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CH 1] Business 101 1-15

Those firms desiring a good business climate will work at it. They will be
innovative, compensate employees well, minimize tax obligations, manage
production costs for increased profits, develop markets for products thus creating 1
employment opportunities for new employees.
It is easy to recognize that the business environment in the United States is
dynamic. Technology continues to develop, desires and customer preferences change,
and starting a new business today looks quite different than it did ten years ago, and
will be still different ten years from now. However, the principles will remain
constant. The first principle is to consider the needs/wants of customers, and when
meeting those needs, business success is easier. Know that taking over a family
business has different challenges when compared to purchasing an established firm or
starting from scratch. The key being, working with what you have.
Different industries are affected in different ways. It's important to have a good
understanding of your industry and the specific changes that affect it. Researching
business climates is a must for all business owners. When it comes to marketing
strategies, there are changes that exist. Once the storefront was a requirement.
However, today, with technology the “pop-up” market presence has become a part of
the environment.
A strong economy tends to support and help small firms succeed across their
market. When the consumer has less disposable income, say from being laid off
through government interference, then their purchasing power will decrease. In a
growing economy firms take out loans to expand their operations to meet the growing
demands of the people, who are earning more. More people become consumers
because of job creation, and have more revenue which in turn expands the banking
industry.
Crowdfunding was once viewed as a last resort for capitalizing an idea or
business, and has since become one of the more popular ways to support startups.
Crowdfunding makes it easier to innovate, and startups are simpler. Crowdfunding is
a way for people to become involved in firms and projects they believe in and are
involved by (1) donation-based, (2) equity funding, (3) peer-to-peer, and (4) reward-
based. Crowdfunding sites include:
Kickstarter.com Indiegogo.com Patreon.com
GoFundMe.com InKind.com Crowdfunder.com

As more companies are conducting business online, and many shops are
accepting new forms of electronic payments, think Google Pay and Apple Pay, people
are using less paper. Banking has become simpler with online access; receive a
payment and deposit it with a picture access over a cell phone. Businesses are
digitizing most of their documentation, which allows for more security and less risk
of human error.
Simply put, the business climate in the United States is currently looking good
for entrepreneurs.

Alternative Economic Systems
Many people fail to realize that a large part of the world lives under economic
systems other than capitalism. The number of countries with political/economic
systems that are heavily bureaucratic, communist or socialist, makes it important to
learn the primary features of these alternative economies. This text does not concern
itself with political questions, even though the political systems greatly influence the
economic success or failure of their economies. This text does address the economic
aspects of socialism, and communism and over-regulated bureaucratic economies.
Table 1.2 outlines the major features of the various systems.

Planned economy—Communism: we own it all, even the people.
Communism is a political system that uses socialist economic theory for support.
Historically it is a failed economic theory. As a theory, communism is a product of
Karl Marx, a nineteenth-century economist. Marx was greatly influenced by the
European hierarchy that all-but prevented upward mobility of a society, and thus he
wanted to believe that the laboring classes were being exploited by upper classes
which included the capitalists (entrepreneurs and managers). He predicted that a class

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