Questions and Answers of Entrepreneurship Starting Operating

One family business expert says that when it comes to management succession, a leader should pass the baton to the successor not when the leader is ready to leave but when the successor is ready to
Can Robinson Fans continue to be successful with two sometimes three competing leaders at the helm? Explain.
Are the issues that Carla and Tricia Staible face concerning management succession in the family business unusual? Explain.
Suppose your best friend is about to hire someone to work in his or her company. List at least three other tips that will enable him or her to avoid making a hiring mistake.
Why are hiring mistakes so expensive for companies, particularly small businesses?
Identify at least three lessons that other leaders of small businesses can learn from Kevin Hancock’s experience.
Summarize the key provisions of CAFTA-DR.
What lessons did each of these expat entrepreneurs lean that would be useful for others interested in this type of lifestyle? Explain.
What advice would you give to someone who wants to become an expat entrepreneur? Explain.
How are expat entrepreneurs’ assumptions about conducting business internally different from those of entrepreneurs pursuing more traditional international strategies? Explain.
What steps do you recommend that entrepreneurs such as John Aron take before they make the decisions to take their companies global?
Identify some of the barriers that companies such as The Pasta Shoppe encounter as they expand internationally. What steps can entrepreneurs take to overcome these obstacles?
Identify the risks and the benefits that The Pasta Shoppe faces by operating as a global business.
Notice that the founders of Zkipster used a direct, localized sales approach to enter new markets. What are the advantages and the disadvantages of setting up local sales operations? Why do most
Capital is any form of wealth employed to produce more wealth. Capital exists in many forms including cash, inventory, plant and equipment. Entrepreneurs have access to two different types of capital
What is the role and function of loan brokers?
What is peer-to-peer lending?
How do merchant cash advances work as a course of financing a small business?
Explain how an entrepreneur can use retirement funding to start a business using Rollovers as Business Startups (ROBS).
Explain the advantages and the disadvantages of using factors as a source of financing.
Describe a venture capitalist procedure for screening investment proposals.
Work with a team of your classmates to brainstorm ways these entrepreneurs could attract the capital they need for their businesses. What steps would you recommend they take before they approach the
What is capital?
What can entrepreneurs do to increase the probability that bankers will approve their loan requests?
Which of the funding sources described in this chapter do you recommend that Ralph Lucci and Aaron Hoffman consider for financing their businesses? Which sources do you recommend that they
What are some of the features that determine a good manufacturing layout?
What is ergonomics? Why should entrepreneurs apply the principles of ergonomics in the design of their facilities?
Why is it costly for a small firm to choose a location that is too small?
Do you agree with Bi’s idea of using temporary pop-up shops in certain cities to test their market potential for Blank Label’s custom-made clothing line? Explain. What are the advantages and
What criteria should Bi use to evaluate prospective cities?
What process should Bi use to identify the best cities for Blank Label ‘s retail expansion plans? How might the company use its database of information on its existing online and retail store
What advantages and disadvantages do pop-up stores such as the ones described here offer entrepreneurs?
List at least five steps, in addition to the ones described here, that entrepreneurs should take to prevent their businesses from becoming victims of employee theft and embezzlement.
Are small businesses more likely than large ones to be victims of employee theft? Explain.
Identify the factors that led Holt of California to become a victim of employee theft and embezzlement. What impact does this crime have on a company’s cash flow?
What other advice can you offer owners of seasonal businesses about coping with the effects of their companies’ highly irregular sales patterns? About managing cash flow in general?
What impact do highly seasonal sales have on a small company’s cash flow?
Do you recommend that Anita expand her business? Explain.
Compute the break-even point, assuming that Anita decides to expand her business.
Calculate Anita’s break-even point without the expansion plans. Draw a break-even chart.
What recommendations can you make to the Edens to improve their company’s financial performance in the future?
What might be causing the deviations you have observed?
Analyze the comparisons you have made of Eden’s Garden’s ratios with those from Bizminer. What red flags do you see?
Do you see any ratios that, on the surface, look suspicious?
Assume the role of Shelly Edison. Using the financial statements for Eden’s Garden, calculate the 12 ratios covered in this chapter.
Assume the role of a small business banker. Suppose that Kuhn were to approach you for a bank loan to refinance his debt. Which financial ratios would you be most interested in? Why? What advice
What lessons concerning the use of debt financing can entrepreneurs learn from Charles Kuhn’s experience?
Why is using ratio analysis to keep track of their companies’ financial performance over time so important for entrepreneurs?
What are the risks associated with debt financing?
What are the benefits to entrepreneurs who use debt capital (leverage) to finance their companies’ growth?
What is cost-plus pricing?
How is the markup for a product calculated?
What is a markup?
If you owned your own business and had the information required to engage in dynamic pricing, would you do so? Explain.
What are the advantages and the disadvantages of dynamic pricing to the companies that use it? To the customers of the companies that use it?
Work with a team of your classmates to define the ethical issues involved in dynamic pricing.
Why do many entrepreneurs underprice their goods and services, especially when they first get into business? Discuss the connection between the prices a company establishes for its goods and services
What challenges does evaluating the effectiveness of a Web site pose for online entrepreneurs?
What advantages does each e-commerce metric offer?
What are the risks and dangers to a small company that is the victim of a cyberattack?
What can an entrepreneur do to avoid falling victim to these 11 myths?
Why are cybercriminals increasingly targeting small businesses with their attacks?
What are the 11 myths of e-commerce?
Why are many companies shifting to a multichannel strategy that involves both physical stores and an online presence?
What advantages do retail stores offer a company? Disadvantages?
What advantages does an “online-only” strategy offer a company? Why do many start-up companies use this strategy?
Describe how a small business owner could use concentrating on innovation for a competitive advantage.
Describe how a small business owner could use building a community of customers for a competitive advantage.
Describe how a small business owner could use entertaining instead of just selling for a competitive advantage.
What advice would you give to one of Chick-fil-A’s competitors to try to match Chick-fil-A’s customer service?
Chick-fil-A does not compete with its rivals using low prices. What lessons can other small businesses learn from Chick-fil-A about the relationship between prices and customer service?
What impact has Chick-fil-A’s strategy of providing superior customer service had on the company’s success?
How can market research benefit entrepreneurs as their businesses grow?
Identify at least three lessons that entrepreneurs can learn from Victory Auto’s use of social media.
What steps can the new owner of .CO Internet S.A.S. take to maintain the brand and continue to build customer recognition of it? Refer to Figure 9.2 on page 354 and use the table below to do
Define marketing plan. What lies at the center of a marketing plan?
How would you envision the marketing of .CO Internet S.A.S. to change now that it is part of a large corporation? Can large companies effectively take advantage of bootstrap marketing strategies?
Use the Internet as a resource to develop a list of at least five suggestions to help new franchisors looking to establish outlets in China or India to be successful.
Describe the opportunities and the challenges franchisors face when entering emerging markets such as India and China.
What steps should prospective franchisees, whether they are athletes or not, take to ensure that franchising is the right path to business ownership for them and that they select the right franchise?
Do you agree with Michael Stone that franchising is a good fit for athletes? Explain.
What benefits does franchising offer professional athletes such as those described here?
What are the advantages and the disadvantages of purchasing an outlet from a small franchisor?
What steps should a buyer take to ensure a smooth transition after closing the deal to buy a business?
Explain the seller’s position in a typical negotiation for a business.
What determines the bargaining zone between a business seller and a buyer?
Briefly outline the process of valuing a business using the adjusted earnings, the capitalized earnings, and the discounted future earnings approaches.
What topics does the due diligence process address?
Outline the stages involved in buying a business.
What techniques for estimating the value of these businesses would be most useful to a prospective buyer of these companies? Are the owners’ asking price reasonable?
What advantages does an LLC offer over a partnership?
Give an example of a company that is using each of the three strategies.
Give examples of strengths, weaknesses, opportunities, and threats.
What are the risks associated with these companies’ strategies?
What competitive advantages does the successful execution of subscription-based strategies produce for these businesses?
Discuss the importance of what you do with a mission statement.
Which of the strategies discussed in this chapter are these companies using? Explain.
A common criticism of mission statements is that entrepreneurs spend too much time crafting them and not enough time implementing them in the business. What is meant by this criticism?
How do lenders and investors use the 5 Cs of credit when evaluating a request for financing?
Why do many small businesses fail when a big discount retailer such as Wal-Mart enters their market?

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