Manufacturing Small manufacturers excel at customization High technology depend

Manufacturing small manufacturers excel at

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-Manufacturing -- Small manufacturers excel at customization -High technology – depend on advanced scientific and engineering -- 43% of high-tech jobs are with small businesses Small Businesses: Advantages: -Independence -Costs -Flexibility Disadvantages: -High stress level -High failure rate -Undercapitalization -Managerial inexperience/incompetence -Inability to cope with growth -Focus -Reputation
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10 Common Mistakes Small Companies and Start-ups Make: 10 Successful traits of Entrepreneurs: The Business Plan: -precise statement of rationale for a business and step-by-step explanation of how it will achieve goals Acts as a guide and reference document: -explanation of business -analysis of competition -income/expense statement Lean Canvas / Lean Stack Model Finance Resources: Equity Financing: -capital comes from small business owner (cash, equipment…) Debt Financing: -Borrowing financial resources typically from a bank or lending institution
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-Banks often require the entrepreneur to put up collateral, a financial interest in the property or fixtures of the business -Small-business owner may have to provide personal property as collateral, such as his or her home, in which case the loan is call a mortgage -Line of credit – An agreement by which a financial institution promises to lend a business a predetermined sum on demand Venture Capitalists: -Persons/Organizations that agree to provide funds for new business in exchange for ownership/stock -they require that the small-business owner share the profits of the business (and sometimes the control, as well) with the investors Debt Financing: Small businesses may obtain funding from their suppliers in the form of a trade credit -Suppliers allow the business to take possession of the needed goods and services and pay for them at a later date or in installments Occasionally, small businesses engage in bartering -Trading their own products for the goods and services offered by other businesses Starting from scratch vs. Buying an existing business:L -Starting from scratch can be expensive and will require a lot of promotional efforts to familiarize customers with the business Making a Big Business Act Small: -Large firms emulate smaller ones to improve their bottom line -Downsizing (rightsizing) – To reduce management layers, corporate staff, and work tasks in order to make the firm more flexible, resourceful, and innovative Intrepreneurs: -Individuals in large firms who take responsibility for the development of innovations within the organizations
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Advantages/Disadvantages of Franchises: Help for Small Business Managers: Organizations and programs exist to help small-business managers o National publications such as Inc. and Entrepreneur share statistics, advice, tips, and success/failure stories o Small Business Administration (SBA) Small Business Development Centers (SBDCs) Service Corps of Retired Executives (SCORE) Active Corps of Executives (ACEs) o Small Business Institutions (SBIs) o U.S. and Local Departments of Commerce o Other small businesses
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