Transcript Chapter 1 Power Point Presentation 1.2

PowerPoint Presentation

Section 1.2
 Pages 12-15
1.2
The Entrepreneurial Process
What you’ll learn
 The
process of
entrepreneurship
 The components of a new
venture organization
 How businesses succeed
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The Entrepreneurial Process
Why it’s important
 Understanding
the
entrepreneurial process will
help you build a more
effective business that creates
value.
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The Entrepreneurial Process
Why it’s important
 Learning
the facts about
business success and failure
will help you make wiser
business decisions.
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The Entrepreneurial Process
Key Terms
environment
enterprise zones
opportunity
start-up resources
new venture
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Key Terms (Cont.)
business failure
discontinuance
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I. ENTREPRENEURIAL
START-UP
The entrepreneurial start-up
process includes five key
components.
A. The entrepreneur
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B. The environment
C. The opportunity
D. Start-up resources
E. The new venture
organization
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II. THE ENTREPRENEUR
A. The entrepreneur pulls
together the different
components involved in
creating a new business.
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B. The entrepreneur brings to
the business all the behaviors
and experience from his or
her life to that point.
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III. THE ENVIRONMENT
A. The business environment
refers to the variables
affecting it that are not
controlled by the
entrepreneur.
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B. There are four general
categories of environmental
variables affecting a new
venture.
1. The nature of the
environment (uncertain,
fast-changing, stable,
highly competitive etc.)
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2. The availability of resources
3. Ways to realize value
(favorable taxes, good
markets, supportive
government policies)
4. Incentives to create new
businesses, such as
enterprise zones
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Enterprise zones - Specially
designated area of a community
that provide tax benefits to new
businesses locating there and
grants for new product
development.
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Springboard
Analyze the current
business environment.
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IV. THE OPPORTUNITY
A. An opportunity is an idea that
has commercial value.
B. New businesses are founded
on recognized opportunities
in the environment.
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V. START-UP RESOURCES
A. The start-up resources an
entrepreneur needs to start a
business include the
following.
1. Capital
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2. Skilled labor
3. Management expertise
4. Legal and financial advice
5. A facility
6. Equipment
7. Customers
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B. The most important start-up
resource is customers.
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VI. THE NEW VENTURE
ORGANIZATION
A. The new venture
organization is the shell
that surrounds all the
parts of a new business.
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B. The parts of a new business
include the following.
1. Products
2. Processes
3. Services
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C. Entrepreneurs are able to
create value for a business
through new venture
organization.
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VII. HOW BUSINESSES
SUCCEED
A. The myth that most new
businesses fail is not true.
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B. A recent study done by Dun
& Bradstreet found that
more businesses succeed than
fail.
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C. The problem with most
reports on business failure is
that they don’t define failure
properly.
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VIII. WHAT IS BUSINESS
FAILURE?
A. A business failure is a
business that files
Chapter 7 bankruptcy or
loses money for creditors
and their investors.
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B. Businesses that disappear
from public lists are not
always failures.
C. Some businesses that
disappear from public lists
are discontinuances.
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D. A discontinuance is a
businesses that is either
operating under a new name
or has been purposely
discontinued to start a new
one.
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Discussion Starter
Name a business in the
community that is
considered a
discontinuance--not a
failure.
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E. Discontinuances are not
failures because they are
planned and cause no harm
to creditors.
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F. Failure is also sometimes
mistakenly reported when an
owner changes the legal
status of a business.
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IX. HOW CAN
ENTREPRENEURS
SUCCEED?
A. The chances of a new
business succeeding are
good with effective
planning.
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B. The number–one cause of
business failure is poor
management.
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C. Entrepreneurs can improve
their chances of success.
1. Learn how to build a new
business
2. Assemble a team that has
the expertise they need
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End of Section 1.2