Chapter 1

Chapter # 1

Introduction to Course:
Small Business & Entrepreneurship

CONTENTS
 What is small business?
 What is special about small businesses?
 What is entrepreneurship?
 What resources support entrepreneurship and

business development?

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What Is “Small Business”?
Independently owned and managed business that does not dominate its market.
Committee for Economic Development
 Owner manages company directly (independently)
 Capital supplied by one individual or a small group
 Area of operations is mainly local
 Business is small in comparison with biggest competitors

Small Business Administration
 Independently owned and operated
 Not dominant in its field of operation

White House Conference on Small Business
 < 500 employees
 <$20 million in annual sales

Small Business Owners
Small business owners are people who own a

major equity stake in a company with fewer than 500 employees.
In 1997 there were 22.56 million small business in the United States.
47% of people are employed by a small business. Advantages of a Small Business
Greater

Opportunity to get rich through stock options Feel more important Feel more secure
Comfort Level

Disadvantages of a Small Business
Lower guaranteed pay
Fewer benefits
Expected to have many skills
Too much cohesion
Hard to move to a big company
Large fluctuations in income possible

Trends in Small Business Start-ups
Emergence of
E-commerce
Crossovers From
Big Business
Opportunities for Minorities &
Women
Global
Opportunities
Increased
Survival Rates

Getting Started
Buying an
Existing
Business

Starting
From
Scratch

What is special about small businesses?
 Small businesses …
Ones with 100 or fewer employees.
Independently owned and operated.
50 percent of the private labour force works

in small businesses.
Are established by:
 Starting a new business.
 Buying an existing business.
 Buying and running a franchise.

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What is special about small businesses?
 Entrepreneurship