Assessment - Introduction To Business - ثاني ثانوي

Chapter 7 Review Business Concepts 7.1 The Entrepreneurial Life Assessment • Successful entrepreneurs have a real desire to be their own boss. They use special skills and abilities to come up with innovative ideas and then develop a good initial plan for a business. Entrepreneurs represent all age categories, women and men, as well as varied educational levels. • Entrepreneurship is a key and growing part of the Saudi economy. Successful entrepreneurs often possess natural skills and characteristics (competitive, creative, reliable, goal-oriented, capability to learn from failure, willingness to work hard) but all entrepreneurs can work to develop these characteristics. Small businesses are responsible for 20% of GDP, rising to 35% by 2030. • Opportunities open to entrepreneurs include the creation of new or improved products and services, an improved design, more effective procedures, or greater attention to quality. Risks include lack of adequate capital, low sales, higher than expected expenses, competitive pressure, an owner unprepared to manage a growing business, and operations that require more time than the owner is willing to commit. 7.2 Becoming an Entrepreneur • Four fundamental reasons for owning a company are personal fulfilment, personal satisfaction, independence and financial rewards. Saudi Vision 2030 is opening up many opportunities for entrepreneurs with innovative ideas. Entrepreneurship is a key driver of business across the world. It is a growing part of the Saudi economy, with over 750,000 small and medium enterprises in Saudi Arabia by the close of Q1 2022. A range of services and departments are available to Saudi entrepreneurs and small businesses. Monsha'at is the Saudi Arabian Small and Medium Entreprises General Authority. It aims to drive growth of the private sector and empower SMEs. Other useful resources include the Social Development Bank and the Research, Development and Innovation Authority, and Universtity Incubation Centers. 7.3 Small Business Basics • In a small business, the owner is usually the manager, it operates in one or very few locations, it typically serves a small market, and it is not dominant in its field of operation. Small businesses play an important role in the economy. They often serve customers where the number of products and services needed is small or the requirements are too specialized for large businesses to be profitable. Some of the most common reasons for small business failure are not keeping adequate records, not having enough start-up money, lack of management experience, lack of experience with the type of business, not controlling operating expenses, poor location for the business, and failure to manage customer credit. وزارة التعليم Ministry of Education 2024-1446 Assessment | 229

Think Critically About Business 1. Describe a new product or service that could become the basis for a new business that fits your interests, hobbies, or special skills and abilities. What are some reasons you would be interested or not interested in becoming an entrepreneur? 2. Why do you believe that small businesses contribute more new jobs to the economy than large, established businesses? 3. Describe some of the key factors that you believe have contributed to the success of the top entrepreneurs across the world. Do you believe the idea for a product or service is more or less important than an entrepreneur's personal characteristics? 4. How is the Internet changing the characteristics of small businesses? Do you believe the Internet can make small businesses more competitive with large businesses? Why? 5. Ali is thinking about starting a small business and has come to you for advice. Using the reasons why most small businesses fail as listed in Lesson 7.3, what would you tell Ali that will help him increase his chances for being successful? 6. In many communities, there are several locations where retail businesses locate but soon fail. They are followed by other businesses that also fail. People say the pattern of failure is because of a poor location. Do you agree that the location is the most likely reason that the businesses fail? Why would a new business consider a location where a previous business has already failed? 7. Identify the three types of people you believe would be the most important to assist a new small business owner. Justify each of your choices. 230 ليم 0 Chapter 7 | Entrepreneurship and Small Business Management Ministry of Education 2024-1446

Develop Your Business Language Match the terms listed with the definitions. Term 8. Competitive Advantage 9. Entrepreneur 10. Entrepreneurship 11. Improvement 12. Innovation 13. Intrapreneur 14. Small Business 15. Social Entrepreneurship Your Choice Definition Make Academic Connections a. A business with 6-49 full-time employees and SAR 3-40 million in revenue. b. An invention or creation that is brand new. C. A designed change that increases the usefulness of a product, service, or process. d. The process of starting, organizing, managing, and assuming the responsibility for a business. e. f. Someone who works within an existing corporation as an employee and assumes responsibility for converting a new idea into a profitable product, service, or process. They mostly create value for the company, rather than starting their own new business. A situation in which one business is better able to meet a certain need. g. Entrepreneurial activity whose goal is to find innovative solutions to social needs, problems, and opportunities. h. Someone who takes a risk by starting a business to try to earn a profit. 16. Communication Many small business owners obtain some of their start-up financing from family members and friends. Assume you are starting a small Internet business that will develop and maintain low-cost websites for local organizations, clubs, and non-profit groups. You have SAR 7,000 of your own money to invest and need to raise an additional SAR 10,000. Develop a letter or one-page brochure that you can use to interest family and friends in investing SAR 1,000 or more in your new business. Make sure it is persuasive and tells them what benefits they will receive from their investment. وزارة التعليم Ministry of Education 2024-1446 Assessment | 231

17. Government The Saudi Government provides many resources as well as financial support for small businesses. Use the Internet to locate two national or local agencies of the government that provide services developed specifically for small businesses. Prepare a brief report on each of the agencies you identified in which you describe the agency, the services provided, and how a new business can qualify for the services. Make Your Case Ahmed completed a college program in Small Business Management. He wanted to own his automobile repair shop. He had worked for a local maintenance center during college. In addition, he was able to save almost SAR 50,000 toward starting his own business. However, he knew that he would need more than that to buy a garage workshop. Ahmed studied three ways he might start his business. a. He could find a partner to provide the additional cash. b. He could work for the local maintenance center until he retires in seven years and buy the business with his accumulated savings. c. He could purchase a franchise for an investment of SAR 5,000. However, Ahmed would have to pay a franchise fee of 6% of total receipts each year to the franchisor. 18. What are the advantages and disadvantages of each route to small business ownership for Ahmed? 19. If you were Ahmed, which choice would you make? Why? 232 ليم 2 Chapter 7 | Entrepreneurship and Small Business Management Ministry of Education 2024-1446

Interactions and Connections The Internet has opened a world of opportunities for entrepreneurship. Budding entrepreneurs can now easily reach customers with online games, products, social networking opportunities. Often the businesses developed from these entrepreneurs' ideas are purchased by larger companies, turning them into millionaires. 20. Research online to find information about how entrepreneurs have used the Internet to launch their businesses. Determine why these businesses were successful. 21. Identify an idea for a business that you would like to start using the Internet. Develop a short business plan to determine if your idea would be feasible. وزارة التعليم Ministry of Education 2024-1446 Assessment | 233