Deck 20: Achieving Success in the Small Business

Question 1

)Managerial role needs to be focused during the emergence and existence stage of the small business life cycle.

Answer 1

False

Question 2

Successions and business sales generally occur only among the largest small businesses.

Answer 2

True

Question 3

The resource maturity stage is characterized by a stable level of sales and profits over several years.

Answer 3

True

Question 4

Survival is the second riskiest period after emergence.

Question 5

Recency,frequency,urgency,and potency are four key recommendations for staving off customer complacency.

Question 6

Lifestyle firms are the smallest full-time businesses.

Question 7

The single most typical way businesses close down is by a walkaway.

Question 8

People who open multiple businesses throughout their career are called unsatisfied entrepreneurs.

Question 9

For start-ups,the short-term measure of success is profits and the long-term measure of success is survival.

Question 10

In every small business effort,there is always an element of risk.

Question 11

All models for the life cycle of the small business firm have multiple stages.

Question 12

Terminations are more likely for young firms,who are four years old or less.

Question 13

For most small businesses existence will follow the success stage.

Question 14

High-growth ventures aim to achieve growth rates of 5-10 percent a year,with sales of $100,000.

Question 15

Businesses starting with no start-up capital and those starting with more than $50,000 are among those most likely to survive long-term.

Question 16

When one firm absorbs another,it is called a merger.

Question 17

For the owners,a central goal of a harvest is to get the maximum value they can for their business.

Question 18

)In the hierarchy of business outcomes,the worst possible outcome is leaving the firm with no debt.

Question 19

Most small businesses never go through the takeoff stage.

Question 20

Bankruptcy is the legal form of insolvency,where liabilities are greater than assets.

Question 21

The set of risks faced by firms early in their life cycles that come from a lack of knowledge by the owners about the business they are in and by customers about the new business is called the

A)slack resource.
B)walkaway and workout.
C)liability of newness.
D)CSF.

Question 22

The existence stage is defined by

A)a period of exceptional growth.
B)a stable level of sales and profits.
C)thoughts about starting a firm.
D)a lack of stability in terms of markets,operations,or finances.

Question 23

The challenges of the emergence stage is

A)getting the necessary financing.
B)getting from entrepreneurial thinking to entrepreneurial action.
C)getting the external help to start the business.
D)getting the family support and proper location.

Question 24

Managing _____ involves working extensively with potential sources of funding and other key resources,as well as working with markets outside and employees within the firm.It also often entails relearning the processes that led to this level of success.

A)takeoff
B)resource maturity
C)existence
D)survival

Question 25

The main challenge of the resource maturity stage is to avoid

A)overspending.
B)legal problems.
C)cost fluctuations.
D)customer complacency.

Question 26

_____ is the second riskiest period after emergence.

A)Success
B)Resource maturity
C)Existence
D)Takeoff

Question 27

For most businesses,_____ will follow the success stage.

A)takeoff
B)resource maturity
C)existence
D)survival

Question 28

Most small businesses never go through the _____ stage.

A)takeoff
B)resource maturity
C)emergence
D)survival

Question 29

Which of the following statements is true regarding success stage of the small firm life cycle?

A)Firms develop the information,skills,and the routines to grow the business's profits.
B)Profits are always taken in the form of money.
C)For most small business owners,this stage lasts for a very brief period.
D)Firms face the liabilities of newness in this stage.

Question 30

Which of these techniques can help an individual move from entrepreneurial thought to actions?

A)High-growth venture
B)BRIE
C)Walkaway and workouts
D)CSFs

Question 31

Profits that are available to be used to satisfy the preferences of the owner in how the business is run refers to

A)slack resources.
B)liability of newness.
C)takeoff.
D)high-growth ventures.

Question 32

The solutions for liabilities of newness come from getting _____ as quickly as possible.

A)financing
B)expertise
C)slack resources
D)potency

Question 33

Which of these is a common idea among the different models for the life cycle of the small business firm?

A)There are multiple stages.
B)Each stage has predetermined profit levels.
C)The level of risk the business faces is constant from stage to stage.
D)Businesses spend a fixed amount of time in each stage.

Question 34

Staying in touch with customers on a regular basis via visits,phone calls,e-mails,newsletters,and so on refers to which of these components from Zig Ziglar?

A)Urgency
B)Frequency
C)Potency
D)Recommendations

Question 35

Entrepreneurial role is most needed or focused upon during which stage of the small firm life cycle?

A)Success
B)Resource maturity
C)Takeoff
D)Emergence

Question 36

For most owners these profits are called flexibility.

A)Slack resources
B)Marginal profits
C)Resource maturity
D)Takeoff

Question 37

According to the components from Zig Ziglar,a message that is remembered and remembered for the right reasons is said to be

A)relevant.
B)recent.
C)frequent.
D)potent.

Question 38

For most small businesses,which of these represent the usual sequence of stages in the business life cycle?

A)Emergence,existence,survival,success,and resource maturity
B)Existence,survival,financing,success,and maturity
C)Emergence,success,financing,marketing,and maturity
D)Existence,growth,survival,and decline

Question 39

Profits which are not taken in the form of money are known as

A)liabilities of newness.
B)slack resources.
C)takeoffs.
D)high-growth ventures.

Question 40

Being among the people your customers have seen in the past few days refers to which of these components from Zig Ziglar?

A)Recency
B)Urgency
C)Frequency
D)Potency

Question 41

_____ are firms intended to provide a living income to the owner,and operating in a manner and on a schedule consistent with other firms in the industry and market.

A)High-growth ventures
B)High-performing small businesses
C)Traditional small businesses
D)Lifestyle businesses

Question 42

Which of these are the smallest full-time businesses with schedules defined by customer,not owner,needs?

A)High-growth ventures
B)High-performing small businesses
C)Traditional small businesses
D)Lifestyle businesses

Question 43

Identify the businesses that start and stay very small,often operating seasonally or when the owner wants to work in the business.

A)Lifestyle firms
B)High-performing small businesses
C)High-growth ventures
D)Traditional small businesses

Question 44

_____ are the smallest full-time businesses.

A)Lifestyle firms
B)Traditional small businesses
C)High-performing small businesses
D)High-growth ventures

Question 45

The most straightforward way to achieve sales growth

A)is to count on established customers to help improve sales through word-of-mouth.
B)is to expand into areas where you may have a small customer base.
C)is to convert occasional customers into steady customers.
D)is by increasing sales to existing steady customers.

Question 46

_____ aim to achieve growth rates of 25 percent or more a year,with sales of more than $1 million.

A)Traditional small businesses
B)High-growth ventures
C)Lifestyle firms
D)High-performing small businesses

Question 47

High-performing small businesses

A)often grow through multiple locations and higher levels of professionalization.
B)aim to achieve growth rates of 25 percent or more a year.
C)have sales of more than $1 million.
D)have schedules defined by customer needs.

Question 48

This represents the owner's last major return from the firm and a key pool of money for retirement or further businesses.

A)Transfer
B)Harvest
C)Termination
D)Consolidation

Question 49

A _____ is a firm started with the intent of eventually going public,following the pattern of growth and operations of a big business.

A)lifestyle firm
B)traditional small business
C)high-performing small business
D)high-growth venture

Question 50

_____ refers to the recovery of value through the sale of a firm or its assets.

A)Harvest
B)Invest
C)Transfer
D)Terminate

Question 51

A(n)_____ is a formalized legal method to transfer some or all of the ownership of a business to its employees.

A)IPO
B)ESOP
C)consolidation
D)termination

Question 52

When one firm absorbs another through purchase,it is called a(n)

A)merger.
B)acquisition.
C)transfer.
D)termination.

Question 53

Of the four generic growth strategies,most small businesses are

A)traditional small businesses.
B)lifestyle or part-time firms.
C)high-performing small businesses.
D)high-growth ventures.

Question 54

Of the four generic growth strategies,_____ represents the smallest category.

A)traditional small businesses.
B)lifestyle or part-time firms.
C)high-performing small businesses.
D)high-growth ventures.

Question 55

A transfer method describing the first-time public sale of a stock listed on a public stock exchange is called a(n)

A)IPO.
B)ESOP.
C)consolidation.
D)termination.

Question 56

Which of these businesses typically have sales of $25,000 a year or less and are intended to provide partial or subsistence financial support for the existing lifestyle of the owner?

A)High-growth ventures
B)High-performing small businesses
C)Traditional small businesses
D)Lifestyle firms

Question 57

A transfer method in which a small firm is bought by a larger firm for the purpose of quickly growing the larger firm refers to

A)IPO.
B)ESOP.
C)consolidation.
D)termination.

Question 58

These businesses typically go through all the stages,but include takeoff before going through resource maturity.

A)Lifestyle firms
B)High-performing small businesses
C)High-growth ventures
D)Traditional small businesses

Question 59

Lifestyle firms are also known as

A)high-performing small businesses.
B)high-growth ventures.
C)traditional small businesses.
D)part-time firms.

Question 60

Which of these grow at rates more like 5 to 15 percent a year,adding employees and often gaining through multiple locations?

A)Traditional small business
B)High-growth ventures
C)Lifestyle firm
D)High-performing small business

Question 61

Identify the type of termination that is employed when the entrepreneur feels that the business was less than successful,usually because of the result of poor use of the firms' assets combined with an unsatisfying business experience.

A)Bankruptcy
B)Walkaway
C)Sell off
D)Workout

Question 62

Which of these is a type of termination?

A)IPO.
B)Workout.
C)Pass off.
D)Sell off.

Question 63

Which of these is a type of transfer?

A)Liquidation
B)Workout
C)Walkaway
D)Pass off

Question 64

Grantor retained annuity trusts can be used in

A)tax management.
B)liquidity enhancements.
C)estate freezes.
D)walkways.

Question 65

People who open multiple businesses throughout their career are called

A)serial entrepreneurs.
B)unsatisfied business owners.
C)terminal venturers.
D)workout specialists.

Question 66

Entrepreneurial success is measured with all of these bottom lines EXCEPT

A)the firm.
B)the family.
C)the community.
D)the government.

Question 67

Which is the form of business termination that uses a legal method for closing a business and paying off creditors when debts are substantially greater than assets?

A)Bankruptcy
B)Sell off
C)Walkaways
D)Workout

Question 68

_____ refers to a form of business termination in which the firm's legal or financial obligations are not fully met at closing.

A)Workout
B)Walkway
C)Pass off
D)Sell off

Question 69

In a successful walkaway

A)contracts,leases,and the like are in effect.
B)employees are let go as they find other jobs.
C)insurance is discontinued after the firm closes.
D)assets or inventory are available.

Question 70

A _____ happens when the owner realizes there is little chance of being able to sell the firm and gives the firm to someone as a gift,without compensation.

A)workout
B)sell off
C)pass off
D)succession

Question 71

_____ is an estate planning strategy which focuses on generating cash to cover likely estate taxes.

A)Liquidity enhancement
B)Tax management
C)Estate freeze
D)Transfer

Question 72

The two broad types that CSFs fall into are outside help and

A)entrepreneurial experience.
B)start-up capital.
C)brand name affiliation.
D)serial entrepreneurs.

Question 73

In the hierarchy of business outcomes,the worst possible outcome is

A)sell off.
B)pass off.
C)walkaway.
D)bankruptcy.

Question 74

These are processes,benchmarks,or components of the business that are essential for the business to be profitable and competitive in its market.

A)IPOs
B)CSFs
C)ESOPs
D)BRIE

Question 75

In a _____ the assets of a firm are sold to another business,with the proceeds used to pay off the firm's remaining debts,and perhaps leaving the owner some small profit.

A)workout
B)sell off
C)pass off
D)succession

Question 76

An endgame strategy in which the owner closes down a business is called

A)IPO.
B)ESOP.
C)consolidation.
D)termination.

Question 77

Business terminations in which the entrepreneur ends the business with its obligations met is called a

A)sell off.
B)workout.
C)pass off.
D)walkaway.

Question 78

Which of these is NOT a CSF that can help identify those businesses more likely to survive?

A)Being incorporated
B)Moderate start-up capital
C)Protectable intellectual property
D)Brand name affiliation

Question 79

Tax management

A)focuses on generating cash to cover likely estate taxes.
B)focuses on minimizing estate tax payments.
C)focuses on transferring assets to heirs when the asset costs are low.
D)focuses on giving the firm as a gift to someone who will keep the business a going concern.

Question 80

_____ is the popular name for a_____ bankruptcy in which a bankrupt firm's assets are sold by the bankruptcy trustee and the proceeds used to pay the firm's debts.

A)Liquidation;Chapter 11
B)Reorganization;Chapter 13
C)Liquidation;Chapter 7
D)Reorganization;Chapter 11