Q Entrepreneurship
and small business
Start-up, growth and nra.
PAUL BURNS
Professor of Entrepreneurship and Dean,
University of Bedford Business School, UK
palgrave
macmillan
VII
List of figures
xvi
List of tables
xviii
Preface to the third edition
xix
How to use the book and website
xxi
Guided tour of the book and website
xxvi
Part 1 Entrepreneurship
1 Entrepreneurship in the twenty-first century
The stuff of dreams
The entrepreneurial revolution
The economics of ehtrepreneurship
Entrepreneurs and owner-managers
Small firms
^
The differences between small and large firms
Lifestyle and growth firms
The UK small firms sector
Global Entrepreneurship Monitor [GEM)
Summary
3
5
8
9
11
16
18
19
21
24
27
Case insights
Bill Gates and Microsoft
Michael Dell and the Dell Corporation
Richard Branson and Virgin
Shaa Wasmund and Brightstation Ventures
Marc Demarquette
Joseph Bamford and JCB
6
8
13
15
17
23
Cases with questions
Julie Spurgeon
20
Sara Murray - Serial entrepreneur
26
2 Entrepreneurs and owner-managers
Start-up influences
Personal character traits
Character traits of owner-managers
31
33
34
36
Contents
Character traits of entrepreneurs
Antecedent influences
Ethnicity and immigration
Gender
Growth businesses
National culture
Situational factors
Summary
38
42
44
46
48
49
53
58
Case insights
Steve Hulme
Simon Woodroffe and YO! Sushi
Market traders
Kenyan Asians
Elizabeth Gooch and EG Solutions
Will King and King of Shaves
33
39
43
45
47
54
Cases with questions
Duncan Bannatyne, Dragon
Hilary Andrews and Mankind
3
55
57
Innovation and entrepreneurship
Innovation
Innovation and competitive advantage
Discontinuous innovation
Innovation and entrepreneurship
Creativity and entrepreneurship
Innovation and size
Innovation and location
Summary
63
65
65
69
71
74
75
77
80
Case insights
James Dyson
McDonald's
Who invented the world wide web {www}?
Trevor Baylis
Great Ormond Street Hospital for Children
Swarfega
67
69
71
72
73
73
Case with questions
Big companies and new ideas
79
4 Social and civic entrepreneurship
The rise of social entrepreneurship
Social enterprise and the social economy
'
Legal forms of social enterprise in the UK
The social entrepreneur
The growth and development of the social enterprise
The civic entrepreneur
The dangers of social entrepreneurship
Summary
83
85
87
88
92
94
96
99
102
Contents
Case insights
The Maggie Keswick Jencks Cancer Caring Centres Trust
Abs-Kids
Bright Ideas Trust
91
91
91
Seven Stories
91
Cases with questions
Big Issue
Ridgeway Primary School
Nin Castle, Phoebe Emerson and Goodone
Part 2 Start-up
89
98
100
107
5 Developing creativity and the business idea
109
Creativity
Barriers to creativity
The creative process
Techniques for generating new ideas
Recognising opportunity
The business idea
The internet
Safeguarding your ideas
Summary
111
113
113
116
121
125
128
129
137
Case insights
Martin Dix and Current Cost
Bruce Bratley and First,Mile
Tom Mercer and mOma
Adrian Wood and GTI
115
116
123
125
Cases with questions
Alex Tew and the Million Dollar Homepage
eBay
Andrew Valentine and Streetcar
6 Evaluating the business idea
What you need to start a business
Personal attributes
Knowing your customers
Knowing your competitors
Marketing strategies
Resources
Capital
The importance of networks
Planning and evaluation
Summary
Case insights
Quad Electroacoustics
Morgan Motor Company
Alan Pound and Aculab
Richard Branson
118
131
136
141
143
143
145
146
148
154
155
157
159
163
152
153
153
155
Contents
Robbie Cowling and Jobserve
Big companies and strategic alliances
155
159
Cases with questions
David Sanger and Rollover
Mark Constantine and Lush
160
161
7 Launching the business
Marketing strategies
Pricing
Differentiation
Developing customer focus
Entrepreneurial marketing
Undertaking market research
Developing selling skills
Retailing on the internet
Legal forms of business
Summary
167
169
172
177
178
180
182
185
188
190
196
Case insights
Martin Penny and Good Hair Day
Jean Young
Radio Spirits
Mark Dorman and Black Vodka
Mark Goldsmith and Goldsmith s Fine Foods
Gary Frank and the Fabulous Bakin' Boys
, Cases with questions
' The Body Shop franchise
Stephen Waring and Green Thumb
Calypso Rose and Clippy
8 International entrepreneurship
Globalisation and international entrepreneurship
The international start-up
The stage model of internationalisation
The influence of networks and learning theory
Export strategies
The agency dilemma
Summary
Case insights
Michael Ross and Figleaves
John and Julie Gilbert and Hop Back
Julie Diem Le and Zoobug
Cases with questions
B&Q
Hightech Components
9 Running the business
Cash flow and Death Valley
The profit statement
The balance sheet
173
175
178
184
186
189
193
194
195
201
203
205
207
209
210
213
216
208
211
213
204
214
221
223
224
229
Contents
Planning and control
Financial drivers
Break-even
Decision-making
Summary
232
233
236
238
243
Case insights
Jean Young
225, 226, 228,231
Chris Hutt and tffe Newt & Cucumber
234
David Speakman and Travel Counsellors
237
Flitwick Manor Hotel
237
Penforth Sofa Beds
239
Appendix 1: Forecasts and budgets - an example
246
252
Appendix 2: Accounting records - an example
10 Financing the business
Money
Bank finance
The bank's perspective
Banking relationships
Venture capital institutions and business angels
The equity investor's perspective
Stock market floatation
Is there a financing gap?
Gender, ethnicity and finance
Summary
Case insights
Martyn Dowes and Coffee Nation
Peter Kelly and Softcat
Andrew Barber, Robin Hall and FBS Engineering
Fred Turok and LA Fitness
Bob Holt and Mears Group
Elizabeth Gooch and EG Solutions
Cases with questions
Specsavers
257
259
263
267
269
270
272
273
275
278
281
264
267
271
274
275
280
NDT
272
276
Part 3 Growth
287
11 Planning for growth
Ingredients of success
A framework for developing strategy
Sustainability and corporate social responsibility
Vision and mission
Values and ethics
The SWOT analysis
Financial performance analysis
Value chains
SLEPT analysis
289
291
292
293
297
299
300
304
308
309
Contents
Strategy intent
Securing competitive advantage
Successful entrepreneurial strategies
Developing entrepreneurial strategies in the real world
Summary
311
313
314
320
Case insights
Jordans
Dale Vince and Ecotricity
Abet & Cote
J. J. Cash
Dell Computer Corporation
294
295
296
303
312
Cases with questions
Dmitry Kotehko and Nitol Solar
Lastminute.com
easyJet
312
316
318
12 New products and services
Product life cycles
Product portfolios
Portfolio strategies
Managing the product life cycle
Financial implications of the product portfolio
Implications for the entrepreneur
Summary
310
325
327
330
332
335
338
339
340
Case insights
Heinken
331
Cases with questions
Cadbury 1
Barbie and Mattel Corporation
333
336
13 Growing the business
Growth options
Market penetration
Product/service development
Market development
Diversification
Risk
Buying growth
Summary
343
345
346
348
349
350
352
355
360
Case insights
Wilson & Sons
Virgin
Tim Slade, Julian Leaver and Fat Face
Wing Yip
347
348
350
352
Cases with questions
Jim Ratcliffe and Ineos Group
George Brian BoedeckerJr. and Crocs
Cadbury 2
357
358
359
Contents
14 Developing the business plan
363
Why you need a business plan
The planning process
What a business plan looks like
Using the plan to obtain finance
The bankers' view
The investors' view
Presenting a case for finance
Pro forma business plan
Summary
365
365
369
371
Cases with questions
Chris Hutt and the Newt & Cucumber
15 Exit: failure and success
Stagnate and die
Failure
The ingredients of failure
Predicting failure
Dealing with failure as an individual or a sole trader
Dealing with failure as a company
Success - selling the business
Company valuation
Summary
Case insights
Nick Kenton, Rob Taub'and Sportsbase
Nicholas Hall
Tech Board and Imperial Board Products
ZedZed.com
Alex Meisl and Taotalk, then Sponge
Peter Durose and the English Grocer
Kristian Segerstrale and Ptayfish
Vivid Imaginations
The Body Shop
Julian Harley Ian West and Harley West Training
Anne and Simon Notley and Feather and Black
Cases with questions
Cobra Beer
Part 4 Maturity
16 The family firm
The advantages of family
Family business is big business
The conflict between family and business cultures
Succession
Points of conflict
The introvert firm
Resolving conflict: the family constitution
374
375
377
378
382
372
385
387
388
390
394
396
397
400
403
404
387
390
392
393
394
397
401
401
402
403
404
399
407
409
411
413
414
417
419
421
422
Succession planning
Summary
Case insights
Doreen Lofthouse and Fisherman's Friend
Adidas vs Puma
Values and beliefs
Ferrero Rocher
Noon Products
Litttewoods
Alex Ramsay
J&B Wild
Everards Brewery
Cases with questions
Timberland
Wates Group
Mars Inc.
425
428
412
414
415
416
419
420
420
421
423
416
424
427
17 From entrepreneur to leader
Growth and crises
Changing skills
Coping with crises
The role of leader
The evolving vision
Leadership style
Building the management team
The board of directors
Entrepreneurial structures
Traditional large firm structures
Structure, change and task complexity
Creating culture
Entrepreneurial leadership skills
Summary
431
433
435
439
440
442
444
448
450
451
453
454
456
459
465
Case insights
David Poole and DP&A
Gary Redman and Now Recruitment
455
460
Cases with questions
Michael Dell
461
18 Corporate entrepreneurship
Defining corporate entrepreneurship
Entrepreneurial architecture
Learning organisations
Building the architecture for entrepreneurial
transformation
The role of culture
The role of structure
Management, structure and control
Intrapreneurship
469
471
474
475
477
480
482
485
489
Contents
Organising new venture ideas
Corporate venturing
Summary
498
Case insights
Julian Metcalf, Sinclair Beecham and Pret a Manger
Richard Branson's Virgin Group
472
484
Cases with questions
David Hall and HFL
Nokia
3M
487
494
496
Further reading and journals
Subject index
Author index
Quotes index
491
492
505
508
513
516
Companion resources
Visitwww.palgrave.com/business/burnsforanaccompanying students' website :
and password-protected lecturers' website:
Students' website
0 Video commentaries by the author
> Interactive chapter tests
t> General Enterprise Tendency (GET) Test
> Corporate Entrepreneurship Audit Tool
> Leadership Style Test
> Small business audit checklists
:
0 Five entrepreneurship assignments including a small business growth
audit
> Downloadable versions of the cases with questions, including additional;
cases not included in the book
D> Downloadable versions of a pro forma business plan and the specimen
plans for Sport Retail, Jean Young and Dewhurst Engineering
> Additional exercises on basic business skills such as accounting, financial
management and marketing
[> Checklist of regulations to be met in setting up a business in the UK
> Sources of information, help and advice in the UK
> Selected websites offering further learning resources and practical,
up-to-date help and advice, with hyperlinks
i
Lecturers' website
t> Powerpoint slides for each chapter
> Notes on the entrepreneurship exercises
> Teaching notes for cases with questions
t> Teaching notes for the specimen business plans
> Selected case studies from the European Case Clearing House, many with
related DVDs. These are particularly valuable for postgraduate teaching.
