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Intro to Business > core concepts chapter 6,7,8 > Flashcards

core concepts chapter 6,7,8 Flashcards

1
Q

what is a sole proprietorship?

A

one person owning and operating a business, without forming a corporation

in a sole proprietorship, the business and owner are a single entity

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2
Q

what are the 6 advantages to a sole proprietorship?

A

easy and inexpensive to form

profits are retained by the owner

direct control of the business

freedom from government regulation

taxed once

ease of dissolution

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3
Q

what are the 7 disadvantages of a sole proprietorship?

A

unlimited liability
difficulty raising capital
limited managerial expertise
trouble finding qualified employees
personal time commitment unstable business life (limited lifespan)
losses are the owners responsibility
limited growth few fringe benefits

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4
Q

what are the 3 forms of partnerships?

A

general partnership
limited liability partnership
limited partnership

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5
Q

explain a limited partnership?

A

a partnership with one or more general partners and one or more limited partners

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6
Q

what is a limited liability partnership?

A

Limits all partner’s risks of losing their personal assets to the outcomes of only their own acts and omissions and those of people under their supervision

all other partners are not liable for another partners mistakes

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7
Q

what are the 6 advantages of a partnership?

A

more financial resources

shared management and pooled, complementary skills and knowledge

longer survival

shared risk

special taxes

flexibility

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8
Q

what are the 5 disadvantages of a partnership?

A

unlimited liability
division of profits
disagreements among partners
difficulty of termination
possibility of higher taxes

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9
Q

what are the 5 types of corporations?

A

private
public
non-profit
professional corporations
crown corporations

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10
Q

what are the 7 advantages to a corporations?

A

limited liability

more money for investment

size: may be larger due to increased resources

perpetual life

ease of ownership change

ease of attracting talented employees

separation of ownership from management

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11
Q

what are the 6 disadvantages of corporations?

A

high initial costs
extensive paperwork
double taxation
two tax returns
termination is difficult
stock holder and board conflict

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12
Q

what are the four reasons why mergers do not work?

A

companies overpay to acquire another firm

acquiring company overestimates cost saving and synergies

after merger, managers disagree about integrating operations

after merger, cost cutting obsession hurts business, costing the top employees and customers

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13
Q

what are the 5 responsibilities of a franchisor?

A

assign territory

may provide financial aid/advice

offers merchandise or supplies at a competitive price

provides training and support

business expansion

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14
Q

what are the 4 responsibilities of a franchisee?

A

pay upfront costs

make monthly or annual payments to the franchisor (royalty fee)

runs business by franchisors rules and procedures

buys materials from franchisor or approved supplier

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15
Q

what are the 5 advantages to franchises?

A

management and marketing assistance

personal ownership

nationally recognized name

financial advice and assistance

low failure rate

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16
Q

what are the 6 disadvantages to franchises?

A

large start up cost

shared profit

management regulations

coattail effect

restrictions on selling

fraudulent franchisors

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17
Q

what are the 4 ways to avoid disaster in a franchise?

A

research officers and their business experience

get all summary of any bankruptcy and litigation

estimate ALL costs to set up a franchise

review franchise contract and three most recent financial statments

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18
Q

what is the difference between the intent of small business and the intent of entrepreneurship?

A

small business is fine remaining small and does try to innovate and grow to become a larger company or corporation

entrepreneurship may start small but the intention is to grow to a large scale company corporation and revolutionize the market

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19
Q

what are the 4 ways entrepreneurial ventures differ from small business?

A

amount of wealth creation
speed of wealth creation
risk
innovation

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20
Q

what is entrepreneurship?

A

taking a risk to either create a new business or to greatly change the scope and direction of an existing one

entrepreneurs are typically innovators who start companies to pursue their ideas for a new product or service

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21
Q

what is a small business owner?

A

people with technical expertise who started a business or bought an existing small business and made a conscious decision to stay small

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22
Q

what are the 6 reasons people take the entrepreneurial challenge?

A

opportunity presents itself (to fill a customers needs, or they have a skill or resources)

new idea, product or product
profit
challenge
family pattern
independence

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23
Q

what is an example of small business vs entrepreneurship?

A

the owner of a local independent bookstore is a small business owner. Jeff Bezos, founder of Amazon, also sells books. but Bezos is an entrepreneur because he revolutionized the bookselling world

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24
Q

what are the four types on entrepreneurs?

A

classic entrepreneurs
micropreneurs
multipreneurs
intrtapreneurs

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25
what is a classic entrepreneur?
a risk taker who starts their own companies based on innovative ideas and bringing new products to market
26
what is a micropreneur?
micropreneurs are someone who starts small and plans to stay small they normally have 1-4 employees
27
what is a multipreneur?
multipreneurs are someone who starts a series of companies. they thrive on the challenge of building a business and watching it grow (start with one entrepreneurial venture and it presents an opportunity for another one)
28
what is an intrepreneur?
they are entrepreneurs that don’t own their own companies but apply their creativity, vision and risk-taking within a large corporation. enjoy the freedom to grow ideas and develop products but with less risk due to being part of a big corporation
29
what is defined as a small business?
a independently owned and operated business that meets certain standards of size interms of employees or annual revenue
30
what are the 5 reasons small business is important?
contribute to growth in specific economic areas create jobs spark innovation provide opportunities for many people to achieve financial success and independence, including women and minorities compliment the economic activity of large organizations by providing them with services
31
what are the 7 advantages of a small business?
independence personal satisfaction from work best route to success rapidly changing technology major corporate restructuring and downsizing outsourcing small business are resilient
32
what are the 5 disadvantages of small business?
financial risk stress time commitment undesirable duties limitations
33
what are some (6) resources for small businesses that the government offers?
business and industry services business development bank of Canada innovation, science and economic development canada canadian chamber of commerce business accelerator (access to mentorship and investors) business incubators (space, services, advice, support and financial assistance)
34
what are the 3 causes for small business success?
pay attention to competition business in a growth industry product is not easily replicated
35
what are the 12 things that can lead to small business failure?
plunging in without first testing testing the waters on a small scale underpricing or overpricing goods or services underestimating how much time it will to take to build a market staring with too little capital starting with too much capital and being careless in its use going in to business with little or no experience and without first learning something about the industry or market borrowing money without planning how and when to pay it back not allowing for setback and unexpected setbacks buying to much on credit extending credit to freely expanding credit too rapidly failing to complete accurate records so that the owners drift into trouble without realizing it
36
what are the 4 ways to get into your first business venture?
start your own company buy an existing franchise unit inherit or take over a family business get some experience and ideas
37
what are the 5 functions of managing a small business?
planning the business financing the business knowing the customers (marketing) managing the employees maintaining records (accounting)
38
what are the details (4) of a written business plan?
nature of the business target market advantages the business will have over competition and the resources qualifications of the owners
39
what are the 10 key elements of a business plan?
cover letter executive summary company background management team financial plan capital required marketing plan location analysis manufacturing plan appendix
40
what are the 3 positives of a small business going global?
access to world market absorb (sell) excess inventory extend product life
41
what are the 4 negatives of small business going global?
financing difficult not knowing how to get started lack of cultural understanding paperwork
42
what is management?
the process of guiding the development and allocation of resources to attain organizational goals
43
what are the three basic categories of managerial skills?
technical human relations conceptual skills
44
what are the three levels of management?
top managers middle managers first-line managers
45
what is an acronym for the 4 functions management areas?
P.L.O.C
46
what are the 4 functional areas of management?
planning organizing leading controlling
47
explain the planning functional area of management?
anticipating potential problems or opportunities and planning how to deal with them
48
explain the organizing functional area of management?
coordinating and allocating the resources needed to implement plans (allocating budget to different areas)
49
explain the leading functional area of management?
creating a vision for the organization and motivating others to achieve that objective
50
explain the controlling functional area of management?
establishing clear standards, reviewing results and making any necessary corrective actions
51
what are the three things that are in a company vision?
goals objectives plans
52
what is a SWOT analysis?
how strengths can be capitalized on how weakness can be improved how opportunities can be exploited how strengths can be mitigated
53
what are the 4 planning strategies?
strategic planning tactical planning operational planning contingency planning
54
what is tactical planning?
the identification of specific, short-range objectives by lower managers
55
what is contingency planning?
backup plans in case primary plans fail
56
what is operational planning?
the process of setting work standards and schedules necessary to implement the company’s objectives
57
what does strategic planning involve?
creating long-range (1-5 years) broad goals and determining how the organization will accomplish those goals
58
what are the two categories of decision making?
programed decision making nonprogrammed decision making
59
what is programmed decision making?
decisions that are made in response to routine situations that occur frequently ex: scheduling
60
what is non-programmed decision making?
decisions that are infrequent, unforeseen or very unusual problems and opportunities
61
what are the 5 steps in the decision making process?
recognize the problem or opportunity gather information to identify alternative actions select one or more alternatives after evaluating S and W put chosen alternative into action gather information to obtain feedback on the effectiveness of the chosen plan
62
what are the 5 ways kinds of power?
legitimate power reward power coercive power expert power referent power
63
what is legitimate power?
power that comes from an individuals position in an organization
64
what is reward power?
the power that coms from an individuals control over rewards
65
what is coercive power?
power that comes from an individuals ability to threaten and produce negative outcomes
66
what is expert power?
power that comes from an individuals extensive knowledge in one or more areas
67
what is referent power?
the power that comes with their influence and respect of their opinion
68
what are the three leadership styles?
autocratic participative/ democratic free rein
69
what is autocratic leadership?
they are directive leaders and wants their subordinates to follow their directions, they like to make all of the decisions
70
what is participative/ democratic leadership?
they share decision making with with group members and encourage discussion of issues and alternatives
71
what are the three types of participative leadership?
democratic leaders consensual leaders consultive leader
72
what is free-rein leadership?
managers who use this style turns over all authority and control to subordinates and let the employees figure out the best way to figure things out
73
what makes a leader effective?
leaders that recognize employee growth and select a leadership style that matches the maturity and competency levels of those completing the tasks
74
what are the 5 responsibilities of a franchisor?
assign territory may provide financial aid/advice offers merchandise or supplies at a competitive price provides training and support business expansion
75
what are the 4 responsibilities of a franchisee?
pay upfront costs make monthly or annual payments to the franchisor (royalty fee) runs business by franchisors rules and procedures buys materials from franchisor or approved supplier
76
what is controlling in management?
the process of assessing the organizations progress towards accomplishing its goals

Intro to Business (25 decks)

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