Recognizing Opportunity 3 2 Whether you start a

Recognizing Opportunity 3. 2 Whether you start a business from scratch or buy an existing business and make it better, owning a business that is compatible with your personal values and goals is critical. Section 3. 2 Starting Versus Buying a Business 1

Recognizing Opportunity 3. 2 Identify the importance of personal values and goals in choosing an entrepreneurial pursuit Examine the challenges and rewards of entering a family business Determine the benefits and drawbacks of buying a business Describe how you can evaluate a business opportunity Section 3. 2 Starting Versus Buying a Business 2

Recognizing Opportunity Personal Values and Goals Personal values and goals should be used as a guide when choosing entrepreneurial pursuits. Section 3. 2 Starting Versus Buying a Business values the beliefs and principles by which you choose to live that define who you are, shape your attitudes and choices, and help you identify your priorities 3

Recognizing Opportunity Entering the Family Business The greatest advantage of a family business is the trust and togetherness that family members often share. Families that work well together have great potential for success in a family business. Smith and Son Section 3. 2 Starting Versus Buying a Business 4

Recognizing Opportunity Buying an Existing Business In many ways, buying an existing business is less risky than starting one from scratch. When you buy an existing business, you often gain the goodwill of loyal customers. Section 3. 2 Starting Versus Buying a Business goodwill the favor and loyalty a business acquires by its good reputation 5

Recognizing Opportunity Buying a Franchise When you buy a franchise, you buy the right to set up a new business patterned on an existing model. Section 3. 2 Starting Versus Buying a Business franchise a legal agreement to begin a new business in the name of a recognized company franchisee the buyer of a franchise who is given the right to the franchisor’s product, process, or service franchisor the seller of a franchise who is giving the buyer planning and management expertise 6

Recognizing Opportunity Evaluating a Business Opportunity To evaluate a business opportunity: Investigate the company. Investigate the industry. Talk to customers, employees, and suppliers. Hire an accountant to advise you. Hire an attorney to advise you. Section 3. 2 Starting Versus Buying a Business 7

Where to Find a Business business publications newspapers Finding Business Opportunities business brokers Section 3. 2 Starting Versus Buying a Business networking 8

Recognizing Opportunity Where to Find a Business You can find a business broker in the telephone book or online. Section 3. 2 Starting Versus Buying a Business broker someone whose job it is to bring buyers and sellers of businesses together for a fee 9

Recognizing Opportunity Where to Find a Business Questions To Ask Before you purchase a business, ask these questions: • Is the business interesting to me and to others? • Why is the owner selling? • What is the business’s potential for growth? Section 3. 2 Starting Versus Buying a Business 10

Recognizing Opportunity Starting Your Own Business When you start your own business from scratch, you can do things your own way. You can build the company with fresh ideas and enthusiasm. Section 3. 2 Starting Versus Buying a Business 11

Recognizing Opportunity Starting Your Own Business Questions To Ask Before you start your own business, ask yourself these questions: • Do I have the motivation to start a new business from nothing? • Does the business align with my personality, abilities, values, and goals? • Do I have sufficient knowledge of basic operations to undertake the business? • Do I have the necessary managerial ability? Section 3. 2 Starting Versus Buying a Business 12

Recognizing Opportunity Starting Your Own Business Questions To Ask Before you start your own business, ask yourself these questions: • Do I have the right partners to help me with the business? • Do I have enough financial resources to start from scratch? • Am I willing to accept the risk? Section 3. 2 Starting Versus Buying a Business 13