the trust and togetherness that family members often share. Families that work well together have great potential for success in a family business. Entering the Family Business

37. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity In many ways, buying an existing business is less risky than starting one from scratch. Buying an Existing Business

38. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Buying an Existing Business When you buy an existing business, you often gain the goodwill of loyal customers. goodwill the favor and loyalty a business acquires by its good reputation

39. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Buying a Franchise When you buy a franchise, you buy the right to set up a new business patterned on an existing model. franchise a legal agreement to begin a new business in the name of a recognized company

40. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Buying a Franchise The franchisee is the buyer of a franchise. The franchisor is the seller of a franchise. franchisee the buyer of a franchise who is given the right to the franchisor’s product, process, or service franchisor the seller of a franchise who is giving the buyer planning and management expertise

41. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity To evaluate a business opportunity: Investigate the company. Investigate the industry. Talk to customers, employees, and suppliers. Hire an accountant to advise you. Hire an attorney to advise you. Evaluating a Business Opportunity

42. Where to Find a Business 42 Finding Business Opportunities newspapers business publications networking business brokers

43. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity Where to Find a Business You can find a business broker in the telephone book or online. business broker someone whose job it is to bring buyers and sellers of businesses together for a fee

44. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity When you start your own business from scratch, you can do things your own way. You can build the company with fresh ideas and enthusiasm. Starting Your Own Business

45. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity After You Read 1.Identify the importance of personal values and goals in choosing an entrepreneurial pursuit. Personal values and goals should be used as a guide when choosing entrepreneurial pursuits because they define who you are, shape your attitudes and your choices, and help you identify your priorities.

46. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity After You Read 2.Describe the challenges and rewards of entering a family business. The greatest reward of a family business is the trust and togetherness that family members often share. One of the greatest challenges of a family business is that its owners can never get away from the business.

47. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity After You Read 3.List the benefits and drawbacks of buying a business. The benefits include established procedures, inventory, trade credit, employees, equipment, and customers. The drawbacks include the possibility that the business may be losing money or have a poor reputation, dated inventory, substandard equipment or facilities, and/or unskilled employees.

48. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity After You Read 4.Describe how you can evaluate a business opportunity. To evaluate a business opportunity, investigate the company and the industry very carefully; verify the value of the businesses inventory, accounts receivable, and assets; and hire an accountant and an attorney to advise you.

49. Starting Versus Buying a Business Glencoe Entrepreneurship: Building a Business SECTION 3.2 Chapter 3 Recognizing Opportunity After You Read 5.Compare the advantages and disadvantages of starting your own business. The advantages include being able to do things your own way and being able to build the company with fresh ideas and enthusiasm. The disadvantages include extensive planning and resource gathering.

50. Recognizing Opportunity Glencoe Entrepreneurship: Building a Business Understanding Entrepreneurial Trends Starting Versus Buying a Business 3.1 Section 3.2 Section 3 3 End of Chapter 3 Recognizing Opportunity