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Small Business Management


A person, who starts and/or operates a business.

The Rewards and Drawbacks of Entrepreneurship

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· The reward of profit

· The reward of independence

· The reward of satisfying way of life


· Hard work

· Long hours

· Emotional energy

· Risks

Characteristics of Entrepreneurs

· Need for achievement

· Willingness to take risks

· Self-confidence

· Passion for the business

Types of Entrepreneurs

There are three types of entrepreneurs founders, general managers, and franchisees.


An entrepreneur who brings a new firm into existence.

General Managers

An entrepreneur who functions as an administrator of a business.


An entrepreneur whose power is limited by a contractual relationship with a franchising organisation.

A winning hand of Entrepreneurs

· Customer Focus

· Integrity and responsibility

· Innovation

Business Plan

A document that sets out the basic idea underlying a business and related start up consideration.

A business plan has two primary functions

1. To provide a clearly articulated statement of goals and strategies for internal use, and

. To serve as a selling document to be shared with outsiders.

Deciding on the content of a Business Plan

Four independent factors should be given thorough consideration in deciding on the content of a business plan for a start up company.

The People A description of the men and women starting and running the venture, as well as any outside parties, such as lawyers, accountants, and suppliers, providing key services or important resources.

The Opportunity A profile of the business itself- what it will sell and to whom, how much and how rapidly it can grow, what its financial outlook is, who and what may stand in the way of its success.

The Context The big picture- the regulatory environment, interest rates, demographic trends, inflation, and other factors that inevitably change but cannot be controlled by the entrepreneur.

Risk and Reward an assessment of everything that can go wrong or right, with a discussion of how the entrepreneurial team can respond to the various challenges.

Abbreviated Business Plan

1. Title page

The title page is the first page of the business plan and should contain the following information

· Company name, address, phone number, fax number, and web address

· Company logo, if available

· Names, titles, addresses, and phone numbers of the owners and key executives

· Date on which the business plan was issued

· Number of copy (to help track how many copies are outstanding)

· Name of the preparer, if other than the owners and key executives

. Table of Contents

The table of contents provides a sequential listing of the sections of the plan, with page numbers.

. Executive Summary

It is the crucial for getting the attention of the one-minute investor. It is a section of the business plan that conveys a clear and concise overall picture of the proposed venture.

4. Vision and Mission Statements

The firm’s mission statement concisely describes, in writing, the intended strategy and business philosophy for making the making the entrepreneur’s vision a reality.

5. Company Overview

The main body of the business plan begins with a brief discussion of the firm. If the firm is already in existence, its history is included. This section informs the reader of the type of business being proposed, the firm’s objectives, where the firm is located, and whether it will serve a local or international market. In may cases, legal issues- especially those concerning the firm’s form of organisation- are addressed in this section of the plan. In writing this section, the entrepreneur should answer the following questions

· What are the basic nature and activity of the business?

· When and where was this business started?

· What has been achieved to date?

· What changes have been made in structure and/or ownership?

· In what stage of development is the firm- for example, seed stage or full product line?

· What are the firm’s objectives?

· What is its primary product or service?

· What customers will be served?

· What is the firm’s distinctive competence?

· What are the current and projected economic states of the industry?

· What is firm’s form of organisation- sole proprietorship, or corporation?

· Does the firm intend to become a publicly traded company or an acquisition candidate?

6. Product and/or Service Plan

This section is of the business plan that describes the product and/or service to be provided and explains its merits.

7. Marketing Plan

A section of the business plan that describes the user benefits of the product or service and type of market that exist. This section must identify user benefits as well.

8. Management Plan

A section of the business plan that describes a new firm’s organisational structure and the background of its key players.

. Operation Plan

A section of the business plan that offers information on how a product will be produced or a service provided, including descriptions of the new firm’s facilities, labour, raw materials, and processing requirements.

10. Financial Plan

A section of the business plan that provides an account of the new firm’s financial needs and sources of financing and a projection of its revenues, costs, and profits pro forma statements reports that project a firm’s financial condition.

11. Appendix of Supporting Documents

This section should contain various supplementary supporting materials and attachments to expand the reader’s understanding of the plan. These supporting documents include any items referred in the text of the business plan, such as resumes of the key investors and owners/managers; photographs of products, facilities, and building; professional references; marketing research studies; pertinent published research; and signed contracts of sale.

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