Maria Gonzales

Yuet Wong

7- What are the major advantages and disadvantages of smallness in business? -Advantages

-Disadvantages

Personal relationships with customers and employees The owners of retail shops get to know many of their customers by name and deal with them on a personal basis. through such relationships. small- business owners often become involved in the social, cultural, and political life of the community. Ability to adapt change Through personal relationships with customers, the owners, of small business quicly become aware of changes in people's needs and interests, as well as in the activities of competing firms.
Simplified record keeping Obviously, enough records must be kept to allow for producing and filing accurate tax returns.
Independence
Small business owners are the masters of their own destinies - at least with regard to employment. Risk of failure Well-established small firms can be hit hard by a business recession mainly because they do not have te financial resources to weather an extended difficult period.
Limited potential
1

The owner may havesome techbical skill and may have started a business to put this skill to work. Such a business in unlikely to grow into big business.

-Introduction
- Executive summary
- Benefits to the community
-Labor Force
-Marketing plan
- Financial plan
Limited ability to raise capital Small business typically have a limited ability to obtain capital. Most small business financing comes out of the owner's pocket. personal loans from lending institutions provide only about one-fourth of the capital required by small businesses.
8- What are the major components of a business plan? why should an individual develop a business plan?
Basic information suchas the name, address and phone number of the business; the date the plan was issued; and a statement of confidentiality to keep important information away from potential competitors.
A one to two page overview of the entire business plan, including a justification why the business succeed.
Information on how the business will have an impact on economic development, community development, and human devepment.
Discussion of the quality of skilled workers available and the training, compensation, and motivation of workers.
Discussion of markets, market trends, competition,market share, pricing, distribution,promotion, and service policy.
Summary of the investment needed, sales and cash flow forecats, breakeven analysis, and sources of funding.
13- A Franchise is a license to operate an individually owned business as if it were part of a 2

chain of outlets or stores.
- The Franchisor teaches the franchisee how to operate according to the system and the franchisor assists the franchisee in growing their business.
15- Benefit of franchising for the franchisor.
The franchisor gains fast and well -controlled distribution of its products without incurring the high cost of constructing and operating its own outles. The franchisor thus has more capital available to expand production and to use for advertising. At the same time, it can enurance, through the franchise agreement, that outlets are maintained and operated according to its own standards.
- The franchisee gets the opportunity to start a business with limited capital and to make use of the business experience of thers. Moreover, an outlet with a nationally adversited name, such as radio shack, Mcdonald's, or century 21 real estate, has guaranteed customers as soon as it opens.
3