Marketing Essentials Flashcards

Business Concepts Overview

• Franchise: Business model that allows an owner to license operations, products, services, and branding for a royalty fee.
• Survival Stage: Early phase where businesses gain customers and stabilize income. At this point, they cover loans and begin to pay owners a fair salary.
• Success Stage: During this phase, businesses are economically healthy; entrepreneurs may seek growth opportunities or delegate operations to executives like CEO, CFO, and COO.
• Take Off Stage: Owners assess whether to expand into a larger business and strategize for rapid growth or consider selling the company.
• Business Life Cycle: Stages involving Existence, Survival, Take Off, Resource Maturity, Pivot or Persist, and Exit Plan.

Stakeholders and Shareholders

• Stakeholder: Groups or individuals invested in the company's success.
• Stockholder: Holds voting power on company management decisions, including potential removal of the CEO.

Business Structures

• S Corporation: Limited liability business structure with special taxation permitting income pass-through to shareholders, resulting in lower taxation.
• C Corporation: Provides limited liability but incurs double taxation on profits and shareholder dividends. Suitable for international business.

Compensation and Payment Models

• Commission: Payment structure that rewards employees based on performance, particularly in sales, using a percentage of sales or fixed rates.
• Piecework: Compensation method where employees are paid for the number of units produced.
• Equity: Non-cash compensation that includes ownership stakes or stocks offered to employees as an incentive.

Understanding Business Opportunities

• Seller assistance is key in finding optimal business locations.
• Franchises come with higher start-up costs but provide ongoing support and training.

Management and Skills

• Management reliability is assessed alongside one's personal skills to ensure business opportunity success.
• Companies value validated processes, leading to the utilization of trade secrets.

Business Plans and Pitch Decks

• Business Plan: Detailed operational and growth framework.
• Pitch Deck: Concise overview containing key business elements including problems addressed, vision, team strengths, milestones, competition, and funding needs.

Characteristics of Entrepreneurs

• Self Resilience: Confidence in personal goals and progress.
• Forward-Thinking Mentality: Proactive planning for future success.
• Opportunity Recognition: Innovative approach to new ventures.
• Initiative: Execution of ideas to improve or generate business outcomes.
• Resiliency: Ability to adapt to changes and setbacks.
• Growth Mindset: Belief in achieving success through effort and determination.

Intellectual Property

• To use someone else's patent, legal ownership must be obtained first.

Executive Roles in Business

• CEO: Chief decision-maker overseeing operations and strategic vision.
• CFO: Manages financial aspects, cash flow, and budgets.
• COO: Handles day-to-day operations and administrative tasks.
• Founder: Originator of the company or organization.
• Partnership: Shared financial responsibilities among one or multiple individuals.
• Employee: Executes assigned tasks within company guidelines and policies.