LECTUREPEDIA - Ajarn Paul Tanongpol, J.D.; M.B.A.;B.A.; CBEST
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LECTUREPEDIA - Ajarn Paul Tanongpol, J.D.; M.B.A.;B.A.; CBEST
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CHAPTER 9 Entrepreneurship and ventures
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Entrepreneurship is dynamic, risk taking, creative, and growth oriented behavior. This type of behavior is used to describe strategic thinking and risk-taking behavior that results in the creation of new opportunities for individuals and/or organizations.
An entrepreneur is one who is willing to pursue opportunities in situations others view as problems or threats. An entrepreneur brings to life new ideas, and new products or services.
i. Internal locus of control (control your own destiny) ii. High energy level iii. High need for achievement iv. Tolerance for ambition v. Self-confidence vi. Action oriented vii. Desire for independence
Entrepreneurship is rich with diversity. It offers women and minorities opportunities that otherwise are closed to them.
Small business is defined as a firm that has 500 or less employees. This is an American definition (Small Business Administration). There are many ways to start small business: o Start an actual small business o Buy an existing small business o Buy franchise
Franchise is a type of business in which the owner of the business sells that business or, rather the duplication of that business in a form of name and operations, and the right to operate that business in another location. The reasons for franchise: o Standard products and services o Brand name recognition o Proven success of franchisor that could be duplicated
i. Easy to start ii. Low start up cost iii. Review dot.com life cycle
i. International trade brings more opportunities and market share, additional financing, and access to quality and possibly low-cost resources, access to labor and technical expertise, and on-site location for low-cost manufacturing or outsourcing.
ii. As the economy of the world expand and growth, consumer demands in all countries go up. People are demanding for more goods and services; therefore, there are many opportunities worldwide. This is a good opportunities for international entrepreneur.
i. Family business is owned, operated and controlled by member of the family who founded the company.
ii. Succession problem is a common problem seen in family business. Mom and dad may start the business and worked at it to a successful end; however, the son or daughter has other interests to follow. There is a problem with succession. Who will take over the business? How will the business continue?
iii. Succession plan is a solution to the succession problem. The entrepreneur that is running a family business must plan ahead. The leadership transition and related financial matters should be planned in advance.
i. Lack of experience ii. Lack of expertise iii. Lack of strategy iv. Poor financial control v. Growing too fast vi. Lack of commitment vii. Ethical failure
An entrepreneur who starts the new business will always have the advantage. This is called the first-mover advantage. This is an advantage that is accorded to the first comer who first comes to exploit a niche or enter a market. o New market o Niche market: specialized market. Cater your product and services to a specific customer base. The niche may be based on products or services, or customer base.
i. Birth ii. Breakthrough iii. Maturity
Entrepreneurs often face control and management dilemmas when their firms experience growth, including diversification or global expansion. This is a challenge for management and it requires strategic leadership skills to maintain success.
i. Business plan describes the direction for new business and the financing needed to operate it. o Executive summary o Industry analysis o Company description o Products and services description o Market description o Marketing strategy o Operations description o Staffing description o Financial projection o Capital needs
ii. There is no set template for a successful business plan, but the above outline seems to be the standard format.
i. Sole proprietorship ii. Partnership iii. Corporation
i. Debt financing ii. Equity financing
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i. Internal locus of control ii. High energy level iii. High need for achievement iv. Tolerance for ambition v. Self-confidence vi. Action oriented vii. Desire for independence
i. Sole proprietorship ii. Partnership iii. Corporation
i. Debt financing ii. Equity financing
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