enterprise, business growth and size

• Entrepreneur


  A person who organizes, operates and takes the risk of a new business venture
• Advantages of being an entrepreneur

  • Flexible
  • Your own boss
  • Take responsibility
  • Can get very rich and famous
• Disadvantages of being an entrepreneur

  • Might lose a lot of money
  • A lot of risk involved
  • Only person to raise the capital especially initially
  • A lot of pressure because you're the only one
  • Cannot share ideas with others about ideas of other people
• Characteristics of a good entrepreneur

  • Hard working
  • Risk taker
  • Creative
  • Optimistic
• Self-confident


  Necessary to convince other people of your skills and convince banks to lend you money and make sure your business will be successful
• Effective communicating


  Need to talk clearly and confidently about the business to raise the profile of the business
• What is included in a business plan

  • Business overview
  • Information about the products
  • Marketing
  • Selling and delivery
  • Business organization
  • Financial projections
  • Customer service
  • Business stretching
  • Advertising
• Business plan


  A document that contains business objectives and important details about the operations, finance and owners of the new business
• What is a business plan used for

  • Loan applications
  • For the owner to think ahead and think about the future
  • To let the employees and stakeholders in the business know what's going on
  • To let investors know what's going on
• The number of millionaires in China is over 1.5 million and most of these are successful entrepreneurs
• There has been a start-up boom by Chinese entrepreneurs who studied abroad and returned to China
• Over 10,000 new businesses start up every day which is about 70 businesses every minute
• Why governments support startups

  • Helps unemployment
  • Increases the output of the country which will improve the economic situation
  • Increases competition which drives businesses to succeed
  • Benefits society with the families of employees and the economy growing
  • Helps business growth
• How governments support new businesses

  • Offer business idea and help
  • Organize training for entrepreneurs
  • Organize the ranging of premises
  • Provide low cost premises in enterprise zones
  • Give loans and grants to small businesses
  • Give labor grants to small businesses to train employees and increase productivity
  • Encourage universities to make research facilities available to new business entrepreneurs
• Reasons why businesses want to expand

  • Make more money
  • Save money
  • Beat the competition
  • Feel pride in what you're doing
• Types of business expansion

  • Internal expansion (e.g. a restaurant opening in more cities)
  • External expansion (e.g. merging with or taking over another business)
• Types of external expansion

  • Horizontal merger (taking over a business in the same industry)
  • Vertical merger (taking over a business at a different stage of production)
  • Conglomerate merger (taking over a business in a completely different industry)
• Problems that can result from business expansion

  • Larger business is difficult to control
  • Poor communication
  • Expansion costs too much leading to finance shortages
  • Integration with another business is more difficult than expected
• Small business


  A business that has less than 250 employees
• Reasons why some businesses remain small

  • Type of industry has a niche market
  • Market size is small
  • Owner wants to maintain strict control
• Reasons why some businesses fail

  • Lack of management
  • Change in business environment
  • Liquidity problems
  • Overexpansion
  • New business at higher risk of failing