Brittany Killins explains here about Entrepreneurship and its importance for society. It is very useful for us to build a better world for the next generations.

1. SLIDE 1
Brittany Killins
Entrepreneurship and
Small Business
Management

2. Becoming an Entrepreneur
Goals
1. Identify characteristics of successful
entrepreneurs
2. Recognize the importance of
entrepreneurship in the economy
3. Describes opportunities and risks

3. Characteristics of
Entrepreneurs
 Entrepreneur – someone who takes a risk in
starting a business to earn a profit
 Being your own boss
 Developing a good initial plan
 Special skills and abilities and coming up with
innovative ideas
 Entrepreneurship – the process of starting,
organizing, managing, and assuming the
responsibility for a business

4. What Does it Take?
 Not all business owners and managers are
entrepreneurs.
 Entrepreneurs have unique skills and personal
characteristics.

5. Entrepreneurs Are:
 Persistent
 Inquisitive
 Energetic
 Goal-oriented
 Independent
 Self-confident
 Creative
 Reliable
 Competitive

6. Entrepreneurs Have:
 Problem-solving skills
 Tolerance for ambiguity
 Strong integrity
 Personal initiative
 Ability to secure resources
 Capability to learn from failure
 Willingness to work hard

7. Checkpoint #1
 What personal characteristic are common
to most successful entrepreneurs?
persistence, inquisitiveness, self-confidence,
creativity, and so forth.

8. Entrepreneurship and
the Economy
 Employment
 Small businesses are responsible for most new employment.
 Financing
 Most new businesses start on $10,000 or less.
 75% of startup capital comes from owner savings, bank
loans, credit card debt.
 Venture Capital – money provided by large investors to
finance new products and new businesses that have a goods
chance to be very profitable.

9. Entrepreneurship and
the Economy
 Productivity
 New and small businesses produce a large volume of
goods and services fro the economy.
 Businesses with just a single owner and no staff
account for more than $770 billion in sales annually
 Responsible for more than half of the U.S. GDP each
year.

10. Employment Growth by Business Size,
1990–2005
24.9%
20.1%
18.7%
36.3%
1-9 employees
20-99 employees
100-499 employees
500 or more employees

11. Checkpoint #2
 What are the sources of financing that
entrepreneurs use for their new businesses?
Personal savings
Friends and family
Venture capital
Bank loans

12. Opportunities and Risks
 Before deciding to start a business, you need to
think about the opportunities and risks.
 New Business Opportunities
 Innovation – an invention or creation that is brand new
 Improvement – a designed change that increases the
usefulness of a product, service, or process

13. Opportunities and Risks
 Recognizing Risks
 The primary reasons that businesses started by
entrepreneurs close are:
1. Lack of adequate capital
2. Low sales
3. Higher than expected expenses
4. Competitive pressure
5. An owner unprepared to manage a growing
business
6. Operations requiring more time than the owner is
willing to commit

14. Checkpoint #3
Where do entrepreneurship
opportunities begin?
Opportunities begin with innovations
(ideas about new products and services)
or improvements (ideas for changes to
existing products, services, or processes).

15. Small Business Basics
Goals
1. Identify important characteristics of a
small business
2. Recognize the competitive advantages of
small businesses
3. Identify problems faced by many small
busineses

16. Small Business Ownership
 Small Business – an independent business with
fewer than 500 employees.
 99.9% of roughly 26 million U.S. Businesses are small
businesses
 Description of a Small Business:
1. The owner is usually the manager
2. It operates in one or very few locations
3. It typically serves a small market
4. It is not dominant in its field

17. Small Business Ownership
 Small Business Employment
 Responsible for 60-80% of all new jobs
 Large number of small businesses
 Professional and Technical (Construction Companies)
 Ownership Diversity
 Women own more than 1/4th of all small businesses
 More than 17% have African-American, Asian-American, or
Hispanic ownership
 14% of owners are under 35 years-old

18. Small Business Ownership
 Ownership Diversity
 64% have finished some college work
 Half are home based businesses
 Average $5,000 or less to start up the business (Part-Time)

20. Checkpoint #4
 Beyond the formal definition of a small business,
what four points can be used to describe a small
business?
1. The owner is usually the manager
2. It operates in one or very few locations
3. It typically serves a small market
4. It is not dominant in its field

21. Small Business Advantages
 Meeting customer needs
 Serve customers where the number of products and services
needed is small or the requirements are too specialized for
large businesses
 Get direct information from their customers
 Providing Unique Services
 Spend time determining needs and discussing alternatives
 Unique needs, more individual attention, and willing to pay
more.

22. Checkpoint #5
 How can small businesses compete successfully
with larger businesses?
 Smaller businesses are able to provide more
personalized products and services to their customers.
 They are able to provide products and services where
smaller orders and projects are required and tend to
fill unique customer needs, which larger companies do
not provide.

23. Common Small
Business Problems
 Reasons for failure
1. Not keeping adequate records
2. Not having enough start-up money
3. Lack of management experience
4. Lack of experience with the type of business
5. Not controlling operating expenses
6. Poor location for the business
7. Failure to manage credit offered to customers

24. Common Small
Business Problems
 Small Business Assistance
 Small businesses can get help from a number of
sources:
1. Universities and colleges
2. Local Group of business people
3. Small Business Administration
 A government agency that helps small business owners
develop a business plans and obtain financing and other
support for their companies.

25. Checkpoint #6
 List common reasons for small business failure.
 Not keeping adequate records
 Insufficient start-up money
 Lack of management experience
 Lack of experience with the type of business
 Not controlling operating expenses
 Poor location
 Failure to manage credit

26. Starting a Small Business
Goals
1. Recognize important factors to be
considered when starting a business
2. Describe elements of a business plan
3. Identify types and sources of financing a
small business

27. The Business Decision
 An Idea Plus Experience
 Business ideas come from many sources
 Hobbies, interests, business experiences, books, Magazines
 Several years of training in a range of business operations
will prepare you for the role of owner.
 Right place right time
 If the business is not easy to find or requires a great deal of
travel time, many potential customers will stay away.

28. The Business Decision
 Team Approach
 Even small businesses need a few full – or part –time
employees to grow or cover extended hours.
 Choosing the team members become one of the most
important initial business decisions.
 Preparation and Research
 Includes having enough information to make good decisions
about the business.
 Information is needed on customers, competitors, important
operations, government regulations, and many more

29. Checkpoint #7
 Why is it important to use a team approach when
starting a new business?
 A team approach allows employees to feel valued and
motivated to take personal responsibility for the
benefit of the business.
 Owners cannot expect to be able to do everything
alone. Building a team will allow the business to
increase productivity and, ultimately, profits.

30. Developing a Business Plan
 What is a business plan?
 A written description of the business idea and how it will be
carried out, including all major business activities.
 Key Features:
 General description of the company
 The credentials of the owners
 Description of the product or service
 Analysis of the market
 Financial plan

31. Elements of a Business Plan
 Description of the Business
 The business idea
 Major products and services
 Ownership structure
 Strengths/weaknesses
 Long- and short-term goals

32. Elements of a Business Plan
 Description of Competition
 Characteristics of the industry
 Condition of the economy
 Strengths and weaknesses of major competitors
 Customer Analysis
 Description of customers
 Location, number, and resources of customers
 Sales forecasts

33. Elements of a Business Plan
 Operations Plan
 Organization of the company
 Description of major operations
 Analysis of resources needed
 Human resource plans
 Marketing Plan
 Description of major marketing activities
 Description of resources needed
 Schedule of marketing activities

34. Elements of a Business Plan
 Financial Plans
Start-up costs
Short- and long-term financial needs
Sources of financing
Budgets and financial statements

35. Steps in Developing the
Business Plan
 Gather and review information
 Develop the strategic alternatives
 Write the plan
 Ask an expert to review the plan

36. Checkpoint #8
 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.

37. Financing The Small Business
 Types of financing
 Start-up financing
 Short-term financing
 Long-term financing
 Sources of financing
 Owner-supplied funds
 Borrowed funds

38. Checkpoint #9
 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.