chapter 3.1 vocabulary & notes

Chapter 3.1 Vocabulary & Notes

Understanding Entrepreneurial Trends

Entrepreneurship

Understanding Entrepreneurial Trends

businesses that conduct business mainly on the internet

Advantages:◦ potential to attract a huge amount of customers◦ faster business growth

Internet Businesses/Online Businesses

Provide services to people for many different reasons◦ biggest and fastest growing part of the American

economy◦ Examples: Banking, Insurance, Education,

Advertising, Real Estate, Trades, Tax Preparation

Service Businesses

Businesses that are run out of an individuals home◦ Rapid business growth since the late 1990’s◦ Examples: Consultants, Sales Reps, Writers,

Graphic Artists, Web Designers, Survey Takers

Home-based Businesses

A business that focuses on a goodwill mission to better society

Examples: United Way, Salvation Army, Feed the Children, YMCA, American Red Cross

Nonprofit Businesses

Trend in business to improve processes, efficiency and marketing to gain a competitive advantage over competition

Technology

Contracting with other companies for services

Outsourcing

Partnering with another company for mutual benefit

Strategic Alliances

Starting another company within a company

Corporate Ventures

1. Brainstorming – thinking freely to generate new ideas

2. Recognize Needs as Opportunities3. Evaluate Products & Services4. Observe the world around you and the

people5. Learn about different types of businesses

and industries

Learning to Recognize Opportunity

Thinking creatively that results in a new way of doing something

Innovation

A small specialized market

Niche

Personal characteristics that describe a population◦ Age◦ Gender◦ Income◦ Ethnic background◦ Education◦ Occupation

Demographics

Interests Hobbies Work

Consider Your Own Experiences

Trade Magazines◦ Periodical published for specific types of business

or industries

Consider Outside Sources

Specialty Magazines◦ periodical that targets people with a specific

interest◦ Examples: Sports, Fashion, Computers &

Electronics, Entertainment, Autos, Cooking

Consider Outside Sources

Trade Show◦ Show or exhibition in which vendors promote new

products and do demonstrations to market products

Consider Outside Sources

Newspapers Internet Government Agencies

Consider Outside Sources

Ch. 3.2Starting vs. Buying a

BusinessEntrepreneurship

Beliefs and principles that you choose to live by◦ Define who you are◦ Shape your attitudes and choices◦ Identify priorities

Influenced by◦ Family◦ Religion◦ Friends◦ Society◦ Personal Experiences

Personal Values & Goals

a business in which one or more members of a family have a significant ownership interest in the business◦ Typically small businesses◦ Exceptions: Marriot, Mattel Toys◦ Only 1/3 survive to the second generation

Family Business

Shared feeling of trust and togetherness Family working as a team can achieve great

things Family profits

Rewards of Family Business

It is tough to separate business and family Can’t get away Trouble viewing problems objectively

without emotion Backstabbing

Challenges to Family Business

Could I work for someone in my family? Do we share similar values & goals? Clear Expectations? Can we separate family & business when we

go home each night? Can we keep relationships positive?

Questions to Ask?

Buying the rights to set up a new business patterned on an existing model

A legal agreement to begin a business in the name of the recognized company

Examples: ◦ Subway◦ Dunkin Donuts◦ UPS Store◦ Super 8◦ McDonald's

Buying a Franchise

Franchisee – buyer of the rights◦ Example: John Doe, Susan Smith

Need initial investment in $30,000 - $250,000 range

Franchisor- seller of the rights

◦ Example: McDonald’s, Subway

Franchisee vs. Franchisor

Usually less risky Facility, employees, equipment, procedures

are usually established Customer base Goodwill – loyalty to existing customers

Buying an Existing Business

Read pg. 60 thru the end of the Section 3.2 on pg. 63

◦ Franchises◦ Evaluating a Business Opportunity◦ Starting Your Own Business

◦ Answer #3 and #4 on pg. 63 in your journal

In Your Book