Entrepreneur Case studies:

Jill Kearns was in her first year of college, and was running low on money. She
needed to make at least $500 to cover her expenses. She considered getting a full-time
job, but realized that she did not have enough time to do her studies and keep the job.
Her solution was to start a small business venture with the members of a jazz band to
which she belonged. They would hold jazz concerts and sell tickets to Jill's
performances.

Jill's idea for this venture came from her own and a friend's interest in jazz. As the
popularity of jazz has grown, she would have seen the potential for a business venture
expanding. The idea of using her interest in music to earn the money was very
appealing. Currently, the group members have $500 in the bank. In order to give a
concert, Jill anticipated that they would have the following start-up expenses: an
advertising cost of printing posters, rent on a concert hall, cost of printing tickets, and
incidental expenses for transportation, telephone calls, etc.

By deferring as many payments as possible and obtaining credit, she found that they
needed $465to hold their first concert. Jill figured their total expenses would be about
$2000. By giving two shows and multiplying the ticket price by the legal capacity of
the hall, she calculated that the maximum gross receipts would be $2900. The
business venture would earn a profit of $900! 

1. What risks are involved in this business venture?

2. How could these risks be reduced or eliminated?

3. What would you decide to do if you were Jill?

A Pigskin Revolution

Ed Sabol, a once unhappy coat salesman, had a passion for filming his son’s high
school football games and other activities. Word of Ed’s filming abilities soon got
around and he found himself working a number of local high school games. This
led to Ed’s successful bid ($3,000) to film the 1962 NFL championship game.

Then Commissioner Pete Rozelle was so impressed with the work that he agreed to
Ed’s proposal to create a new entity known as NFL Films that would both preserve
the history of the game and promote it to the nation’s sports fans. NFL Films’
creative approach to the game has resulted in 82 Emmy Awards to date.

Ed retired in 1987, turning the reins over to his son Steve who has taken the
company to new heights thanks in part to his empowering leadership style and
product innovation. The company now has a 200,000 square foot state-of-the-art
facility.

1. Identify the entrepreneurial traits that Ed Sabol and his son Steve exhibit?

2. How would you characterize the Sabol’s philosophy, beliefs, and values to a
small business as it grows?

3. What factors have led to NFL Films’ success?

Never too Young!

Erica Gluck had a desire to earn her own money at the age of seven. She convinced
a local pasta shop to allow her to sell their products off site on weekends. Erica
never looked back as she went on to start her own pasta company, expand its
product lines, hire her parents and give a portion of her profits back to the
community.

Adam Witty, a college student, observed his father repeatedly giving up (season)
tickets to Orlando Magic games that often went unused because of last minute
business commitments. That sparked the idea for a Web-based company that
allows buyers to securely purchase tickets to events that normally would not be
available. Adam started the company from his dorm room, was able to utilize the
facilities of his school and expanded his product lines to include a wide variety of
sporting events. The University of Maryland created a forum that allows about 100
student entrepreneurs to live and work together. That environment has inspired
about twenty of those students to start their own business.

1. In addition to the normal obstacles of starting a business, what other barriers do

young entrepreneurs face?

2. What advantages do young entrepreneurs have when launching a business?

3. What advice would you offer a fellow college student about to start a business?

4. Work with a team of your classmates to develop ideas about what your college
or university could do to create a culture of entrepreneurship on your campus or in
your community.
A Chilly Idea

Willis Carrier invented the air conditioner in 1902 to solve a variety of problems
that manufacturers were experiencing with their raw materials. The Carrier
Engineering Company, formed in 1915, went on to develop products that would air
condition large spaces including those outside of the manufacturing area. That
feature became an effective marketing tool for retailers and eventually spread to
practically every form of space occupied by humans in every country of the world.

Willis Carrier may not have ever imagined the impact that his entrepreneurial and
small business spirit and actions would have on the way that we all work and live.

1. Was launching a business any easier in Willis Carrier’s day than it is today?
Explain.

2. Explain how Willis Carrier exhibits the entrepreneurial spirit?

3. Develop a list of other entrepreneurs whose products, services, or businesses

changed the world. Select one that interests you and prepare a short report on him
or her.
If At First You Don’t Succeed, So What?

The textbook case and the world are full of stories of now famous and successful
business people that experienced bankruptcy and/or business failure a number of
times prior to achieving the success that we are all familiar with. While the
business may have failed, the entrepreneur often learns from these errors and
thinks of launching the next venture based on their newfound understanding and
insight.

1. Do those entrepreneurs exhibit the entrepreneurial spirit? If so, how?

2. How do these entrepreneurs view failure? Is their view typical of most

entrepreneurs?

Three Women Who Made It

When Janet Jones picks up passengers in her taxi, they are not the usual type; in
fact, they are furry and four-legged. Jones’s cab service, Pet-Mobile, is reserved
for pets—dogs, cats, rabbits, small livestock, and birds. Her cab service shuttles
animals to grooming appointments, veterinary checkups, boarding, and other
destinations. “My service is designed to help people who don’t have transportation,
folks with busy work schedules, and those who would rather stay in bed on a
Saturday morning,” she says. Jones typically charges $20 to $30 for a round-trip,
although rates vary depending on the number of pets, their size, and the distance
traveled. Her truck, distinctively painted with the name of her business, is fully
equipped with leashes, carrying crates and harnesses to ensure pet safety in transit.

Joanne Marlowe began her entrepreneurial career at age thirteen. In the ten years
that followed, she launched several companies in the garment industry. Marlowe
discovered that a co-founder had embezzled thousands of dollars from her
company, Double Sharp Garments. “I was pretty depressed, and one of my friends
pointed out that I lived across the street from the beach but had never gone. Never
had time,” she recalls. “It was a beautiful Lake Michigan day,” Marlowe says. “I
laid out my towel. To pamper myself, I spent a lot of time putting on suntan oil.
Just as I stretched out, a gust of wind picked up the towel and covered me in sand.
I hit the roof. My friend said, `Joanne, instead of getting angry, why don’t you
figure out a fix?’“ Marlowe figured that a weighted beach towel would be
relatively inexpensive to produce, and that it could be telemarketed. “So instead of
relaxing at the beach, I spent the day coming up with a prototype and had the
product developed within five weeks. I had it to market within eight weeks,” she
remembers. The workload was terrific. “I was sleeping about three hours a day
from July to October. I wasn’t very healthy, but it worked,” remembers Marlowe.
The company that Marlowe started with just $750 now sells more than $8 million
worth of the towels each year.

Celia Tejada always dreamed of becoming a clothing designer so she could

translate the secret vision of her Spanish homeland into fashionable clothing. Born
in a tiny village in northern Spain, Tejada studied at an internationally known
design school in Bilbao before coming to the United States. While working for an
interior designer, Tejada came up with a sweatshirt combining a tic-tac-toe design
and the Italian phrase for “kiss me.” The department store I. Magnin purchased the
design for a Valentine’s Day promotion. Tejada decided that “I knew enough to
start my own business, and I took the plunge.” She spent the next six months
working feverishly on market research, determining costs and prices, forecasting
cash flow, and designing her logo. She based her product line on the Spanish
attitude toward leisure time. “In Spain, we have a saying: ‘The mornings are for
sport, the afternoons are for relaxation, and the nights are for parties,’” she jokes.
She first introduced a line of sportswear called Tejada Deporte. She added a line of
dressier, higher-priced clothing with heavier Spanish design elements called
Signature Sportswear. “When starting a company from scratch,” she says, it’s not
easy to find people willing to wear many hats. In the beginning, I handled all the
marketing, design, and production and a customer-service person doubled as
secretary.” Today, more than three hundred specialty shops nationwide and three
upscale California department stores carry her lines.

Questions
1. What particular barriers do women face in launching businesses?
2. What advantages does entrepreneurship offer women over working for someone
else?

3. What disadvantages do women face as entrepreneurs?

Sometimes You Win – Sometimes You Lose

The greatest glory is not in never failing
but in rising up every time we fall.
– Confucius

Philip J. Romano, founder of Fuddruckers, a nationwide gourmet hamburger chain,

truly is a restaurant entrepreneur. Romano has experienced the taste of failure on
more than one occasion. Yet he realizes that success in the volatile restaurant
business requires trying creative new concepts that may fail. Failure is common in
the restaurant industry; eating and drinking establishments top the list of businesses
with the greatest failure rates.

Much of Romano’s success is attributable to his ability to anticipate dining trends

and to develop effective restaurant promotions. He caught on to the salad-bar trend
early in his first restaurant, the Nag’s Head Bar in West Palm Beach. He captured
customers’ interest with another venture after his grand-opening; he padlocked the
door and sent keys to select customers. The gimmick created an informal cadre of
salespeople touting the restaurant by word of mouth. When meat prices pushed up
prices 30 percent at his Friends of Edinburgh Scottish Pub, Romano had new
menus printed. Nevertheless, he issued the old menus to regular customers, who
continued to pay the old prices as long as they brought their old menus. The
gimmick at his first lunch-oriented First National Bar & Grill was for customers to
punch time clocks and pay by the minute.

The gimmicks didn’t always work, and Romano’s instincts about diners’
preferences weren’t always correct. His Pasta Palace, a combination art-deco
movie house and pasta restaurant opened well before art deco or pasta became chic
in Florida. It closed quickly thereafter.

Romano thought he was catching the wave for lighter fare with his health-oriented
Stix Eating Spa in San Antonio. However, the upscale restaurant appealed to only a
very small customer base, and sales fell well below expectations. “It was the right
restaurant in the wrong place,” he claimed after the restaurant closed. Even
Fuddruckers, which for a time was one of the hottest food chains around, began to
slide. Romano overestimated the public’s willingness to pay $5 for a burger. The
restaurant failed to adapt its menu and its prices in time and incurred a huge loss.
Romano sold Fuddruckers the next year.

His current venture, Romano’s Macaroni Grill, is highly successful. Modeled after
his memories of his grandfather’s warm Italian kitchen, the restaurant draws
crowds on traditionally slow nights. Romano offers free meals on Monday or
Tuesday each month. The catch: customers never know which Monday or
Tuesday! Romano’s newest restaurant idea presents yet another challenge for him:
convincing New Yorkers to indulge their palates with hearty Tex-Mex fare. The
competition will be stiff; there are some twelve thousand competing restaurants in
Manhattan, and overhead expenses are outrageously high. The real test of success
or failure will be told on the tables of the Texas Tortilla Bakery.

1. Describe the small business failure rate.

2. What factors cause most small business failures?

3. Is failure among entrepreneurs necessarily bad? Why or why not?

Now, write down a list of 10 entrepreneurs that you can think of!
Write down what they are entrepreneurs of next to their name.
They can be famous, someone you know, etc! Who do you find the
most interesting and why??

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.