Better Business 6th Edition Michael R. Solomon

Better Business
Table of Contents
Dedication
Brief Contents
Contents
About the Authors
Reviewers
New to the Sixth Edition
Solving Teaching and Learning Challenges
Instructor Teaching Resources
Prologue Five Steps for Better Business Success
Part 1 Looking at the Business Environment
Chapter 1 Business Basics
Objectives
The Business Landscape
Business Defined
What exactly is a business?
What kinds of products do businesses offer?
What do businesses do with their profits?
What about nonprofits?
The Factors of Production
What do businesses use to create the products they sell?
Common Business Challenges and Opportunities
Competition
How does competition influence business?
How does competition foster better businesses?
How do successful businesses react to changes in their customers’ needs?
Are social networking sites good for business?
How should a competitive business treat their employees?
Social Environment
How does the social environment affect businesses?
An Aging Population
Increasing Workforce Diversity
The Green Movement
What social issues will impact your career?
Globalization
How has globalization affected businesses?
Technological Changes
Why does the pace of technological change present challenges to businesses today?
What benefits does technology provide to business?
What role does the Internet play in technological growth?
What types of e-commerce are popular?
Do security issues impact online businesses?
How is privacy a challenge for online business?
Types of Businesses
Local and Regional Businesses
What defines local or regional businesses?
What special challenges do local and regional businesses face?
National Businesses
What defines national businesses in the United States?
What special challenges do national companies face?
Multinational (International) Businesses
What categorizes a company as multinational (or international)?
What special challenges do multinational corporations face?
Taking Business Personally
Life Skills for Business
How do you receive funding?
What are your expenses?
How does the social environment affect your life?
How does globalization affect your life?
How do you keep up with new technology?
What sort of e-commerce do you use?
How do you keep your business secure?
What types of financial goals do you have?
Chapter 1 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 2 Economics
Objectives
The Basics of Economics
Economics Defined
So what is economics?
Microeconomics
Macroeconomics
Economic Systems
What are the types of economic systems?
Planned Economic Systems
Market Economies
Mixed Economies
Business and Economics
Why do business managers need to be concerned with economics?
Determining Price: Supply and Demand
Supply
What is supply?
Demand
What is demand?
Factors That Determine Price
What factors determine price?
Factors That Affect Demand
What other factors besides price affect demand?
Changes in Income Levels
Population Changes
Consumer Preferences
Complementary Goods
Substitute Goods
Factors That Shift Supply
What makes supply change?
Technology Changes
Changes in Resource Prices
Price Expectations
Number of Suppliers
Price of Substitute Goods
Degrees of Competition
Monopolies
What is a monopoly?
Why aren’t there many monopolies?
Duopolies and Oligopolies
What happens when two or three companies control a market?
Monopolistic Competition
What happens when there isn’t much differentiation between products?
Perfect Competition
What happens when products are almost identical?
Economic Indicators
Gross Domestic Product
How do we determine the health of an economy?
How does the GDP act as an economic indicator?
Consumer and Producer Price Indices
What else is used to gauge the health of an economy?
How are changes in the price of consumer products measured?
What goods and services are included in the CPI?
Does the CPI measure the change in price of all goods?
Why are price indices important?
What is the importance of the cost of living?
The Unemployment Rate
What other indicators are used to measure the economy?
Why is unemployment an important economic measure?
Productivity of Firms
How is the productivity of a firm’s workforce measured?
Why is measuring productivity important to businesses?
Government and the Economy
Economic Policies
Why does the state of the economy change?
Fiscal Policy
How does the government control swings in the business cycle?
How does changing tax policies influence the economy?
How does government spending help stimulate the economy?
Monetary Policy
What else can be done to control the economy?
What is the money supply?
Why is the money supply important?
Reserve Requirements
What are reserve requirements?
Short-Term Interest Rates
What is the discount rate?
Is the discount rate the same as the federal funds rate?
Open Market Operations
What are open market operations?
Chapter 2 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 3 Ethics in Business
Objectives
Ethics: The Basics
Ethics Defined
What exactly is ethics?
Systems of Ethical Conduct
What are the different systems of ethical conduct?
Personal Ethics
What are personal ethics?
How can I clarify what my personal ethics are?
How can an ethical life get me ahead?
Can living ethically make you happier?
Can living ethically make you healthier?
Personal Ethics Meets Business Ethics
You as a Person and as an Employee
What role do personal ethics have in a business environment?
What if you are asked to do something that conflicts with your understanding of ethical behavior?
Identifying a Company’s Ethics
How do I examine a company’s ethics?
How can I find out the best and worst aspects of a company’s ethical conduct?
What is a certified B corporation?
Corporate Social Responsibility
The Five Pillars of Corporate Social Responsibility
What is corporate social responsibility?
Human Rights and Employment Standards in the Workplace
Ethical Sourcing and Procurement
Marketing and Consumer Issues
Environmental, Health, and Safety Concerns
Community and Good-Neighbor Policies
The Conflict of CSR in the Business Environment
Can a corporation really be socially responsible?
The Benefits of CSR
What are the benefits of CSR?
Measuring CSR
Is it possible to measure a company’s CSR level?
Social Audits
Ratings and Rankings
Self-Reporting
Corporate Philanthropy
CSR and Social Networking
What does social networking have to do with CSR?
The Challenges of CSR
What challenges does CSR pose?
The Effects of CSR on Society
How does CSR affect society as a whole?
Environmental Effects
Economic Effects
Effects on Employee Morale
Effects on Social Justice
The Effects of Individuals on CSR
How can I affect how businesses operate ethically?
Dangers of a Weak Ethical Focus
Legal Regulations and Legal Compliance
How is a company regulated legally?
Don’t companies often break the law and still make money?
Recovering from Weak Ethical Conduct
What if your company is breaking the law and you want it to stop?
Can a company really recover from an ethical lapse?
Business Opportunities Created by Ethical Needs
Creating New Markets with an Ethical Focus
How can firms create business by acting ethically?
Offering Clean Fuel
Creating Medical Vaccines
Reducing Ocean Pollution
Businesses Going Green
How can businesses benefit by going green?
How Businesses Develop an Ethical Environment
Ethical Focus from the Start
How can a business improve its own culture of ethical and responsible conduct?
Ethical Focus Every Day
How can a business maintain its policy of ethical conduct in the workplace?
Chapter 3 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 4 Business in a Global Economy
Objectives
What Is Globalization?
The Effects of Globalization
How does globalization affect the United States?
How does globalization offer more marketing opportunities to businesses?
How does globalization lower the costs to manufacture products?
Global Business Trends
Why has globalization accelerated so rapidly?
Where will trends in global business take us?
International Trade
International Competition
What is the theory of comparative advantage?
What can a country do to have an edge in world markets?
What can businesses do to be more competitive?
The Benefits and Costs of International Trade
What are the benefits and costs of international trade?
Do the benefits of international trade outweigh the costs?
Free Trade and Protectionism
Types of Trade Barriers
What trade barriers can governments put in place?
Trade Barriers: Winners and Losers
Who benefits and who suffers from trade barriers?
What are common arguments in favor of protectionist trade barriers?
How do economists feel about protectionist trade barriers?
How does nationalism lead to protectionist trade barriers?
International Organizations Promoting Free Trade
What groups are working to promote free trade?
Can more be done to promote global free trade?
What problems can result from free trade?
Regional Free Trade Agreements
What are regional free-trade agreements?
The European Union
The United States–Mexico–Canada Agreement (USMCA)
Other Free-Trade Areas
Conducting Business Internationally
International Business Strategies
What types of strategies can an international business pursue?
Entering Foreign Markets
How do firms enter foreign markets?
Exporting
Turnkey Projects
Franchising
Licensing
Joint Ventures
Strategic Alliances
Contract Manufacturing
Wholly Owned Subsidiaries
What are the advantages and disadvantages of the different modes of entry to foreign markets?
International Business: Economic Factors and Challenges
The Role of Exchange Rates
What are exchange rates?
How does the exchange rate affect export and import prices?
How does a trade deficit or surplus impact export and import prices?
What is the difference between fixed and freely floating exchange rate systems?
What is nonconvertible currency?
Other Economic Challenges to Conducting International Business
What are some other economic challenges to conducting international business?
Creating Successful International Businesses
Challenges for Businesses in International Markets
How does culture affect business?
Why do aesthetics matter when it comes to international business?
What other cultural prejudices must be examined for success in other countries?
Why is knowing the native language not enough?
What are the political challenges to conducting international business?
What are the legal challenges to conducting international business?
Chapter 4 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Mini Chapter Chapter 1 Business Law
The U.S. Legal System
Sources of Law
How Laws Affect Businesses
Running a Business: Essential Concepts of Business Law
Contract Law
What are the elements of a contract?
What does it mean to be in breach of a contract?
Tort Law
Intellectual Property Laws
Sales Law
Antitrust Laws
Environmental Laws
Laws for Consumers and Employees
Advertising Laws
Employment and Labor Law
Laws That Govern Closing a Business
Bankruptcy
Key Terms
Endnotes
Part 2 Starting and Structuring a Business
Chapter 5 Small Business and the Entrepreneur
Objectives
Small Business: The Mainstream of the American Economy
Small Business and the Economy
What is a small business?
Why are small businesses important to the economy?
How do small businesses foster innovation?
How do small businesses help other companies and consumers?
Small Business and the Workforce
What kind of workers do small businesses employ?
Do small businesses provide opportunities for minorities?
How has the gig economy affected small businesses?
Why work in a small business?
Small Business and Technology
How has technology impacted new businesses opportunities?
Reasons for Starting a Small Business
Why would you want to start your own business?
Entrepreneurship
The Traits of Successful Entrepreneurs
What are the traits of successful entrepreneurs?
How are entrepreneurs innovative?
How do entrepreneurs take risks?
What makes entrepreneurs motivated to succeed?
Why do successful entrepreneurs need to be flexible and self-directed?
Why are people skills and leadership skills important to entrepreneurs?
What does it mean for entrepreneurs to be “system” thinkers?
Types of Entrepreneurs
Are there different types of entrepreneurs?
What about those who innovate for another company?
What about entrepreneurs who create businesses for the good of society?
What if I don’t have all the skills to be an entrepreneur?
Buying Franchises and Existing Businesses
Franchise Basics
What is a franchise?
What kinds of business opportunities are available as franchises?
Pros and Cons of Owning a Franchise Business
What are the advantages of owning a franchise business?
What are the disadvantages of owning a franchise?
Franchise Considerations
What are things to watch out for when considering buying a franchise?
Buying an Existing Business
Is there another way to start a business besides starting new or buying a franchise?
What are the advantages of buying an existing business?
What are the disadvantages of buying an existing business?
What do I need to do before I buy a business?
The Risks of Small Businesses and Where to Get Help
Why So Many Small Businesses Fail
What are the risks of owning my own business?
How does poor fiscal management lead to failure?
What other types of improper management lead to failure?
How important is pre-planning to a business’s success or failure?
Getting Help
Where do small business owners go for advice?
What kind of training is appropriate for small business owners?
Where can small business owners go for support services?
What other options exist for small business advice and assistance?
Does my business location make a difference in the type of help I can get?
Where can I go for assistence in case of a natural or unexpected ­disaster?
What else can small businesses do to survive in a crisis?
Start-up Financing Considerations
Cash and Credit
Where can I get the money to start a business?
Is it reasonable to use crowdfunding sites to raise capital?
What are the pros and cons of crowdfunding?
Should I use credit cards to finance my business?
Small Business Loans and Grants
What if I need more money than what I can provide myself?
Can I apply for grants to help start my business?
What kind of financial assistance is available to me when disaster strikes?
Angel and Venture Capital Financing
What if I need additional sources of funds through investors?
Chapter 5 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 6 Forms of Business Ownership
Objectives
Sole Proprietorships
Starting a Sole Proprietorship
Why is a sole proprietorship a popular form of business ownership?
How do I start a sole proprietorship?
Advantages and Disadvantages
Are there advantages of a sole proprietorship?
Why wouldn’t I want to run my business as a sole proprietorship?
Are there other things to consider when operating as a sole proprietorship?
Partnerships
Advantages and Disadvantages of Partnerships
When is it good to have a business partner?
Are there disadvantages to adding partners?
As a business form, how does a partner­ship compare to a sole proprietorship?
Elements of a Partnership Agreement
What goes into a partnership agreement?
Types of Partnerships
Are there different types of partnerships?
What is a general partnership?
What is a limited partnership?
Will partnerships work well when liability is a concern?
Corporations
Corporate Structure
What is a corporation?
When does it make sense to form a corporation?
How is a corporation structured?
What are shareholder responsibilities?
What does the board of directors do?
What are the responsibilities of the corporate officers?
Advantages of Incorporation
How can a business owner protect his or her personal assets?
What happens to a corporation when an owner leaves the business?
Is it easier for corporations to get funding and to raise capital?
Are corporations taxed the same as other types of businesses?
Does it matter where a business is incorporated?
Disadvantages of Incorporation
Are there any disadvantages of structuring a business as a corporation?
S Corporations
What is an S corporation?
How is an S corporation different from a C corporation?
How does an S corporation handle personal liability?
Can any business elect to be an S corporation?
When does it make sense to be an S corporation?
Limited Liability Companies
What is a limited liability company?
What kinds of businesses are best suited as an LLC?
What are the differences of an LLC and an S corporation?
Comparing Forms of Ownership
Which form of ownership is best?
Nonprofits, Not-for-Profits, and Cooperatives
Nonprofit and Not-for-Profit Organizations
What is a nonprofit organization?
What is a not-for-profit organization?
Can nonprofit organizations act like corporations?
Are there advantages to being tax exempt?
Cooperatives
What structure would be best for groups of businesses with common goals?
How are cooperatives structured?
Are cooperatives nonprofits?
What are the advantages of cooperatives?
Mergers and Acquisitions
Mergers versus Acquisitions
What is the difference between a merger and an acquisition?
Are all mergers and acquisitions mutually desired by both companies?
Advantages of Mergers and Acquisitions
Why do mergers and acquisitions occur?
Is competition a driving force for mergers and acquisitions?
Do companies add value to their product lines by merging?
Types of Mergers
Are there different types of mergers?
Disadvantages of Mergers
Are there disadvantages with mergers?
Chapter 6 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Mini Chapter Chapter 2 Constructing an Effective Business Plan
Planning—It’s Never Too Late
The Purpose of a Plan
Business Plan Competitions
Before the Business Plan: Finding the Right Fit
Components of a Business Plan
The Cover Sheet and Table of Contents
The Executive Summary
The Company and Management Team
Market Analysis
The Product
Sales and Promotion
Financials
Appendices
Conclusion
Endnotes
Part 3 Managing a Business and Employees
Chapter 7 Business Management and Organization
Objectives
The Foundations of Management
Business Management
What exactly is management?
What are the four functions of management?
Levels of Management
What are the different levels of management?
What do top managers do?
What do middle managers do?
Are the people who supervise the day-to-day operations also managers?
The Skills of Successful Managers
What skills should a manager have?
What do we mean by conceptual skills?
What technical skills do managers need?
What time management skills does it take to succeed as a manager?
Why are interpersonal skills important for managers?
Why do some people consistently make better decisions than other people?
The Functions of Management: Planning
Strategic Planning
What is the highest level of planning in an organization?
How is a strategic plan developed?
Vision and Mission Statement
What helps define the direction of a business?
What helps define the purpose of a business?
What makes an effective mission statement?
What are some benefits of well-defined vision and mission statements?
Are mission statements only for businesses with a profit?
Where can I find a company’s vision and mission statements?
SWOT Analysis
How does the management team begin to move a company toward achieving its vision?
What is a SWOT analysis?
What happens after a SWOT analysis is completed?
Tactical and Operational Planning
How do managers decide how to execute a strategic plan?
How is a tactical plan translated into instructions for employees?
Contingency Planning
What if unforeseen events occur?
How can planning help companies survive unexpected events?
What specific concerns are addressed in pandemic contingency plans?
The Functions of Management: Organizing
Organizational Structures
How do managers put their plans into action?
How do companies document the structure of an organization?
How is power distributed in an organization?
What are the pros and cons of vertical organization?
What are the pros and cons of horizontal organization?
Does a company’s organization structure ever change?
Alternative Organizational Structures
What is line and staff organization?
What is a matrix organization?
What is an inverted organization?
What organizational structure works across multiple companies?
The Functions of Management: Controlling
Control Strategies
Why does a company need to adapt to stay on course?
How is moving toward the corporate vision measured?
Are financial, production, and sales measures the only tools for assessing performance?
What are the basic tools managers use for monitoring quality?
What is the Six Sigma strategy for quality?
Chapter 7 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 8 Motivation, Leadership, and Teamwork
Objectives
Motivation
Personal Motivation
What drives you to do your personal best?
What does it feel like to be optimally motivated?
Motivating Employees
How motivated is the U.S. workforce?
How does a work environment encourage flow?
What are the benefits of keeping employees motivated?
Traditional Theories of Motivation
What are the traditional theories describing what motivates people?
What is Maslow’s hierarchy of needs?
How does Herzberg’s motivator-hygiene theory explain motivation?
Motivational Theories in the Modern Workplace
Do managers actually use theories of motivation?
What can a manager do to enhance employee motivation?
What other motivational models exist?
What are the Theory X and Theory Y models?
How is the Theory Z model different?
What is unique in strength-based management?
How have motivational theories changed?
What motivational theories fit the knowledge worker economy?
Leadership
Are all managers leaders?
What styles of leadership exist?
What are democratic and autocratic leaders like?
What are affiliative leaders?
What is a visionary leader like?
Traits of Leadership
What are the traits of great leaders?
Are there systems for measuring leadership potential?
Leadership and Corporate Culture
How does the leadership style of a firm’s managers affect the work ­environment?
How does a leader establish corporate culture?
Teamwork
Teams in the Workplace
What is the value of using teams in the workplace?
Do teams always improve the development process?
Are generational differences really that significant in the workplace?
Best Practices for Teams
What kinds of practices set the stage for the best team performance?
How do managers create the best teams?
What are cross-functional teams?
What effect does technology have on team design?
How can technology help modern teams?
Is designing a strong virtual team the same as creating a strong ­face-to-face team?
Your Role on a Team
How can I be a valued team player?
What habits will give me the best chance to contribute to a team?
Chapter 8 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 9 Human Resources Management
Objectives
Human Resources Management
Managing Staffing Needs
How does planning for staffing needs change as a company evolves?
How does a company determine whether it has the correct number of employees?
How do companies identify the exact jobs they need to staff?
Once a job is well defined, how does HR find the best candidates to ­interview?
How do social networking sites affect recruiting?
Does technology help or complicate recruiting?
Hiring
What happens in the hiring process?
What legalities must be considered when hiring?
Training and Evaluating Employees
Training Methods and Requirements
What kind of training do new employees receive?
What other training is required of new and current employees?
What kind of impact does technology have on training?
Do managers need training?
How are experienced managers developed?
Performance Appraisals and Alternatives
Why are performance appraisals necessary?
Are there problems with performance ­appraisals?
What alternatives exist for performance appraisals?
Compensating, Scheduling, Promoting, and Terminating Employees
Compensation Strategies
Are all employees paid in the same way?
What types of retirement plans do companies offer employees?
What other financial incentives do companies offer as compensation?
Benefits
What are noncash forms of compensation?
What are work/life benefits?
What are some other trends in employee benefits?
Alternative Scheduling and Work Arrangements
What work schedules are possible outside the traditional workday?
What benefits do employers see from supporting alternative work schedules?
What is the gig economy?
Contingent Workers
Why does a company hire contingent workers?
Is temporary work a common situation for people?
Promotions
How can employees increase their levels of responsibility in a company?
Do promotions always move you into management positions?
Termination and Retirement
Why do companies lay off workers?
How does a manager prepare to terminate an employee?
Is there a set age when employees retire?
Managing Workplace Diversity
Benefits and Challenges of Diversity
Why has the modern workplace become so diverse?
How is a diverse workforce beneficial?
What issues do companies face while managing diversity?
How can employees improve their understanding of each other’s differences?
Labor and Union Issues
Organized Labor
What is a labor union?
What are the objectives of organized labor?
How are labor unions structured?
Collective Bargaining
What is the collective bargaining process?
What happens if an agreement cannot be reached through collective bargaining?
What happens when negotiations break down?
The State of Labor Unions
Are labor unions still effective today?
What is the future of unions and labor–management relations?
Chapter 9 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 10 Online Business and Technology
Objectives
Online Business
Generating Online Business
How does a company establish online marketing?
How does having an online presence influence a firm’s marketing strategies?
How has the global COVID-19 pandemic accelerated online commerce?
Are there any drawbacks to online advertising?
How does technology change marketing in a global marketplace?
What is viral marketing?
How is all the data from online marketing organized?
What are the benefits of using CRM in a business?
Online Business Transactions
What types of business transactions occur online?
What is the focus of B2B transactions?
What is the focus of B2C transactions?
What is the focus of C2C transactions?
Challenges of E-Commerce
How are taxes applied to e-commerce?
Who has legal jurisdiction over an online business?
Technology in Business
The Information Technology Organization
Who is in charge of business technology?
What is a typical decision a CIO has to make?
What happens in an IT department?
Information Systems
What’s an information system?
What is the difference between data and information?
What are databases?
As the amount of data grows, how is it managed?
What is “Big Data”?
Does Big Data create threats to our privacy?
What kinds of tools are used to analyze business data?
What other kinds of questions can business intelligence software answer?
Security
Threats to Online Business
What special security threats do online businesses face?
Can a business protect its online identity?
What risks does a breach of security pose for management?
Can technology also be used to support ethical conduct?
Privacy
How has technology impacted employees?
How does technology affect employee privacy?
Impact of Social Media and Mobile Technology
Social Networking
How is social networking changing businesses?
Are social media apps used within businesses?
How are companies using social media to monitor their business?
What new jobs have been created with the rise of social media?
Can social media provide information that is directly useful to a business?
How can social media help with technical support services?
How is social media helping people start and fund new businesses?
Mobile Devices
How do businesses use mobile devices?
How does a business select which mobile devices to purchase?
What kinds of mobile apps are useful for business?
How has cloud computing helped grow the mobile device market?
Chapter 10 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 11 Production, Operations, and Supply Chain Management
Objectives
Operations Planning and Management
Operations Management
What is operations management?
Why is operations management so important?
Facility Location
How do businesses decide where to locate their facilities?
How does labor affect location decisions?
Facility Layout
Why is facility layout important?
How big should a manufacturing facility be?
How does facility layout affect production?
What are the different types of facility layouts?
Supply Chain Management
Supply Chains
What is a supply chain?
Why is supply chain management important?
How are disruptions in supply chains managed?
How does a company decide which suppliers to use?
How are materials acquired for the production process?
Is supply chain management only for manufacturing companies?
The Production of Goods and Services
The Importance of Production
Why is production a critical component of any business?
How important is manufacturing in the United States?
What are the biggest challenges facing the manufacturing industry?
How important are services to the U.S. economy?
The Global Production Landscape
How does manufacturing affect the global economy?
How does U.S. manufacturing compete globally?
What changes in production will keep the United States competitive?
Production Management
Production Systems
What production systems are used in manufacturing?
How are large quantities of goods produced?
What is the production process for goods that require more flexibility?
What production process is used when bulk customization is ­desired?
How is mass customization achieved?
Can mass customization be used in service industries?
What type of production process focuses on efficiency?
Production Technology
What is the role of technology in the production process?
What has helped automate the production process?
How does technology improve the design process?
How is CAD information incorporated into the manufacturing process?
Can an entire production facility be automated?
What effect has automation had on overall productivity?
Production Control
Production Process Controls
How does scheduling shape the production process?
What tools are available to help with scheduling?
How are the individual tasks of a process tracked?
What is a PERT chart?
Inventory Control
How does a company maintain inventory control?
What methods are used to manage inventory?
What problems can be expected with JIT management systems?
How is technology used to streamline the control of inventory?
What is materials requirement planning?
What is enterprise resource planning?
Quality Management
Has quality control always been part of the operations control process?
What methods are being used to improve quality?
How is TQM carried out?
What is needed to implement TQM?
How does TQM cater to the customer?
Is there another quality control method?
Are there global quality standards?
What is the ISO certification process?
What are the benefits of ISO certification?
What happens if a safety issue is detected?
Are there laws that protect consumers?
Chapter 11 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Mini Chapter Chapter 3 Business Communications
Improving Your Presentation Skills
Improving Your Writing Skills
Business Letters
Memos
Memo Writing Tips
What Form of Communication Should You Use?
E-Mail
Tips for Writing an Effective Business E-Mail
Texting
Using Collaborative Communication Tools
Videoconferences
Collaborative Editing
Blogs
Podcasts
Endnotes
Part 4 Principles of Marketing
Chapter 12 Marketing and Consumer Behavior
Objectives
Consumer Behavior
Consumer Markets
Why study consumer behavior?
How does a consumer make a buying decision?
What influences consumer decision making?
How does culture affect a person’s buying behavior?
What unique personal influences shape buying behaviors?
How do attitudes affect buying decisions?
Can temporary conditions affect how buyers behave?
Business Markets
What are the differences between consumer (B2C) and business (B2B) markets?
How do business and consumer markets compare?
How does a business make a buying decision, and what influences that decision?
Marketing for Nonprofit, Not-for-Profits, and Others
How do nonprofit and not-for-profit organizations market their products?
Is it possible to market a person?
Marketing Fundamentals
The Evolution of Marketing
What does a marketing department do?
How has marketing evolved over time?
What was the production concept era?
What was the sales concept era?
What was the marketing concept era?
Is there a marketing philosophy that encourages customer loyalty?
How has the development of the Internet affected marketing?
Does marketing also take into consideration what is best for society?
Benefits of Marketing
How do sellers benefit from marketing?
How does society benefit from marketing?
How do investors and employees benefit from marketing?
How does marketing benefit consumers?
Are there different types of utility?
How is a product’s value measured?
Criticisms of Marketing
What are the criticisms of marketing?
The Marketing Environment
Internal and External Environments
How can an organization’s environment affect marketing?
What factors outside an organization affect marketing?
What are the demographic factors that affect marketing?
How do economic factors affect a marketing strategy?
How does technology affect marketing?
How do physical and environmental factors affect marketing?
What are the social and cultural factors that affect marketing?
How do politics and legislation affect marketing?
Marketing Research and Planning
Market Research
What is market research, and what is involved in the process?
Why is it important to define the marketing needs or opportunity?
What kind of data should be collected?
How are social media used in market research?
How are the data analyzed and interpreted?
What happens when the research is completed?
The Marketing Plan
What is a marketing plan?
What are the elements of a good marketing plan?
Why is a marketing objective necessary?
What is a situational analysis?
What do we mean by internal strengths?
How does a company assess its weaknesses?
Why look to the external environment?
Are there other ways to perform a situational analysis?
Marketing Tactics
Target Markets
How are target markets determined?
How are consumer markets segmented?
How are markets defined by location or region?
How are markets defined by different population characteristics?
Can a market be segmented based on opinions or interests?
How can consumer behaviors define a market segment?
The Marketing Mix
What elements are included in the marketing mix?
Can the marketing mix be represented a different way?
Chapter 12 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 13 Product Development, Branding, and Pricing Strategies
Objectives
New Product Development
The New Product Development Process
What is involved in new product development?
The Product Life Cycle
What is a product life cycle?
Does a product’s life cycle affect marketing decisions?
How can a product’s life be extended?
Modifying Existing Products and Product Lines
The Total Product Offer
What is the total product offer?
What is the core product?
What is the actual product?
What is the augmented product?
Product Differentiation
How important is product differentiation?
How does consumer input affect product development?
Product Lines and the Product Mix
What are a product line and a product mix?
Does it matter how many products are in a product line?
Consumer Products and Business-to-Business Products
What’s the difference between consumer products and ­business-to-business products?
Consumer Product Classifications
What are the different consumer product classifications?
What constitutes a convenience product?
How are less frequently purchased products classified?
What if a consumer is very particular about the type of product they want?
What about products that are purchased only when a special need arises?
B2B Classifications
What are the different B2B product classifications?
What is considered equipment?
How do you classify operating supplies?
How are products that are used to make other products classified?
How are parts used in an assembly process classified?
Do specialized services have a separate classification?
Branding
Branding Benefits
What are the benefits of branding?
Can a company’s trademark legally be put on another company’s product?
How does a logo help to build a brand?
Brand Equity
What is brand equity?
Can branding promote customer preferences?
What contributes to brand equity?
Brand Architecture and Branding Options
How are brands structured within an organization?
What is a master brand?
What is an endorsed brand?
What is a house of brands?
Can an organization have multiple branding architectures?
What is a private brand?
What is co-branding?
What is a generic brand?
Packaging
How does packaging help promote a product?
How does packaging protect a product?
Why is convenient packaging so important?
How does packaging affect the environment?
The Importance of Labels
Why is labeling important to establishing a brand image?
What does the government have to say about product labels?
Pricing Goods and Services
Product Pricing and Pricing Objectives
Why is a product’s price an important component in the marketing mix?
What are some pricing objectives?
How do you choose the right pricing objective?
How does value affect a product’s price?
Pricing Strategies and Price Perceptions
What are the major pricing strategies?
What is cost-based pricing?
How does product demand impact pricing?
What pricing strategy offers low prices all the time?
Are there pricing strategies that work better in certain phases of the ­product life cycle?
What strategies are used to affect people’s price perceptions?
How might production be affected by pricing strategies?
Adjusting Prices
What are common price adjustment strategies?
Can you determine the effect a change in price will have on demand?
Chapter 13 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 14 Promotion and Distribution
Objectives
Promotion and the Promotional Mix
Promotion
What is promotion?
What are the most popular tools marketers use to promote a product?
What are the steps involved in a promotional campaign?
Advertising and Public Relations
The Role of Advertising
What role does advertising play in the promotional mix?
What’s the economic impact of advertising?
What is an advertising agency?
Types of Advertising Media
What media are most used in advertising?
What are the advantages and disadvantages of the frequently used advertising media?
How are infomercials useful as an advertising technique?
How is global advertising conducted?
Public Relations
What is public relations?
What steps are involved in developing public relations plans?
What are some common public relations tools?
How is publicity helpful?
How does a company respond to negative publicity?
Personal Selling and Sales Promotion
Personal Selling
What is personal selling?
Why is personal selling important?
What are the advantages and disadvantages of having a sales force?
What functions do sales personnel fulfill?
What are the steps in the selling process?
How are customers identified?
What is the best way to approach a prospect?
How are the details of the product explained?
What happens if the prospect has an objection?
How is the sale finalized?
What happens after the sale is made?
Sales Promotions
What is a sales promotion?
What are the two general types of sales promotions?
What are some consumer sales promotional tools?
What are some trade sales promotional tools?
Social Media Promotions
How is social media used to promote products?
What are the advantages and disadvantages of the promotional mix?
Distribution: Marketing Intermediaries
Distribution Channels and Marketing Intermediaries
How do companies get their products to customers?
What are marketing intermediaries?
What are the different types of marketing intermediaries?
Why are marketing intermediaries needed?
What are the different types of distribution channels?
Wholesalers, Agents, and Brokers
What services do wholesalers provide?
What are the different types of wholesalers?
What are some common types of agents?
Retailers
What are the important retail strategies?
What are the different types of retailers?
What kinds of in-store retail organizations are there?
What is nonstore retailing?
How has the web impacted retailing?
Distribution Logistics
What is meant by distribution logistics?
The Benefits and Costs of Transportation Modes
What are the benefits and costs of various transportation modes?
How does a company determine the transportation method?
Warehousing and Inventory Control
How important is warehousing?
How is inventory tracked?
Chapter 14 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Mini Chapter Chapter 4 Finding a Job
Marketing Yourself
Developing a Resumé
Getting Started
Contact Information
Objective
Education
Experience or Work History
Skills/Interests
References
Resumé Showdown!
Writing a Cover Letter
Tip #1: Tailor Your Cover Letter to Fit the Job You’re Applying For
Tip #2: Indicate What You Can Do for the Employer
Tip #3: Clearly Explain Why the Company Should Hire You
Tip #4: Keep It Short
ePortfolios
Search Strategies
Networking
Spot the Truth
Internet Research
Recruiters
Cold Calling Pros and Cons
College Campus Career Resources
Informational Interviews
Interviewing and Negotiating
Interview Red Flags
Preparing for the Interview
Interview Questions
During the Interview
Interview Take-Alongs
Negotiating Strategies
Key Terms
Part 5 Principles of Finance
Chapter 15 Financing and Accounting for Business Operations
Objectives
Financial Management
The Financial Manager
What is financial management?
What is the role of a financial manager?
Planning for a Firm’s Financial Needs
How does the financial manager plan for a firm’s financial needs?
What is involved in planning for and managing a firm’s financial needs?
How does a company know it has enough resources to meet its forecasted needs?
Addressing Cash Flow and the Budget
What is cash flow?
Why is monitoring cash flow important?
How does a company know if it is staying on budget?
What must financial managers consider when seeking outside funds?
Financing Small Business Activities
Short-Term Financing Options
How are the short-term financing needs of a small business met?
What are some personal sources of short-term working capital financing?
Can suppliers help by providing credit?
Can businesses turn accounts receivables into cash?
Short-Term Loans and Grants
How do commercial banks help with financial management?
Will banks lend money to small businesses?
Are there other short-term loan options?
Are grants available to finance small business operations?
Is there a way to obtain loans from the general public?
Financing Big Business Activities: Debt and Equity
Financing Options
Why do large companies need short-term financing solutions?
Why do large companies need long-term financing solutions?
What are the different types of long-term financing?
How do companies choose between debt and equity financing?
Financing with Bonds
Why finance with bonds?
What are the advantages of financing with bonds?
What must financial managers consider before choosing to finance with bonds?
How are bond interest rates determined?
How do companies repay bonds?
Financing with Equity
What sources of financing are available when bonds are not an option?
Why finance with stock?
What are the advantages to financing with stock?
Are there disadvantages to financing with stock?
How does a company choose between debt and equity?
Accounting Functions
Accounting Fundamentals
What is accounting?
Types of Accounting
Are there different types of accounting?
What is corporate accounting?
What is managerial accounting?
What is financial accounting?
What is auditing?
What type of accounting do governments and not-for-profit corporations use?
Are there accountants who focus just on taxes?
Accounting Standards and Processes
Are there specific standards that accountants must adhere to?
Do all countries share the same accounting standards?
What is the accounting process?
Does the accounting equation always stay in balance?
Financial Statements
The Balance Sheet
What is the balance sheet used for?
What does a balance sheet track?
Assets
What are assets?
What assets are the most liquid?
What assets are the least liquid?
Are there other types of assets?
Liabilities
What are liabilities?
What types of liabilities are due to be paid within a year?
What types of liabilities take more than a year to pay off?
Owners’ Equity
What is owners’ equity?
Is owners’ equity the same for large companies?
Analyzing a Balance Sheet
What information is important on a balance sheet?
How does inventory indicate efficiency?
Balance Sheet Ratios
How can I evaluate balance sheet data?
What measures how financially efficient a company is?
Can a company have too much debt?
How do ratios help to compare companies?
Income Statements
What information does an income statement show?
What are the components of an income statement?
Revenue
What is revenue?
What are other sources of revenue?
How is the cost of generating revenue accounted for?
What is gross profit?
Operating Expenses
What are operating expenses?
Is operating income adjusted further?
Analyzing Income Statements
How do I analyze an income statement?
What ratios are used to analyze an income statement?
How can I determine a company’s overall profitability?
How much of a company’s profit belongs to its shareholders?
Statement of Cash Flows
What is the statement of cash flows?
What are the components of a statement of cash flows?
Why is the statement of cash flows important?
What does a statement of cash flows reflect?
Chapter 15 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Chapter 16 Investment Opportunities in the Securities Market
Objectives
Investment Fundamentals
The Risks and Rewards of Saving and Investing
Why is it important to put money into a savings account?
Are there other savings options with higher interest rates?
Why isn’t saving enough?
How are savings compromised by taxes and inflation?
How do investments generate income?
Investment Risk
Isn’t investing too risky?
What is diversification?
What is asset allocation?
Are there rules and regulations that govern investing?
Beginning to Invest
When is a good time to start investing?
How do I set investment goals?
How do I know my risk tolerance?
How do I start investing?
How much money do I need to start investing?
Can I borrow funds to make an investment?
Is investing in foreign companies possible?
Are there services that can help me make investment decisions?
Is there a way to invest without being actively involved?
Investing in Stocks
Stock Basics
Are all stocks the same?
How do I determine which stocks to invest in?
Where are stocks bought and sold?
How are stocks traded?
Changing Stock Prices
What causes stock prices to change?
What influences investor behavior?
What else influences stock prices?
How do you know how the overall market is doing?
Investing in Bonds
Bond Basics
What are the characteristics of a bond?
Are there different types of bonds?
What are corporate bonds?
What are government bonds?
What are savings bonds?
What are municipal bonds?
Bond Risk
Are bonds risky investments?
How is bond risk determined?
Can bonds be sold before they mature?
Mutual Funds and Other Investment Opportunities
Mutual Funds
What is a mutual fund?
Why are mutual funds so popular?
Different Types of Mutual Funds
Are there different types of mutual funds?
What are money market funds?
What are bond mutual funds?
What are stock mutual funds?
Are there funds that invest in both stocks and bonds?
What are index funds?
What are exchange-traded funds?
Investing in Mutual Funds
How do mutual funds generate investment income?
What do I need to watch out for when investing in mutual funds?
Other Investment Opportunities
Besides stocks, bonds, and mutual funds, what else can I invest in?
What is an option?
What are futures?
What about real estate or precious metals?
Chapter 16 Summary
Key Terms
Self-Test
Multiple Choice
True/False
Critical Thinking Questions
Endnotes
Mini Chapter Chapter 5 Personal Finance
Creating a Financial Plan
Step 1: Take a Financial Inventory
Step 2: Set Financial Goals
Step 3: Know Where Your Money Goes
Step 4: Create a Budget
So You Want to Be a Millionaire?
Step 5: Execute the Plan
Step 6: Monitor and Assess Your Plan
Managing Your Personal Credit
Insurance and Investments
Insuring Your Present and Your Future
Investing Now and for the Future
Investing for Retirement
Individual Retirement Accounts
Roth IRAs
Simplified Employee Pension Individual Retirement Account
Pension Plans
401(k), 403(b), and 457 Plans
Taxes
How Much Tax Are You Paying?
Car Considerations
Getting Wheels
Key Terms
Business Plan Project Appendix
Part 1. Introduction
The Business
Business Name
What is the name of your business?
Description of Business
What will your business do? Describe the product (good or service) the business will be providing.
Form of Business Ownership
What form of business ownership (sole proprietorship, partnership, LLC, or corporation) will your business take? Why did you choose this form?
Ideal Customers
Describe your ideal customers. What are they like in terms of age, income level, and so on?
Competitive Advantages
Why will customers choose to buy from your business instead of your competition?
Start-up Financing
How much money do you think it will take to begin your new business? Do you need to rent/buy space, purchase equipment or other resources, hire employees? Where is this money coming from?
Part 2. The Company and Management Team
Industry Profile
Company Profile and Strategy
Business Goals
What are three business goals you want to achieve in the first year? What are two intermediate to long-term goals you want to achieve in the next three to five years?
Company Mission and Values
The Mission and Vision Statements
Write brief mission and vision statements for your business.
Ethical Issues
All businesses must deal with ethical issues. One way to address these issues is to create a code of ethics. List three core (unchanging) principles that your business will follow.
Social Responsibility
A business shows social responsibility by respecting all its stakeholders. What steps will you take to create a socially responsible business?
The Management Team
Management
Who are the key individuals that will manage the business?
Organization Chart
Show how the “team” fits together by creating a simple organizational chart for your business. Make sure the organizational chart indicates who will work for each manager as well as each person’s job title.
Required Resources
Raw Materials and Supplies
Explain what raw materials and supplies you will need to create your product or run your business. How will you produce your product? What equipment do you need to make the good or provide the service? What hours will you operate?
Personnel
Explain what employees you will need to fulfill your short-term business goals.
Equipment and Technology Needs
What kind of essential equipment will you need to fulfill your short-term business goals? Think also of the kind of technology will you require to run your business. What hardware is required for communication, security, point of sale, etc.? In addition, what kind of software might you need? Describe the function each type of equipment will serve.
SWOT and Planned Responses
Company Strengths and Weaknesses
Describe the strengths and weaknesses of your company.
Opportunities and Threats
Describe the opportunities and threats that face your company.
Anticipated Challenges
Describe any weaknesses or potential challenges that face your company.
Planned Responses
Describe any plans you have to address these weaknesses and anticipated challenges.
Part 3. Marketing
Market Analysis
Target Market
Describe your target market in terms of age, education level, income, and other demographic variables.
Assessment of the Competition
Describe three companies that you see as your main competitors.
The Product
Product Features and Benefits
Describe the features and benefits of your product.
Product Differentiation
How will you make your product(s) stand out in the crowd?
Pricing and Promotion Strategies
Pricing
What pricing strategy will you choose for your product(s), and why did you choose this strategy?
Advertising
How will you advertise to your target market? Why have you chosen these forms of advertisement?
Promotions
What other methods of promotion will you use and why?
Place (Distribution) Issues
Where will customers find your product or service? (That is, what distribution channels should you consider?)
Part 4. The Financials
Income Statement
Expected Revenue
In the pricing section above, you determined how much you would charge for your product. You also need to determine how many products you believe you can sell in one year (or how many customers do you think your business will attract)? Multiply the price that you will charge by the number of products that you hope to sell or the amount you hope each customer will spend. This will give you an estimate of your revenues for one year.
Operating Expenses
What are the expenses you anticipate incurring while conducting your business? Supplies, salaries, rent, utilities, and insurance are just some of these expenses. Describe these anticipated expenses.
Balance Sheet
Assets
What assets does your company own?
Liabilities: Financing and Loans
Earlier in the business plan you identified the source of your start-up funding. Now think about whether you’ll need additional funding if revenues don’t cover all your expenses. Describe in this section any loans or financing options that you’ll eventually need to pay back.
Part 5. The Finishing Touches
Cover Sheet and Table of Contents
Cover Sheet
Create a cover sheet for your business plan.
Table of Contents
Create a table of contents for the plan so a reader can quickly find information.
Executive Summary
After you’ve finished your business plan, write an executive summary that contains the key points of the business plan. The summary should be brief—no more than two pages—and cover the following points:
Glossary
Index
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X–Y–Z
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