AOF Entrepreneurship Unit 3 Lesson 8 Nav Buigating

Entrepreneurs’ goals and values help them choose the best strategies for growth and maintenance of the business

A partnership enables an entrepreneur to share the risk and responsibility of owning and managing the business Benefits of partnerships: • Shared workload • Combined skills Drawbacks of partnerships: • Shared profits • Loss of total control

Licensing and franchising a business allows an entrepreneur to increase profits through royalties Benefits of licensing and franchising: • Revenue without direct effort • Increased brand recognition • Growth with low financial risk Drawbacks of licensing and franchising: • Risk to brand image by poor franchisee • Reduction of potential markets

Two strategies for growing the company with an immediate infusion of assets are acquisitions and mergers Benefits of acquisitions and mergers: • Can finance growth that wouldn’t otherwise be possible • Gives entrepreneur the option of staying or leaving Drawbacks of acquisitions and mergers: • Long, complex process to close • Deal often comes apart during negotiations

Globalization is one way for a company to grow—by selling products and services to untapped markets Benefits of globalizing: • 95% of the world’s population lives outside the United States—many markets are untapped. • Selling to multiple markets diversifies a business’s “portfolio, ” making it less susceptible to downturns in one market. Drawbacks of globalizing: • Hard to gauge partner creditworthiness • Exchange-rate fluctuations • Language barriers

Entrepreneurs manage business growth by choosing a strategy and selecting the options that help reach that goal Entrepreneurs have several options to help them promote and manage their business’s growth. A few of these are: • • Partnerships Licensing and franchising Mergers and acquisitions Globalization