Direct selling practices such as pyramid schemes and front-loading are unethical.
Though less recognized franchises exist, these rarely have the success rate of high
profile, large franchisors, such as McDonald’s.
In order to achieve market success, a firm merely needs to concentrate on either
providing an excellent product/service or devising an insightful marketing strategy.
An installment account is a typical trade credit agreement.
Though time spent on interviewing and other phases of the selection process helps to
address the immediate need of finding suitable employees, the long-term benefits of this
investment are trivial.
Locating close to niche market customers often requires placement at a site that
otherwise would be less than desirable.
You Make the CallSituation 1
Gary Fuller and his wife, Kelly Kimberly, have a dream of owning a successful
restaurant. Three and a half years ago, Fuller was vice president of operations for a
Cincinnati Bell affiliate; Kimberly was a public relations consultant. Now, they are
considering a startup venture in Houston, Texas.
Early in their research, they uncovered some discouraging statistics about the restaurant
industry: Profit margins run about 1 to 5 percent; one in three new restaurants don”t last
a year; and, because of the current economy, plans for new restaurants have been
shelved by many existing companies. One industry consultant they contacted said the
cost of setting up an average restaurant, like a diner, is around $300 per square
footexcluding property costs.
Source: Emily Lambert, “No Free Lunch,” Forbes, Vol. 171, No. 12 (June 9, 2003), p.
154.
Question 1 How important will the location decision be to these two entrepreneurs?
Why?
Question 2 What types of permits and zoning ordinances might they need to consider if
they decide to pursue their dream?
Question 3 How could a presence on the Internet help with the success of this venture?
Gofer delegation allows the subordinate substantial freedom in carrying out an
assignment.
The sole proprietorship is a business owned by two or more people but operated by only
one person.
The liability of owners is not affected by the form of business organization selected.
If an entrepreneur anticipates several target markets, each individual segment must have
its own corresponding customer profile.
You Make the CallSituation 3
Mary Wilson is a 31-year-old wife and mother who wants to start her own company.
She has no previous business experience but has an idea for marketing an animal
grooming service, with an approach similar to that used for pizza delivery. When a
customer calls, she will arrive in a van in less than 30 minutes and will provide the
grooming service. Many of her friends think the idea has promise but dismiss her
efforts to seriously discuss the venture. However, Wilson is not discouraged; she plans
to purchase the van and the necessary grooming equipment.
Question 1 What target market or markets can you identify for Wilson? How could she
forecast sales for her service in each market?
Question 2 What advantage does her business have over existing grooming businesses?
Question 3 What business name and promotional strategy would you suggest that
Wilson use?
The business plan should never include photographs because these tend to make the
plan look unprofessional.
Bequeathing equal amounts of ownership to all heirs, including those outside the
business, is obviously the fairest and probably the most efficient way to perpetuate a
family firm.
Preparation of a business plan helps to refine a new-venture idea and to make it more
practical.
The work measurement method that determines the fewest motions necessary to
complete a job is called time study.