Interview Sheet

Name ________________________________________________

Age ________________________________________________

Type of enquiry Loan to start up a new business

Type of business ______________________________________

Present occupation_____________________________________

Preparation for business Yes No

Market survey □ □

Competition checked □ □

Breakdown of start-up costs □ □

Present assets Present liabilities

House £_______ Mortgage £______

Savings £_______

Shares £_______

Amount required for loan £_________

b) Discuss with your partners what the bank manager's decision will be in this case. Make reasoned assumptions, using functional words of 'probability' given below.

He'll definitely get the loan because…

He might get the loan because…

He probably won't get the loan

He definitely won't get the loan because…

2. Role play

Three different groups of inexperienced young business people require capital for their businesses. They all apply to the local branch of Megabank.

The roles are:

1. A junior manager (and assistants) at the bank, responsible for new local small businesses.

2. A group of young people who want to open a small specialist shop selling CDs of black music – jazz, soul, funk, reggae, rap, and some latest trends.

3. A group of young people who want to buy an existing take-away pizza business (the lease on the premises, the kitchens, the delivery scooters, and so on),

4. A group of students who already operate a part-time computing consultancy service, advising small businesses on what hardware and software to buy and how to set up an Internet home page. They need money to buy more computers, on which to try out elaborate new software.

Choose the roles, study further details given in the role cards below, discuss your questions or arguments in groups and act out an interview with the bankers, following the pattern of the conversation in 1.

Role 1

Your bank recently launched a big advertising campaign announcing that it was the friend of small businesses, with the result that everyone with half an idea is coming to you and asking for money. Your superiors expect you to pick out good local investment opportunities. On the one hand, you have previously lent money to young people who lost it all within six months. You want facts and figures – about costs, sales projections, profit margins, repayment periods, existing competitors, the possibility of new competitors entering the market, and the long-term prospects for the market.

_________________________________________________________________

Role 2

You are fans of black music; you think you know what the market wants; you think the market is big enough to make a small shop profitable; you think the existing competition is weak – inadequate selection of music, wrong ambience, etc. Remember that you will probably be talking to someone who knows nothing at all about the kind of music you are interested in. He/she wants numbers. You have to convince him/her that your business will be successful – that is will have, and keep enough customers to make a profit. You have to pay three months' rent in advance for the small shop. You have to buy display racks and lots of CD players and headphones. Your suppliers (record companies, exporters, distributors) expect to be paid within 60 days.

Role 3

Members of the group have been working in the business – answering the telephone, making pizzas and delivering them – for over two years. You know that the business is profitable. The owner wants to leave quickly and is keen to sell to you. You have enough money to pay the rent and the normal bills, but the equipment will cost $40,000. Not only do you have experience in the take-away pizza business, but as business students you know all about accounting, promotions, etc.

Role 4

You are what other people call 'computer nerds'. You know everything about computers. You have spent several hours a day in front of a computer screen since you were nine years old. You have been advising small local businesses for two years and earning good money, but you would like to buy better hardware for yourself. $40,000 would be perfect.

____________________________________________________________________

3. Which definition of the word ‘entrepreneur’ do you find the most comprehensive? Explain your choice.

a. Someone who uses money to start businesses and make business deals.

b. A person who attempts to make a profit by starting their own company or by operating alone in the business world, esp. when it involves taking risks.

c. A person who shifts economic resources out of an area of lower and into an area of higher productivity and yield.

d. A person who takes the risks necessary to organize and manage a business and receives the financial profits and nonmonetary rewards.

3. Comment on the following quotation:

"Business is a game, the greatest game in the world if you know how to play it." (Thomas J. Watson Sr.).

5. Give arguments to prove the need for more governmental support of small businesses in the Republic of Belarus.

6. Get ready to discuss the topic "Keys to Success in Business", use the following outline:

- Are entrepreneurs born or can entrepreneurial skills be acquired?

- What are the major personal traits that a person must possess to be a successful entrepreneur?

- What knowledge and skills are necessary for a successful entrepreneur?

7. Find detailed information about a business success story and present it to your group mates; make an emphasis on the reasons of success.

WRITING

1. You just nabbed a plum job (заполучить теплое местечко) joining a team of consultants writing an advice column, "Dear Dr. Decisive," for the local newspaper. Yesterday you received your first letter.

Dear Dr. Decisive,

Yesterday, my boyfriend and I got into a high-spirited discussion about lucky people in business. I say that most successful businesspeople are just plain lucky. They've been in the right place at the right time. He says that these successful people have worked hard preparing themselves for the time when they will be in the right place at the right time. OK, I think we're saying the same thing. He says there is an important difference. Now he won't call me unless I admit I'm wrong (which I'm not) or until you say I'm right. I'm right, right?

Call me "Lucky."

Write a response to "Lucky."

2. Write an essay of 250 words about the role of small business in your own country, support your judgements with statistics.

3. Imagine that you are thinking of starting a business of your own. Give a short description of this business in a paragraph of about 70-100 words.

SUPPLEMENTARY READING

Text 1

An Entrepreneur Can Be Made as well as Born

The following essay is by Mr Kian Petit, the secondary school winner in the Young Business Writers Award, which is sponsored by Ericsson, organized by Dublin City University and supported by The Irish Times.

The term "entrepreneurship" has become very fashionable over the past decade. It is associated with enterprise, small businesses and job creation.

High-profile entrepreneurs such as Richard Branson and Gillian Bowler have become well-known media personalities.

Small business has become an important engine of job creation and the European Union had taken a particular interest in encouraging a higher rate of small business start-ups. The general work climate has become less secure, leading more people to consider the option of self-employed or contract work. Within Ireland, attitudes towards enterprise are changing, and government policy is now geared towards giving more incentives to would-be entrepreneurs.

The term "entrepreneur" has its origins from the French word entreprendre, meaning to undertake something. Entrepreneurs were viewed as people undertaking risk.

Cantillon (1755), an Irish businessman living in France, was the first economic commentator to identify an entrepreneur as a person who takes on uncertainty in the hope of making a profit. He observed that some traders "buy at a certain price and sell at an uncertain price, and those who cope with this are the true entrepreneurs.

John Stewart Mill (1862) described the entrepreneur as a bearer of risk and supervisor of business enterprise. He introduced the word entrepreneur to the English language, using it to refer to an individual who founded a business.

Many studies have tried to analyse the psychological make-up and personality of the entrepreneur. The most widely known psychological theory is that entrepreneurial behaviour is the result of a need for achievement.

In the Irish context, a study by O'Connor and Lyons, contained in the book Modern Management – Theory and practice for the Irish Student, found that the most common personal traits among the entrepreneurs they surveyed were: a strong self-image, a need for control and independence, a need for achievement, calculated risk-taking and seeing money as a tool to achieve aims rather than an end in itself.

Generally, the entrepreneur has the following distinguishing characteristics: the ability to recognize an opportunity; the ability to marshal resources in response to an opportunity; and the ability to undertake risk, which by its nature implies being willing to live with the consequences of failure.

Dr Michael Smurfit, the highly-respectful and highly successful Irish entrepreneur, once said: "I must, I can, and I will." Any other attitude is doomed to instant failure, he said.

Richard Branson is a good example of someone who possesses the above characteristics and is perhaps one of the world's best-known entrepreneurs.

There are two Richard Bransons: the public man is informal, friendly, idealistic, happy-go lucky, attached to his family, guided by strong principles and concerned to improve the society he lives in.

The private man is a ruthlessly ambitious workaholic, a hard bargainer, an accountant with an instinctive feel form minimizing the losses on each new venture, and a gambler who prefers to put his assets at risk every day rather than retire to a life of luxury on what he has already made.

He is an empire-builder who keeps the inner workings of his businesses secret.

And where did it all start? At 44 Albion Street, Shamley Green, Surrey, where a 17-year-ole Branson, out of school and looking for something to do, established Student, a student magazine, and his very own record company selling records from the local phonebox. From there, many years of diversification later, he has his millions his mother told him he would get as a child.

I believe that one can be taught the criteria and attitude to be an entrepreneur at any age.

Richard Branson's childhood was full of parental observation and in his autobiography he tells us of tests set by his parents even before the age of 12, tests where he was woken early in the morning and told by this mother to cycle to Bournemouth, which was 50 miles away.

Even at the age of four, Branson remembers his mother stopping the car on the way home and telling little Richard to find his own way back through the fields.

On the other hand, Michael Smurfit was taught these essential criteria through his school years and, unlike Branson, Smurfit has three university qualifications.

So it is quite clear to see that one can be taught the necessary information and also one can be taught to adapt to a certain way of thinking and a certain essential attitude.

A Napoleon Hill, author of Think and Grow Rich, said: "If you can conceive it, you can achieve it."

Text 2

Power of a Great Idea

A dream in the hands of the right person is a winner every time

In this era of multinational corporations run by Master of Business Administration, lone entrepreneurs don’t have a chance. Or do they?

This is a story how.

On October 30, 1980, 35-year-old pipe fitter Ross Hansen of Fredericton was driving home from work when his car blew a tire and plunged into a ditch. The next thing Hansen knew, he was in the neurological unit of Saint John General, paralyzed from the neck down. Doctors told him he’d never walk again, but Hansen was determined to prove them wrong.

During three years of rehabilitation, Hansen had to relearn everything, from sitting up to writing with his unparalyzed left hand. Though he was able to get around with a cane in good weather, winter’s snow and ice proved insurmountable. Frustrated at being “marooned,” he scoured the market for anti-slip footwear, but the local stores carried what he considered cheap junk. “I can do better than that in my garage," he scoffed.

A qualified journeyman-tradesman who once worked his way around the world, Hansen had loved working with his hands. With the help of longtime friend Peter Baldwin, a former schoolteacher and musician, he put together a prototype sole that used the principle of studded snow tires to create traction. Although Hansen knew little about running a business, Baldwin thought he was onto something. They pooled their savings of $5,000 and incorporated their company in 1987. Super Soles was born.

Two years of intensive research and development followed, including 26 working prototypes and hundreds of design changes. Friends and neighbours were enlisted for tests on icy walkways as the partners experimented with a variety of tire studs and other materials. Finally a consensus was reached on the winning product: strap-on rubber soles studded with modified sheet-metal screws. With business plan firmly in hand, Hansen took out a $100,000 loan, but only after mortgaging the equity on his house.

By the spring of 1989, production was under way. A staff of five worked out of a rented church basement, cutting and assembling the materials by hand. Hansen, who was easily fatigued and prone to muscle spasms, sometimes felt overwhelmed by the demands of his business. But he drew strength of his business that he had something useful to contribute.

At first Hansen thought Super Soles’s market would be limited to the elderly and disabled. But as he searched for a way to establish credibility in the marketplace, he came up with the true acid test. Who better for field-testing than letter carriers? His ingenuity paid off. A major contract with Canada Post to gradually outfit thousands of postmen nationwide reeled in safety-supply companies – and healthy sales, which more than doubled in the second year to $150,000.

By now, company headquarters was bursting at the seams. Raw materials, finished product and shipping containers vied for space as orders poured in. Hansen leased a warehouse complete with a loading dock. With a second loan of $50,000 he bought new machinery and set himself the goal of expanding into foreign markets.

After licensing Super Soles to a U.S. manufacturer in 1991, Hansen found a distributor in Norway. He got more than he bargained for. Instead of perhaps 50 units, Norway was ordering 500 at a time. For three months Hansen and his team struggled to keep up with the demand.

Once he’d caught his breath, Hansen determined never to be caught short again. He leased a larger warehouse and crammed it with supplies. Sales broke $300,000. He made further inroads into cold climates – Sweden, Switzerland, Greenland – which meant annual sales that continued to increase. By 1995 Super Soles (now renamed Icer’s Inc.) reached close to $1 million in sales. More than 500,000 pairs are in use in nine countries, where they’re worn by, among others, utility and sanitations workers and, of course, letter carriers.

Hansen’s struggles were enlightening. ”I’ve been everything from CEO to janitor,” he says. “I realized I could do a lot more than what I originally thought I could.”

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