Name the advanages of small business ownership. (5) |
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Independence, Cost, Flexibility, Focus, and Reputation. |
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Leading reasons why entrepreneurs go into business for themselves. (2) |
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Independence and opportunity to better themselves. |
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How is the cost difference in a small business versus large ones? |
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Usually require less money to start and maintain. |
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What do small businesses have the flexibilty to do? |
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Adapt to changing market demands. |
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How can small businesses benefit from one layer of management? |
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Decisions can be made quickly. |
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Small firms can focus their efforts on what? |
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A precisely defined market or niche or a specific group of customers. |
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Small firms can develop what? This demonstrates what? |
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Reputations for quality and service demonstrating a commitment to customer satisifcation. |
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Name the disadvantages of small business ownership. (2) |
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High stress level and high failure rate. |
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What are the worries in small business ownership that cause high stress? (3) |
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Business, competition, or changing market demand. |
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In a small business, what is the norm for work days and vacations? |
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Long work days and few vacations. |
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What are some reasons why small businesses have a high failure rate? (3) |
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Poor business management, a poor business concept, and burdens imposed by governement regulation, insufficient funds during slow periods, and competition from others. |
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What are the 3 major causes of small business failure? |
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Undercapitalization, Managerial Inexperience or Incompetence, and Inability to Cope with Growth. |
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Define Undercapitalization |
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Lacking sufficent funds to operate the business efficiently. |
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The shortest path to failure in a business is what? |
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Undercapitalization |
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Along with a vision, an entreprenuer needs what to manage a growing business effectively? |
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Knowledge and/ or experience. |
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Why can growth be a problem for a small business? |
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The owner may not have (or have the time to aquire) the specialized management skills needed. |
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Immediate threats to small and mid-sized businesses include? (5) |
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Rising inflation, collapse of the dollars value, energy and other supply shortages, excessive household or corporate debt, and the growing federal deficit. |
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