Test Winter 2020, questions and answers PDF

Preview

Summary

Robert Madronic...

Description

Midterm Test Review for Entrepreneurs Robert October 16 2-hour class 19 topics and of those 8 short answer questions – pick 4 1 essay question Answering the 4 p’s ex. Air Canada answer Questions Chapter 1 1. 3 motivators for entrepreneurship

2.

Drawbacks of Entrepreneurship (pick like 4)  Dealing with finances  Finding new customers/Markets  Gov’t regulations and paperwork  Keeping up with competition  Dealing with employment issues (keeping solid employees) (hiring contractors)

3.

Causes of business failure (know 4, just the reasons)  32 percent inadequate research and development  23 percent lacked competitive advantage  14 percent due to uncontrolled costs  13 percent due to poorly developed marketing strategies  10 percent poor market timing  8 percent succumbed to competitor activities

4.

4 routes (roots) to Entrepreneurship  Starting a new business  Entering a family business  Opening a franchise business  Buying an existing business

5.

6 entrepreneurial characteristics  Commitment and determination  Leadership  Opportunity obsession  Tolerance of risk, ambiguity, and uncertainty  Creativity, self-reliance, and adaptability  Motivation to excel

1.

Chp 2 3 Startup ideas  New Market o Providing customers with an existing product not available in their market  New Technology o Involving new ideas, involving new technology, centred around providing customers with a new product  New Benefit o Providing customers with an improved product

2.

General environment (or pestle)

3.

Factors contributing to competitive advantage  Unique service features  Price/value  Notable product attributes  Customer service  Accessibility

4.

4 niche marketing strategies  Restricting focus to a single market segment  Limiting sales to a single geographical region  Emphasizing a single product or service  Concentrating on the superiority of the product

Chapter 4

1.

4 advantages of franchising  Proven marketing concept and customer base o Use of an established, nation-wide brand  Training o Help alleviate managerial weaknesses  Financial assistance o Start-up business costs are high and by teaming up with a franchise, the individual can increase her/his chance of receiving financial help  Operating assistance o Franchisor provides operating services, including site selection, bulk purchasing of equipment, and inventory

2.

Limitations of franchising Franchising Costs Restrictions -Initial franchise fee -Sales territory -Cash investment -Site approval required -Royalty payments -Outlet appearance -Advertising costs -Goods/services to be sold -Resale of franchise -Advertising and hours of operation

3.

5 legal issues  Legal counsel must be obtained  Consult a lawyer  Discuss franchise proposal with a banker  Seek a professional accounting firm  Franchisee should be wary of contract provisions that contain

4.

4 reasons to buy an existing business  To reduce uncertainties and unknowns  Ongoing operations and relationships  To obtain an ongoing business at a bargain price below what it would cost to start a new business  To get into business more quickly than by starting from scratch

5.

Quantitative factors for evaluating a business Fair Value:  Asset-based The value of a firm can be determined by estimating the value of its underlying assets.  Market-based Relies on financial markets in estimating a firm’s value.

 Earnings-based Firms value is determined by future returns from the investment.  Cash flow-based Based on the amount and timing of its future cash flows 6.

1.

Qualitative reasons • Competition • Market • Future community development • Legal commitments • Union contracts • Buildings • Product prices Chp 6 3 marketing philosophies CONSUMER ORIENTED a. All marketing efforts begin and end with the customer b. Focus is on consumer’s needs c. Philosophy is most consistent with long-term success of firm PRODUCTION ORIENTED d. Emphasizes development of the product and production efficiencies over other activities SALES ORIENTED e. Favours product sales over production efficiencies and customer preferences

2.

4 segmentation variables  Benefit  Geographic  Demographic  Psychographic

3.

4 characteristics of services  Tangibility  Production/Consumption  Standardization 

Perishability

4. Building the total product offering (6 parts to it)

Service mark

Labelling

Packaging

Trademark

Branding

5.

PRODUCT

Warranties

8 pricing strategies (pick 4)

Bundling

Offering several products for one combined price.

Odd-Even

Make the price appear to be lower. Ending in 0.99.

Unit Pricing

Comparison where a product may be sold in different sizes.

Price Lining

Setting a range of several distinct merchandise levels.

Loss Leader

Products offered at or slightly below cost to attract people.

What the Market Will Bear

Charging as high a price as possible before resistance.

Marketing the 4 P’s – Product- The product the company is trying to sell the consumer. What product should we sell that consumers will want to purchase? Price- How much the company should charge for the product. Prices often go up or down depending on economy and competition. Price needs to be set based on materials manufacturing shipping etc. Place-The ‘home’ the product comes from, can be internet or a location Promotion- Product exposure and public relations. How you get your product out to the world....