Unit One Entrepreneurship. What is an Entrepreneur? Name an Entrepreneur. Name an Entrepreneur. Give three reasons for becoming an Entrepreneur. Give.

Unit OneUnit OneEntrepreneurshipEntrepreneurship

What is an Entrepreneur?What is an Entrepreneur?

Name an Entrepreneur.Name an Entrepreneur. Give three reasons for becoming an Give three reasons for becoming an

Entrepreneur.Entrepreneur. List three skills or abilities needed to be List three skills or abilities needed to be

your own boss.your own boss. Are you now, or have you ever been, an Are you now, or have you ever been, an

Entrepreneur?Entrepreneur? Is being an Entrepreneur a career move?Is being an Entrepreneur a career move?

Unit 1 VocabularyUnit 1 Vocabulary AchieverAchiever BrainstormBrainstorm Business BrokerBusiness Broker Business CycleBusiness Cycle Business FailureBusiness Failure CapitalCapital CompetitionCompetition Corporate VentureCorporate Venture DiscontinuanceDiscontinuance DemandDemand DemographicsDemographics Diminishing Marginal Diminishing Marginal

UtilityUtility EconomicsEconomics

Elastic DemandElastic Demand EntrepreneurEntrepreneur EntrepreneurialEntrepreneurial EntrepreneurshipEntrepreneurship Enterprise ZonesEnterprise Zones EquilibriumEquilibrium Factors of ProductionFactors of Production Foundation SkillsFoundation Skills Free Enterprise SystemFree Enterprise System FranchiseFranchise FranchiseeFranchisee FranchisorFranchisor GoodwillGoodwill GoodsGoods

Unit 1 VocabularyUnit 1 Vocabulary Gross Domestic ProductGross Domestic Product InvestmentInvestment InnovationInnovation Inelastic DemandInelastic Demand Market StructureMarket Structure MonopolyMonopoly NeedNeed New Venture OrganizationNew Venture Organization NicheNiche OligopolyOligopoly Online BusinessOnline Business OpportunityOpportunity OutsourcingOutsourcing ProfileProfile

ProfitProfit Role ModelRole Model ScarcityScarcity ServicesServices Specialty MagazineSpecialty Magazine Start-up ResourcesStart-up Resources SupplySupply Strategic AllianceStrategic Alliance Trade ShowTrade Show Trade MagazineTrade Magazine ValuesValues VentureVenture WantWant

Unit 1 EssentialUnit 1 EssentialQuestion 1Question 1

What are the concepts and processes What are the concepts and processes associated with successful entrepreneurial associated with successful entrepreneurial performance?performance?

Essential Question 1AEssential Question 1A(MKT-EN-1A)(MKT-EN-1A)

What is entrepreneurship?What is entrepreneurship?

Entrepreneurship

• Entrepreneurship: The process of recognizing an opportunity, testing the market, and gathering resources necessary to go into business.

• Entrepreneurial: Acting like an entrepreneur or having a similar mind set.

Entrepreneurship

• Entrepreneur: An individual who undertakes the creation, organization, and ownership of a business venture. They accept the risks and responsibilities of business ownership to gain profit and personal satisfaction.

• Venture: A new business undertaking that involves risk.

Essential Question 1BEssential Question 1B(MKT-EN-1B)(MKT-EN-1B)

What are the What are the characteristics of characteristics of successful successful entrepreneurs?entrepreneurs?

Why Be An Entrepreneur?RewardsRewards

• Being Your Own Boss• Doing Something You

Enjoy• Having the Opportunity

to be Creative• Freedom to Set Your

Own Schedule• Controlling Your Salary• Contributing to the

Community

Costs and RisksCosts and Risks• Working Long Hours• Having an Uncertain

Income• Being Fully Responsible• Risking One’s Investment

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Entreprenurial VentureThomas EdisonKing GilletteCharles DarrowRobert PittmanMargaret RudkinJohn JohnsonWilson GreatbatchWally Amos

H Exibited a high degree of this characteristicM Exibited a medium degree of this characteristicL Exibited a low degree of this characteristic

N/O Characteristic not observed

Persistent

• Willing to work until job is done, no matter what it takes.

Creative

• Looks for new ways to solve old problems.

Responsible

• Takes responsibility for decisions and actions.

Inquisitive

• Conduct research and asks questions to solve problems.

Goal-oriented

• Know where to go and how to get there.

Independent

• Sets own agendas and schedules.

Self-demanding

• Have high expectations of themselves.

Self-confident

• Believe in themselves.

Risk-taking

• Are not reckless. Looks for opportunity with a reasonable chance of success.

Restless

• Once their goals are achieved, they start looking for new challenges.

Action-oriented

• Doers as opposed to spectators.

Enthusiastic

• Energetic and passionate about their pursuits.

Foundational Skills• Communication Skills – Person to

person, telephone, and written skills.• Math Skills – Basic math, record

keeping, budgeting, and preparing financial statements.

• Problem-solving Skills – Able to use logic and creative solutions.

• Decision-making Skills – Able to choose the best option from among many.

Human Relations Skills

• Teamwork Skills – Coordinate and manage work teams, respecting others, being flexible, leadership.

• Social Skills – Able to interact well with employees, customers, and vendors.

Technical Skills

• Computer Skills – Understands the use of technology, word processing, spreadsheet, database, e-mail, and the Internet.

Business Skills

• Basic Business Skills – Understands how the economy works, and fundamental concepts of finance, marketing, and management. Keeps up to date on current events.

• Organizing and Planning Skills – Uses logical thinking and time management skills.

• Adaptability Skills – Able to change with the constantly changing business and economic environment.

Essential Question 1CEssential Question 1C(MKT-EN-1C)(MKT-EN-1C)

What are the reasons for planning an What are the reasons for planning an entrepreneurial businesses?entrepreneurial businesses?

Home-based Businesses

• 6 million in mid-1980’s

• 41 million in late 1990’s

Outsourcing

• Outsourcing: Contracting with another company for services.– Allows greater efficiency, saving time and

money.– Decreases overhead investment or debt.– Lowers regulatory compliance burdens.– Makes companies more attractive to investors

because more capital is sent directly into money making activities.

Service Businesses

• Services: Intangible things that businesses do for us that enhance our lives.

• Fastest growing business segment in the U.S. Economy today.

Internet Businesses

• Online Business: A business that conduct business by means of the internet.

• Small businesses that use the internet have grown 46% faster than those who do not.

• www.prairietumbleweedfarm.com

http://www.prairietumbleweedfarm.com/

Essential Question 1DEssential Question 1D(MKT-EN-1D)(MKT-EN-1D)

What is the entrepreneurial discovery What is the entrepreneurial discovery process?process?

Recognizing OpportunityRecognizing Opportunity Entrepreneurial thinking is about Entrepreneurial thinking is about

generating ideas and recognizing generating ideas and recognizing opportunities.opportunities. Creativity and Innovation: Creativity and Innovation: Creativity is the Creativity is the

result of result of innovationinnovation: : finding new ways of finding new ways of doing things.doing things.

Idea vs. Opportunity:Idea vs. Opportunity: Ideas are generated though creative thinking.Ideas are generated though creative thinking. Opportunity is an idea that has commercial value.Opportunity is an idea that has commercial value. Many opportunities come from fulfilling a Many opportunities come from fulfilling a nicheniche:: a a

small specialize market.small specialize market.

Recognizing OpportunityRecognizing Opportunity Finding opportunity by understanding Finding opportunity by understanding

industry: industry: An industry is a grouping of businesses with a An industry is a grouping of businesses with a

common purpose.common purpose. The marketplace and economics of every industry is The marketplace and economics of every industry is

constantly changing which creates profitable niche constantly changing which creates profitable niche opportunities.opportunities.

Knowing the inner workings of the industry and the Knowing the inner workings of the industry and the industry trends allows the entrepreneur to identify industry trends allows the entrepreneur to identify opportunity.opportunity.

Learn and understand what the customer problems Learn and understand what the customer problems are and create a business to fix them.are and create a business to fix them.

Essential Question 1EEssential Question 1E(MKT-EN-1E)(MKT-EN-1E)

What are current global trends and What are current global trends and opportunities?opportunities?

Global TrendsGlobal Trends Diminishing trade barriersDiminishing trade barriers

NAFTA and CAFTANAFTA and CAFTA EUEU Most favored nation statusMost favored nation status

Advances in technology have made the Advances in technology have made the world “smaller”world “smaller”

Global TrendsGlobal Trends Global OpportunitiesGlobal Opportunities

AsiaAsia Enormous and diverse continentEnormous and diverse continent China is the number one importer of US goodsChina is the number one importer of US goods

Latin AmericaLatin America Diverse community of nations with many Diverse community of nations with many

cultural differencescultural differences Includes traditional as well as modern culturesIncludes traditional as well as modern cultures Tends to make buying decisions based on Tends to make buying decisions based on

family needs as opposed to individual needsfamily needs as opposed to individual needs

Global TrendsGlobal Trends EuropeEurope

Entrepreneurship and risk-taking are not highly Entrepreneurship and risk-taking are not highly encouragedencouraged

Market difficult to define due to no common Market difficult to define due to no common European cultureEuropean culture

Great cultural differences between individual Great cultural differences between individual nationsnations

High degree of socialism affects the thinking High degree of socialism affects the thinking toward individual wealth as well as the distribution toward individual wealth as well as the distribution of wealth, individualism and powerof wealth, individualism and power

Market segmentation a must to sell similar Market segmentation a must to sell similar products across national bordersproducts across national borders

Global TrendsGlobal Trends Regions in transitionRegions in transition

Russia, Eastern European nations, African nations, Russia, Eastern European nations, African nations, and the Middle Eastand the Middle East

Very risky opportunity due to unstable Very risky opportunity due to unstable governments and US politics and policiesgovernments and US politics and policies

Must thoroughly understand culture and business Must thoroughly understand culture and business practicespractices

How currency is exchanged and handled may How currency is exchanged and handled may affect profitsaffect profits

Essential Question 1FEssential Question 1F(MKT-EN-1F)(MKT-EN-1F)

How are opportunities How are opportunities for business creation for business creation determined?determined?

Learn to Recognize Opportunity

• Work with unrelated items.

• Get from here to there.

• Think outside the box.

• Think Creatively about Opportunity

Essential Question 1GEssential Question 1G(MKT-EN-1G)(MKT-EN-1G)

How are ideas for business generated?How are ideas for business generated?

Creative Sources of Ideas

• People Watching

• Demographic Changes – Characteristics of human populations and population segments.

• Become an Insatiable Reader

• Your Own Experiences

• Hobbies – many hobbies can be turned into successful ventures.


• Work– Look for opportunities at your work. – Is there room in the market for a similar business?– Are there gaps in the network of suppliers?– Is there a need for services which are not being

provided?


• Consult Outside Sources– Trade magazines

– Specialty magazines

– Newspapers


• Consult Outside Sources - Trade shows and exhibitions

- Internet

- Government agencies

Starting Versus Buying a Business

• Being creative and opportunistic does not always mean that you must start a business from scratch. You may also enter a family business or buy an existing business.

Entering a Family Business

Up-side Families have a greater

degree of trust and togetherness.

The family team can achieve more than others.

Down-side Owners can never get

away from their business. Families have difficulty

viewing the venture and its problems objectively.

Only one-third of family run businesses survives the second generation.

Buying an Existing Business

Positives Has a location and a physical plant. Has experienced employees. Has goodwill – loyal customer base. Has established procedures in place. Has substantial inventory. Has established trade credit.


Negatives Most businesses are put up for sale because

they are not successful. The business may have a poor reputation. Inventory may be dated and equipment or

facilities may need repairs. Employees may lack the skills necessary to

keep the business competitive.


Franchise A legal agreement to begin a new business

in the name of a recognized company. Franchisee – The buyer of a franchise. Franchiser – The seller of a franchise.


Franchise

• Has the same positives as other existing businesses with different negatives.- Purchase or initial investment costs are very high.- You may have to pay additional costs for advertising.- You may have to pay a percentage of your annual

sales.- Lack of freedom. Must operate and run the business

by the franchiser’s guidelines.


What are the fundamental concepts of What are the fundamental concepts of business ownership?business ownership?


What is the relationship of competition to What is the relationship of competition to our private, free enterprise system?our private, free enterprise system?

Resources

• Resources: All the things used in producing goods and services. Also known as factors of production.

Factors of Production• Land: Everything contained in

the earth or found in the sea.

Factors of Production

• Labor: Full and part-time workers, managers, public workers and professional people.


• Capital: Money as well as buildings, equipment and tools needed for the operation of a business.


• Entrepreneurship: Skills of the people who are willing to risk their time and money to run a business.

Scarcity

• Scarcity: Condition that exists when people’s wants and needs exceed their resources.

Economic Systems

1 What goods and services should be produced?

2 How should the goods and services be produced?

3 For whom should the goods and services be produced?

Economic Systems• Market Economy: No government

involvement in economic decisions.– Consumers decide what should be

produced with their purchases.

– Businesses decide how products will be produced.

– People with money decide for whom products should be produced.

Economic Systems• Command Economy: The government

makes all economic decisions.– The dictator or central committee decides

what should be produced.

– The government decides how products will be produced because it runs all businesses.

– The government decides for whom products should be produced.

Economic Systems

• Mixed Economy: No economy is 100% market or command therefore, to what degree or how much does the government get involved in the market?

Free Enterprise System

People have the right to make economic choices.• Can choose what products to buy.

• Can choose to own property.

• Can choose to start a business and compete with others.

CompetitionCompetition: The struggle between companies.

• Forces companies to become efficient.

• Keeps prices down and quality up.

Types of Competition• Price Competition: Goes on the assumption,

all things being equal, customers will buy the product that is lower in price.

• Non-price Competition:– Quality– Service– Location– Reputation

Risk & Profit• Risk: Potential for loss or failure.

– As the potential for earning gets greater, so does the risk.

• Profit: Money left after all expenses.– Main incentive of a free enterprise

system.

– Risk of failure serves as a positive function to encourage quality.

Market Structures• Market Structure: Refers to the nature and

degree of competition among business operating in the same industry. The market structure will affect the market price.

• Market structure groupings:– Perfect Competition– Monopolistic Competition– Monopoly– Oligopoly


What are the effects of competition on What are the effects of competition on buyers and sellers?buyers and sellers?

Goods and Services

• Goods and services are the products our economic system produces to satisfy customer needs and wants.– Goods: Tangible products.– Services: Intangible products.– Needs: Basic requirement for survival such as food,

water, clothing, and shelter.– Wants: Anything that is not needed for survival.

Supply and Demand

• Demand: The amount of goods and services that consumers are willing and able to buy.

Supply and Demand

• Law of Demand: Price is inversely proportional to demand.

• P D

PRICE

QUANTITY

Supply and DemandTypes of Demand• Elastic: A small change in price causes a

significant change in demand.

• Inelastic: Any change in price has little to no effect on demand.– No acceptable substitute.– Price change is small relative to buyer income.– Product is a perceived necessity.

Supply and Demand

• Supply: The amount of goods and services that producers are willing and able to provide.

Supply and Demand

• Law of Supply: Producers are more willing to supply products in greater amounts when the price is high.

• P S

PRICE

QUANTITY

Supply and Demand

• Surplus: Occurs when quantity supplied exceeds quantity demanded.

PRICE

QUANTITY

Supply and Demand

• Shortage: Occurs when quantity demanded exceeds quantity supplied.

PRICE

QUANTITY

Supply and Demand

• Equilibrium: Occurs when the amount of product supplied equals the amount of product demanded.

PRICE

QUANTITY

What Entrepreneurs Contribute• Entrepreneurs are the mechanism by which the

economy turns demand into supply.• Entrepreneurs are a principal source of venture

capital.• Entrepreneurs provide jobs.• The most successful entrepreneurs change

society.• Entrepreneurs are the catalyst that make

economic progress happen.


What are the concepts, systems, and tools What are the concepts, systems, and tools needed to gather, access, synthesize, needed to gather, access, synthesize, evaluate, and disseminate information for evaluate, and disseminate information for use in making business decisions?use in making business decisions?


How is technology used in marketing How is technology used in marketing information management?information management?

Technology in Market ResearchTechnology in Market Research

Research methods include: Research methods include: documentation, observation, documentation, observation, experiment, test, simulation and experiment, test, simulation and market investigationmarket investigation

The main research tool is the The main research tool is the questionnaire.questionnaire.• Pen and paper methodPen and paper method• Online formatsOnline formats


Point of Sale (POS) data Point of Sale (POS) data gathering include:gathering include:• NameName• Zip CodeZip Code• AddressAddress• Telephone numberTelephone number

Internet data gathering methods Internet data gathering methods include:include:• Website tracking including app trackingWebsite tracking including app tracking• Social media data miningSocial media data mining


Geographical Information Geographical Information Systems (GIS) is used in the site Systems (GIS) is used in the site selection analysis. selection analysis. • Analyzes different factors such as Analyzes different factors such as

infrastructure, physical capital, infrastructure, physical capital, knowledge capital, customer profiles knowledge capital, customer profiles and geodemographic informationand geodemographic information

• Answers the question “where should we Answers the question “where should we our new business, new store, or new our new business, new store, or new distribution service?”distribution service?”


Experimental technologies being Experimental technologies being developed include:developed include:• NeuroscienceNeuroscience:: Measures brain waves Measures brain waves

and other biometric measures like and other biometric measures like temperature, blinking, breathing, and temperature, blinking, breathing, and pulse to assess reactions to brands, pulse to assess reactions to brands, logos and experiences on a continuous logos and experiences on a continuous basis.basis.

• TelepresenceTelepresence:: Allows for focus groups Allows for focus groups to be conducted using multiple locations to be conducted using multiple locations in a virtual room. in a virtual room.


Experimental technologies being Experimental technologies being developed include:developed include:• Eye trackingEye tracking:: Measures how ad Measures how ad

elements are perceived, retained and elements are perceived, retained and recalled to explain how advertising is recalled to explain how advertising is processed or how consumers process processed or how consumers process packaging in stores. packaging in stores.

• Implicit association analysisImplicit association analysis:: Uses Uses reaction times or accuracy on reaction times or accuracy on completing tasks to measure the completing tasks to measure the motivational power of logos or brand motivational power of logos or brand names. names.


What is demographic, geographic, What is demographic, geographic, psychographic, and behavioral psychographic, and behavioral segmentation?segmentation?

Market SegmentationMarket Segmentation

GeographicsGeographics Segmentation of the market Segmentation of the market

based on where people live.based on where people live.

Market SegmentationMarket SegmentationDemographicsDemographics

Statistics that describe a population in Statistics that describe a population in terms of personal characteristics. terms of personal characteristics. These include age, gender, income, These include age, gender, income, ethnic background, education, etc.ethnic background, education, etc.

Market SegmentationMarket SegmentationPsychographicsPsychographics

Involves the study of customers Involves the study of customers based on lifestyle, and the attitudes based on lifestyle, and the attitudes and values that shape it.and values that shape it.

Market SegmentationMarket Segmentation

Behavior SegmentationBehavior Segmentation Market segmentation that groups Market segmentation that groups

consumers based on specific consumers based on specific behavioral patterns they display behavioral patterns they display when making purchasing when making purchasing decisions.decisions.

Essential Question 3CEssential Question 3C(MKT-EN-3C)(MKT-EN-3C)

What options do businesses have to What options do businesses have to obtain market research data (i.e. primary obtain market research data (i.e. primary and secondary research)?and secondary research)?

Types of DataTypes of Data

Primary dataPrimary data:: Data obtained Data obtained for the first time and used for the first time and used specifically for the particular specifically for the particular problem or issue under study.problem or issue under study.

Secondary dataSecondary data:: Data Data already collected for some already collected for some purpose other than the purpose other than the current study.current study.

Data CollectionData Collection

Primary dataPrimary data can be obtained by: can be obtained by:- the survey method- the survey method

- the observation method- the observation method- the experimental method- the experimental method

Secondary dataSecondary data can be obtained by can be obtained by a number of agencies.a number of agencies.

- Internet Sources- Internet Sources- US and Government Sources- US and Government Sources

- Specialized Research Companies- Specialized Research Companies- Business Publications and Trade - Business Publications and Trade

OrganizationsOrganizations

Essential Question 3DEssential Question 3D(MKT-EN-3D)(MKT-EN-3D)

What are the characteristics of effective What are the characteristics of effective data collection instruments?data collection instruments?

Data SamplingData Sampling When designing a survey, marketers When designing a survey, marketers

must determine the number of people must determine the number of people to include in their survey.to include in their survey.• Population:Population: The entire target group of people The entire target group of people

under study.under study.• SampleSample: : Part of the target population that Part of the target population that

represents it accurately.represents it accurately.• Bias:Bias: Inaccuracies introduced into the results due Inaccuracies introduced into the results due

to errors in measurement, coverage, and to errors in measurement, coverage, and nonresponsive.nonresponsive.

• Error:Error: Determined by the sample sizeDetermined by the sample size with with respect respect to the population. Theto the population. The greater greater the sample size,the sample size, the lowerthe lower the margin of the margin of error.error.

Data SamplingData Sampling

1.1. Provide clear and detailed Provide clear and detailed instructions for completing the data instructions for completing the data collection instrument. collection instrument.

2.2. Provide definitions and clarifying Provide definitions and clarifying information for individual items and information for individual items and terms.terms.

3.3. Make definitions of data elements Make definitions of data elements consistent with standardconsistent with standard definitions definitions and analyticand analytic conventions when conventions when appropriateappropriate and feasible. and feasible.

Data SamplingData Sampling4.4. Determine whether another Determine whether another

organization is already collecting organization is already collecting data related to the items you plan to data related to the items you plan to collectcollect..

5.5. Any deviations from accepted usage Any deviations from accepted usage should be explained.should be explained.

6.6. Indicate subpopulations to include Indicate subpopulations to include and/or exclude in the reporting.and/or exclude in the reporting.

7.7. Be clear about the date orBe clear about the date or time time period the survey should reflect.period the survey should reflect.


8.8. If more than one analytic If more than one analytic convention is commonly used for a convention is commonly used for a given measure, indicate the given measure, indicate the preferred convention. preferred convention.

9.9. Use standard language. Avoid Use standard language. Avoid jargon and abbreviations. Keep jargon and abbreviations. Keep questions short and simple.questions short and simple.

10.10. Make categories as concreteMake categories as concrete as as possible. Use simple andpossible. Use simple and exact terms.exact terms.


11.11. If response categories are supposed If response categories are supposed to be mutually exclusive and to be mutually exclusive and exhaustive, make sure all possible exhaustive, make sure all possible categories are included on the survey. categories are included on the survey. If in doubt about whether categories If in doubt about whether categories are exhaustive, include a response are exhaustive, include a response option of "other, please specify."option of "other, please specify."

12.12. If data may be unknown orIf data may be unknown or missing, be sure to include an missing, be sure to include an “unknown/missing” option.“unknown/missing” option.


13.13. Provide a “not applicable” response Provide a “not applicable” response for questions that may not be for questions that may not be applicable to all respondents.applicable to all respondents.

14.14. Do not combine two separate ideas Do not combine two separate ideas inappropriately and request a single inappropriately and request a single response.response.

15.15. Design the item sequence of the Design the item sequence of the survey such that it increasessurvey such that it increases the the respondent's ability torespondent's ability to complete the complete the survey. survey.


16.16. Keep topic-related questions Keep topic-related questions together and provide transitions together and provide transitions between topics.between topics.

17.17. Be sure that return address, fax Be sure that return address, fax number, and contact information number, and contact information are included on the form itself as are included on the form itself as well as in accompanying letter. well as in accompanying letter. Consider including anConsider including an addressed, postage-paidaddressed, postage-paid envelope to return the survey.envelope to return the survey.

Essential Question 3EEssential Question 3E(MKT-EN-3F)(MKT-EN-3F)

What techniques are used to process What techniques are used to process marketing information?marketing information?

Processing Marketing Processing Marketing InformationInformation

Information processing refers to the Information processing refers to the collection, storage, manipulation, collection, storage, manipulation, distribution and presentation of distribution and presentation of data.data.

• Analyzed by using computers or by manual Analyzed by using computers or by manual methods. methods.

• Databases and spreadsheets make it very Databases and spreadsheets make it very easy to analyze information. easy to analyze information.

• Information can be presented in line graphs, Information can be presented in line graphs, histograms, bar charts, pie charts, etc. so it is histograms, bar charts, pie charts, etc. so it is easy to make sense of the information.easy to make sense of the information.

Unit One Entrepreneurship. What is an Entrepreneur? Name an Entrepreneur. Name an Entrepreneur. Give three reasons for becoming an Entrepreneur. Give.

Documents

business venture

entrepreneurship slide

new business undertaking

essential question

resources necessary

b mkten

personal satisfaction

creative freedom