What Is Entrepreneurship and Why Is It Important?
Autor: Adnan • May 23, 2018 • 947 Words (4 Pages) • 437 Views
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-Management Prowess
- Step requires honesty
- Does a sufficient level of passion for the business exist?
- How well is the market(s) understood that the business will operate in?
-Resource Sufficiency
- Does the organize have or is it capable of obtaining resources to move forward
- Focus here is on nonfinancial resources (skills, intellectual protections of key aspects (see Table 3.5)
- Financial Feasibility Analysis
-At this point this is a preliminary financial assessment
-Key issues:
- Start-up cash needed
- Prepare an actual budget indicating all purchases and costs
- Provide an explanation where money will come from (winning the lottery is not reasonable)
- Overestimation better than underestimation (you will run higher than you think)
- Financial performance of similar businesses
- Compare to similar existing businesses
-Archival data exists: can also speak with owners and observe
- -Key issues (cont’d):
- Financial attractiveness of proposal
- Concerned with business’s projected rate of return(profitability) – at this point, based on judgment
- Project rate of return should be considered against the following:
- Amount of capital invested
- Risks assumed in launching the business
- Existing alternatives for the money being invested
- Existing alternatives for the entrepreneur’s time and efforts
- See Table 3.6 for other factors to consider
Chap 4
- Business Models and Their Importance
- General Categories of Business Models
-Standard Business Models: depict existing plans firms can use to determine how the will create, deliver, and capture value for stakeholders
- Advertising Business Model
- Auction Business Model
- Manufacturer/Retailer Business Model
- Bricks and Clicks Business Model
- Peer-to-Peer Business Model
- Franchise Business Model
- Razor and Blades Business Model
- Freemium Business Model
- Subscription Business Model
- Low-Cost Business Model
- Traditional Retailer Business Model
Disruptive Business Models are rare; don’t fit the standard models and disrupt the way business is conduct in an industry or important niche of an industry
Two disruptive models:
- New market disruption – addresses a market that previously wasn’t served
- Low-end market disruption – over supply of over improved products provide market for simpler, cheaper or more convenient ways of performing a task (e.g., Southwest Air)
- The Barringer/Ireland Business Model Template
- Core Strategy
- Resources
- Financials
- Operations
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