Entrepreneurial Concepts

Retail Management

What You Will Learn

The meaning of entrepreneurship How to identify the risks involved in

entrepreneurship The advantages and disadvantages How to identify the personal skills and

characteristics necessary for entrepreneurs The scope of small business in the American

economy

What is entrepreneurship?

The process of starting and managing your own business

Entrepreneurs contributions to economy Henry Ford

Ray Kroc

Steve Jobs

Want to be own bosses

The Risks Involved

Major commitment Time

Money

Effort

60% of those who start a business are between ages of 25-40 Work experience

Personal drive

More than 3,000 businesses started each week in the U.S.

2 out of 3 close within first four years

Entrepreneurship

Advantages Personal Freedom

Increased Income

Personal Satisfaction

Increased Self-Esteem

Disadvantages Potential Loss of Income

Long Hours

Irregular Hours

Strong Self Discipline

Do you have what it takes?

Can you make your own decisions?

Do you like competition?

Can you adapt to changing conditions?

Are you willing to work 12-16 hours a day, weekends, and some holidays?

Are you prepared to lower your standard of living for a while?

Are you prepared to lose your savings?

Importance to Economy

Small Businesses

Less than 500 employees in manufacturing

Less than 100 in retailing

Make up a majority of businesses in U.S.

55% of labor force

Offer choices of goods and services

Help improve products

Logistics of Business Ownership

Retail Management

What You Will Learn

How to discuss business ownership opportunities

How to identify forms of business ownership

The legal steps to take in establishing a business

Business Ownership Opportunities

150,000 businesses are started each year

4 ways to enter a business

Develop a new business

Purchase a franchise

Purchase an existing nonfranchise business

Take over a family business

Forms of Business

Sole Proprietorship Partnership Corporation

Sole Proprietorship

Most common form of business ownership

70% of all U.S. businesses

Advantages

Easy to start

Make own decisions

Freedom from government regulation

Disadvantages

Unlimited Liability-financial liability is not limited to your investment in business

Use personal assets

Partnership

Legal agreement between two or more people to be jointly responsible for the success and failure of a business

Least common form of business ownership (10%)

Advantages Little regulation; taxed less heavily

Fairly easy to establish

Combines skills of owners

Disadvantages Decision making is harder because more people are involved

Business dissolved if one partner dies

Responsible for each others debts

Corporation

Business that is chartered by a state and legally operates apart from the owner

Most complicated form of business

Governing bodies called boards hire directors and managers to protect interest of stockholders

Stock is sold to stockholders (people who actually own the corp. with limited liability)

Legal Steps in Establishing Your Business

File a DBA (Doing Business As)

Sole Proprietorship or partnership

Registration process by which your county government officially recognizes that your business exists

Filing Fee; protects name of business in county

Articles of Incorporation

Identifies the name and address of your business, its purpose, the names of the official directors, and the amount of stock that will be issues to each director