ENTREP 3rd Quarterly

Introduction to Entrepreneurship and Business Planning

• Entrepreneurship: designing, launching, and running a new business
• Entrepreneur: someone who creates a new business
• Key characteristics of entrepreneurship: doing things differently, innovation, and leadership

Career Opportunities for Entrepreneurship Graduates

• Business Consultant: identifies client problems and finds solutions
• Sales Manager: represents a company and follows up on leads
• Fundraiser: raises money for a specific purpose, not for profit
• New Venture Creator: starts a new company or commercializes an enterprise

The Business Plan

• Chapter I: Introduction
  • Business Concept and Business Model
  • Business Goals: Vision, Mission, Objectives, and Performance Targets
• Chapter II: Executive Summary
• Chapter III: The Business Proponents
  • Chief Executive Officer
  • Marketing Director
  • Production Directors
  • Finance Department
  • Human Resource Development

Target Market and Main Value Proposition

• Target Market: specific group of customers with purchasing power and unsatisfied needs
• Main Value Proposition: summarizes why a customer should choose a product
• Examples:
  • Uber: "The Smartest Way to Get Around"
  • Boysen's KnoxOut: "The first air cleaning paint in the world with CristalActiv photo catalytic technology"

Market Demand and Supply, Industry Dynamics, and Macro Environmental Factors

• Market Demand: total demand for a product in a given business environment
• Industry Dynamics: study of the means and processes through which industries change over time
• Macro Environmental Factors:
  • Social Environment: demographic and cultural dimensions
  • Political Environment: laws, rules, and regulations
  • Economic Environment: supply and demand forces
  • Ecological Environment: natural resources and ecosystem
  • Technological Environment: new scientific and technological discoveries

Product and Service Offerings

• Purpose of the Product: My T-shirt offers customers a variety of options for custom shirts

• Product's Unique Features:

  • Wide array of graphic designs and personalized designs
  • High-quality screen printing with premiere silkscreen ink and paints### Enterprise Strategy and Enterprise Delivery Systems

• Enterprise Strategy (ES) involves mapping the competitive landscape, situating the enterprise and its competitors, and choosing a positioning strategy.

• The Marketing Mix consists of 7 P's: Product, Price, Promotion, Place, Packaging, Positioning, and People.

• Types of Products:

• Breakthrough: offers new performance benefits

• Differentiated: occupies a new space in the customer's mind

• Copycat: doesn't make a significant impression on customers

• Niche: has lower reach, visibility, and prices

Financial Forecast and Expected Returns

• Financial Forecasting involves rendering assumptions into numbers, examining critical variables, and assessing their impact on the industry and business.
• Financial Statements include:
  • Income Statement: revenues, expenses, gross profit, net income before taxes, and net income
  • Balance Sheet: assets, liabilities, and equity
• Profitability Ratios:
  • Return on Sales (ROS): measures profitability of sales
  • Return on Assets (ROA): measures profitability of assets
  • Return on Equity (ROE): measures profitability of capital invested

Environmental and Regulatory Compliance

• The business plan must articulate laws, rules, and regulations governing the business and industry.
• Do's and Don'ts: examples of rules and regulations for employees, such as working hours, compensation, and performance appraisal.
• Evidences of compliance with environmental regulations, such as sanitary permits and fire safety certificates.

Capital Structure and Financial Offering

• Profitability Ratios:
  • Return on Sales (ROS): measures profitability of sales
  • Return on Assets (ROA): measures profitability of assets
  • Return on Equity (ROE): measures profitability of capital invested
• LOGO: promoting a company's products or services, including logo design, types of logos, and what makes a good logo.
• Types of Logos:
  • Wordmarks: free-standing words or abbreviations
  • Letterform Logos: single letters or symbols
  • Pictorial Logos: illustrated symbols

Starting a Business in the Philippines

• Basic Requirements:
  • Department of Trade and Industry (DTI) Registration
  • Securities and Exchange Commission (SEC) Registration
  • Mayor's Business Permit
  • Bureau of Internal Revenue (BIR) Registration
  • SSS, Philhealth, Pag-Ibig Fund Registration

Opportunity Screening and Seizing

• 12 R's of Opportunity Screening:
  • Relevance
  • Resonance
  • Reinforcement of Entrepreneurial Interests
  • Revenues
  • Responsiveness to Customer Needs and Wants
  • Reach
  • Range
  • Revolutionary Impact
  • Returns
  • Relative Ease of Implementation
  • Required Resources
  • Risks
• Business Position Statement: a brief description of a product or service, introducing it to customers and aligning branding efforts.

Value Proposition and Unique Selling Proposition

• Value Proposition (VP): a business or marketing statement that summarizes why a consumer should buy a company's product or use its service.
• Unique Selling Proposition (USP): a marketing concept that persuades target customers, identifying what makes a product or service unique.
• Difference between VP and USP: VP is a statement, while USP is a marketing concept.

Market Research

• The process of gathering, analyzing, and interpreting information about products or services to be offered for sale.
• Data Collection: the most valuable tool in market research.
• 7 Basic Questions in Market Research:
  • Why
  • What
  • Which
  • Where
  • When
  • How
  • How much

Entrepreneurship

• The process of designing, launching, and running a new business.
• Career Opportunities for Entrepreneurship Graduates:
  • Business Consultant
  • Sales Manager### Entrepreneurship
• Go presented artistic designs of Leo Arts and Designs, implementing strategic plans to make the designs top of mind for customers.
• A fundraiser is someone who raises money for a specific purpose, not for profit, but to maintain an organization, e.g., Maria, who oversees campaigns and events to raise money and donations for an organization.
• A new venture creator is an entrepreneurial person who launches a company or commercializes an enterprise, e.g., Aya Fernandez, who turned a school project into an eco-friendly social enterprise.

Potential Market

• It is the part of the total population that has shown interest in buying a particular product or service.
• Also known as Total Addressable Market (TAM).
• Importance of Potential Market:
  • Part of a business's future growth.
  • Increases the entrepreneur's revenue.
  • Ensures business' future by identifying new customers.
  • Shows the business potential to investors or collaborators.
  • Helps with financial projections.

Identifying Potential Market

• Consider every target demographic that you currently sell to and those you have not targeted.
• Ask questions:
  • What other products do my customers need now?
  • What related products do they need in the future?
  • Who else could make use of the products I am selling now?
  • What demographic information does that new group have in common with my current customers?
  • What demographic information does that new group have in common with each other?

Opportunity Seeking

• An endless curiosity about discoveries and finding better ways.
• Essential to opportunity seeking:
  • Entrepreneurial Mind Frame: seeing things in a positive and optimistic way.
  • Entrepreneurial Heart: driven by passion and drawn to find fulfillment.
  • Entrepreneurial Gut: ability to sense without using the five senses or intuition.

Sources of Opportunities

• Macro Environmental: big or macro forces that affect the area, industry, and market.
• Industry: a group of manufacturers or businesses that produce a particular kind of goods or services.
• Market: discovered from a decreased or increased demand of consumers' desire to purchase.

Goods and Services

• Goods: tangible products that consumers can observe with their senses.
• Services: intangible offerings that are abstract and cannot be observed with our senses.

12 R's of Opportunity Screening

• Relevance
• Resonance
• Reinforcement of Entrepreneurial Interests
• Revenues
• Responsiveness to Customer Needs and Wants
• Reach
• Range
• Revolutionary Impact
• Returns
• Relative Ease of Implementations
• Required Resources
• Risks

Opportunity Seizing

• Determine the critical success factor.
• Be vigilant on the factors that cause them to fail.
• Know where to put up the business.
• Know the means and methods of marketing the products or services.
• Business Position Statement: a brief description of a product or service that answers the compelling need of the target market.

Market Research

• Process of gathering, analyzing, and interpreting information about the products and services to be offered for sale to potential consumers.
• Data Collection: the most valuable tool in any type of research study.
• 7 Basic Questions in Market Research:
  • Why: purpose and objectives.
  • What: scope and limitations.
  • Which: which segment of the market must be studied.
  • Who: identifies the members of the selected market segment.
  • When: time and timing of the research.
  • Where: pinpoints the relevant location of the market research.
  • How: determines the methodology to be used for the research.

Data Collection Techniques

• Survey: the most common way to gather primary research using questionnaires.
• Interview: one of the most reliable and credible methods.
• Focus Group Discussion: excellent method for generating and screening ideas and concepts.

Business Plan

• Serves the entrepreneur, investors, and managers of the organization.
• Contents of a Business Plan:
  • Chapter I: Introduction
    • The Business Concept and Business Model
    • The Business Goals: Vision, Mission, Objectives, and Performance Targets
    • The Business Offering and Justification
  • Chapter II: Executive Summary
  • Chapter III: The Business Proponents
    • Chief Executive Officer
    • Marketing Director
    • Production Directors
    • Finance Department
    • Human Resource
  • Chapter IV: The Target Customers and the Main Value Proposition
    • Market Segments
    • Customer Profile
    • Value Proposition
  • Chapter V: Market Demand and Supply, Industry Dynamics, and Macro Environmental Factors
    • Market Demand
    • Industry Dynamics
    • Macro Environmental Factors
  • Chapter VI: The Product and Service Offerings
    • Purpose of the Product
    • Product's Unique Features
  • Chapter VII: The Enterprise Strategy and Enterprise Delivery Systems
    • Business Competitiveness
    • Enterprise Strategy (ES)
    • Marketing Mix
  • Chapter VIII: Financial Forecast and Expected Returns
    • Financial Forecasting
    • Financial Statements
    • Elements of the Income Statement
      • Revenues or Income
      • Expenses
      • Sales
      • Cost of Good Sold or Cost of Sales
      • Operating Expenses