Entrepreneurship: Starting and Managing Your Own Business 6 Chapter © 2004 by Nelson, a division of Thomson Canada Limited.

Entrepreneurship: Starting and

Managing Your Own Business

6Chapter

© 2004 by Nelson, a division of Thomson Canada Limited.

2 © 2004 by Nelson, a division of Thomson Canada Limited.

Learning Goals

1. Why do people become entrepreneurs, and what are the different types of entrepreneurs?

2. Which characteristics do successful entrepreneurs share?

3. How do small businesses contribute to the Canadian economy?

4. What are the advantages and disadvantages facing owners of small businesses?


Learning Goals (cont’d)

5. How does the Business Development Bank of Canada help small businesses?

6. What are the first steps to take if you are starting your own firm?

7. Why does managing a small business present special challenges for the owner?

8. What trends are shaping the small business environment?


Learning Goal 1

Why do people become entrepreneurs, and what are the different types of entrepreneurs?


Entrepreneur:

a person with vision, drive, and creativity willing to take the risk of starting a new business for profit or of greatly changing the scope an direction of an existing firm


Reasons for Becoming an Entrepreneur

• Desire to control one’s own destiny

• The opportunity for profit

• Create something new

• Personal satisfaction

• Lifestyle


Types of Entrepreneurs

1. Classic entrepreneurs– people who start their own companies

based on innovative ideas

2. Multipreneurs– people who start a series of companies

3. Intrapreneurs– people who apply vision and risk taking

within a large organization


Learning Goal 2

Which characteristics do successful entrepreneurs share?


Characteristics of Successful Entrepreneurs

• Ambitious• Independent• Self-confident• Risk takers• Visionaries• Creative• Energetic• Passionate• Committed


Learning Goal 3

How do small businesses contribute to the Canadian economy?


Small Business:

a business that is independently owned by an individual or small group of investors, locally based, and not dominant in its industry


Small Business Contributions

• The majority of businesses in Canada are small businesses

• Dominate the services, wholesale, retail, construction and agriculture fields

• Provide most of the new jobs

• Lead in creating new products and services


Learning Goal 4

What are the advantages and disadvantages facing owners of small businesses?


Small Businesses

• Advantages– Greater flexibility– More efficient

operation– Greater ability to

serve specialized markets

– More personal service

• Disadvantages– Limited managerial

skill– Difficulty raising

funds– Burdensome

govern-ment regulations

– Extreme personal commitment of the owner


Learning Goal 5

How does the Business Development Bank of Canada help small businesses?


Business Development Bank of Canada

Provides small and medium sized businesses with flexible financing, affordable consulting services, and venture capital

Canadian Business Service Centres (www.cbsc.org) provide services for start-up and growing small businesses


Learning Goal 6

What are the first steps to take if you are starting your own firm?


Steps to Starting Your Own Business

1. Self assessment

2. Find a business idea

3. Buy a business or start from scratch

4. Choose a form of business organization

5. Develop a business plan

6. Finance the business

7. Manage the risk


Business Plan Contents

1. Title Page & Table of Contents2. Executive Summary3. Vision and Mission Statement4. Company Overview5. Detailed Plans for:

Products and/or Services, Marketing, Management, Operating, and Financing

6. Appendix of Supporting Documents


Learning Goal 7

Why does managing a small business present special challenges for the owner?


Managing a Small Business

Owners are involved in all aspects of the firm’s operations. Growth requires:– Using outside consultants

• hiring a good accountant (CA, CMA, or CGA)

• outsourcing some business functions

– Hiring and retaining employees• recruiting process• promoting employee satisfaction


Learning Goal 8

What trends are shaping the small business environment?


Trends in the Small Business Environment

• Increase in home-based businesses

• More younger, female, and minority entrepreneurs

• Increased use of the Internet– e-mail– purchasing– business research– selling