Studied by 16 people
Small Business
One which is independently owned and operated and which is not dominant in its field of operation
Independently owned
ownership is by a private individual, a partnership or corporation
Small Business under total assets approach
as one having total assets that fall within a certain bracket
Types of Small Business
-Manufacturing -Service -Wholesaling -Retailing -General Construction Firms
Manufacturing
it is one involved in the conversion of raw materials into products needed by society
Service
are those that provide service in one way or another
Wholesaling
Refers to the activities of persons or establishments that sells to retailers and other merchants and/or to industrial, institutional, and commercial users but do not sell in large amounts to final consumers
Retailing
Covers all activities involved in the sale of goods and services to the final consumers
General construction firms
Are those engaged in the construction of buildings whether for private individuals or firms or for the government
Classification of Service
Business Services
Personal Services
Repair Services
Entertainment and Recreation
Hotels and Motels
Education Service
Business Services
Provide service to other business
Repair Services
provide repair services to owners of various machinery and appliances
Entertainment and Recreation
includes movie houses, resorts, billiard, pool centers and the like
Education Services
Include montessori schools for children, high school, correspondence schools
Characteristics of Small Business
Independent Management
Small Capital Requirement
Independent Management
The owner is also the manager
Small Capital Requirement
Small Business requires
Advantages of Operating Small Business
Be an employee
Be an professional
Be a small business operator
Benefits of Small Business Operator
-Opportunity to gain control over his own destiny -Opportunity to reach his full potential -Opportunity to reap unlimited profits -Opportunity to make a contribution to society and receive recognition for his efforts
Opportunity to gain control over his own destiny
The perspective of small business owners can choose from several business opportunities that they would like to take advantage of
Opportunity to reach full potential
The employees will do his work based on prescribed targets which may only require less than his full potential
Opportunity to reap unlimited profits
It the small succeeds, all profits, big or small, accrue to the owner
Opportunity to make a contribution to society and receive recognition for his efforts
Entrepreneurs who make innovative products available to the public are recognized properly by society
Disadvantages of Operating Small Business
Uncertainty of income
Risk of losing your entire capital investment
Lower Quality of life until the business gets established
Complete responsibility
Having to serve undesirable customers
Paperwork and other chores
Long hours and demanding work condition
Note
Flashcard