Chapter 6

Entrepreneurship and
Business Planning

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Learning Objectives

Risks Creating

Entrepreneurship &
Business
Business Plan Planning Enter Market

Competing
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from pg 192
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Entrepreneurship
and Business
The Key Decisions in Running a
Planning
Business

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from pg 192
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Entrepreneurship
and Business
Planning
New Business - Resources

Creating
Enter Market
Competing
Business Plan SBA
Risks

Yahoo !

Portion of Graphic
American Express
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Entrepreneurship
- May possibly earn - Loss Potential
Creating large profits. (Possibly large losses
Enter Market (Profit Potential) and may lose entire
Competing -Your Own Boss investment)
- Accountability
Business Plan -No fear of being
- Income is tied to how
Risks mistreated or fired. well business is run
-Direct Rewards - Failure Possibility
(Work in a business you (Lose source of income if
created and will be business fails.)
directly rewarded for.)
Portion of Graphic
from pg 192 Advantages Disadvantages
will go here
Pros Cons

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Entrepreneurship
and Business
Planning
Demand

Creating
Enter Market
Competing
Product Markets
Business Plan
Risks Change

Flexibility

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Competition

Creating
Enter Market
Competing Market share: a firm’s sales as a proportion
Business Plan of the total market
Risks

Competition within segments

Segments: subsets of a market that reflect a
Portion of Graphic specific type of business and the perceived
from pg 192
will go here quality

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Competition

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Competition

Creating
Enter Market
Competing
Business Plan
Risks

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Segments

Creating
Enter Market
Competing
Business Plan
Risks

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Labor & Regulations

Creating
Enter Market
Competing
Business Plan Labor Costs
Risks
Unions

Regulations
Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Competitive Advantage

Creating
Enter Market
Competing
Business Plan
Risks

Portion of Graphic
Efficiency
from pg 192
will go here Higher Quality

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Competitive Advantage
Same Product, Lower Price
1) Cost leadership is the first competitive advantage businesses
often attempt to gain. Cost leadership as an advantage occurs
when a business is able to offer the same quality product as its
competitors, but at a lower price.

• To use this strategy, a company must find ways to produce

goods at a lower cost through the perfection of production
methods or by the utilization of resources in a more efficient
manner than competitors.
2) Higher Quality
If a new business can produce a product of higher quality without
incurring excessive costs, it has a competitive advantage over
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other competitors in the same price range
from pg 192
Example : Easier to use, last longer, or provide better service
will go here
For soft drinks, quality may be measured by taste.
For outdoor furniture, quality may be measured by durability.
For computers, quality may be measured by ease of use, the
service provided, and processing speed.
Copyright © 2007 South-Western. All rights reserved.
Entrepreneurship
and Business
Planning
Internet and Advantage

Creating
Enter Market
Competing Website
Business Plan
Risks
Advertising

Sales

Portion of Graphic Expenses

from pg 192
will go here

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Entrepreneurship
and Business
Planning
Business Plan

Creating
Enter Market
Competing
Business Plan
Risks

1.Environments
2.Management
Portion of Graphic
from pg 192 3.Marketing
will go here 4.Financial

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Assess the Environment

Creating
Enter Market
Competing
Business Plan
Economic
Risks

Industry

Global
Portion of Graphic
from pg 192
will go here

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Entrepreneurship
and Business
Planning
Management Plan

Creating
Enter Market
Competing
Business Plan PRES
Organization
Risks MGR

SALES
Production
SALES

SALES H.R.
Portion of Graphic
from pg 192
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Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Marketing Plan

Creating
Enter Market Target Market
Competing
Business Plan
Risks
Product

Pricing

Distribution
Portion of Graphic
from pg 192
will go here
Promotion

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Entrepreneurship
and Business
Planning
Financial Plan

Creating
Enter Market
Competing
Business Plan
Risks
Financing

Feasibility

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Business Plan Decisions

Creating
Enter Market
Competing
Business Plan
Risks

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Business Risks

Creating
Enter Market
Competing
Business Plan
Risks

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.

Entrepreneurship
and Business
Planning
Business Insurance

Creating
Enter Market
Competing
Business Plan
Risks
Insert Exhibit 6.7 from page 221

Portion of Graphic
from pg 192
will go here

Copyright © 2007 South-Western. All rights reserved.