UBTE 2013 ENTREPRENEURSHIP

UNIVERSITI TUNKU ABDUL RAHMAN (UTAR)

FACULTY OF ACCOUNTANCY AND MANAGEMENT

MAY 2019 TRIMESTER

UBTE 2013 ENTREPRENEURSHIP

TUTORIAL QUESTIONS & ANSWERS

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TUTORIAL 1

The Nature and Importance of Entrepreneurship

Briefing
 Self introduction by tutor and students.
 Open discussion about entrepreneurial process and its development in general.
 1 short question to be answered and discussed by the students in class.
 Handout of tutorial topics and questions will be given to students in advance for subsequent weeks
 Simple entrepreneurialism test to assess readiness of student to be an entrepreneur

Simple Entrepreneurialism Test

You will be given a series of situations (15 questions in total) involving a businessperson and his
associate(s), and all you have to do is guess which one, out of the 2 possible conversations, takes place.

The test takes less than 3 minutes, and answers and evaluation are at the bottom. Each ‘correct’ answer
is awarded 1 mark. You will need a pen/pencil and a paper to record your answer. No cheating, i.e. you must
answer honestly, according to your most convenient judgment.

1. A businessman is showing a machine to his friend. What would have been said by the businessman to his friend?

a. “I am going to fine tune this machine.”

b. “I hope this machine works, otherwise it will affect my profit.”

2. Few businessmen are having a discussion shortly after meeting a couple of government officers. What are they
discussing about?

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a. They’re discussing on how to prove themselves right, though the government officers has given a solid proof that
they’ve disobeyed some rules.

b. They are discussing the strategies on how to finish up the works given for them

3. An entrepreneur is saying something to his close associate. What is the thing he said?

a. “I am sure that my company will be making profit soon.”

b. “If my company is not making profit, then I’ll be put in a difficult predicament.”

4. A businessman has just had a meeting with his company’s manager. What is he thinking about the manager?

a. The manager is less than motivated and has not been selling as per target

b. The manager is diligent and hardworking

5. An entrepreneur is talking to his wife. What is being said?

a. “I feel that I am doing a good job and I am happy for that.”

b. “I am disappointed for not having been appointed the contract.”

6. A businessman is discussing his plans with his associate. What is he saying to him?

a.“I do not want to be trailing other contractors in finishing this contract”.

b. “I am pretty sure I will be able to finish the contract within the given period of time”.

7. A businessman is discussing with an external consultant. What is happening?

a.He’s asking the consultant to devise a new management system for his company.

b. He’s showing his own plans to the consultant to double check.

8. It’s in the middle of a networking function, where two businesspersons are talking to each other. What are they
saying to each other?

a. “We will not be successful if we don’t work together.”

b. “We both have our chances to be successful.”

9. A businessman is discussing something with his supervisor. What is the discussion about?

a. If the supervisor achieves his objective, then he’ll get a pay rise.

b. The supervisor needs to work a bit harder if he wants to expect a pay rise.

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10. A businessman is leaving his office late at night. What is happening?

a. He’s saying to himself,”Oh God I’m yet to solve the problem. I’ll work again to solve the problem tomorrow.”

b. He finally solved the problem, and feels good about himself

11. An entrepreneur is planning his strategy. What is he planning?

a. He’s trying not to put too high on the price so that he’ll get the contract

b. He doesn’t want to fail in the bidding, so he’s thinking of what he should do.

12. A factory owner is sitting on a chair. What is he thinking?

a. He’s thinking on how he can increase his factory production

b. He’s thinking on any mistakes that he has done in his factory operation

13. A business owner asked his sales manager to see him regarding his work plans. What is in the sales
manager’s head?

a. He believes the work can be finished

b. He should be given the work because he does his job perfectly

14. 2 government officials are discussing about a businessman. What are they saying about him?

a. The businessman should be given the next contract if he can finish the current job well

b. The businessman should be given the next contract as he’s doing his current job well

15. A businessman is standing in front of his newly-invented machine. What is he thinking?

a. “This is an outstanding machine I created.”

b. “I wonder what mistakes I have done, I really could not figure out.”

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TUTORIAL 2 (Topic 1)
Chapter 1
Introduction to Entrepreneurship

Q1. Based on Barringer (2008), stresses four characteristics of Successful entrepreneurs. Detail explanation
required.

Q2. Explain ccommon characteristics of entrepreneurs

Q3. What are the roles of Entrepreneurship in Economic?

Q4. What are the roles of Entrepreneurship in Society Development?

Q5 What are the roles of Entrepreneurship in larger firm?

TUTORIAL 3 (Topic 2)
Chapter 2
Recognition Opportunities and Generating Ideas

Q1. What is a product opportunity gap? How can an entrepreneur tell if a product opportunity gap exists?

Q2. What is an opportunity? What are the qualities of an opportunity, and why is each quality important?

Q3. What four environmental trends are most instrumental in creating business opportunities? Provide an
example of each environmental trend and the type of business opportunity that it might help create.

Q4. Explain how “solving a problem” can create a business opportunity. Provide an example that was not
mentioned in the chapter of a business opportunity that was created in this way.

Q5. Describe the difference between strong-tie relationships and weak-tie relationships. Is an entrepreneur
more likely to get new business ideas through strong-tie or weak-tie relationships? Why?

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TUTORIAL 4 (Topic 3)
Chapter 3
Feasibility Analysis

Q1. What is a feasibility analysis? What is it designed to accomplish?

Q2. Describe the difference between primary and secondary research?

Q3. What is industry/target market feasibility analysis?

Q4. Describe the attributes of an attractive industry for a new venture.

Q5. What is a target market? Why do most start-ups focus on relatively small target markets to being with
rather than larger markets with more substantial demand?

Tutorial 5 (Topic4)
Chapter 4
Developing an Effective Business Model

Q1 . Define the term “business model.” How can entrepreneurial firms benefit by developing and using a business
model? What are the downsides for entrepreneurial ventures when an effective business model isn’t put in place?

Q2. List at least three reasons that demonstrate why having a business model is important.

Q3. What are the nine components of business model canvas? Briefly describe the importance of each component.

TUTORIAL 6 (Topic 5)
Chapter 5
Industry and Competitor Analysis

Q1 . What is an industry? Provide an example of an industry and several firms in it.

Q2 . What are the four primary categories of environmental trends? Provide an example of how a trend in each
category could affect the toy industry?

Q3. Identify the five competitive forces that determine industry profitability?

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Q4 . What is meant by the term barrier to entry? Describe the six major sources of barriers to entry that firms use
to restrict entry into their markets?

Q5 . Describe the four primary factors that play a role in determining the nature and intensity of the bargaining
power of buyers. How does the bargaining power of buyers have the potential to suppress an industry’s
profitability?

TUTORIAL 7 (Topic 6)
Chapter 6
Writing a Business Plan

Q1. What is a business plan? What are the advantages of preparing a business plan for a new venture? Explain
your answer?

Q2. What are the two primary reasons for writing a business plan?

Q3. Who reads the business plan and what are they looking for?

Q4. Why is it necessary for a business plan to be realistic? How will investors typically react if they think a
business plan is based on unsubstantiated predictions and estimates rather than on careful thinking and facts?
Explain your answer.

TUTORIAL 8 (Topic 7)
Chapter 9
Building A New Venture Team

Q1 . What is a new-venture team? Who are the primary participants in a start-up’s new venture team?

Q2. What is liability of newness? What can a new venture do to overcome the liability of newness?

Q3. What are the personal attributes that affect a founder’s chances of launching a successful new firm? In your
judgment, which of these attributes are the most important? Why?

Q4. Describe the different ways that advisory boards meet and conduct their business.

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TUTORIAL 9 (Topic 8)
Chapter 11

Unique Marketing Issues Confronting New Ventures

Q1 . What is a target market? Why is it important for a firm to choose its target market early in the process of
launching its venture?

Q2. What is a niche market? Provide examples of niche markets in the women’s clothing industry.

Q3. Describe what is meant by a firm’s “positioning” strategy?

Q4. Why is it important for firms to sell the “benefits” of its products rather than the “features?”

Q5. Describe the difference between a core product and an actual product.

TUTORIAL 10
Oral Presentation for group assignment (Group 1, 2, 3)

TUTORIAL 11
Oral Presentation for group assignment (Group 4, 5, 6)

TUTORIAL 12 (Topic 9)
Chapter 13
PREPARING FOR AND EVALUATING THE CHALLENGES OF GROWTH
Q1. What is sustained growth? Why is it important?

Q2. Briefly describe each of the five stages in the organizational life cycle?

Q3. Explain why cash flow management is an important issue for a firm that is entering a period of rapid
growth.

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TUTORIAL 13 (Topic 10 & 11)

FRANCHISING
Case study

NANTUCKET NECTARS: BLENDING MARKETING METHODS FOR JUICY SUCCESS

After graduating from Brown University in the spring of 1989, college friends Tom First and Tom
Scott moved to Nantucket Island, Massachusetts, determined to make it on their own and avoid the usual coat-
and-tie corporate life. There, the two friends opened a boat-based delivery business in Nantucket Harbour to
service the visiting yachts that came to the remote island in the warmer months. Having the summer of their
lives, the pair delivered coffee, muffins, laundry, and other necessities to well-to-do island visitors and
worked other odd jobs, such as shelling scallops, washing dogs, and pumping sewage, to earn money. Then
Nantucket's ferocious winter kicked in, and their business slowed to a crawl.

One night during their first winter, the Toms started mixing fruit in a blender, trying o recreate a peach
nectar that First had tasted during his travels to Spain. When they stumbled on some flavourful concoctions,
their entrepreneurial spirits took over, and First and Scott decided to hand-bottle their juices in recycled wine
bottles and sell them off their boat when the yachts returned with the warmer weather. They called their juices
Nantucket Nectars and sold 2,000 bottles at $1 a piece the next summer. Encouraged by their initial sales,
First and Scott decided to go into the juice business.

In the beginning, the pair targeted New England colleges close to Nantucket Island and Boston,
thinking that the young adults there would most likely be receptive to their anti-establishment and underdog
image. They pitched a big purple tent at football games and other college events and handed out juice and T-
shirts with the distinctive Nantucket Nectars' logo. Their low-cost, grassroots marketing early on helped
position Nantucket Nectars as the youthful, natural, and independent alternative to larger juice and beverage
companies.

They also stumbled upon an effective radio advertising campaign. After booking a recording session,
the Toms never got around to actually writing a script for their ad. Instead, they persuaded the radio producer
to just record them talking. First and Scott" shot the breeze" for a couple of hours, reminiscing about their
early days as "Juice Guys," and then edited the conversation for a radio spot. What resulted was an off-the-
cuff, down-to-earth radio ad that ended up winning an award for excellence in radio advertising.

Nantucket Nectars still prefers such homespun techniques to promote its many juice flavours. The
company uses" mobile marketing squads" that drive purple Winnebagos to outdoor events frequented by the
company's coveted consumers -18-to 35 year-olds. Members of the company's high-energy, purple-shirted
juice squad hand out free samples of the company's flavourful juices to sports fans, marathoners, and
concertgoers. Mobile squads will also swap any competitor's product for a new cold bottle of Nantucket
Nectars.
To introduce its latest Squeezed Nectars line of juice teas and lemonades packaged in distinctive wide-
mouthed glass canning jars, the company relied heavily on sampling and promotions to create a buzz. In
addition, the Toms decided to invite their grandmothers to promote the new line. In radio spots, the

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grandmothers chat with Scott and First about a wide range of topics, but mostly about how lemonade was
made long ago, reinforcing the idea that Nantucket Nectars , lemonades taste just like grandma's.

From its humble beginnings, Nantucket Nectars has grown to be a major player in the premium juice
drink category with a loyal following. While “Juice Guys” First and Scott have had their share of bumps
along the way, their once tiny company now employs over 100 people, and revenues top $80 million. Their
evolving juice lineup-50 different flavours in all-are sold in about 40 states and in Britain, France, Korea, the
Caribbean, South and Central America, and Canada. The Toms still consider themselves the underdog in the
premium juice industry. But no matter how much Nantucket Nectars grows, Scott says, he will always be
looking for ways to change since the only way to succeed in this competitive environment is to be
entrepreneurial.

[Source: Adapted from Carl McDaniel, Charles W.Lamb,Jr & Joseph F.Hair,Jr (2006). Introduction to
Marketing (8th ed.).Thomson: South-Western]

Critical Thinking Questions:

Q1. If Tom Scott and Tom First decided to franchise their business, what would be your advice? Why or why
not?

Q2. If Tom Scott and Tom First decide to go global, what are factor would motivate them?

TUTORIAL 14 (Topic 12 &13)

Preparing A Proper Ethical And Legal Foundation

Q1. In general, do entrepreneurs tend to overestimate or underestimate their knowledge of the laws that pertain to
starting a new firm? What does the answer to this question suggest that entrepreneurs do before they start a firm?

Q2. Describe what is meant by the terms code of conduct and ethics training programs. What is their purpose?

Q3. Describe what a founders’ agreement is and why it’s important for a team of entrepreneurs to have one in
place when launching a venture.

Q4. Describe the purpose of a nondisclosure agreement and the purpose of a noncompete agreement.

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Q5. What are the advantages and disadvantages of organizing a new firm as a sole proprietorship? Is a sole
proprietorship an appropriate form of ownership for an aggressive entrepreneurial firm? Why or why not?

THE IMPORTANCE OF INTELLECTUAL PROPERTY

Q1. What distinguishes intellectual property from other types of property, such as land, buildings, and
inventory? Provide several examples of intellectual property and describe their importance to a firm.

Q2. Give an example of a design patent. Explain how having a design patent can provide a firm a competitive
advantage in the marketplace.

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