3. Enterprise, business growth and size

• the benefits of being an entrepreneur are independence, putting in own ideas, becoming famous and successful, income might be higher and making use of personal interests and skills
• disadvantages of being an entrepreneur are, risk, capital: have to put their own money, lack of knowledge and experience, and opportunity cost
• characteristics of successful entrepreneurs are hard-working, risk taker, creative, optimistic, self-confident, Innovative, independent, and effective communicator
• a business plan includes which products? Clash Flow, business costs, location, resources required
• a business plan is used to help gaining finance and careful planning reduces risk
• business start-ups need a business idea and help, premises, finance, labour, and research
• comparing businesses is useful to investors, government, Banks, workers, and competitors
• comparing business size methods by number of workers employed, value of output, sales and capital employed
• internal growth occurs when a business expands its existing operations
• external growth is when a business takes over on mergers with another business
• horizontal integration is merging or takes over same industry at the same stage of production
• vertical integration is merges or takes over the same industry but different stage
• conglomerate merger or integration is merges or takes over and completely different industry also known as diversification
• disadvantages of internal growth include high costs due to expansion, may not have enough resources to expand, may take longer time to see results
• problems resulting from expansion can be difficult to control, leading to poor communication, expansion costs so much, and integrating with another business can be more difficult
• businesses remain small because if they grow too large it can be difficult to offer close and personal services, appeal more only to a limited number of consumers, and knowing all their staff and customers, easier to keep control and avoid stress
• causes of business failure can be lack of management skills, changes in environment, powerful new competitors, liquidity problems or poor financial management, and over-expansion