Entrepreneurship Basics

Entrepreneurship

• The term "entrepreneur" comes from the French word "ENTREPRENDRE", meaning "to UNDERTAKE."
• An entrepreneur organizes and directs a business enterprise.
• Entrepreneurs provide products and services in exchange for payment.
• Products can be tangible, manufactured, perishable, and can be sold in the international market.

Types of Businesses

• Extractive: Take raw materials from nature (e.g., mining, forestry).
• Manufacturing: Transform raw materials into finished goods (e.g., factories, production facilities).
• Wholesaling: Buy goods from extractive or manufacturing businesses and sell them to other businesses (e.g., distributors, suppliers).
• Retailing: Buy goods from wholesalers, manufacturers, or extractive businesses and sell them directly to consumers (e.g., stores, shops).
• Service: Provide services to customers in exchange for payment (e.g., hair salons, cleaning services, repair shops).

Entrepreneurial Development

• Assuming Responsibility: Entrepreneurs proactively observe their customers and competitors for insights.
• Experimenting: Entrepreneurs embrace trial and error to test new ideas.
• Networking: Entrepreneurs connect with diverse individuals to gain fresh perspectives.
• Evaluation: Entrepreneurs critically assess their business opportunities.
• Developing a Plan: Comprehensive business plans help entrepreneurs set standards, goals, and track progress.
• Resources: Entrepreneurs identify funding sources, acquire human resources, and seek investors.
• Managing the Company: Entrepreneurs implement management structures, operational strategies, and address ongoing operational challenges.
• Harvesting: Entrepreneurs evaluate business performance against projected growth and plan for future expansion or security.

Benefits of Entrepreneurs

• Empower Individuals: Entrepreneurs provide an opportunity for individuals to accumulate wealth.
• Enhanced National Identity and Pride: Successful entrepreneurs contribute to a country's identity and pride.
• Enhance Competitive Consciousness: Entrepreneurs introduce competitiveness and innovation that benefits other individuals and sectors.
• Improves Quality of Life: Entrepreneurs' innovations and product development contribute to the betterment of products, services, and overall quality of life.
• Enhance Equitable Distribution of Income and Wealth: Entrepreneurs create opportunities for individuals to achieve financial success.
• Introduce New Technologies, New Industries, and New Products: Entrepreneurs drive innovation and development.
• Create Employment: Entrepreneurs are a key driver of private-sector employment.
• Provide Taxes to the Economy: Entrepreneurs contribute to government revenue through taxes.
• Capital Aggregators: Entrepreneurs establish financial institutions, such as banks and insurance companies, which require large amounts of starting capital..
• Acquirers: Entrepreneurs acquire existing businesses by buying out a significant portion of the company's stock.
• Buy and Sell Artists: Entrepreneurs profit by buying and selling businesses at higher prices.

Entrepreneurial Traits and Characteristics

• Moderate Risk Takers: Entrepreneurs assess and manage financial, government, and legal risk.
• Self-Confidence: Entrepreneurs believe in their ability to achieve their goals.
• Hard Workers: Entrepreneurs are willing to sacrifice time, energy, and personal life for their business.
• Goal-Oriented: Entrepreneurs set clear goals and focus on achieving them.
• Responsible: Entrepreneurs take accountability for their actions and the success or failure of their business.
• Innovative: Entrepreneurs introduce new ideas and seek improvements.
• Technical and Business Knowledge: Entrepreneurs possess knowledge about their products and how to operate a business.

Self-Employment

• Advantages: Personal satisfaction, independence, potential for profit, job security, and status.
• Disadvantages: Possible loss of invested capital, uncertain or low income, long hours, and routine chores.

How to Become Successful

• Identify a Business Opportunity: Recognize a need or problem that can be solved through a business.
• Develop a Business Plan: Create a comprehensive plan outlining your business goals, strategies, and financial projections.
• Secure Funding: Obtain financial resources to start and operate your business.
• Build a Team: Assemble a skilled and motivated team to support your business.
• Market Your Business: Promote your products or services to target customers.
• Provide Excellent Customer Service: Go above and beyond to satisfy customers.
• Adapt to Change: Be flexible and responsive to changing market conditions.
• Learn from Your Mistakes: Analyze setbacks and use them as opportunities for growth.

Successful Filipino Entrepreneurs:

• Henry Sy Sr. (SM Group): Retail and real estate
• John Gokongwei Jr. (JG Summit Holdings): Diversified businesses, including food and beverage
• Lucio Tan (LT Group): Tobacco, banking, and beverage
• Tony Tan Caktiong (Jollibee Foods Corporation): Fast food chain
• Socorro Ramos (National Bookstore): Bookstore chain
• Cecilio Kwok Pedro (Happeee Toothpaste): Toothpaste brand
• Mariano Que (Mercury Drugs): Drugstore chain
• Alfredo M. Yao (Zest-O): Juice and beverage brand
• Corazon D. Ong (CDO): Food products
• Gregorio Sanchez Jr. (Asia Brewery): Beverage company
• Diosdado Banatao (Computer Chips): Semiconductor industry