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SmallBusinessManagementProfessorHornaday Lecture5 SMALLBUSINESSMANAGEMENTTYPESOFCOMPETITION 1 Monopoly2 Oligopoly3 MonopolisticCompetition4 PureCompetition Overhead50B SMALLBUSINESSMANAGEMENTTHEMARKETINGDISTRIBUTIONCHANNEL PRODUCER PROCESSOR MANUFACTURER DISTRIBUTOR RETAILER CONSUMER LOWVALUE HIGHVALUE SMALLBUSINESSMANAGEMENTMARKETNICHE 1 GroupofCustomerswithSimilarPurchasingPatterns2 RelevantPriceRangeProducesProfit3 DefensibleagainstAllComers Overhead50A SMALLBUSINESSMANAGEMENTSEGMENTINGTHEMARKET 1 Demographics Age Sex Race Income Location Transportation Etc 2 ShoppingHabits When Where Impulse PlannedPurchases Etc 3 MethodofPayment CashorCharge Overhead50C SMALLBUSINESSMANAGEMENTMARKETINGRESEARCH 1 SecondarySources Library SBA TradeAssociations ChamberofCommerce Suppliers Banks Etc 2 PrimarySources Interviews Questionnaires MailandTelephone Demonstrations Etc 3 CollectandCollatetheInformation WhatistheDataTellingYou 4 NeedtoKnow HowManyUnitscanYouSellatWhatPrice Overhead51 SmallBusinessManagementTheFour Ps 1 Product2 Place3 Price4 Promotion SMALLBUSINESSMANAGEMENTPRICING 1 Strategy SkimorLongTerm 2 CoverCosts3 MeetCompetition4 SatisfyDemandCurve5 RelevantRange Overhead52 RelevantPriceRange A B Relevant PriceRange LowestPrice toCoverCosts 350 275 200 0 PricetooHigh forCustomers PricetooLow forCustomers SMALLBUSINESSMANAGEMENTSETTINGTHEPRICE 1 Markup GrossMarginPercentageofCost2 Markon IncreaseoverMarkuptoallowforMarkdown3 MultiplierApproachforServiceFirms4 JobCostEstimates Overhead52A SMALLBUSINESSMANAGEMENTADVERTISING 1 ProductorInstitutional2 TheMessage3 TheMedia4 GettingAssistance5 TheCostversustheBenefit Overhead53 SMALLBUSINESSMANAGEMENTSELLING 1 GetOrganizedtoSell2 TheFour P s 3 SalesPeople Overhead54 SMALLBUSINESSMANAGEMENTSALESTRAINING 1 KnowYourself2 KnowYourCompany3 KnowYourProduct4 KnowYourCustomer Overhead54A SMALLBUSINESSMANAGEMENTBUYINGMOTIVES 1 Packaging Image2 BrandName3 StoreLocation4 Price5 TreatmentbySalespeople Overhead54B SMALLBUSINESSMANAGEMENTCUSTOMERCREDIT 1 RetailersuseCash CarryorCreditCards2 ServiceFirmssometimesmustOfferCredittoMajorCustomers3 Distributors Wholesalers andManufacturersuseCreditasaSalesTool4 LargeCustomersareSometimesDifficult SlowPayers Overhead55 SMALLBUSINESSMANAGEMENTLOCATIONSELECTION 1 GeneralFactorsa Personalb Economicsc Competitiond Geographice LocalLaws2 RetailLocationsa ConsumerDrivenb CostversusFootTraffic3 WholesaleLocationsa Accessb ZoningandSpace4 ServiceLocationsa CustomersCometoYoub YougototheCustomer5 ManufacturingLocationsa Accessb LaborForcec Utilitiesd Zoning SMALLBUSINESSMANAGEMENTOTHERCONSIDERATIONS 1 LeaseBuildings Equipmenta LowInitialInvestmentb LeasePaymentsTaxDeductible2 BuyBuildings Equipmenta CapitalAppreciationb CreatesAssets3 FixturesandFacilitiesa Retailb Wholesalec Serviced Manufacturing SmallBusinessManagementCustomerDraw 1 TrafficStudy2 TransportationMethods3 LicensePlateCheck4 Interviews SmallBusinessManagementServiceBusinesses 1 ServicesIntangible2 BuyersandSellersInterdependent3 ServiceandSellerInseparable4 ServicesarePerishable5 QualityStandardizationDifficult SmallBusinessManagementServiceBuyers 1 PersonalAttention2 SubjectiveImpressions3 MarketingTimeSaving4 CustomerWantsIncrease5 SmallThingsCount SmallBusinessManagementValuingService 1 LifeStyl
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