Entrepreneurship and Small Business Management

Small Business Management is a great source of information for any up-and-coming entrepreneurial endeavor. An entrepreneurial career can offer an exciting life and considerable personal rewards, while also contributing to the well-being of society. The knowledge to create a successful business plan, to formulate a marketing strategy, to decide on the right human resource organization, to choose an appropriate location plan, and to develop the best financial approach to starting and running a small business is necessary for any entrepreneurial opportunity.

The business plan has an important place in starting and growing a business. The business plan is a document that lays out the vision of an entrepreneurial opportunity. It provides a declaration of purposes and strategies for use by individuals within the business. Not only is it important for internal purposes, it is necessary for telling the story of the entrepreneurial opportunity to outsiders who can contribute to the success of the business. Writing an effective business plan is an ongoing process and not a means to an end. Even though a business plan conveys the idea and purpose of a business, it normally does not reflect what actually happens. In starting a business, many things can go wrong which can affect the final outcome. Therefore, a business plan can also help a young entrepreneur map out different scenarios that can make or break the business venture which can significantly enhance an entrepreneur’s adaptability.

Once a new venture proposal is presumed to be a factual opportunity, the next step is to build a marketing plan. The plan may be written, especially if financing is required, or it may remain unwritten, in abstract form, and be made progressively over time. Small business marketing includes activities of business that express the creation, expansion, and delivery of a collection of approval from the creator to the targeted audience and that please the targeted audience. There are three distinct marketing philosophies which includes production, sales, and consumer oriented philosophies. Normally, a growing business should choose the consumer-oriented philosophy to marketing since it is the most reliable road to long-term success.

The human resource plan is an important aspect of a growing business. A strong management team is the key factor in a good human resource plan. A management team is made up of people with supervisory responsibilities and non-supervisory personnel who play an essential role in running the business. It can create a better advantage for a business opportunity than an individual entrepreneur. A strong management team brings a variety of talent to meet different managerial requirements. In addition, before beginning a new business, an entrepreneur must decide on a form of legal organization which will decide who the real proprietors of the business are. The basic choices are the sole proprietorship, partnership, and C corporation.

A proper location plan is another essential aspect of a successful business. Entrepreneurs can choose to establish their business in a traditional physical building, their home or residence, or on the World Wide Web. The proper business location depends on the type of business plus a number of other factors. These factors which guide the location selection process include customer accessibility, business environment conditions, availability of resources, the entrepreneur’s personal preference, site availability, and site costs. Other factors consist of neighbor mix, security and safety, available services, the fate of past tenants, and the life-cycle of the location.

Forecasts of a venture’s profits, assets, financial requirements, and its cash flows are important in determining whether a venture is economically sound. In order to make sound financial projections, an entrepreneur needs to have a good understanding of financial statements. The basic financial statements which provide important information about a firm’s performance and resources include the income statement, the balance sheet, and the cash flow statement. An income statement provides information about the amount of profits generated by the business over a specific period of time. A balance sheet shows the assets, liabilities, and ownership equity for a given period of a business. The cash flow statement of a business explains the sources and uses of cash.

Finding financial support for starting a business can be difficult. A firm’s economic potential, the size and maturity of the business, the nature of its assets, and the personal preference of its owners with respect to the tradeoffs between debt and equity are the basic factors that determines how a business is financed. Normally, an entrepreneur relies on personal savings to start their business. Family and friends are also an important financial source. Only if these sources are insufficient will an entrepreneur try more formal means of financing, such as banks and outside investors.

In conclusion, learning about entrepreneurship can prepare you for your journey of starting your own business. Understanding the basic concepts of a business plan, marketing plan, human resource plan, location plan, and financial plan are essential for starting a successful business.