ENTREPRENEURSHIP financial support for the existing lifestyle of the

owner, most often through operations that fit the

Module 1 owner’s schedule and way of working.
Entrepreneurship: Its Opportunities and Rewards 2. Traditional Small Business. A firm intended to
provide a living to the owner and operating in a
ENTREPRENEURIAL MANAGEMENT manner and on a schedule consistent with other
According to the Global Entrepreneurship firms in the industry and market.
Institute, Entrepreneurial Management as the practice 3. High-performing Small Business. A firm intended
of taking entrepreneurial knowledge and utilizing it for to provide the owner with high income through sales
increasing the effectiveness of new business venturing or profits superior to those of the traditional small
as well as small- and medium-sized businesses. business.
Entrepreneur, however, is an individual who creates a 4. High-growth Venture. A firm started with the intent
new business, bearing most of the risks and enjoying of eventually going public, following the pattern of
most of the rewards. The entrepreneur is commonly growth and operations of a big business.
seen as an innovator, a source of new ideas, goods,
services, and business/or procedures. Rewarding For Starting a Small Business
According to the Asian Development Bank, small and Why become an entrepreneur? If you said, “For the
medium enterprises (SMEs) are the backbone of Asian money,” or, “To do things my way,” you’d be right, but
economies, making up 98% of all enterprises and 66% of these are only a few of the reasons behind owning your
the national labor force from 2007-2012. In the own firm. We know that people go where they feel they
Philippines, Small and Medium Enterprise are defined have the best chance of getting the rewards they value
as any enterprise with 10 to 199 employees and/or most. Nearly all entrepreneurs talk about three key
assets valued from P3 million to P100 million. SMEs and rewards – flexibility, a livable income, and personal
micro enterprises combined make up 99.6% of growth. There are two other rewards – building wealth
establishments in the country. Therefore, despite of the and creating products, which entrepreneurs mention
limited size of this type of business, SMEs are very more often than working people in general. There are
important in our economy, both in the local and national also rewards that entrepreneur mentioned less often
arena. than working people in general. These are social
We use the popular broad definition of entrepreneur – rewards, like respect or admiration of others, or power
anyone who owns a business is an entrepreneur. This of over others, and family rewards, like continuing a family
course, means anyone who is a small business owner is tradition in business. The three most popular types of
an entrepreneur. It also means that self-employed, rewards for small business owners are growth,
anyone who work for himself or herself instead of for flexibility, and income.
others, is also an entrepreneur. Within the population of 1. Growth Rewards. What people get from facing
entrepreneurs, it is sometimes useful to split out through and beating challenges?
these certain groups: 2. Income Rewards. The money made by owning
1. Founders. People who create or start new one’s own business.
business. 3. Flexibility Rewards. The ability of business
2. Franchise. A prepacked business bought, rented, owners to structure life in the way that suits their
or leased from a company called a franchisor. needs best.
3. Buyers. People who purchase an existing
business Flexibility
4. Heir. A person who become an owner through
"To have greater flexibility for my
inheriting or being given a stake in a family
personal and family life
business.
Universally Income
Starting and Entrepreneurial Small Business: Four Mentioned To give myself, my spouse, and
Key Ideas Rewards children financial security
1. Believe that you can do. This belief in yourself is
called self-efficacy. Those who believe in Growth
themselves and in the passion of their beliefs are To continue to grow and learn as
more likely to keep at it until they succeed. a person
2. Planning + Action = Success. A plan without
action is futile. Actions without plans are usually
Wealth
wasted. Success comes from having the right sort
of plan to get you. Occasionally "To have a chance to build great
Mentioned wealth or a very high income
3. Help Helps. Successful entrepreneurs learn from
Rewards
other entrepreneurs, from experts in their chosen Product
field, from potential customers, or even from their "To develop an idea for a product"
professors. Remember, those help succeed bigger
and more often.
4. Do well. Do Good. In the long run, you will depend Recognition
on partners, investors, customers, and neighbors. If "To achieve something and get
you always remember, you try to do well in your recognition"
business, you’ll feel better about your business and
life, and those around you will too. Admiration
Rarely
"To be respected by my friends"
Mentioned
Entrepreneurs and Firm Growth Strategies Rewards Power
The overall growth strategy describes the kind of
business the owner or owners would like to have, from "To lead and motivate others"
the perspective of how fast and to what level they would Family
like the firm to grow. There are four generic growth
strategies that account for nearly all businesses: "To continue a family tradition"
1. Lifestyle or part-time firms. A small business
primarily intended to provide partial or subsistence

1
 environment in which the new can come into being.
Myths about Small Business Small business owners are freer of the judgment and
Over the years, small business experts in academe social constraints of workers elsewhere. Austrian
and government have studied small business and economist Joseph Schumpeter labeled this process
potential entrepreneurs and learned that a lot of the creative destruction. It refers to the way that newly
challenges scaring people away from small business are created goods, services, or firms can hurt existing
the stuff of urban legends. These myths include the goods, services, or firms.
following: Why do so many innovations come from small business?
1. There’s not enough financing. Remember that most people going into small business
2. You can’t start businesses during a recession. mention flexibility as a key reward, such as the flexibility
3. To make profits, you need to make something. to do the work they think is important. Small business
4. If you fail, you can never try again. owners are freer of the judgments and social constraints
5. Students (or moms or some other group) don’t of workers elsewhere.
have the skills to start a business. New Opportunities
Myths like these holds back many potential People who own their business are presented
entrepreneurs. Knowing the truth is a powerful way to with tremendous opportunities - not only to improve their
keep up your motivation for the undeniably tough work of life and wealth, but also to help them move into and
starting your own business. When you encounter upward in the economy and society of the Philippines.
doomsayer, check out facts and do research. Small businesses offer communities another
type of opportunity—the opportunity to goods and
Getting Started Now: Entry Competencies services. Imagine a neighborhood or town without a
There are million things you could do to start a grocery store or a pharmacy. In important ways, the town
business, but which ones are best? Sometimes the would not seem like a real community. A small grocery,
answer will come to you in the form of an opportunity or drugstore, hardware store, or gas station might be able
offer, and sometimes you’ll need to take the first steps to use its low overhead and capacity to adapt to local
yourself. To start a business, you need four elements to needs (e.g., a grocery store stocking a lot of fishing
come together – boundary, resources, intention, and supplies to appeal to visiting fishing enthusiasts) to make
exchange. This is referred to as the BRIE model. a profit where larger chain stores could not. For a city,
1. Boundary. Something that sets it up as a firm municipality, or even barangays, to be able to stand on
and sets it off from the buying or selling or its own, it needs a variety of small businesses.
bartering we all do occasionally. Small business also provides opportunities to
2. Resources. Include the product or service to be large business and entrepreneurial high-growth firms.
offered, informational resources on markets and High growth firms’ ventures and big businesses are like
running a business, financial resources, and giant boat, and where the boat sails, the economy sails
human resources. along too. But for the boat to work, it must be supported
3. Intention. The desire to start a business and is by deep water. The ocean supporting the boat consist of
the most frequently occurring element of the thousands of small businesses.
BRIE Model.
4. Exchange. This refers to moving resources, Aspects of Global Entrepreneurship
goods, or services to others in exchange for There is a pattern to which countries are likely to
money or their resources. have rates of entrepreneurship, and which will have
lower rates.
Boundary Resources 1. Factor-driven Economy. A nation where the
Your Small Business major forces for jobs, revenues, and taxes come
Intention Exchange from farming or extractive industries like forestry,
mining, or oil production.
Small Business and The Economy 2. Efficiency-driven Economy. A nation where
It has been already discussed why small industrialization is becoming the major force
business is important for the individuals for whom providing jobs, revenues, and taxes, and where
income, growth, and flexibility were among the most minimizing cost while maximizing productivity
important rewards of ownership. But you also need to (i.e., efficiency) is a major goal.
know that small business is vitally important to your 3. Innovation-driven Economy. An economy
community and even to our economy. Part of this comes where the major forces for jobs, revenues, and
from new things small business contribute to the taxes come from high-value-added production
economy, particularly new jobs, and innovations, as well based on new ideas and technologies and from
as the basics that small businesses provide for all of us – professional services based on higher
jobs, taxes, and product or services. education.
New Jobs
In the 2019 study conducted by the Department One other important difference across countries is the
of Trade and Industry, MSMEs generated a total of amounts of two types of entrepreneurship.
5,510,760 jobs or 62.4% of the country’s total 1. Opportunity-driven Entrepreneurship –
employment. Small business is the engine of job Creating a firm to improve one’s income or a
generation, but it is important for existing jobs, too. Small product or service.
business employ millions of Filipino, providing wages 2. Necessity-driven Entrepreneurship. Creating
and salaries. a firm as an alternative to unemployment.
One reason why small business is a key
employer is because they are more willing than most Another approach that has grown dramatically this
large business to offer jobs to people with atypical work past decade is using E-commerce, particularly like Ebay
histories or needs, like people new to the workforce, and Amazon, or Lazada and Shopee. E-commerce is
people with uneven employment histories, and people the general term for conducting business on the internet.
looking for part-time work. The formal title for this is Virtual Instant Global
Innovations Entrepreneurship (VIGE), a process that uses internet
Small business is a key element of every to quickly create business with a worldwide reach.
nation’s economy because it offers a very special
Challenge and the Entrepreneurial Way

2
Entrepreneurs’ stories usually tell us about challenges and then consider if additional plans are needed.
faced and overcome. What is fascinating if you hear It is not a very long-term approach to planning.
enough stories is that there some strategies that are  Opportunistic planners generally start with a
used again and again. These strategies are the goal and look for opportunities to achieve it.
following: Once they find a good opportunity, even if it isn’t
1. If you don’t succeed the first time, try, try, the one related to their original goal, they act on
again. This is called the strategy of it, so it is very short term in orientation.
perseverance or the behavior of continued  Reactive planners are completely passive,
effort to achieve a goal. waiting for cues from the environment to
2. Scale back. Maybe you have an idea but can’t determine what actions to take. Their focus is
get the resources to get it started. Try scaling it entirely short term, and there is little in the way
back to the level of resources you currently of goals driving their efforts. They can make the
available. most of a situation because there is no other
3. Bird in the hand. Instead of planning a firm and plan competing for their attention.
then looking for resources, start with the  Habit-based planners do not really plan at all
resources you already have and think about because their actions are dictated by their
what the best use is you can make of them. routines. They do today what they did yesterday.
4. Pivot. Go ahead and start the business in a way They don’t plan, and they don’t even tend to
you can and look for better opportunities as you react to changes in their environments
go along. 5. Professionalization: One hallmark of successful
5. Take it on the road. Sometimes the place you entrepreneurs is that they usually do at least one
live isn’t the best market for your products or thing much better than average. That average is
services. called a standard business practice and every
6. Ask for help. Today everyone can harness the industry has them. Doing that level or better is what
wisdom of crowds, whether it is asking your professionalization is all about. There are three
personal and group connections on Facebook levels of professionalization:
for ideas, advice, opinions, or donations.  expert business professionalization when
Crowdsourcing is the techniques often based on most aspects of the business meet or exceed
internet to get opinions or ideas through the the industry’s standards,
collective involvement of others.  specialized business professionalization
7. Plan to earn. Think through your capabilities, when one or two aspects of the business are at
prospects, and passions to find the best idea for this level, or
you, and then plan for action to make it happen.  minimalized business professionalization
when none of the aspects of the business
achieve the industry standard.
Module 2
Small Business Entrepreneurs: Characteristics and Entrepreneurial Operational Competencies
Competencies All the aspects of the entrepreneurial personality
depend on hard work, but there are other specific types
THE PSYCHOLOGY OF ENTREPRENEURS of business-related expertise—called competencies—
that appear repeatedly in successful entrepreneurs
The Five Ps of Entrepreneurial Behavior around the world.
There are five aspects of behavior that most 1. Key Business Functions Activities common to all
successful entrepreneurs display. These are not the only businesses such as sales, operations (also called
possible behaviors that you could consider, but they are production), accounting, finance, and human
behaviors that have been shown in the research to relate resources.
to success among entrepreneurs. The five behaviors 2. Industry-Specific Knowledge. Activities,
include the following: knowledge, and skills specific to businesses in a
1. Passion: Passion is an intense positive feeling the particular industry.
entrepreneur has toward the business or even the 3. Resource Competencies. The ability or skill of the
idea behind the business. It comes from being entrepreneur at finding expendable components
actively involved in moving the business forward. necessary to the operation of the business such as
2. Perseverance: Perseverance is best thought of as a time, information, location, financing, raw materials,
type of learned optimism, the ability to stick with and expertise.
some activity even when it takes a long time, and 4. Determination Competencies. Skills identified with
when a successful or unsuccessful outcome is not the energy and focus needed to bring a business
immediately known. into existence.
3. Promotion–Prevention Focus: Most of us have 5. Opportunity Competencies. Skills necessary to
some mix of two internal focuses (also called our identify and exploit elements of the business
regulatory focus), a promotion focus intent on environment that can lead to a profitable and
maximizing gains, which gives us a bias toward sustainable business.
pursuing opportunities likely to lead to those gains,
and a prevention focus intent on minimizing losses, The Entrepreneurial Life Cycle
with a bias toward inaction or protective action. Being Like every person, every small business is unique.
a successful entrepreneur involves balancing the two But just as we all go through childhood and adolescence
focuses. on the way to adulthood, so do entrepreneurs’ small
4. Planning Style: There is more than one way to plan. businesses. There is a lot of predictability in this growth
In fact, there are five ways. process and knowing the developmental stages of the
 Comprehensive planners take a long-term business life cycle can help you better understand your
view, develop long-range plans for all aspects of business and your career as a small business owner.
the business, are comfortable with planning, and 1. Emergence. The first stage of the small business
act based on the plans they’ve developed. life cycle, where the entrepreneur moves from
 Critical-point planners plan around the most thinking about starting the business to actually
important aspect of the business first, act on it, starting the business.

3
2. Existence. The second stage of the business life Small, family-owned businesses have many
cycle marked by the business being in operation but advantages. If the business is managed at the top by a
not yet stable in terms of markets, operations, or group of tight-knit family members, communication-
finances. The problems of mastering these three based integration can be more effective and decision
areas form what are called the liabilities of making can be easier and quicker.
newness for small businesses in their existence There are two challenges typical to family
stage. businesses—role conflict and succession.
3. Success. The third stage of the business life cycle 1. Role conflict describes the kind of problem that
marked by the firm being established in its market, arises when people have multiple responsibilities,
operation, and finances. Slack resources. Profits such as parent and boss, and each makes different
that are available to be used to satisfy the demands on them. Role conflict breeds another
preferences of the owner in how the business is unending problem—the shortage of time.
run. Entrepreneurs are among the most rushed people
4. Resource Maturity. The resource maturity stage is in the workforce. There are, however, a collection of
the most typical fourth stage of the small business. techniques for time management, which can help
It is characterized by relatively stable or slowly meet the challenges of schedule overload. Consider
rising sales and profits over several years. In a firm these basic methods:
that has a takeoff stage following the success a. List
stage, the resource maturity stage occurs after b. 123 Prioritize
takeoff. c. Delegate
5. Takeoff. This stage occurs after the success stage d. Repeat
for a small percentage of businesses. It is e. Strategize
characterized by rapid growth (5–10 percent a 2. When the current owners are ready to think about
month or more). When this growth levels off, the what follows them, we get into succession — the
firm enters the resource maturity stage. process of intergenerational transfer of a business.
Often the lack of a clear succession plan is the
THE SOCIOLOGY OF ENTREPRENEURS death knell for those family firms facing their first
Entrepreneurs can be as strongly affected by intergenerational transition. If the founder dies,
their social or sociological characteristics as by their becomes seriously ill, or is incapacitated before he
personality characteristics. These sociological or she can groom a successor, the new family
characteristics relate to the social groups to which they leader may be suddenly thrust into the role before
belong. Family, gender, race, nationality, religion, age, coming up to speed on vital company information
and other types of group memberships, such as being a and developing needed skills. Also, in the absence
member of a team or a veteran, are typical examples. of a succession plan, private and public dissension
among various factions of the family becomes more
Entrepreneurial Teams likely, negatively affecting operations within the firm,
While the classic image of the entrepreneurial and may eventually cause the business to fail.
small business would involve the image of the solo
entrepreneur, the modern reality is different. The majority Second Career Entrepreneurs
of new businesses have a team of two or more co- A special group of entrepreneurs are called
owners, and the trend is toward even more businesses second career entrepreneurs—people who begin their
being developed by teams of entrepreneurs. businesses after having left, retired, or resigned from
There are advantages to a team. When family work. This can be work in the armed forces, in other
members start a business, they start with already profit or not-for-profit organizations, or even when
knowing and trusting each other. Teams are also likely to parents are no longer tied to caring for others at home.
have more money, time, and expertise to put into a As increasing numbers of corporation’s merge,
business. If the team members live together, they can downsize, reorganize, and/or close altogether, many
save even more for the business. firms are offering attractive retirement packages to
When putting a team together it is important to encourage employees to voluntarily leave the
work out key issues ahead of time. For example, team organization.90 Workers are opting to accept
members might be putting different amounts of money or generous offers to retire early (between ages 50 and
time into the business, but might be expecting identical 64). People’s decisions of whether to return to work
returns, which creates an equity problem. depend on their individual level of wealth (retirement
There is a special case of organizational income and savings), their health, and their work
culture for start-ups, called entrepreneurial culture. experience, as well as general economic conditions.
There are a variety of approaches to thinking about the For some Filipinos, retiring early to become an
specifics, but in the end, there are five key elements: entrepreneur can help them get rich. However, it takes
 Passion for the Mission. more than business acumen to succeed. Those who do
 Passion for the Team face two challenges—adjusting to the entrepreneurial life
 Passion for the Customer and keeping personal finances out of the business
 Passion for Innovation
 Passion for Fairness
Module 3
Family Businesses Small Business Environment: Managing External
Family businesses are firm in which one family Relations
owns a majority stake and is involved in the daily
management of the business. Some of the top The environment is at the core of exchange in
companies in the Philippines are run by families. SM the BRIE model, since exchange is literally the firm or
Investments Corp. is owned by the family of the entrepreneur dealing with the environment—buying,
country’s richest family, the Sy Sibings., while Ayala selling, or trading across the boundary of the firm. In the
Corp. is led by the Zobel family. LT Group is owned by end, entrepreneurs carve a firm out of the environment
the family of tycoon Lucio Tan, while Aboitiz Equity by gathering resources, setting them up inside a
Ventures is run by members of the Aboitiz clan. boundary and trading or exchanging them across the
boundary. In short, almost everything a firm does
involves the environment. This chapter will help you

4
understand more about the environment and its a. Task Environment. A part of the external
components, and how you can organize yourself and environment made up of those components that
your firm to manage its relations with the environment. the firm deals with directly such as customers,
suppliers, consultants, media, interest groups,
and the like.
The Environment of Small Business b. General Environment. A part of the external
Following the BRIE model in starting a business, environment made up of sectors of major forces
the entrepreneur creates a boundary within the that shape the people and institutions of the task
environment, setting his or her firm apart from the rest of and internal environments, such as the
the environment. Environment is the sum of all the economic sector or the demographic sector.
forces outside the firm or entrepreneur. In doing this, the
entrepreneur gives the firm an organizational identity. Environmental Scanning for Small Businesses
Organizational identity is not just the name of a firm, Big corporations have whole departments
but its basic description—what it does and where it does focused on scanning the environment and the firm’s
this. It can include formal elements like a registration competitors. Most small businesses cannot afford to try
with the state, or a website or email account with the that approach, but they can benefit tremendously from
firm’s name on it, or a telephone number in the firm’s even a small amount of environmental scanning.
name.
In creating a firm using the BRIE model, the There are several low-cost and relatively fast ways to
entrepreneur gathers resources from the environment. monitor the environment. They include:
These can include information on how to do the business  Looking for trends and future-looking articles in the
or whom to sell to, funding to run the business, space for trade and professional press of your industry or
the business, and raw materials for the business to use those of members of your task environment.
to make goods or deliver services. If the environment is  Asking your customers, suppliers, banker, attorney,
rich with resources as it is during economic boom times, and accountants what they see on the horizon for
it can be easy to gather what is needed. In tougher business in general, for business in your community
times, such as during economic recessions, gathering in general, or for your industry or line of business in
resources can be harder. As entrepreneurs face particular.
resource constraints, they often learn to get by with less,  Keeping notes on the things that bother you about
or substitute a more readily obtained resource, or ask to the way work is done now, or what bothers you
borrow, rent, or trade for the resource. These techniques about how something has changed (whether a
are called bootstrapping and are part of the culture of product, service, or process you deal with), and
most successful start-up. periodically do some fast research (typically
searching on the web) on what causes it and how
The elements of the small business environment others feel about it.
Environment is a difficult concept to consider  Subscribing to a couple of magazines or
because it is so big. It literally includes the entire world newsletters (online or hard copy) or online
outside yourself and your business. As an entrepreneur, newsfeeds or blogs outside your area of business.
or entrepreneur-to-be, how do you go about
understanding it, much less using it to help focus and Beyond trendspotting, the other key scanning ability
operate your business? The key is to have a model of is to find the resources you need from the environment
the environment in mind, which can help you focus on a to build your business. The key to identifying resources
part of the world at a time. comes from the acronym PROFIT, which stands for
the six types of resources:
1. Property/Physical: Buildings, land, equipment, raw
materials
2. Relational: Customers, networks, distributors,
social capital
3. Organizational: Systems, structures, operational
procedures
4. Financial: Money, lines of credit, crowdfunding,
bartering
5. Intellectual (also known as Human): Employees,
contractors, advisers, consultants, and the skills the
business needs or has.
6. Technological: Patents, trademarks, ideas,
copyrights, licenses, access to technology or
expertise networks
1. The Internal Environment of a firm consists of
those people inside the boundary—the owner, any Five Skills for Managing Relations with the
employees, and any other owners or board Environment
members of the firm. As every company matures, it Building Legitimacy
adds to its organizational culture a set of shared Legitimacy means that a firm is worthy of
beliefs or basic assumptions that demonstrate how consideration or doing business with because of the
things get done. Organizational culture also impressions or opinions of customers, suppliers,
includes common, accepted ways of dealing with investors, or competitors. Gaining legitimacy is one of
problems and challenges within a company. the top challenges facing new small businesses, but it
2. The External Environment consists of everything can be especially difficult for entrepreneurs seen as
outside the firm’s boundary. When businesspeople “different”—women, minorities, home-based businesses,
talk about “the environment” and they are not businesses started by young people, entrepreneurs
talking about air, land, or water, this is the introducing a new technology, or people new to the area
environment they are discussing. The easiest way or industry.
to think about this very large entity is to break it
into two parts.

5
There are three general forms of legitimacy that you businesses, and it can be wrenching when something
can develop: goes wrong.
1. Based on your people. Remember that often the Although originally given for large businesses,
owner is the business in many people's minds. So, the six steps to follow can be readily adapted to small
he or she is the most important element of social ones. The steps are:
capital to customers and supporters of a business, 1. Admit you’re in trouble—quickly. It is better to
such as bankers, lawyers, and suppliers. Having say, “If there is a problem, I will find it and fix it,”
people in the organization—an owner, employees, than to delay an admission until fact-finding is done.
or even media spokespeople—whom customers 2. Get to the scene as soon as possible. Your job?
know, and respect increases the firm’s legitimacy. Show caring and accountability.
Making sure the people of your business always 3. Communicate facts you know (and those you
work in the best, friendliest, and most professional don’t) to employees, customers, and suppliers.
way also helps build the business. 4. Have one person serve as the firm’s
2. Based on your product. The goal is to make sure spokesperson. It is best if it can be the owner, but
the customer knows about the details of the product an articulate employee, family member, or outside
—its high quality and environmental friendliness, its professional (e.g., lawyer) can stand in.
competitive advantage, how to use it—and has the 5. Separate crisis management from the everyday
assurance that it will be backed up by the firm. management of the firm. If you are doing both, try
3. Based on your organization. the final key to take time to do each separately. Delegate as
legitimacy factor is promoting knowledge about the much as possible of the everyday management to
organization itself. This might focus on talking about employees or family while you concentrate on
the history or visibility the firm already enjoys. It dealing with the crisis.
might come from published information that makes 6. Deal with the crisis quickly. Take steps to solve
sure your firm looks like a substantial and the problem and make the process of dealing with
professional business. Whatever gives customers the problem as open as possible.
confidence in the quality and survivability of the firm
helps the selling process and in turn increases the Achieving Sustainability
all-important trust factor. If you look at a management, entrepreneurship,
or small business text from 10 years ago, you would be
Developing a Social Network hard-pressed to see anything related to sustainability or
Another basis for building social capital is green business. Those elements we called corporeal
through building a social network. A social network is forces in the general environment were taken for
the entrepreneur’s relationships and contacts with granted. Today, however, some of the negative effects of
others. Social networking is a way to work trust, industrialization on the earth and the living species
reciprocity, and long-term relationships into your day-to- inhabiting earth are becoming apparent. Sustainable
day business operations. It’s a way to build your entrepreneurship is an approach to the operation of the
company’s expertise by convincing others to share their firm, the line of business of the firm, or both, which
skills and knowledge with your firm. The most successful identifies or creates and then exploits opportunities to
owners are those who recognize that others have the make a profit in a manner that minimizes the depletion of
expertise needed and establish relationships that give natural resources, maximizes the use of recycled
them the benefits of that expertise. material, improves the environment, or any combination
Reputation has a positive community impact; it of these outcomes. Positive outcomes along these lines
increases trust and creates a culture that enables people are described as “greener,” so the approach is also
to make good decisions. Social networking helps all sometimes called green entrepreneurship.
those aspects of small business by building your
reputation as giving the most expert business goods or Making Ethical Decisions
services and as being an important community resource. Ethics comprise a system of values people use
Social networking can help your long-term reputation as to determine whether actions are right or wrong. We
a business owner by showing others who you are—a consider ethics in determining whether a decision we are
consistently top-notch community player. about to make is good or bad. And we make judgments
Remember, social networking makes a about actions—something is good or bad; someone is
difference in how you’ll conduct business every day. It right or wrong— based upon our own personal ethics. An
means asking for help when you need it, respecting the ethical dilemma occurs when a person’s values are in
other person’s time and expertise, and most importantly conflict, making it unclear whether a decision we’re
being willing to reciprocate if asked. Mutuality is the thinking about making is right or not. An ethical dilemma
idea and action of each person helping the other. also occurs when there are several different options for a
Building social capital through social networking decision we have to make, and the best choice isn’t
involves giving information, letting people know they clear. Of the five environment managing techniques
belong, and providing social support and approval. You discussed in this section, making ethical decisions is
have to take the time to build and keep up your undoubtedly the hardest. Part of it is because the ethical
relationships with others in your network. This is called problems that keep entrepreneurs up at night are ones
networking, which means small business owners where there is not a satisfying yes or no answer.
interacting with others in order to build relationships LaRue Hosmer was initially a professor of
useful to the business. entrepreneurship who came from a family logging
business. He later turned his eye toward the challenge of
Handling a Crisis making ethical decisions in business. He came up with a
While some challenges come slowly and give model widely used today, but it is focused more on big
the small business owner a chance to think about how to business than small ones. Adapting his approach30 to
choose, all businesses sooner or later face some sort of small business, making ethical decisions involves three
crisis. A crisis is a situation that poses a major problem steps:
for the business or its people, in which the survival of the 1. Define: Define the moral problem.
business is at stake, and immediate action is necessary. 2. Generate: Generate alternatives that could meet
For owners, knowing what to do during a crisis is a very the ethical, legal, and economic goals every
specialized and emotionally demanding form of decision business must balance.
making. Small business owners are optimists about their

6
3. Implement: Pick the best alternative you and your arrangement called licensing. A license is a legal
business can live with and implement it. agreement granting you rights to use a particular piece
of intellectual property (for example, a technology). In
Caveat Emptor return, you (the licensee) are required to pay the owner
You can still see an occasional entrepreneur, of the license (the licensor). These payments can
corporate magnate, or economic pundit invoke the old consist of an upfront or annual flat licensing fee or a
Latin phrase caveat emptor, let the buyer beware. It gets royalty, which is a payment per item sold.
repeated because it has popped up in legal cases, and
the Latin makes it sound impressive, but as a legal FROM IDEAS TO OPPORTUNITIES THROUGH
principle, it has been routinely discredited. Caveat CREATIVITY
emptor is often the first line of defense by rip-off artists, You might have a viable business idea, but is it
frauds, and producers of shoddy merchandise. Using it the best one to pursue? Are you sure you have the right
as a defense puts the entrepreneur who uses it, and, approach for making the most of the idea? Very often the
usually by association, the whole small business first good idea an entrepreneur has is not necessarily the
community, in a negative light. best one he or she will have. Before committing yourself
Assuming you realize the caveat, emptor to one viable idea, it is a good practice to take some time
approach is not the way to go, you may still need to and see if you can take that viable idea and innovate on
make a decision you believe is ethical. Here are four it to create an even better—more profitable, more
proven philosophies to try when you are thinking distinctive, harder to copy—idea.
through alternatives to help you determine how
ethical the choices are. SCAMPER tool
1. Am I treating others the way I would want to be One tool you can use to help you identify new
treated? You’ve probably heard of this one before. opportunities is the SCAMPER. It is based on the work
It’s the Golden Rule, and almost every major of Alex Osborne, a pioneer in the field of creativity, who
religious tradition in the world has some version of it first coined the word brainstorming. The tool is known as
2. Is my solution the best thing for the most SCAMPER, the acronym for a set of cues that trigger
people over the long term? You may have heard new ideas for your business.
of an idea called utilitarianism. Basically, it means 1. Substitute: Think of what you might substitute for
that the action resulting in the greatest good for the something else to form a new idea. A feature that
greatest number of people is the right action to take. allows your customers to order directly from a Web
3. What if everyone did what I want to do? What site rather than visiting your store or ordering by
kind of world would it be? Those questions in a mail is an example of substitution. Sometimes
nutshell are the idea of universalism, a code of solutions derived through SCAMPER cues are very
right and wrong that everyone can see and follow. “way out” and lead people to some creative ideas
4. What if my decision were advertised on a for solving annoying problem.
billboard? If you have tried ways to think this 2. Combine: Think of possible combinations you can
through and still can’t decide whether what you plan make that result in something entirely different. Not
to do is ethical, try the billboard principle. As the long ago, if you wanted to buy a book, you went to a
name implies, this asks whether you’d be store that typically carried only books, and if you
comfortable having your decision (with your name, wanted to buy a cup of coffee you went to a coffee
of course) advertised on a billboard for everyone shop, and if you wanted to hear music you went to a
you know to see. club or theater.
3. Adapt: Think about what could be adapted from
products or services that already exist. Many
Module 4 successful businesses are founded on the concept
Small Business Ideas: Creativity, Opportunity, and of adaptation. It’s a popular innovation strategy that
Feasibility can be just as effective, and much more likely in the
real world, than business opportunities that are the
IDEAS, OPPORTUNITIES AND BUSINESS result of radical innovations such as inventions.
The search and capture of new ideas is called 4. Magnify or modify: Taking an existing product and
opportunity recognition, which researchers believe changing its appearance or adding more features or
might be the most basic and important entrepreneurial increasing the hours your store is open or making
behavior. The exact reasons why entrepreneurs seem to its advertising more dramatic are some ways you
be better able to find ideas that work are unclear. The could magnify or modify your idea.
notion of entrepreneurial alertness is one that has 5. Put to other uses: Think of ways you could
captured the attention of scholars in the field. This generate a high number of opportunities for your
phrase means that entrepreneurs have a special set of product or service beyond what it is traditionally
observational and thinking skills that helps them identify used for.
good opportunities. 6. Eliminate: Search for opportunities that arise when
you get rid of something or stop doing something
Opportunity Strategies 7. Rearrange or reverse. Overall, you have to ask
1. Imitative strategy. An overall strategic approach in yourself this question: How can I change, reorder,
which the entrepreneur does more or less what or reverse the product or problem? What would I do
others are already doing. if I had to do this process in reverse?
2. Incremental strategy. Taking an idea and offering
a way to do something slightly better than it is done AVOID PITFALLS
presently. There are five major pitfalls that business owners
3. Radical innovation strategy. Rejecting existing can become victim to when trying to become more
ideas, and presenting a way to do things differently. innovative. See if you recognize the ones that apply to
you and your business, so that you can sidestep them at
One powerful but rarely used source of ideas are every opportunity:
universities and government agencies. Both develop 1. Identifying the wrong problem: When a problem
a tremendous range of new technologies or refinements doesn’t stay solved or an opportunity doesn’t pan
of existing technologies, but never do anything with out as expected, it could be that the wrong problem
them. What these organizations will offer you is an was defined.

7
2. Judging ideas too quickly: At many business spell the end of the process if you can use creative
meetings when someone suggests a new idea or solution approaches like SCAMPER (introduced earlier
approach, often the first reaction you hear is, in this chapter) to come up with a new way to resolve or
“We’ve tried that before and it didn’t work,” “The sidestep problems.
boss will never go for it,” “It’s not in the budget,” or
the frequently heard, “Yes, but . . .” People tend to WAYS TO KEEP ON BEING CREATIVE
judge ideas prematurely, before they take the time Even if you are a solo small business owner, you
to ask, “What’s right about this idea?” or “How could can take steps to keep yourself in an innovative frame of
this idea be made better?” mind. Here are some techniques you can try as you
3. Stopping with the first good idea: The first good practice the business of innovation on your own:
idea you come up with is rarely the best. That’s 1. Read magazines or trade journals outside your
because it was the easiest to think of, and so there area.
is little doubt that your competitors have already 2. Invite someone you never included before to a
thought of it, too. meeting at which you are solving a problem or
4. Failing to act: Good opportunities have a way of searching for a new opportunity. Try a supplier or a
coming into existence. It might be up to you to bring friend who works in a different field.
it to the market. 3. Have a “scan the environment” day in which you
5. Obeying rules that don’t exist: We sometimes put discuss trends and happenings that could impact
obstacles in front of ourselves because we think we your business.
can’t do something, when in fact there is no reason 4. Try a mini-internship. Ask a colleague or friend if
we can’t. you can spend a day at his or her business to see
what you can learn that may be applicable to yours.
SCREEN IDEAS 5. Instead of trying to simply sell your product or
One of the simplest and fastest ways to screen service to customers, put yourself in their shoes and
ideas is what we will call the RBI screen, named for Alex ask them what frustrates them most or what
Bruton’s “Really Big Idea”. RBI screen RBI stands for problems they cannot seem to solve that relate to
“Really Big Idea” and is a fast technique for making your business.
initial assessments (called screens) of prospective 6. Redesign your work environment. Get a room with a
business ideas based on five questions. view. This doesn’t have to cost a bundle in
1. People: Who are you? What is your (or your remodeling or even redecorating costs. Try to bring
team’s) relevant experience or knowledge? in some items from nature and add color and
2. Offering: What are you offering? What is the inspirational objects or quotations
product or service or experience?
3. Customer: Whom are you offering it to? Who is Module 5
your customer? Who makes the buying decision? SMALL BUSINESS ENTRY: PATHS TO PART-TIME
How many buyers are there? ENTREPRENEURSHIP
4. Value proposition: Why do they care? Why will it  Part-Time Employment-Working 35 or fewer hours
be important to the buyers/users? Why will they be a week.
happier with your offering than their current  Full-Time Employment- Working more than 35
substitutes or alternatives? hours a week.
5. Distinctive competencies: Do you have any key  Pop-Up Business- A temporary business that
or core science/technology or feature? Does offers services or products in a variety of locations
your idea have something special compared to for a brief period at a time. What characterizes a
competitors that is valuable to your customers or popup business from any other is its temporary
buyers (e.g., better technology, better quality, easier nature.
to buy or use, better support, new/better features,  Episodic Businesses- A temporary, project-based,
costs less, gives your firm an advantage over or sporadically operating business.
competitors, rare, costly for others to imitate, etc.)?
 Hybrid Entrepreneurship- the process of initiating
a business while simultaneously remaining
MAKE SURE AN IDEA IS FEASIBLE
employed for wages or salary.
Feasibility. The extent to which an idea is viable and
 Part-Time Business- A business in which the
realistic and the extent to which you are aware of internal
owner either participates fewer than 35 hours per
(to your business) and external (industry, market, and
week or operates on a temporary or seasonal basis
regulatory environment) forces that could affect your
while maintaining employment elsewhere for wages
business.
or salary.
Feasibility studies consist of careful investigation of five
primary areas: the overall business idea, the  Volatility- the frequency of business starts and
product/service, the industry and market, financial stops
projections (profitability), and the plan for future
action. Within each of these areas you will examine the When to Consider Part-Time Entrepreneurship?
strengths and weaknesses (advantages and These days, the conventional wisdom is that if
disadvantages) of your business opportunity. you are serious about starting a business, you ought to
In crafting a feasibility study, the goal is to start a business full time and prepare for it by doing a
assess if the idea can be profitably brought to market. business plan. That makes a lot of sense because a
The traditional problems facing new ideas are (1) the business plan enables you to look at every aspect of
idea cannot be economically made into a product or your business. Business plans are also important if you
service; (2) the resulting product or service works, but intend to ask others for expertise or financial
does not appeal to a large enough market (or is not investments. However, running a business full time can
worth enough to them) to make the effort profitable; and be a major commitment and is not always the best way
(3) the product or service works, has a market, and to go about becoming an entrepreneur.
could be profitable, but you need to get additional There are four situations in which it might make
people, funding, or other resources to make the idea into better sense to first undertake a part-time business:
a business. Notice that each problem builds on the 1. One of these is when you are new to business and
solution of the prior problem. As with idea screenings, need to gain basic experience.
having no solution for one of these problems may not 2. Second type of situation is one in which you lack

8
 resources to pursue a full-scale business or create to your home. Use the private mailbox address for your
a business plan. business on the web and on your stationery.
3. Third type of situation is a narrow window of Another approach is to seek to get permission—called a
opportunity variance—to have your business operating from out of
4. Fourth situation arises when you are uncertain your home.
about the demands of going into a fulltime Variance- Permission from a government organization to
business. act differently than the laws state. This approach is only
for those with determination and money.
Key Considerations for Success in Part-Time
Entrepreneurship The following list touches on many of the issues home-
When you decide to pursue part-time based entrepreneurs find most important to running their
entrepreneurship, there are usually two major questions: business:
What kind of product or service do you want to offer and  Choose a work location inside your home that is
how do you want to organize your part-time business? away from noise, distractions, and family traffic. It
For the second question, about how to organize your helps you concentrate and sound business like
business, there are usually three key considerations for when on the phone.
part-time small business start-ups:  Be realistic about the amount of space you will need
1. The cost to start up your new part-time business. for your equipment.
Cost to Start Up- the amount of money it takes to  An office door can keep business separate from
start a new business. family and the rest of life.
2. The time to start up your business.  Try out your location for a day or two to check out
Time to Start Up- How long it takes to start a new noise, traffic patterns, lighting needs, and
business. distractions.
3. The permanence of the business you are creating  Do not overload on hours of work, or on snacks
Permanence- the impression of long-term from the refrigerator down the hall.
continuity a business gives others  Set up your workday to minimize distractions from
household or family chores and, as much as
What Kinds of Part-Time Entrepreneurship Exist? possible, stick to the plan.
In this section we will look at the ways to start a
 Consider hiring help to handle household or family
part-time small business in most industries—retailing,
chores to free up your time.
wholesaling, most services, and even manufacturing.
 Set the ground rules early and stick with them.
Watch out for family, friends, and visitors who do
Home-Based Business
not understand home-based businesses.
Home might be where the heart is, but it is also
Essential Questions to Answer for a Home Office
where the part-time business starts. If yours is a retailing
Here are five most important issues that you should think
or wholesaling business, home is where you store your
about before you set up a home-based business.
goods. If you are making furniture, toys, clothing, or food,
1. If you intend to deduct the expenses of your home
it is probably where your work area is. And if you are in a
office, can you comply with the regulatory
service, it is where you retire to in order to get your work
standards?
done.
2. If you are going to use a home office, can you meet
Home-based business meets at least two of the
state, country, and municipal regulations?
three criteria for start-up. It is inexpensive, since you
3. If you choose to have a home office, can you be
are already living somewhere, and you can quickly get
productive in that space?
your business going where you live. Although home-
4. Will you be able to deal with clients, vendors, or
based businesses do not always give customers the
employees in your home office?
strongest sense of legitimacy, the idea that a customer
5. Will you be able to separate home and business
knows where the entrepreneur lives can be a point in
life?
favor of trusting in the potential permanence of the firm.
Home-based business is the easiest and fastest
With so great a number of firms, there are not
way to start a business, and the easiest and fasted type
many hard-and-fast rules that apply to everyone, but
of business to move or close down. This ease of
there are a few key ideas to keep in mind. First and
deployment, moving, and closing make the home-based
foremost is the location of your home-based
business one of the volatile forms of part-time business.
business. According to home-based entrepreneurs, the
Even so, it is the core and greatest common factor in
greatest problems they face come when there are zoning
business start-ups.
challenges or family challenges to the business.
Internet Informational Websites:
Zoning laws- Government specifications for acceptable
Perhaps the biggest change in part-time self-
use of land and buildings in particular areas.
employment in the past five years has been the growth
Covenant- The limitations imposed on an individual’s
of the Internet as a major method for conducting
property by the neighborhood group.
business.
One of the greatest challenges to making a
Most of us have bought something online, which is what
home office work is getting family and friends to give you
is called e-commerce. The use of the Internet to
the privacy and time alone to do the work you need to
conduct business transactions. But another type of
do.
website, the informational website, an Internet site
designed to introduce and explain a business to others.
To minimize problems, there are several alternatives:
If you are not concerned about the ethical
Business-To-Consumer (B2C)- Business-to-consumer
implications, you can generally keep the web- and
transactions using e-commerce. Type of e-commerce
phone-based aspects of your business at home without
that products like music and cellphones are example of
neighbors becoming aware of (or disturbed by) your
the kind of goods we buy as individuals.
business—but be sure not to tell them you work from
home!
Business-To-Business (B2B)- Business-to-business
The way to handle large amounts of mail and
transactions using e-commerce. Another type of e-
packages is through the use of private mailboxes and
commerce, sales where one firm sells to another firm.
self-storage facilities rather than having them delivered

9
 2. Chargebacks: This is a fee the service levels on
Consumer - A private individual or household that is the you for any of a variety of problems related to the
end user of (the entity that “consumes”) a product or sale—for example, a lost, stolen, or fraudulent card
service was used, the customer reports nothing was
received, the product was not the one promised, or
Blog - A web page in which entries are posted in reverse there were problems with the product.
chronological order (i.e., the most recent at the top of the  eBay - a site offering a variety of ways to sell goods
page). and services.
 Reverse auction - an auction in which the low bid
RSS feed - An Internet messaging service that pushes gets the business or wins.
(sends) whatever web material you specify to  Upwork.com adapts the eBay model to services.
subscribers to that feed. RRs stands for “really simple  Using e-commerce services like eBay or Upwork
syndication” and an RSS feed pushes or sends can provide access to a wider range of vendors or
whatever web material you specify to subscribers to that service providers.
feed. RSS feeds can be read in many browsers or with  Reserve price - minimum acceptable selling price
special readers. in an auction. If the bidding does not exceed the
Tweet – It is the latest variation on push technology. A price, the sale will not go through.
140-character-or-less message sent using the Twitter Network marketing - An approach to selling in which
web service. the salesperson recruits’ customers to become
Multichannel marketing - use of several different distributors of the product or service to others.
channels to reach your customers, for example, a Another variation on the home model is network
website, direct mail, and traditional retailing. marketing efforts, also called multilevel marketing or
Reciprocal link - A listed, live connection to a different MLM.
website, which in turn displays a similar link to the first
website. Stand retailing—the roadside, flea market, farmers’
Search Engine Optimization (SEO) - A general market, or craft fair business is one of the most ancient
approach to website design intended to result in the site forms of small business. It is mentioned in the Bible, and
being displayed toward the beginning of a search marketplaces full of stands have been found in virtually
engine’s (e.g., Google, Yahoo!, etc.) listing for that term. all archeological digs. Today, stands tend to be either
Sponsored link - A form of paid advertising that gets semi-permanent one that remain in one place and are
your company’s website at the top of a search list. built to be sturdy, like a farmer’s roadside stand, or
movable ones that can be quickly assembled and
E-Commerce and eBay Websites disassembled for use in farmers’ markets, flea markets,
 For part-time entrepreneurs, the lure of an e- and craft fairs.
commerce site is undeniable.  The advantage of stand businesses is that you can
 E-commerce on the Internet is an attractive start with little investment. Stands can be a box or
approach for entrepreneurs looking to create a ground cloth. They also do not require a lot of
business. This is especially true for part-time investment in inventory. There are a variety of
entrepreneurs. locations where a stand can be set up, such as flea
a. For part-time entrepreneurs, the online approach markets. Stands can also be quickly established
makes a highly attractive opportunity. and easily ended as a business. Stands vary widely
b. For many part-timers, the online approach in the products they sell.
provides a great way to learn the business and  The key success factor for a stand is having a
the market, establish your reputation and location where there is enough foot or vehicle traffic
business track record, and lay a foundation for a to sustain the business. High traffic concentrations
full-time business. are why flea markets, farmers’ markets, and craft
c. For entrepreneurs looking to prospect for the fairs are popular locales for stands.
right type of business, the online sales approach  The other success factor is inventory. You might be
makes it possible to try out a range of industries selling products you make yourself. The next best
quickly and with minimal risk. thing is to start with what you know. If you have
d. For entrepreneurs with highly specialized seen someone’s work and think it would sell, ask if
products, the idea that low-cost listings on two you can be an agent or reseller.
sites could reach half of 1.1 billion Internet users Pop-Up Businesses - One trend that we see increasing
worldwide opens up sales possibilities like never across the United States, Europe, New Zealand, and
before. Australia is that of pop-ups. We see pop-up retail shops,
Two Major Approaches to Online Selling pop-up restaurants, pop-up festivals, Pop-up art galleries
1. Using eBay or another online site to showcase your the list seems endless. But what are these pop-ups that
goods and handle the selling and payment process. seem to be so much the trend today? According to
2. Set up own website Wikipedia (every college student’s first-choice research
 E-commerce sites has the ability to create and Tool): “Pop-up retail, also known as pop-up Store (or
maintain an online catalog of products, create new pop-up shop in the UK, Australia, and Ireland), or flash
database entries for orders, and handle the payment retailing, is the practice of opening short-term sales
for products or services. The more tools and space.
services you need and the larger the catalogs you
post, the more you will end up paying. Venue - is temporary here today but gone tomorrow.
Two Important Financial Issues for Entrepreneurs The space where a pop-up business is selling classic
Who Create their Own E-commerce Websites: vinyl records today may well be the space where
1. Payment: Most online transactions use a credit Halloween costumes are being sold tomorrow. Pop-up
card or an online payment system like PayPal shops and restaurants are typically small, sometimes as
(which originated as a division of eBay). There are small as a single shipping container.
fees for the transaction itself, and there are often In a very real sense, the pop-up phenomenon is not new
fees for currency conversions, or guaranteed at all. In fact, it is very much like the stand retail
payments. discussed in the previous section. However, it is very
much a part-time business. For Part-timers, the big

10
advantage to a pop-up business is its extreme flexibility: a problem.
 Pop-ups do not have a fixed place of businesses. 2. Do not aim for perfection; “good enough” really is
 Pop-ups exist for only a short time—a few hours, a good enough.
day, or a few weeks. 3. Do not dwell on the past; just plan to do better next
 Pop-ups are designed to be easy to set up and take time.
down. 4. Minimize your time spent in meetings, or schedule
 Pop-ups can easily be set up in new locations. meetings to be short.
 Pop-ups must be special, distinct from other 5. Schedule and protect quality time with your family.
permanent businesses. 6. Schedule and protect some time for yourself to
Mobile Offices - One recent survey suggested that one have fun.
in six working Americans worked from their cars or
Trucks. The kinds of jobs that involve face-to-face selling Exchange: Dealing with Others
and client services are the ones most likely to be done  There are two key groups outside your business
from a car or truck. with whom you must deal—government and
Virtual Offices, Executive Offices, and Incubators customers. Even part-time businesses have to
 When stresses in the home are making the home deal with government, and three issues pop up
office problematic, but Your business is not ready repeatedly: registration or licensing, taxes, and
for a full-time rental, one approach is to look at zoning which was discussed earlier in this chapter.
Outsourcing your office. For businesses run from a home or commercial
 A virtual office is actually the next step to most venue like a fair or consignment shop, most states
Business web hosting packages. Major players and localities require some form of registration, but
include Regus.com, Onebox.com, and Hq.com. the requirements vary so it is important to check.
Executive offices provide small amounts of short- Pricing - is often seen as a challenge by part-time
term space for an office or work area. They can be businesses.
furnished or unfurnished and provide basic utilities.
Doing Business without a Business Organization Delegation - the assignment of work to others over
Artists, artisans, authors, inventors, small-scale whom you have power.
manufacturers, and collectors of antiques or other Here are several tips that can help make any
collectibles all have one thing in common: They possess delegation effort more successful:
something they would benefit from selling. Often, these  Start delegation with simple tasks to get you and your
people start small part-time businesses to do that. With employees used to the process.
the advent of general selling platforms like eBay.com  Match the task to the person with the best skills and
and specialty platforms like etsy.com, selling your Work attitude for it.
has never been easier.  Solicit questions from your employees about the
delegated work.
Maker - A modern term for an inventor, in particular, an  Attach a motivating outcome to the delegated work—
inventor who Uses modern techniques like a chance to learn new skills or demonstrate
3-D Software and 3-D printers or do-it-yourself leadership, increased visibility, or an opportunity to
electronics to create new items. see more of the business or its customers.
 Allow time for the employees to learn the task and
Doing Business without a Business Organization correct the inevitable early mistakes.
 Artists, artisans, authors, inventors, small-scale  Give employees feedback about their performance
manufacturers, and collectors of antiques or other soon after they start.
collectibles all have one thing in common: They  Hope for perfection in performance but be satisfied
possess something they would benefit from selling. with good enough.
Often, these people start small part-time businesses  Once delegated, do not take back responsibilities.
to do that. When problems arise, remedy them, rethink your
 However, many others prefer to stick to their approach, and retrain the employee.
creating or discovering and let someone else Outsourcing - Contracting with people or companies
handle the selling process. The kind of businesses outside your business to do work for your business.
that do this are called a variety of names such as
consignment shops, auctioneers, or sales agents. Moonlighting - working on your own part time after your
Regardless of the name, the basic business model regular job.
remains the same.
 An eBay consignment shop starts with you dropping Conflict of interest - A situation in which a person faces
off your item. The consignment shop photographs two or more competing standards or goals.
the item, prepares a description, and posts it on
eBay. When the item is sold, the shop ships it to the Cannibalizing - Taking business away from your
buyer and sends you your share of the sale price. employer.
 Intellectual property (IP) refers to original works
like inventions, visual and performing art works, Poisoning the well refers to creating a negative
books, and computer programs. impression among your employers’ customers.
Boundary: Separating and Balancing Business and
Home Aggrandizing is an attempting to make your business,or
 Time is central to balancing home and business. It you seem more accomplishedor grander than reality.
is important to organize a business around a *The entrepreneur may start thinking about
schedule that makes sense for you. Internet- making the firm seem bigger, more substantial, or more
based businesses let you work anytime that is capable than it really is. This misleading impression,
convenient for you. called aggrandizing, can spell the death of a firm if
Having some general rules to help sort out these discovered at an inconvenient time.
conflicting demands helps. Fred Kiesner, an The owner is the business. If you cannot trust
entrepreneurship professor at Loyola Marymount the owner, you cannot trust the firm.
College, suggests six key ideas:58
1. Do not waste time complaining; do something about Moving from Part-Time to Full-Time

11
Entrepreneurship
 In deciding whether to make the move to full time,
the key challenge is usually financial.
 The way to determine the financial situation of a
business is through crafting a business plan.
There are several ideas to keep in mind to help in
this transition
 often makes sense to wait until there is a solid
income likely for the business before moving over to
full time.
 make use of any transition services your former
employer offers, such as COBRA health coverage.
 recognize that initially at least you will spend nearly
all your time running and marketing the business.
Part-time entrepreneurship is important because it gives
people a chance to learn the ropes in business and to
test out their ideas.

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