Matakuliah
Tahun
: J0712 - Pengantar Bisnis
: 2009
Business Plan
Pertemuan 04
Business Plan
•Outline:
–Forms of business
–Small business
–Entrepreneurship
–Corporation
–Non-corporate business
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What Is a “Small” Business?
• U.S. Department of Commerce:
– if it has fewer than 500 employees.
• Small Business Administration
(SBA):
– number of employees
– total annual sales
• Griffin (2008) defines as one that is
independently owned and managed
and does not dominate its market.
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Need For Small Businesses
• Job Creation
• Innovation
– Products/Services
– Processes
• Important To Big
Business
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Small Business Impact By Industry
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Entrepreneur
• Business person who accepts
risks & opportunities in creating/
operating a new business.
• Characteristics:
– Resourceful
– Good Customer Relations
– Desire To Be Own Boss- Gain Control Of
Life
– Build For Family
– Tolerance For Uncertainty/Risk
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Distinctions between Entrepreneurship
and Small Business
The key distinctions between
small-business ownership
and entrepreneurship are:
• Vision
• Aspiration
• Strategy
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Entrepreneurs
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Yesterday
Today
Self-Reliant
Open-Minded
Male
Male or Female
Quick Decisions
Relies On Others
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Non-Financial Reasons To Start A Business
Do Something I
Love
More Flexibility
9%
7%
41%
9%
Be Key Decision
Maker
Change Lifestyle
13%
21%
Spend More Time
With Family
Don't Know or Not
Stated
Source: CIBC World Markets, Economics & Strategy, “Secrets to Small Business Success”,
research.cibcwm.com/economic_public/ download/sb-ssbs-10192004.pdf
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Financial Reasons To Start A Business
Loss of Job Or Change
Of Employment
27%
39%
More Income For
Necessities
Second Income
13%
Bridge A Gap Till
Retirement
Forced Into Early
Retirement
3%
12%
6%
Don't Know Or Not
Stated
Source: CIBC World Markets, Economics & Strategy, “Secrets to Small Business Success”,
research.cibcwm.com/economic_public/ download/sb-ssbs-10192004.pdf
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Start/Operate Small Business
Business Plan
Buying Existing?
Start From
Scratch?
Financing
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What Is Business Plan?
• Document in which the
entrepreneur summarizes
her or his business strategy
for the proposed new
venture and how that
strategy will be implemented
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Crafting the Business Plan
• Setting Goals and Objectives
• Sales Forecasting
• Financial Planning
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Starting the Small Business
• Buying an Existing Business
• Starting from Scratch
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Starting from Scratch
Entrepreneurs must determine:
–
–
–
–
–
–
Who are my customers?
Where are they?
At what price will they buy my product?
In what quantities will they buy?
Who are my competitors?
How will my product differ from those of
my competitors?
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Financing Small Business- Traditional
• Family/Friends
•
•
•
•
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Personal Savings
Lenders
Investors
Government
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What Is a Franchise?
• Arrangement in which a buyer (franchisee)
purchases the right to sell the product of
the seller (franchisor)
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Franchise Contract
Franchisor, Inc.
Branded
Product/Service
Performance
Monitoring
$$$$$
Franchisee
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Advantages and Disadvantages of
Franchising
Advantages:
Disadvantages:
• To Franchisor:
– Rapid growth by using
investment money provided
by franchisees
• To Franchisee:
– High start-up costs
– Contribution of a
percentage of sales to
parent corporations
• To Franchisee:
– Business ownership and
access to big-business
management skills
– Low failure rate
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Trends in Small-Business Start-Ups
• Emergence of E-Commerce
• Crossovers from Big Business
• Opportunities for Minorities and
Women
• Global Opportunities
• Better Survival Rates
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Reasons For Failure
3%
15%
32%
11%
12%
15%
12%
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Poor Financial
Management
Incompetence or
Inexperience
Bad Economic
Conditions
Poor Books or
Records
Marketing
Problems
Staff or Union
Problems
Did Not Use
External Advice
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Reasons For Success
• Hard Work, Drive, &
Dedication
• Demand For Product/Service
• Managerial Competence
• Luck
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What Is a Sole Proprietorship?
• Business owned and
usually operated by one
person who is
responsible for all of its
debts
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Advantages and Disadvantages of Sole
Proprietorship
Advantages
 Freedom
 Easy To Form
 Low Start-up Costs
 Tax Benefits
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Disadvantages
 Unlimited Liability
 Lack Of Continuity
 Resources of One Person
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What Is a General Partnership?
• Business with two or
more owners who
share in both the
operation of the firm
and the financial
responsibility for its
debt.
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Advantages and Disadvantages of
General Partnership
Advantages
 More Talent & Money
 Easily Created
 Partners Taxed As
Individuals
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Disadvantages
 Unlimited Liability
 Lack Of Continuity
 Difficult To Transfer
Ownership
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What Is a Corporation?
• Business that is legally considered an entity separate
from its owners and is liable for its own debts—owners’
liability extends to the limits of their investments
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Advantages and Disadvantages of Corporation
Advantages
Disadvantages
 Limited Liability
 Ease Of Ownership
Transfer
 Continuity
 Startup Cost- Legal
 Access To More
Requirements
Capital
 Ease Of Ownership  Double Taxation
Transfer
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What Is a Cooperative?
Form of ownership in which a group of sole
proprietorships and/or partnerships agree
to work together for common benefits.
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