Describe an entrepreneurship and a small
List the advantages and disadvantages of
Recognize the advantages and disadvantages of a
Explain why small businesses may fail.
Do you have what it takes to be an entrepreneur?
business started by someone who notices a need
for a product or service
Entrepreneurships and small businesses are the
majority of business firms
a person who:
recognizes a business opportunity
organizes, manages, and assumes the risks of a
business enterprise, with the intent of increasing the
market value of the business.
Desire to earn profit
taking a risk and
becoming a success
Show expertise and
Working from home
Most fail because they
run out of money
SMALL BUSINESS ADMINISTRATION (SBA)
Defines small business as
Business where the owner is also the manager
Fewer than 500 employees
Employ 55 percent of workforce in US
Generate more than half the nation’s income - 54% of
all US sales
Principal source of new jobs – since 1990 big business
eliminated 4 million jobs, small businesses added 8
million new jobs.
Small business sector is growing rapidly. While
corporate America has been "downsizing", the rate of
small business "start-ups" has grown, and the rate for
small business failures has declined.
You’re the boss
Offer services larger companies can’t
Formation - easy
SMALL BUSINESS CON’T
Responsible for everything
Long hours and financial risk
Four out of five fail in first five years
Mistake freedom for the liberty of working or not.
Underprice/overprice goods or services
Little or no experience
SMALL BUSINESS MIGHT FAIL
Effect of change
Consumers’ taste change and they don’t
Inadequate financial planning
Starting with little money
Borrowing without thinking about paying back
Written description of business venture
describing all aspects of business.
Management and operating plan
Products and services
QUESTIONS THAT SHOULD BE ANSWERED
IN BUSINESS PLAN
What will I produce?
Who are my main competitors?
Why is my product needed?
How much will my product cost to produce?
How many people will I need to run the business?
What physical facilities will I need?
What licenses, permits or other legal documents
do I need?
How much money will I need to get started?
Give me an example of an entrepreneur.
What is an advantage of being a small business
What is a disadvantage of being a small business
What might be one reason a small business fails?