Mangt 420 test 3 - Chapter 10 -86.7 % of all US businesses...

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Chapter 10 -86.7 % of all US businesses employ 20 or fewer people; another 11% employ between 20-99 people. Only about one-tenth of 1 percent employs 1,000 or more workers. -25.6% of all US workers are employed by firms with fewer than 20 people; another 29.1% work in firms that employ between 20-99 people, the vast majority of these companies are owner operated. 12.7% of US workers are employed by firms with 1,000 or more total employees. -Do sales influence? Small businesses sales and assets are not large enough to influence the environment. -What makes small business important in the U.S.? Job creation, Innovation, Important to big business. How many jobs did small business create in the 80’s? 8 of every 10 new jobs were created by small business. In what industries are jobs created? 38% in technology. New jobs are being created in small firms specializing in international business. Small business accounts for 96% of all U.S. exports. Established market: What is it? A market in which several large firms compete according to relatively well-defined criteria. Identifying niches is? A segment of a market that is not currently being exploited. What Is a First Mover Advantage? Any advantage that comes to a firm because it exploits an opportunity before any other firm does. How many businesses will fail? 63%. Factors causing failure: Managerial incompetence. Neglect. Weak control systems. Insufficient funds. Choosing an Industry Services- primarily because they require few resources, service businesses are the fastest-growing segment of small-business enterprise. No other industry group offers a higher return on time invested. Appeals to the talent for innovation typified by many enterprises. 37.6% Retailing- a retail business sells directly to consumer’s products manufactured by other firms. People who start small business favor specialty shops which let them focus limited resources on narrow market segments. 22.7% Construction- since many construction jobs are relatively small, local projects, local construction firms are often ideally suited as contractors. Many such firms are
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begun by skilled craftspeople who start out working for someone else and subsequently decide to work for themselves. 10% Finance and Insurance- In most cases, these businesses are either affiliates of or sell products provided by larger national firms. Although the deregulation of the banking industry has reduced the number of small local banks, other businesses in this sector are still doing quite well. 10% Wholesaling- Small bus. Owners often do very well in wholesaling. A wholesale bus. Buys products from manufacturers or other producers and then sells them to retailers. Wholesalers usually buy goods in bulk and store them in quantity at locations that are convinent for retailers. For a given volume of business, therefore, they need fewer employees that manufacturers, retailers, or service providers. Also serve fewer
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This note was uploaded on 04/17/2008 for the course MANAGEMENT 420 taught by Professor Turnley during the Spring '08 term at Kansas.

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Mangt 420 test 3 - Chapter 10 -86.7 % of all US businesses...

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