organizing a business ppt
DESCRIPTION
Finance Powerpoint Presentation regarding Organizing a Business.TRANSCRIPT
Organizing A Business
Organizing a Business
• Why Persons Engage in Business• Entrepreneurship• Business Prospecting
the Search for Business Opportunity• Business Promotion
– Discovery– Determination of Feasibility• The Promote
-Assembling the Needed Resources– Liability of Promoters
Most Common reasons for Business Failures
1. Bad or Improper management practices, including poor cost controls and poor hiring practices;
2. Poorly focused and executed marketing or inadequate marketing;
3. Poor location;
Most Common reasons for Business Failures
4. Failure to invest in new products and efficient technology;
5. Lack of adequate financing.
Why Persons Engage in Business
1. Provision of employment to people;
2. Profits;3. Service to the community;4. Personal satisfaction;5. Means to earn a living;
Why Persons Engage in Business
6. Achievement of power; and
7. Protection of one’s self and family
Entrepreneurship
Entrepreneurship
2 Options to engage in Business- To Buy an existing business- To create a business that he will operate
Entrepreneur’s function:- To supply the capital of a firm;- To organize production by buying and
combining inputs;
Entrepreneurship
- To decide on the rate of output in the light of his expectations about demand; and
- To bear the risk involved in these activities
Business Prospecting
Business Prospecting
• First, he should carefully scan the environment for other possible openings;
• Second, he should prepare a list of alternative business opportunities; and
• He should make his choice from the list.
Business Promotion
3 steps involved in business promotion- Discovering the idea for a new business;
- Determining the feasibility of the idea; and
- Assembling the needed resources to start a business.
DISCOVERY
• The identification of an idea for a new business in the first step in business promotion.
• The business promoter may also be induced to consider certain product ideas because of the availability of materials.
Determination of FeasibilityAspects in Determining of Feasibility
• Management study includes proponents, Personnel and Organization
• Marketing study;• Production facilities and the product;
Determination of Feasibility
• Taxation and legal aspects• Financing aspects;• Profitability; and• Social desirability
Management Study
• It is in this particular portion of tfeasibility study where the following aspects are determined:
• The appropriate form of organization;• The internal structure of the organization;
Management Study
• The owners; and
• The staffing pattern of the organization
Assembling the Needed Resources
• Initial capital required;• The essential properties;• Processes;• Personnel
Promoter
• The person responsible for the formation of a
company.
The Promoter is motivated by any or a combination of the following:
• The promoter’s fee;• Shares of stock or bond in the new
business project;• A management position in the new
business project;
• a new customer for his products or services; and
• the desire to contribute to the economic growth of the local community
Classification of Promoters
• Professional promoters – they are those whose main occupation in business promotion;
• Side-line promoters – they are persons who perform promotion activities occasionally;
Classification of Promoters
• Banking promoters – they are banking institutions which provide business promotion services to their clients;
• Financial promoters – they insist of investment houses engaged in a promotion of certain business ventures through the sale of securities; and
Classification of Promoters
• Subdivision promoters – they are those engaged in development of new subdivisions.
• The promoter undertakes to pursue his job with capacity of a temporary trustee.
• He cannot legally bind the firm into contracts and deeds unless approved by the owners or the board of directors.
Liability of Promoters
THANKYOU!