Business and Entrepreneurship (Domain 1)

Entrepreneurship

Always looking for the next new opportunity.

Having innovative (unique) products and services)

unwilling to take unknown risks.

Small Business Owners

Owned by 1 person or a small group of people.

Not interested in new opportunities.

Key objectives is to generate profit.

Franchise

Owners license their operations, products, and services for royalty fee.

Higher up front cost.

Examples. Disney, Miss Johnson’s steak’n’shake, training and guidance.

Defining entrepreneurship and small businesses

They key objective of a small business owner is to generate profit

Entrepreneurs are willing to take new opportunities and unknown risks to grow their businesses rapidly.

Classifying types of businesses Pt.1

Businesses will sell either a product, service, or sometimes both!

Classifying types of businesses Pt.1

Products are tangibles items that can be touched.

Ex. basketball, shoes, pizza

Classifying types of businesses Pt.1

Services are intangible things like a skill or expertise that is performed.

Examples of services- garbage removal, piano tuning, home inspection.

Classifying types of businesses Pt.2

E-Commerce is evolving. It is becoming more common to sell products online. There are two types of E-commerce products; Physical and digital.

Physical products

Physical products are products that require pickup or delivery.

Pros of physical products

Tangible items usually have higher value since most customers want to be able to touch their products.

Cons of physical products

Need to be stored or tracked (extra cost)

Shipping or delivery costs

Digital products

Digital products are intangible (meaning that they cannot be touched)

Examples. Dropbox files, streaming products (Netflix, or Disney)

Pros of digital products

No need for physical storage place

No shipping costs

Cons of digital products

It can be difficult to demonstrate the value of products or services.

Business to consumer (B2C)

Transaction- Is when a customer purchases and item from a business

Example: Erica purchases a milkshake from burger king.

Business to Business (B2B)

Transaction-When business purchases a products, service, or information from another business.

Examples: Mcdonald’s ice cream machine is broken, and they call MacGregor’s appliances to fix the machine.

angible items that are required a pickup or delivery are a ______ product.

Physical

When a customer purchases an item from a business, it is a ____-to-_____ transaction

Business-to-consumer

A small business can have 8 owners (True or Flase)

False

S-Corporation (Business Legal structure Pt.1)

“Spare me; help me with my taxes”

Lower tax roles that prevents the company from being double-taxed.

C-Corporation (Business Legal structure Pt.1)

“Come get me, double tax me”

Best for international businesses even with being double taxed.

LLC ((Business Legal structure Pt.2)

“Aht,Aht I’m not liable!”

Ideal for a single owner seeking low risks.

Sole-Proprietorship (Business Legal structure Pt.2 )

“One soul, I’m on my own; everything falls on me”

Easy to create but comes with unlimited liability

(This means you can be responsible to uncapped amount)

Non-profit (Business Legal structure Pt. 3)

“No owner, No taxes”

No ownership, no U.S. federal taxes.

Partnership (Business Legal structure Pt.3)

More than one person shared financial backing.

__ Corporation are profit corporation with limited liability

S Corporation

__ Corporation are ideal for international businesses.

C Corporation

Sole-proprietorship had limited- liability clause. (True or False)

False

Has unlimited liability.

No owner, No U.S. federal taxes

Non-Profit

Best for international businesses even with being double-taxed

C-Corporation

Easy to create but comes with unlimited liability.

Sole Proprietorship

Lower tax rate that prevents the company from being double taxed.

S-Corporation

Ideal for single owners seeking low risks

LLC (limited liability company)

Shared financial banking

Partnership

Founder (Roles and Responsibilities)

Creates the company. It is the only position that will never change.

Chief Financial Officer (CFO)

Oversees company finances.

Chief Executive Officer (CEO)

Highest ranking person in a company. Reports to the board of directors.

Chief Operating Officer (COO)

Oversees daily operational and administrative functions.

Chief Technology Officer (CTO)

Oversees the technology in a company and makes technology related decisions.

Stakeholder

Has a vested interest in the success of the company.

“The business is at STAKE!”

Stockholder

Owns stock in the company, CAN REMOVE CEO!

The ___ operating officer overseas daily operational and administrative function.

Chief

A ___ votes on the management of a company

Stockholder

Employment Contract

Outlines the employee’s and the employer’s obligations and the terms of employment.

It should include the following:

• Compensation

• Schedule

• Duration of employment

• Benefits

Hourly wage (Defying Business Compensation structure (part 2)

Hourly wage: A payment for the hours a person has worked. This compensation is affected by minimum wage laws. (Ex. Maya makes $13 an hour, which is minimum wage in the state of Florida.”

Salary (Defying Business Compensation structure (part 2)

A fixed payment amount for each pay period, (Ex. Nicole makes $154,000 a year, so her bi-weekly check is $5,923.00.)

Commission (Defying Business Compensation structure (part 2)

A fee paid for competing a task and usually found in sale position. (Ex. Mark gets $50 dollars for every car sales to a customer)

Piece work (Defying Business Compensation structure (part 2)

Employees are compensated for the numbers of unit they produced. (Ex. Jewelry makers will often get paid for each piece of jewlery they create)

Equity (Defying Business Compensation structure (part 2)

Is non-cash compensation commonly offered to employees in a place of cash or in addition to a lower salary. (Example: An employee may be given a low salary with a free car, or stocks in the company.)

___ Employees are paid a fixed amount each pay period.

Salary employees

___Can compensate employees for work they produce when being paid piece work.

Businesses

Creates the company

Founder

Overseas company finances

CFO

Owns stock in the company

Stockholder

Reports of the board of directors

CEO

Oversees daily operational and administrative functions

COO

Has a vested interest in the success of the company

Stakeholder

Non-cash compensation

Equality

Set rate of pay for hours worked

Hourly

Usually found in sales roles

Commission

Set amount of pay in a given period

Salary

Existence

Business is up and running

Survival

Reliable number of customers to stay open (starting to generate incomes.)

Success

Owners look for avenues to leverage the company (economically healthy)

Take Off

Owners decide if they want a big company and decide how to finance it (Owner decides if they want to sell the company.) Expand.

Maturity

The owner had separated themselves financially and operationally

Pivot or persist

persist with current strategy or pivot new strategy.

Exit plan

Owner makes profit from selling their company. Ownership

Survival Stage

During the survival stage of the business life cycle, a company is regularly taking on a new customer amd starting to generate a consistent income.

Exit plan

The owner may decide to sell them ownership in the company during the exit plan stage.

Business Life Cycle Chant

“E” double S, “T”, “M”, “P”, Exit plan, Exit plan!!

Order of business life cycle stages

1. Existence

2. Survival

3. Success

4. Take off

5. Maturity

6. Pivot or Persist

7. Exit plan

Empathize

Learn about customers challenges. “Putting yourself in the customer’s shoes”

Define

Analyze observation and define the core problem as a problem statement.

Ideate

Develop Solutions ideas and created innovative ideas.

Prototype

The Minimum Value Product (MVP)is created and addressed the Core Problem. (Used to test the problem solutions)

Test

Review and Refine the product (Identify and additional problems)

Design Thinking Process chant

“Every Day I Practice Typing”

1. Empathize

2. Define

3. Ideate

4. Prototype

5. Test

The five elements of the design thinking process are: empathize, define, ideate, __________________________ , and test.

prototype

_______________________ allows one to see and experience a customer's perspective.

empathy

The design team creates multiple inexpensive versions of a product, known as __________________  _________________  _______________.

Minimum Viable Products

During which stage of the design thinking process will the design team create multiple inexpensive product ?
versions?

Prototype

During which stage of the design thinking process is a problem statement formed?

Define

Which stage of the design thinking process involves learning about customers' challenges?

Empathize

Self-reliance-

Trusting yourself, your goals and the process. You cannot rely on others

Forward-Thinking Mentality

Thinking about and planning for the future.

Opportunity Recognition

The way you approach new ideas and ventures.

Initiative

Turning an idea into action. Generate new ideas!

Resiliency

Adapting to change, loss, and disappointment.

Grit

Tackling goals with COURAGE and PERSEVERANCE.

Risk tolerance

Entrepreneurs face multiple risks because they are risk takers.

Growth Mindset

Believing that you can accomplish anything with hard work.

Critical Thinking

Solving problems by considering different solutions.

Creativity and Innovation

Entrepreneurs can think outside the box!

(They don't look to do things the same way as everyone else.)

Collaboration

Working with others toward a common goal.

Problem-Solving

Coming up with solutions to problems.

Personal Agency

The ability to work toward achieving a goal without someone directing or making sure you get it done.

Ethical Practices

Making decisions based on morals. Doing the right thing!

Social Responsibilities

Preventing unethical (bad) behavior that can harm your business or community.

Financial risk

Bankruptcy