Fundamentals of Management, 8th ed

Chapter 5: Entrepreneurship and New Venture Management

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Small-business services range from shoeshine parlors to car rental agencies, from

marriage counseling to computer software, from accounting and management consulting

to professional dog walking. In Dallas, for example, Jani-King has prospered by selling

commercial cleaning services to local companies. In Virginia Beach, Virginia, Jackson

Hewitt Tax Services has found a profitable niche in providing computerized tax preparation

and electronic tax-filing services. Great Clips, Inc., is a fast-growing family-run chain of hair

salons headquartered in Minneapolis.

Retailing

A retail business sells directly to consumers products manufactured by other

firms. There are hundreds of different kinds of retailers, ranging from wig shops and

frozen yogurt stands to automobile dealerships and department stores. Usually, however,

people who start small businesses favor specialty shops—for example, big-men’s clothing

or gourmet coffees—which let them focus limited resources on narrow market segments.

Retailing accounts for 11.71 percent of all U.S. businesses with fewer than 20 employees.

John Mackey, for example, launched Whole Foods out of his own frustration at being

unable to find a full range of natural foods at other stores. He soon found, however, that

he had tapped a lucrative market and started an ambitious expansion program. Today,

with 310 outlets in North America and the United Kingdom, Whole Foods is the largest

natural-foods retailer in the United States—three times larger than its biggest competi-

tor.

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Likewise, when Olga Tereshko found it difficult to locate just the right cloth

diapers and breast-feeding supplies for her newborn son, she decided to start selling

them herself. Instead of taking the conventional retailing route, however, Tereshko set

up shop on the Internet. Her business, called Little Koala, has established a customer

base of over 10,000 loyal customers. The “Sustainability Matters” feature highlights

another successful business that has combined retailing and services.