ESB - Entrepreneurship and Small Business Core Business Operations Questions and Answers

Question 1

A small business providing home repair services has several corporate clients that pay their invoices on a "Net 60" basis.
While the company is profitable, it consistently struggles to pay its technicians and suppliers every month.
What is the most critical operational issue this business is facing?

Accepted Answer

Negative cash flow cycle

Answer

Poor market positioning

Answer

Excessive operating costs

Answer

Low customer retention

Question 2

A farm-to-table restaurant bases its brand on using only the freshest, highest-quality local ingredients. When selecting a new vegetable supplier, which of the following factors is most crucial for the restaurant to prioritize in its supply chain management?

Accepted Answer

The supplier's consistency in quality and reliability of delivery

Answer

The supplier offering the lowest price per pound

Answer

The supplier with the most flexible payment terms

Answer

The supplier's ability to offer a wide variety of non-local produce

Question 3

A growing e-commerce company is expanding from 10 to 30 employees. To ensure all team members understand company policies, workplace expectations, and legal rights, which operational tool should be implemented as a priority?

Accepted Answer

A detailed employee handbook

Answer

A complex customer relationship management (CRM) system

Answer

A new company-wide social media platform

Answer

An executive-only strategic offsite meeting

Question 4

Which of the following is a primary Key Performance Indicator (KPI) used to measure customer loyalty and the likelihood of a customer to recommend a company's products or services?

Accepted Answer

Net Promoter Score (NPS)

Answer

Average Resolution Time

Answer

Inventory Turnover Rate

Answer

Gross Profit Margin

Question 5

A small manufacturing company notices that significant time is wasted moving partially finished products between workstations that are located on opposite sides of the factory floor. According to lean manufacturing principles, this type of inefficiency is categorized as which form of waste?

Accepted Answer

Transportation

Answer

Defects

Answer

Overproduction

Answer

Waiting

Question 6

A new software company sets its pricing based on the significant cost savings and efficiency gains its product provides to its customers, rather than on its own production costs or what competitors are charging. What is this pricing strategy called?

Accepted Answer

Value-Based Pricing

Answer

Cost-Plus Pricing

Answer

Penetration Pricing

Answer

Competitive Pricing