现代小企业管理第二讲（英文版）80796.pptx
Small Business ManagementProfessor HornadayLecture 2Small Business ManagementGETTING THE IDEA4Need a Niche1.Identifiable Market Segment2.Can Satisfy the Segment at a Profit3.Can Defend against all Competitors4Usually Small Firms offer Superior Quality&Service1.Flexible2.Short Decision Time3.Short Production Runs4.Small Inventory Balances5.Personal Contact with Customers4New-New or New-Old?Small Business ManagementTHE BUSINESS OPPORTUNITY4Open Niche4Competition4Availability of Materials4Availability of People4Availability of Location4Availability of Funding4Specific Competitive Edge4Desired Growth PatternSmall Business ManagementMarket Analysis1.Brief Description of the Business Opportunity2.A Detailed Description of the Market Segment3.A Detailed Description of the Market Niche4.Emphasize Price,Unit Sales Estimates,and CompetitionSmall Business ManagementGETTING INTO BUSINESS4Start-up?4Purchase?4Inherit?4Franchise?Small Business ManagementSTART-UP PROBLEMS4Timing4Cash Flow Estimates4Initial Capital Requirements4Location4Equipment&Services Required4Legal Form of OrganizationSmall Business ManagementMARKETING4Nature of the MarketWho,What,When,Where,&How?4Price,Place,Product,Promotion4Estimate Volume in Units4Determine PricingCover CostsMeet Customer Demand CurveMeet Competition4Consider Seasonality4Specific Competitive Edge4Desired Growth PatternSmall Business ManagementMANAGING&CONTROLLING OPERATIONS4Planning,Organizing,Staffing,Directing,Controlling4Specific Location and Layout4Work Flow Analysis4Who does What When?4Pay and Incentives4Control of Cash,Inventories,and Supplies4Insurance&Security RequirementsSmall Business ManagementFINANCIAL PROJECTIONS4Financial Projections put the Plan into Numbers4Pro Forma Income Statements4Pro Forma Balance Sheets4Cash Flow Projections4When do Investors get their Money Back?4How&When are Investors Rewarded?4How&When are Owners Rewarded?Small Business ManagementAdvantages of Buying1.Continued Success?2.Good Location3.Employees and Suppliers on Hand4.Equipment and Capacity Known5.Inventories and Credit Established6.Hit Ground Running7.Experience of Previous Owner8.Bargain?Small Business ManagementDisadvantages of Buying1.Its a Dog2.Ill Will from Previous Owner3.Unsuitable Employees4.Poor Location5.Obsolete/Unusable Equipment6.Difficult to Change and Innovate7.Outdated Inventory8.Worthless Accounts Receivables9.Business Overpriced(Good Will)Small Business ManagementFinding a Business1.Advertisements2.Brokers3.Banks,Accountants4.Friends5.Look AroundSmall Business ManagementQuestions before Buying1.Why is Owner Selling?2.Physical Condition of the Business?3.Continued Market for Products/Services?4.Customer Base?5.Competition?Overhead 52Small Business ManagementScreening the DealsPreliminary:Visit,inspect,interview.Quicklook at marketing,finances,and inventory.Second Stage:Examine the value of the investment.Facilities Financial Ratios Ownership-What are you buying?Capital Required Personnel Market NicheFinal Screen:Do a business plan.Small Business ManagementHOW MUCH IS IT WORTH?1.Book Value2.Replacement Value3.Liquidation Value4.Past Earnings5.Cash FlowSmall Business ManagementValuing AssetsIntangiblesImage and reputation with suppliers,customers,and bankers.Any negative things to be overcome?Importance of skills and relationships ofowner and/or key employees.Physical AssetsTrue value of equipment and fixtures.True value of inventory.Small Business ManagementLegal Problems1.Legal encumbrances:Mortgages,liens,judgments,zoning,environmental,etc.2.Patent,trademark,or copyright problems?3.Title to land and buildings?4.Access and parking?5.Existing buy or sell contracts?6.Licenses?7.All debts paid?Small Business ManagementPricing the BusinessAssetsBook,Cost,Market,Replacement?GoodwillEarning PowerMultiple of Revenue or ProfitSmall Business ManagementDETERMINING THE PRICE4Book Value4Replacement Value4Liquidation Value4Past Earnings4Cash FlowSmall Business ManagementASSET PRICING4Building4Inventory4Prepaid Expenses4Supplies&Equipment4Accounts Receivable4GoodwillSmall Business ManagementONE WAY TO ARRIVE AT A PRICE4Net Market Value of Assets$100,0004Earning Power at 10%$10,0004Owner Salary$15,000$25,0004Average Profit$30,0004Extra Earning Power$5,0004Value of Intangibles$25,0004Final Price$125,000Small Business ManagementPricing ExamplesProtected Franchise:1 years profit plus inventory.Bakery(6-day operation):10 times weekly gross.Manufacturing:Appraised value of machinery plusraw materials,packing materials,and inventoryat cost plus 1/2 to 1 years net profit.Restaurant:Replacement value of equipment plusfood inventory plus one-half annual profit.Dry Cleaning Pickup Store:Pay$3500 for each$100weekly net up to$250;$5000 for each$100 weekly netover$250.Ladies Wear:25-50%cost of fixtures plus inventoryat 50-100%.No goodwill.Small Business ManagementTHE BUSINESS PLAN4Purpose&Need4The Business Opportunity4Getting into Business4Start-up Problems4Marketing4Managing&Controlling Operations4Financial ProjectionsSmall Business ManagementParts of the Business Plan1.Executive Summary2.Owner/Officer Resumes3.Company History4.Description of the Business5.Business Strategy6.Description of Product/Service7.MARKETING STRATEGY!8.Operational Plans9.Financial Projections10.Loan Proposal
