Chapter 01 Revised 2&3&4

7/27/2019 Chapter 01 Revised 2&3&4

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PowerPoint Presentation by Charlie Cook

The University of West Alabama

Copyright © 2006 Thomson Business & Professional Publishing.

All rights reserved.

Part 1 Entrepreneurship:

A World of Opportunity

The EntrepreneurialLife



Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved. 1 –4

Entrepreneurial Opportunities

• Entrepreneurial Opportunity – A value-creating innovation with market potential

– A desirable and timely innovation that creates valuefor interested buyers and end users

• Success stories –Auntie Anne’s

–Souto Brothers

–Turf Mgt. Inc

–Mobile Flower Shop –Exotic Yarns Co.

–Gourmet Tomatoes LLC




Who Are Entrepreneurs?

• Entrepreneurs are: –People who start and/or operate a business.

–Individuals who discover market needs and launch

new firms to meet those needs.

–Risk takers who provide an impetus for change,

innovation, and progress.

– All active owner-managers (founders and/or managers

of small businesses).




The Independent Entrepreneur

Source: John L. Hart FLP, and Creators Syndicate, Inc. Exhibit 1.1




The Contributions of Small Business

• Small Businesses: –Represent more than 99.7 percent of all employers.

–Employ more than half of all private-sector employees.

–Pay 44.5 percent of total U.S. private payrolls.

–Generate 60 to 80 percent of net new jobs annually.

–Produce 13 to 14 times more patents per employee

than do large patenting firms.




What Is a Small Business?

• Criteria for Defining Smallness in Business –Financing supplied by one person or small group

–Localized business operations (except marketing)

–Business’ size small relative to larger competitors

–Fewer than 100 employees

4 Routes To Entrepreneurship

-Buy a Business--Start a New Business

_ Franchised Business

_ Entering a Family Business


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Entrepreneurial Incentives

Exhibit 1.3

Main Drawback is business failure



Why People Become Entrepreneurs

• Reluctant Entrepreneur – A person who becomes an entrepreneur as a result

of some severe hardship

• Refugee

– A person who becomes an entrepreneur toescape an undesirable situation



Artisan Entrepreneurs

• Artisan Entrepreneur – A person with primarily technical skills and little

business knowledge who starts a business

• Characteristics

–Technical training

–Paternalistic approach

–Reluctance to delegate

–Narrow view of strategy

–Personal sales effort

–Short planning horizon

–Simple record keeping



Opportunistic Entrepreneurs

• Opportunistic Entrepreneur – A person with both sophisticated managerial skills and

technical knowledge who starts a business

• Characteristics

–Broad-based education –Scientific approach to problems

–Willing to delegate

–Broad view of strategy

–Diversified marketing approach

–Longer planning horizon

–Sophisticated accounting

and financial control




Women Entrepreneurs

• More Women Entrepreneurs –Represent 38% of entrepreneurs in U.S.

–Revenues at female-owned firms have grown 33%

from 1976 to 2000.

–Women are moving into nontraditional industries.• Problems Facing Female Entrepreneurs

–Newness of entrepreneurial role

–Lack of access to credit

–Lack of networking

connections

–Discrimination




Competitive Advantages of

Entrepreneurial Firms

• Customer Focus

–Firms lack bureaucracy.

• Quality Performance –Quality is not limited

to large firms.

• Integrity and

Responsibility – A solid reputation builds

loyal customers.

• Innovation

–Small firms are the

leading source of

innovation.

• Special Niche

–Providing uniquely

specialized services

can be a powerful

competitive advantage.




Age

Early Career Concerns

1. Getting an education

2. Gaining work experience

3. Acquiring financial

resources

Late Career Concerns

1. Fulfilling family

responsibilities2. Attaining seniority

in employment

3. Earning investment ina retirement program

25 35 4520

Age and Entrepreneurial Opportunity




Taking the Plunge

• Precipitating Event – An event, such as losing

a job, that moves an

individual to become

an entrepreneur




Living the Entrepreneurial Life

• Entrepreneurial Legacy –The tangible items and intangible qualities are passed

on not only to heirs but also to the broader society.

• Evaluating accomplishments

• The disappointments in winning the wrong game

• Crafting a Worthy Legacy

–The nature of the entrepreneurial endeavor reflects

personal goals and values.

• Beginning with the End in Mind –Proper values and actions lead to a good exit.

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Chapter 01 Revised 2&3&4

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