This document provides an overview of entrepreneurship and starting a small business. It discusses why people take on the challenges of entrepreneurship, including opportunities for profit and independence. It also examines the importance of small businesses to the US economy and how they create many new jobs. The document outlines various types of small businesses like home-based businesses and strategies the government uses to promote entrepreneurship. Learning objectives are provided at the start to guide key topics.

1. Because learning changes everything.®
Chapter 6
Entrepreneurship and
Starting a Small Business
© 2022 McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw Hill.

2. © McGraw Hill 2
Chapter Contents
The Job-Creating Power of Entrepreneurs in the United
States
Why People Take the Entrepreneurial Challenge
Getting Started in Small Business
Learning about Small-Business Operations
Managing a Small Business
Going Global: Small-Business Prospects

3. © McGraw Hill 3
Learning Objectives
LO 6-1 Explain why people take the risks of entrepreneurship; list
the attributes of successful entrepreneurs; and describe
entrepreneurial teams, intrapreneurs, and home- and web-
based businesses.
LO 6-2 Discuss the importance of small business to the American
economy, and summarize the major causes of small-
business failure.
LO 6-3 Summarize ways to learn about how small businesses
operate.
LO 6-4 Analyze what it takes to start and run a small business.
LO 6-5 Outline the advantages and disadvantages small
businesses have in entering global markets.

4. © McGraw Hill 4
Joel Clark: Co-Founder and CEO of
Kodiak Cakes
Brothers Joel and Jon Clark
took their mother’s whole-grain,
high-protein pancake mix and
sold it door-to-door.
Joel earned an MBA and quit his
job to focus on Kodiak Cakes
full time as CEO.
Kodiak Cakes failed to get
investment on Shark Tank, but
their sales skyrocketed after
consumers saw the show.
Now, the company’s annual
sales exceed $100 million.
Courtesy of Kodiak Cakes

5. © McGraw Hill 5
Name that Company
THE FOUNDER OF THIS COMPANY opened a
candy company in Chicago, but it failed. He tried
again in New York and failed again. But he didn't
give up, and today his company is one of the largest
candy companies in the world.

6. © McGraw Hill 6
The Job-Creating Power of Entrepreneurs
in the United States
Entrepreneurship
Accepting the risk of starting and running a business.
Notable entrepreneurs:
• French immigrant Élruthère Irènèe du Pont de Nemours started
DuPont in 1802.
• David McConnell borrowed $500 from a friend to start Avon.
• George Eastman started Kodak with a $3,000 investment in 1880.
• Jeff Bezos started Amazon with investments from his family and
friends.

7. © McGraw Hill 7
Customer Loyalty
Wacky grocer Jungle Jim
Bonaminio may put on a wizard
suit and roller-skate through his
Jungle Jim’s International
Market, but he’s serious when it
comes to his business. Instead
of competing on price against
big firms like Walmart, Jungle
Jim’s competes on product
variety. For example, a case
holding 1,500 kinds of hot sauce
rests beneath an antique fire
engine. Why do you think
customers might remain loyal
to Jungle Jim’s?
Courtesy of Jungle Jim Bonaminio

8. © McGraw Hill 8
Student Start-ups
Here are just a few examples of young
entrepreneurs who found success in their
college years:
• Matt Czarnecki, Bennett Byerley, and André
Monteiro started Verb Energy in their dorm kitchen
at Yale University, making delicious snacks that
could help them stay awake during long study
sessions.
• Fatimah Hussein and Jamie Glover founded Asiya,
a line of sports hijabs for Muslim women.
• Logan Rae and Kim Hruda teamed up at Florida
Atlantic University to create Bacon Boxes, a tasty
start-up that specializes in boxes and bouquets of
bacon roses.
• Austin Webb, Brac Webb, and Austin Lawrence
developed a start-up called Robotany at Carnegie
Mellon University where they grew organic
vegetables in indoor vertical farms.
ASIYA Modest Activewear

9. © McGraw Hill 9
You’re Never Too Young to Be an
Entrepreneur!
Five reasons to start your business right away:
1. You have potential for long-term returns!
2. You don’t have a mortgage or kids to take care of.
3. You can survive on little funds and work long hours.
4. No disruption to your career path. It hasn’t started yet!
5. You’re more adaptable and have higher risk tolerance at a
younger age.

10. © McGraw Hill 10
You’re Never Too Old to Be an
Entrepreneur Either!
More Americans are working over the age of 65.
Since 1996, older Americans have opened businesses at a
higher rate than those aged 20 to 34.
Older entrepreneurs have greater experience and more
financial resources.

11. © McGraw Hill 11
Why People Take the Entrepreneurial
Challenge 1
Four Major Reasons
• Opportunity.
• Profit.
• Independence.
• Challenge.

12. © McGraw Hill 12
Why People Take the Entrepreneurial
Challenge 2
What Does It Take to Be an Entrepreneur?
• Self-directed.
• Self-nurturing.
• Action-oriented.
• Highly energetic.
• Tolerant of uncertainty.

13. © McGraw Hill 13
Tips for Starting Your Business in School
1. Find a problem or need.
2. Find a mentor.
3. Zero in on specifics.
4. Do research on campus, test products with students.
5. Move forward with your ideas. Don’t wait!
6. Sacrifice.
7. Embrace failure.

14. © McGraw Hill 14
Why People Take the Entrepreneurial
Challenge 3
Turning Your Passions and Problems into
Opportunities
Most sources of innovation are like a flashlight.
An idea is a good opportunity if:
• It fills customers’ needs.
• You have the skills and resources to start a business.
• You can sell the product or service at a reasonable price and
profit.
• You can get your product or service to customers before the
window of opportunity closes.
• You can keep the business going.

15. © McGraw Hill 15
Becoming an Entrepreneur
Kuda Biza and Bryan
Janeczko founded
Nunbelievable Cookies in
2019 as a way to take a bite
out of world hunger. For
every dozen cookies that the
company sells, it donates two
meals to soup kitchens
across the U.S. Do you think
more entrepreneurs should
use their businesses to
directly support charitable
causes?
Nunbelievable

16. © McGraw Hill 16
Why People Take the Entrepreneurial
Challenge 4
Entrepreneurial Teams
A group of experienced people from different areas of
business who join to form a managerial team with the
skills to develop, make, and market a new product.
Teams can:
• Combine their creative skills with production and marketing
skills from the start.
• Ensure more cooperation and coordination among
functions.

17. © McGraw Hill 17
Why People Take the Entrepreneurial
Challenge 5
Entrepreneurship within Firms
Intrapreneurs — Creative people who work as
entrepreneurs within corporations.
Intrapreneurs use a company’s existing resources to
launch new products for the company.
• Examples include: 3M’s Post-it Notes, Apple’s Mac
computer, Sony’s PlayStation.

18. © McGraw Hill 18
Becoming an Intrapreneur
When you come up with a
winning idea, stick with it.
That’s certainly been the
motto of 3M, the maker of
Post-it Notes. The company
encourages intrapreneurship
among its employees by
requiring them to devote at
least 15 percent of their time
to think about new products.
How has this commitment
to innovation paid off for
3M and its employees?
Gianfranco Chicco/EyeEm/Getty Images

19. © McGraw Hill 19
Why People Take the Entrepreneurial
Challenge 6
Micropreneurs and Home-Based Businesses
• Micropreneurs — Entrepreneurs willing to accept the risk
of starting and managing a business that remains small,
lets them do the work they want to do, and offers them a
balanced lifestyle.
• More than half of U.S. micropreneurs are home-based.
• Many are owned by people combining career and family.

20. © McGraw Hill 20
Micropreneurs
Music teachers often operate independently and teach a limited
number of pupils at any given time. Despite their small-scale
businesses, music teachers can have a big impact on the artistic
development of their clients. Can you see why music teachers
could be considered micropreneurs?
Vladimir Vladimirov/Getty Images

21. © McGraw Hill 21
Why People Take the Entrepreneurial
Challenge 7
Micropreneurs and Home-Based Businesses continued
Reasons for growth of home-based businesses:
• Computer technology has leveled the playing field.
• Corporate downsizing has led many to venture on their own.
• Social attitudes have changed.
• New tax laws have loosened restrictions on deducting expenses
for home offices.

22. © McGraw Hill 22
Why People Take the Entrepreneurial
Challenge 8
Micropreneurs and Home-Based Businesses continued
Challenges of home-based businesses:
• Getting new customers is difficult.
• Managing your time requires self-discipline.
• Work and family tasks are sometimes not separated.
• Government ordinances may restrict your business.
• Homeowner’s insurance may not cover business-related claims.

23. © McGraw Hill 23
Figure 6.1 Potential Home-Based
Businesses
Many businesses can be started at home. Listed below are businesses that have low start-up costs and
don’t require an abundance of administrative tasks:
• Personal creations—artwork and handmade items that can be sold on sites such as Etsy, eBay, and
Amazon.
• In-home services—tutoring, landscaping, snow shoveling, house cleaning, pet sitting, babysitting, web
designing, personal training, home organizing, etc.
• Repair or skill-based services—tailoring, plumbing, home repairs, painting, etc.
• Consulting—advising businesses in areas in which you have an expertise such as technology,
marketing, search engine optimization, or social media management.
• Resale—buying goods and reselling them (i.e., reselling items online that you buy in garage or estate
sales).
• Shared-economy opportunities—Uber driver or Airbnb host.
Look for a business that meets these important criteria: (1) The job is something you truly enjoy doing; (2)
you know enough to do the job well or you are willing to spend time learning it while you have another
job; and (3) you can identify a market for your product or service.
Sources: Lesley Spencer Pyle, "Businesses You Can Start at Home," Entrepreneur, entrepreneur.com, accessed March
2020; Mindy Lilyquist, “Home Businesses Ideas That Really Pay,” The Balance, November 24 2019; “20 Businesses Ideas
for Stay-at-Home Parents,” Entrepreneur, January 31, 2019; John Rampton, "50 Work-From-Home Jobs Paying As Much
or a Lot More Than the Average American Salary," Entrepreneur, entrepreneur.com, accessed March 2020.

24. © McGraw Hill 24
Benefits of Home-Based Businesses
• Ability to start your
business immediately.
• Minimal start-up capital
needed.
• No rent or excessive
set-up charges.
• Comfortable working
conditions.
• Reduced wardrobe
expenses.
• No commuting.
• Tax benefits.
• Elimination of office
politics.
• Low risk for trial and
error.

25. © McGraw Hill 25
Downsides of Home-Based Businesses
• Difficult to establish work habits.
• Limited support system.
• Isolation.
• Workspace may be limited.
• Clients may be uncomfortable coming to your
home.
• Zoning restrictions.
• Success is based 100 percent on your efforts.

26. © McGraw Hill 26
Think You’re Ready to Work from Home?
QUESTION YES? NO?
If I don’t know the answer, I can figure it out.
I’m hardworking, self-directed and disciplined.
I’m organized and can multitask.
I don’t mind working long hours or weekends.
I regularly set goals and measure progress.
I’m happy being alone.
I’m an excellent communicator.
I can create relationships with people I’ve never met.
I’m productive on my own.
My family and friends don’t expect me to be available
when I’m working at home.
Source: Entrepreneur, entrepreneur.com, accessed February 2020.

27. © McGraw Hill 27
Why People Take the Entrepreneurial
Challenge 9
Online Businesses
• In 2019, online retail sales in the U.S. reached over
$365 billion, or approximately 12 percent of all retail
sales.
• They must offer unique products or services.
• It is easy for copycats to copy your successful
products and sell imitations on other sites.

28. © McGraw Hill 28
Online Businesses
Each year more than 2 million
American couples get
married. And for many of
these soon-to-be newlyweds,
TheKnot.com is an invaluable
resource for planning the big
day. From sharing gift
registries to creating detailed
schedules, the website helps
ease the stress that inevitably
comes with getting ready for a
wedding. What does the site
offer that other wedding
planners don’t?
JGI/Tom Grill/Getty Images

29. © McGraw Hill 29
Boosting Your Business’s Online
Presence
• Establish an identity.
• Be easy to find.
• Go beyond blogging and create content.
• Look out for opportunities.
• Remember other forms of marketing.
• Make sure your website has a mobile option.
• Be friendly!
Source: Forbes, forbes.com, accessed February 2020

30. © McGraw Hill 30
Small Businesses Struggle to
Fight Fakes on Amazon
Amazon is the world’s largest online
marketplace.
• Once a product becomes successful
enough on Amazon, counterfeiters will
sell knockoff versions through third-party
vendors that are difficult to trace and
shut down.
• That happened to Kevin Williams,
cofounder of a company that sells a
specialized hose attachment called the
Brush Hero.
• Williams enlisted the services of a
sourcing agent in China who discovered
five factories making copycat Brush
Heroes and started shutting them down.
BrushHero Copyright 2020

31. © McGraw Hill 31
Why People Take the Entrepreneurial
Challenge 10
Encouraging Entrepreneurship: What Government Can
Do
• Immigration Act passed in 1990 created a category of
“investor visas” that encourage entrepreneurs to come to
the U.S.
• Enterprise zones — Specific geographic areas to which
governments try to attract private business investment by
offering lower taxes and other government support.
• Jumpstart Our Business Startups (JOBS) Act of 2012
offers tax breaks in order to raise funds and create jobs.

32. © McGraw Hill 32
Why People Take the Entrepreneurial
Challenge 11
Encouraging Entrepreneurship: What Government Can
Do continued
• Incubators — Centers that offer new businesses low-cost
offices with basic business services.
• The Self-Employment Assistance (SEA) program allows
participants to collect self-employment payments instead
of regular unemployment checks.
• Combination of private and public sectors.

33. © McGraw Hill 33
Incubators
Incubators, such as this
one in Washington, DC,
offer new businesses
low-cost offices with
basic business services
such as accounting,
legal advice, and
secretarial help. Do you
have such incubators
in your area?
Mladen Antonov/AFP/Getty Images

34. © McGraw Hill 34
TESTPREP 1
• Why are people willing to take the risks of
entrepreneurship?
• What are the advantages of entrepreneurial teams?
• How do micropreneurs differ from other entrepreneurs?
• What does the government do to promote
entrepreneurship?

35. © McGraw Hill 35
Getting Started in Small Business 1
Small versus Big Business
• Small business — A business that is independently
owned and operated, is not dominant in its field of
operation, and meets certain standards of size (set by the
Small Business Administration) in terms of employees or
annual receipts.
• Businesses are “small” in relation to other businesses in
their industries.
• There are over 30 million small businesses in the United
States.

36. © McGraw Hill 36
Getting Started in Small Business 2
Importance of Small Businesses
• 65 percent of the nation’s new jobs are in small
businesses.
• More personal customer service.
• Ability to respond quickly to opportunities.

37. © McGraw Hill 37
Small Businesses
When Roni Di Lulla’s dog Midnight
had trouble catching a Frisbee due to
his squinting, she retrofitted sports
goggles to fit his canine face.
Midnight became the hit of the dog
park, and soon Di Lulla was making
pairs for all sorts of interested pet
owners. Eventually she contracted
with a manufacturer and started a
company called Doggles, which now
earns $3 million a year selling
goggles to doggie fashionistas,
veterinary ophthalmologists, and
even military canines.
Jeffrey Coolidge/Getty Images

38. © McGraw Hill 38
POLLING QUESTION 1
Do you think small business failures are lower or
higher than is reported?
A. Lower
B. Higher

39. © McGraw Hill 39
Getting Started in Small Business 3
Small-Business Success and Failure
About half do not last five years.
Some reasons for failure are:
• Managerial incompetence.
• Inadequate financial planning.
• Choosing the wrong type of business.

40. © McGraw Hill 40
They Did What?
Famous Business Failures and Comebacks
Tommy Hilfiger: First store went bankrupt.
Milton Hershey: First confectionery failed.
H.J. Heinz: Company went bankrupt six years after start.
Walt Disney: First film company went bankrupt.
Henry Ford: First two car companies failed.
L.L. Bean: Almost went bankrupt in first year.
Source: World Features Syndicate.

41. © McGraw Hill 41
Figure 6.3 Causes of Small-Business
Failure
Access the text alternative for slide images.

42. © McGraw Hill 42
Figure 6.4 Situations for Small-Business
Success
Access the text alternative for slide images.

43. © McGraw Hill 43
Learning about Small-Business
Operations
Learn from Others
• Take classes on small business and entrepreneurship.
• Talk to and work for successful local entrepreneurs.
Get Some Experience
• Gain three years experience in the field.
• Start a part-time small business.
Take Over a Successful Firm
• Serve as an apprentice and eventually take over once the
owner steps down.

44. © McGraw Hill 44
Experiences Leading to Success
Sharon Anderson Wright spent her
teenage years sorting novels,
nonfiction, and newspapers at her
family’s used bookstore. She knew
what her customers liked to read
and worked closely with her mother
to learn the fine details of the
business. This experience served
her well as she expanded Half
Price Books into a national
company earning $240 million in
annual revenue. How do you think
Wright’s experience helped the
business succeed?
Nancy Newberry

45. © McGraw Hill 45
Should You Stay or Should
You Go?
Suppose you’ve worked for two years in a company and you
see signs that it is beginning to falter. You and a co-worker
have ideas about how to make a company like your boss’s
succeed. Rather than share your ideas with your boss, you
and your friend are considering quitting your jobs and
starting your own company together.
Should you approach other co-workers about working for
your new venture? Will you try to lure your old boss’s
customers to your own business? What are your
alternatives? What are the consequences of each
alternative? What’s the most ethical choice?

46. © McGraw Hill 46
Managing a Small Business 1
Planning Your Business
Business plan — A detailed written statement that
describes the nature of the business, the target market,
the advantages the business will have in relation to
competition, and the resources and qualifications of the
owner(s).
• Forces potential owners to be specific about what they will
offer.
• Mandatory for talking with bankers or investors.

47. © McGraw Hill 47
Managing a Small Business 2
Planning Your Business continued
Writing a business plan.
• A good plan takes a long time to prepare.
• A good executive summary catches interest and tempts
potential investors to read on.
• Getting the plan into the right hands is almost as important
as getting the right information in it.

48. © McGraw Hill 48
Business Plans
Rimas Buinevicius first used a
wheelchair after fracturing his leg and
quickly became aware of the shoulder
pain that can result from constant
pushing. To reduce the stress on his
body, Buinevicius and some partners
devised and designed Rowheels, a
system that allows users to row rather
than push their wheelchairs. Rowheels
won the 2012 Wisconsin Governors
Business Plan Competition in the
advanced manufacturing category. The
company aims to relieve those who
suffer from frequent shoulder injuries
by providing them with “the world’s first
truly therapeutic manual wheelchair.”
Rowheels, Inc.

49. © McGraw Hill 49
Outline of a Comprehensive Business Plan
• Cover Letter.
• Section 1—Executive
Summary.
• Section 2—Company
Background.
• Section 3—
Management Team.
• Section 4—Financial
Plan.
• Section 5—Capital
Required.
• Section 6—Marketing Plan.
• Section 7—Location
Analysis.
• Section 8—Manufacturing
Plan.
• Section 9—Appendix.

50. © McGraw Hill 50
Managing a Small Business 3
Financing Your Small Business
Family and business associates are the most common
source of funding.
Banks and finance institutions.
• Community development financial institutions (CDFIs) loan
money and provide counseling, especially for lower-
income communities.

51. © McGraw Hill 51
A Family Affair
What to Consider Before Starting a Family Business
• Clarify Expectations: What will each person contribute?
• Discuss Work/Family Boundaries: What is the line that
separates work from personal relationships?
• Evolve: Changing with the times is essential for all
business.
• Develop Good Communication: Agree about types of
decisions you’ll make jointly and on your own.
• Clarify Long-Term Intentions: Discuss how long
everyone will work full time and goals for the business.
• Have an Escape Hatch: Have a Plan B.
Source: Bloomberg Businessweek, businessweek.com, accessed February 2020.

52. © McGraw Hill 52
Managing a Small Business 4
Financing Your Small Business continued
• Angel investors — Private individuals who invest their own
money in potentially hot new companies before they go
public.
• Crowdfunding — A large group of individuals provide
donations in support of a company or product.
• Venture capitalists — Individuals or companies that
invest in new businesses in exchange for partial ownership
of those businesses.

53. © McGraw Hill 53
Funding Your Dream
Wouldn’t it be great if money grew
on trees? Unfortunately it doesn’t,
so prospective entrepreneurs must
find other sources of capital such
as personal savings, relatives,
former employers, banks, finance
companies, venture capitalists, and
government agencies. What is the
most common source of funding
after personal savings?
John Lund/Blend Images/Getty Images

54. © McGraw Hill 54
Managing a Small Business 5
Financing Your Small Business continued
Small Business Administration (SBA) — A U.S.
government agency that advises and assists small
businesses by providing management training and financial
advice and loans.
• Started a microloan program in 1991 providing very small loans
to small-business owners.
• The program judges worthiness based on the borrowers’
integrity and soundness of their business ideas.

55. © McGraw Hill 55
POLLING QUESTION 2
A Small Business Investment Company (SBIC) is
licensed by the SBA to
A. franchise small businesses
B. lend money to small businesses
C. provide training to small business owners
D. develop business plans for small business owners

56. © McGraw Hill 56
Managing a Small Business 6
Financing Your Small Business continued
Small Business Investment Company (SBIC) — A
program through which private investment companies
licensed by the SBA lend money to small businesses.
• Must have a minimum of $5 million in capital and can borrow up
to $2 from the SBA for each $1 of capital it has.
• Keeps defaults low by identifying a business’s trouble spots
early, giving entrepreneurs advice, and rescheduling loan
payments.

57. © McGraw Hill 57
Managing a Small Business 7
Financing Your Small Business continued
Small Business Development Centers (SBDC) are funded
jointly by the federal government and individual states.
• Help evaluate the feasibility of ideas, develop business plans,
and complete the funding application—for no charge.

58. © McGraw Hill 58
Figure 6.5 Types of SBA Financial
Assistance
The SBA may provide the following types of financial
assistance:
• Standard (7a) loans.
• Microloans
• SBA Express.
• Export Express.
• International trade loans.
• Community Adjustment and Investment Program (CAIP).
• 504 certified development company (CDC) loans.
• CAP Line loans.

59. © McGraw Hill 59
Help Please!
More SBA Resources and Other Helpful Groups
Small Business Investment Companies
Office of Innovation and Entrepreneurship (OIE)
SCORE
Kauffman Entrepreneurs

60. © McGraw Hill 60
Managing a Small Business 8
Knowing Your Customers
• Market — People with unsatisfied wants and needs who
have both resources and willingness to buy.
• Set out to fill the market’s needs by offering top quality and
great service at a fair price.
• One of the great advantages of small businesses is the
ability to know the market and quickly adapt to market
needs.

61. © McGraw Hill 61
Market Needs
Not all small businesses stay small;
some become superstars. For
example, Mattel founders Ruth and
Elliot Handler started their business
in their garage making picture frames.
When they discovered that the
dollhouse furniture they made with
the wood scraps sold better than the
frames, they changed their business
to focus on dolls. Today, Mattel is a
multi-billion dollar business thanks to
the success of blockbuster toys like
Barbie.
Mattel/MEG/Newscom

62. © McGraw Hill 62
Managing a Small Business 9
Managing Your Employees
• Hiring, training, and motivating employees is critical.
• Employees of small companies are often more satisfied
with their jobs because they feel challenged and
respected.
• Entrepreneurs best serve themselves and the business if
they recruit and groom employees for management
positions.

63. © McGraw Hill 63
Managing a Small Business 10
Keeping Records
• Need accurate accounting and recordkeeping.
• Many business failures are caused by poor accounting
practices that lead to costly mistakes.

64. © McGraw Hill 64
What Went Wrong?
Five Mistakes Business Owners Make
1. They’re too afraid to commit!
2. They hire the wrong people.
3. They don’t want to give up control.
4. They become complacent.
5. They fail to use new technology.
Source: The Balance Small Business, thebalancesmb.com, accessed February 2020.

65. © McGraw Hill 65
Managing a Small Business 11
Looking for Help
May need outside advice in legal, tax, accounting, marketing,
or finance.
• An experienced lawyer who knows and understands small
businesses can help with leases, contracts, partnership
agreements, and protection against liabilities.
Consider an independent marketing research study.
Commercial loan officers and insurance agents are important
resources.

66. © McGraw Hill 66
Managing a Small Business 12
Looking for Help continued
• Service Corps of Retired Executives (SCORE) — More
than 11,000 volunteers from industry, trade associations,
and education who counsel small business at no cost.
• Business professors from local colleges or college clubs
may provide advice and counseling.
• Other small-business owners can give insights into the
challenges and solutions encountered within the industry.

67. © McGraw Hill 67
SCORE
Karen Williams, owner of the
Cincinnati-based company
Sewendipity Lounge, worked with
a SCORE mentor to develop the
business side of her sewing
studio. The mentor advised her
about financing, sales and
marketing, human resources,
operations, and organizational
planning. What was the price tag
for all of this valuable advice? $0!
Ron Hill Photography, www.ronhillphotography.com

68. © McGraw Hill 68
TESTPREP 2
• A business plan is probably the most important
document a small business owner will ever create.
There are nine sections in the business plan outline
shown in the chapter. Can you describe at least five
sections of a business plan?

69. © McGraw Hill 69
Going Global: Small-Business Prospects 1
Small Business Exporting
Accounts for 98 percent of all exporting firms.
Technological advances have helped growth.
Hurdles include:
• Difficulty in finding financing.
• Not knowing how to get started.
• Not understanding cultural differences.
• Too much bureaucratic paperwork.

70. © McGraw Hill 70
Technological Advances
Dave Haymond, creator of The
Wizard Spiral Gumball Machine,
liked to say that his mission was
to “help people make money while
doing nothing.” That’s certainly
not the case for Global Gumball,
which ships the machines to
clients around the world. How do
the Internet and other
technological advancements
help Global Gumball serve its
global customers?
Global Gumball

71. © McGraw Hill 71
Going Global: Small-Business Prospects 2
Advantages of global trade for small businesses:
• Overseas buyers enjoy dealing with individuals.
• They can usually begin shipping much faster.
• They provide a wide variety of suppliers.
• They can give more personal service and attention.

72. © McGraw Hill 72
TESTPREP 3
• Why do many small businesses avoid doing
business globally?
• What are some of the advantages small
businesses have over large businesses in selling
in global markets?

73. Because learning changes everything.®
www.mheducation.com
© 2022 McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw Hill.