Successful entrepreneurs recognize that their most valuable asset is their
time, and they learn to manage it effectively to make themselves and their
companies more productive; having passion about their businesses, products, and
customers enables them to stay motivated.
Expanding a business usually requires no significant changes in structure or
What is an entrepreneur? Give a brief profile of a typical entrepreneur. What
is the primary motivation for the typical entrepreneur?
Discuss the potential benefits and drawbacks of entrepreneurship.
Describe the factors that are driving the current entrepreneurial trend in the
112) Discuss the role that the
following groups are playing in leading the ongoing surge in entrepreneurial
Discuss the impact of small businesses on the U.S. economy, including sales,
GDP, job creation, and innovation.
114) The following lists the ten
deadly mistakes of entrepreneurship.
1. Management mistakes
2. Lack of experience
3. Poor financial control
4. Weak marketing efforts
5. Failure to develop a strategic plan
6. Uncontrolled growth
7. Poor location
8. Improper inventory control
9. Incorrect pricing
10. Inability to make the entrepreneurial transition
one of these deadly mistakes, describe what it may look like for the
entrepreneur, and give an example.
Describe the small business failure rate. What are the primary causes of
business failures, and what steps can an entrepreneur take to avoid becoming a
business failure statistic?
plan, learning to manage people effectively, and keeping in tune with yourself.
Mini Case 1-1: Hudson’s Dilemma
Hudson was a real craftsman when it came to being a machinist. Bill had learned
almost all that he knew from Hugo Huffman, his first and only employer. Bill
Hudson was married and had three young children. He was 33 years old and had
worked for Hugo ever since he finished his tour in the army. In 12 years, Bill
had polished his skills under the watchful and critical eye of Hugo Huffman.
Hugo was quick to recognize Bill’s talent for the trade. Bill had a positive
attitude about learning and displayed a drive for perfection that Hugo admired.
Machine Shop was a successful small business. Its success was based mostly on
the reputation for quality that had been established over its 42 years in
operation. Hugo had come to this country with his new wife, Hilda, when he was
in his late twenties. Now the business was a success, but Hugo remembered the
early years when he and Hilda had to struggle. Hugo wanted the business to
continue to produce the highest quality craftsman products possible. On a
Friday evening, he called Bill into his office at closing time, poured him a
cup of half-day-old coffee, and began to talk with him about the future.
Hilda and I are getting old and I want to retire. It has been 42 years of fun
but these old hands need a rest. In short, Hilda and I would like you to buy
the business. We both feel that your heart is in this craft and that you would
always retain the quality that we have stood for.” Bill was taken back by
the offer. He, of course, knew Hugo was getting older, but had no idea Hugo
would retire. Bill and his wife, Anna, had only $4,200 in the bank. Most of
Bill’s salary went for the normal costs of rearing three children. Hugo knew
Bill did not have the money to buy the business in cash, but he was willing to
take a portion of the profits for the next 15 years and a modest initial
investment from Bill.
had, for the past four years, made most of the technical decisions in the shop.
Bill knew the customers and was well respected by the employees. He had never
been involved in the business side of the operation. He was a a high school
graduate but had never taken business courses. Bill was told by Hugo that even
after deducting the percentage of the profits he would owe under the sales
agreement, he would be able to almost double his annual earnings. Bill would
have to take on all the business functions himself because Anna had no business
Which entrepreneurial characteristics does Bill have that may be important to
his success? Which characteristic could lead to his failure?
What steps should Bill take to avoid the pitfalls common to a small business?