Entrepreneurship Reviewer PDF

**ENTREPRENEURSHIP REVIEWER** **UNDERSTANDING THE CONCEPT OF ENTREPRENEURSHIP** **ENTREPRENEUR** - From the French word **entreprendre** which means to **"to undertake".** - It connotes a business paradigm which signifies the start of a new business undertaking. - A person who org...

**ENTREPRENEURSHIP REVIEWER** **UNDERSTANDING THE CONCEPT OF ENTREPRENEURSHIP** **ENTREPRENEUR** - From the French word **entreprendre** which means to **"to undertake".** - It connotes a business paradigm which signifies the start of a new business undertaking. - A person who organizes, operates and assumes the risk of business ventures - A person who strongly advocates and correctly practices the concepts and principles of entrepreneurship in operating and managing the self-owned business enterprise. **ENTREPRENEURSHIP** Is an art of observing correct practices in managing and operating a self-owned, wealth-creating business enterprise by providing goods and services that are valuable to the customers **THE RELEVANCE OF ENTREPRENEURSHIP TO SHS STUDENTS** **Importance of Entrepreneurship** - Entrepreneurship generates new wealth in an economy. - Entrepreneurship decreases poverty. - It creates opportunities, ensures social justice, instills confidence and stimulates the economy. - Entrepreneurship improves productivity. - Entrepreneurs create jobs. - Entrepreneurs innovate. - Entrepreneurs create innovation and social change. **Relevance of Entrepreneurship to SHS Students** - To prepare students for livelihood even before college. - Entrepreneurship education aids students from all socioeconomic backgrounds to think outside the box and nurture unconventional talents and skills. - Entrepreneurship develops their initiative and helps them to be more creative and self-confident in whatever they undertake and to act in a socially responsible way. - It exposes students to numerous opportunities to learn how to think critically and analyze the pieces on the board. - Being aware of all the important factors and seeing how they affect each other is the foundation of a smart decision-making process. - Students have to be exposed to real-world examples and learn from their own experience. - Entrepreneurship education requires students to be innovative, creative and collaborative with others. - Entrepreneurship education provides budding entrepreneurs with the skills and knowledge to come up with business ideas and develop their own ventures. **Business man Vs. Entrepreneur** **THE KEY CONCEPTS OF COMMON COMPETENCIES** **FACTORS AFFECTING ENTREPRENEURSHIP** 1. **Personality Factors** 2. **Environmental Factors** **-Personality Factors** Personal factors, are an entrepreneur core competencies which include: - Initiative - Proactive - Persistent - Problem-solver - Persuasion - Self-confidence - Self-critical - Planner - Risk-taker **[Initiative]** -- does things before being asked, the action of taking the first step or move.**[Proactive]** -- identifies and utilizes opportunities, entrepreneurs are in habit of identifying present and future needs of people and institutions in the community **[Persistent]** -- perseverance works against all odds to overcome obstacles and is never complacent with success, they keep on trying various alternatives to improve their services to the people.**[Problem-solver]** -- they anticipate and solve problems creatively. This calls for being a wise decision-makers. **[Persuasion]** --convinces customers and financiers to patronize his business **Self-confidence** -- makes decisions and sticks to his decisions **[Self-critical]** -- learns from his mistakes and from experiences of others **[Planner]** -- collects information, prepares a plan, and monitors performance **[Risk-taker]** -- is willing to take calculated risks, they take the chance of investing. **II. Environmental Factors** These factors relate to the conditions in which an entrepreneur has to work. - Political climate - Legal system - Economic and social condition - Market situations **[Political Climate]** - Political stability in a country is absolutely essential for smooth economic activity. **[Legal System]** - Unfair trade practices - Elements and bodies that are directly involved in the legislation and interpretation of laws and ordinances directly affecting the business. - Economic forces are factors which are primarily caused by changes or movements in the Philippine economy that have direct or indirect effects on the entrepreneurial venture. - Social forces are elements in society resulting from human interactions that can influence the thoughts, behavior, attitude, actions, and even the belief and customs of the people. **[Market Situations]** - Target market / competition **FUNCTIONS OF AN ENTREPRENEUR** - Innovation - Assumption of Risk - Research - Development of management skills - Overcoming resistance of change - Catalyst of Economic development 1. **[Innovation ]** - "An entrepreneur is basically an innovator who tries to develop new technology, products and markets.\*\* - Innovation may involve doing new things or doing existing things differently. - An entrepreneur uses his creative faculties to do new things and exploits opportunities in the market. 2. **[Assumption of Risk ]** - "An entrepreneur, by definition, is a risk taker and not a risk shirker. He/she is always prepared for assuming losses that may arise on account of new ideas and projects undertaken by him/her." 3. **[Research ]** - "Research data refers to the kind of necessary information to be gathered in answering the objective of the research work."\*\*\* 4. **[Development of management skills]** - "the work of an entrepreneur involves the use of managerial skills which he develops while planning, organizing, staffing, directing, controlling and coordinating the activities of business." - Establishing equilibrium between his/her organization and its environment. - When the size of business grows considerably, an entrepreneur can employ professional managers for the effective management of business operations. 5. **[Overcoming resistance to change]** - "An entrepreneur do not tries new ideas at his level"? 6. **[Catalyst of economic development]** - "An entrepreneur plays an important role in accelerating the pace of economic development of a country by discovering new uses of available resources and maximizing their utilization." **Types of Entrepreneurs** 1. Innovative entrepreneurs 2. Imitating entrepreneurs 3. Fabian entrepreneurs 4. Drone entrepreneurs 5. Social entrepreneurs **[Innovative entrepreneurs -]** These entrepreneurs have the ability to think newer, better and more economical ideas of business organization and management. They are the business leaders and contributors to the economic development of a country. **[Imitating entrepreneurs] -** These entrepreneurs are people who follows the path shown by innovative entrepreneurs. They imitate innovative entrepreneurs because the environment in which they operate is such that it does not permit them to have creative and innovative ideas on their own. **[Fabian entrepreneurs]** - These type of entrepreneurs are skeptical about the changes to be made in the organization. They do not initiate any inventions but follow only after they are satisfied with its success rate. **[Drone entrepreneurs]** -- Drone is " a person who lives on the labor of others".Drone entrepreneurs are those individuals who are satisfied with existing mode and speed of business activity and show no inclination in gaining market leadership. They are die-hard conservatives even ready to suffer the loss of business. **[Social Entrepreneurs]**- Drive social innovation and transformation in various fields including education, health, human rights, workers right, environment and enterprise development. They undertake poverty alleviation objectives and dare to overcome traditional business practices and innovate with the zeal of an entrepreneur. **DEVELOPING A BUSINESS PLAN** **Factor to Consider of a New Entrepreneur** **1. Know your product or service** **2. Analyze the Market Potentials** - The wider the market potential, the more chances of growth and success. **3. Determine the Marketing strategy** - A unique product or service needs effective distribution strategy to get customer into the basket of demand potential. **4. Know the competitors** - In launching a product with existing competitors, you must know their strengths and weaknesses. **Environmental Scanning** **1.Business Location for small entrepreneurs** a\. Rent and space b\. Terms of Lease Agreement c\. Types of goods or merchandise d\. Income level of prospective customer e\. Municipal or city ordinances including taxes and fees f\. Location of the areas **2. Location for small industrial plant or manufacturing facilities** a\. Land area b\. Facilities for expansion c\. Power and utilities e\. Plant site accessibility **BUSINESS PLAN** ╸ Defined as detailed and integrated written document that describes the various activities involved in opening and operating a new entrepreneurial venture. ╸ It is a formal statement of a set of business goals. ╸ The roadmap of the new business and of the entrepreneur. **Focus of a Business Plan:** **Externally focused** plans target goals that are important to external stakeholders, particularly financial stakeholders. They typically have detailed information about the organization or team attempting to reach the goals. **Internally focused** business plan target intermediate goals required to reach the external goals. They may cover the development of a new product, a new service, a new IT system, a restructuring of finance, or the refurbishing of a factory. ***What is a Feasibility Study?*** Is a major **information source** in making **critical decision** whether to go or not to go into the business. Which serves as the **forerunner** of the business plan. ***Comparison between a Feasibility Study and a Business Plan***  ***Types of Business Plan**\ * ***Why make a Business Plan?*** ❑ Guide throughout the business process ❑ Convince prospective investors ❑ Convey capabilities and competencies of owners/managers ❑ For navigational purposes (entrepreneur) ❑ Financing purposes (investors/financiers) ❑ Mechanics purposes (managers and staff) ❑ The business plan is valuable to the entrepreneur, potential investors, or even new personnel, who are trying to familiarize themselves with the venture, its goal, and objectives. ❑ It provides guidance to the entrepreneur in organizing his/her planning activities. ❑ It serves as an important tool in helping to obtain financing. ***Who should write the plan?*** ❑ The business plan should be prepared by the entrepreneur. ❑ The entrepreneur may consult with many other sources in its preparation, such as lawyer, accountants, marketing consultants, and engineers. ***Who reads the plan?*** ❑ The business plan may be read by employees, investors, bankers, venture capitalists, suppliers, customers, advisors and consultants. ***The Comparative Business Plan Format***  ***A Simplified Business Plan*** 1\) **Introduction** - In paragraph form stating salient details about the business 2\) **Executive Summary** - Name of Business, Proponent(s), (owners ), Location, Capital Return on Investment, ( Vision, Mission, Goals, Objective) 3\) **Marketing Plan** -- Describes the user benefits of the product or service and the type of market that exists 4\) **Operational Plan** -- Describes the firm's organizational structure and the backgrounds and qualifications of key personnel. \- The process flow of operation \- The procedure of production ( 4Ms) 5\) **Financial Plan** -- Projects the company's financial position based on well-substantiated assumptions and explains how the figures have been determined 6\) **Appendix** A white background with blue text Description automatically generated*\ * **THE MAJOR PARTS OF THE BUSINESS PLAN** **1. INTRODUCTION** ╸ Presents the general perspective of the business. **It includes the following sections:** **1. Proposed name of the business** - Reflect business identity and image - Promote the philosophical values and culture that the business values the most - Profess the brand identity of the product, and - Attract or influence the target consumers **2. Address of the business** - It must state the correct business address. - Necessary to have an email address to facilitate electronic communication. **3. Name of the owner or owners -** The name of the owner must be properly stated. **4. Description of the business** - A brief description of the business must include information about the type of product or service that the business intends to produce or provide. - It may include a brief information about the ultimate mission, vision, and objectives of the business. **5. Location of the business -** The basic entrepreneurial consideration is to place the proposed business in a strategic location that will assure competitive advantage. **6. Funding requirement and source** - This section also presents the source or sources of funds. The initial cost of the investment may be provided solely by the owner or owners or partly by the owner and creditors. - The estimated period to settle the funding source provided by creditors must also be mentioned. **2.EXECUTIVE SUMMARY** ╸ It point out the overall highlights of the business plan as well as a bird's-eye view of its sections. ╸ It must be written in simple language that can be easily understood and at the same time attract the attention and influence the decision of the reader **1. vision, mission, goals and objectives** ╸ The business plan must depict the fundamental characteristics, nature, philosophical values, identity, and image of the business. **Vision** -- ability to see something that you dreamed **Mission** -- A task that you need to do **Goal** -- something to achieve **Objective** -- Based on facts rather than opinion **2. Business model** Defines the perspective of the business in terms of its structure, production, operation and financial activities that will lead to the achievement of the VGMO. **3. Business and product position** The business and product position will help determine how the business defines its course and the process of accumulating wealth. It tells the sizeof the market and target market share of the business and product. **4. Wealth improvement approaches** This section of the executive summary describes the methodologies or approaches that will be taken by the business in order to: 1\. Maintain a competitive advantage 2\. Position the business in the market 3\. Improve the market share, and 4\. Maximize the utilization of resources. **5. Parties supporting the business** The last section of the executive summary is a description of the parties that strongly support the business. The parties that have a direct relationship with the business are as follows : 1\. Consumers 2\. Creditors 3\. Suppliers 4\. Employees and staff[] **3. MARKETING PLAN** Details how the proposed business will sell its product to the target consumers.It may consist of some or all of the following important sections: the 7P's 1\. Product 2\. Place 3\. Price 4\. Promotion 5\. People 6\. Packaging 7\. positioning **4. OPERATIONAL PLAN** Is a major section of the business plan that outlines the various activities, from the acquisition of raw materials to the delivery of the products to the target consumers. **1. Organizational Structure** ▰ The organization section sets up the hierarchy of the people involved in your business. It's often set up in a chart form. ▰ It includes form of the business organization, liability of the owners, roles and responsibilities, job description, salary requirements **2. Production Plan** ▰ Focuses on ensuring a smooth flow of actual production work activities. ▰ It includes production schedule, production process, equipment required, materials and sources of materials, estimated production cost. **3. Operation Plan** ▰ The operation plan commonly covers the following areas: 1\. Evaluation of suppliers 2\. Purchase procedures 3\. Storage and Inventory control 4\. Sales Procedures **5. FINANCIAL PLAN** ▰The last major section of the business plan. ▰ It accumulates and describes all the data expressed in monetary units from the other sections of the business plan. ▰ Simply collates and describes the various sets of information derived from other sections of the business plan. ▰ It is composed of the following important areas: 1\. Start up cost 2\. Expenses 3\. Manufacturing cost 4\. Selling price 5\. Projected financial statement 6\. Projected schedule of division of profit or loss **6. Appendix** ▰ Supplementary materials and attachments to expand the readers understanding of the business plan **TECHNIQUES ON SEEKING, SCREENING, AND SEIZING OPPORTUNITIES** **Philippine Economic Landscape in the Present Time** ▪ The Philippine Economic landscape remains to be the spring board of questions when economic development is the focus of discussion. **Two important factors hinder our growth as a nation:** 1\. Poverty is the making of its people and the kind of leaders that hold the wheels of economic fortune. 2\. Population explosion is another factor that contributes to the poverty of our nation. **Factors in Determining Economic Growth** 1\. The Filipino Values and culture 2\. Availability of Needed Capital **1. The Filipino Values and Culture** **a. Love for Imported Products** The country's colonization for centuries has developed in the Filipinos a culture of dependence and love for foreign products. **b. Our Values of BAHALA NA.** BAHALA NA is the concept of belief in BATHALA, the Gods of the lazy bones and undetermined individuals. **c. Our Crab Mentality** Is the action of people to pull down others who are about to get out of the verge of poverty and reach for their success. **d. The MAÑANA HABIT** MAMAYA NA or BUKAS NA is a culture that is brought to us by the colonizers who were fond of SIESTA after lunch time. **e. The Value of Time** We are always late in the start of the program, coming to our classes, attending to office work and even in important meetings and appointment. **f. Our Values of HIYA** Our political and social systems have not developed the value of HIYA, as graft and corruption still exist because of our love for material things, money, and power. **g. Fiesta and Social Occasions** Savings spent in a day of the fiesta, entertaining guest, only to find out the next day that there is no more rice to feed their children. - Proper education could help us develop our values towards work and proper dealings with other people. - Graft and corruption should be taken out of the political and social system in the management of our people. - It must start from us if we want this nation to develop economically **2. Availability of Needed Capital** **A. Republic Act 6977**, known as the **MagnaCarta for Small Enterprises** provided the necessary funds for the development of entrepreneurs in the countryside. **B. Republic Act No. 6810** is the establishing the **Magna Carta for Countryside and barangay business enterprises**, granting exemptions from any and all government rules and regulations and other incentives and benefits and for other purposes. **ENTREPRENEUR AND SOCIO-ECONOMIC DEVELOPMENT** **The following are the contributions of the Entrepreneur in our Socio-economic Development** **Economic Development:** 1\. The Entrepreneur provides Employment 2\. The Entrepreneur Pays Taxes 3\. The Entrepreneur Improves the Capital Base of the Economy 4\. The Entrepreneur Profits 5\. The Entrepreneur Creates People Empowerment and Social Mobility 6\. The Entrepreneur provides Healthy Competition **The following are the contributions of the Entrepreneur in our Socio-Economic Development:** 1. **The Entrepreneur Provides Employment -** Employment generates income and those employed pay taxes to the government which in turn gives benefits to the social and educational needs of the greater population. Those with income through employment become less burdensome to the government. 2. **The Entrepreneur Pays Taxes -**Entrepreneurs pays taxes in the form of real estate tax, sales tax, import and export tax, and permits from the local and national government. 3. **The Entrepreneur Improves the Capital Base of the Economy -** Entrepreneurs mobilizes the economic activity as the circulation of money which pumps up the economic development of the community. 4. **The Entrepreneur Profits -** Profit, in return, is growth in investment base that will propel more business activities. Entrepreneurs do not keep their money in the piggy banks or make this idle deposit in banks. The greater money in circulation the greater is the economic activity of the nation. 5. **The Entrepreneur Creates People Empowerment and Social Mobility -** Entrepreneurs accumulate financial resources that give them social power in the community. They can afford to buy some personal luxuries of life. They acquire new life style of travel and pleasure. They make new houses and invest in real properties that make them respected in the community. 6. **The Entrepreneur Provides Healthy Competition -** Healthy competition provides people with choices of new products or better services. Entrepreneurs seek better products and develops new ones that will satisfy their target customers. **PRODUCT : ITS NATURE AND SUSTAINABILITY** **PRODUCT** Refers to the tangible good or intangible service offered by the business to the target consumers. The products must satisfy the needs of the consumers better than the other competing products.\*\*\* **LEVELS OF PRODUCT** **1.Tangible products** - Are the basic physical appearance which can be a service or idea having precise specifications and is offered under a given/specified description or model number **2.Augmented product** - Includes the image and service features of a certain entity. It gives emphasis on the intangible benefits that the customer will be getting from buying the product. **3.Generic product** - Emphasizes the impact of the product to the consumer, not the seller. This will signify the purpose of its existence and the primary objective in creating the product. **TYPES OF PRODUCT** **1.Goods** - Are sale of the physical products from the manufacturer to the consumer or final and ultimate user. **a. Durable goods** are the physical products that are used over a long period of time.\*\* **b. Non-durable goods** are the physical products that are quickly and easily be consumed or worn out, become obsolete, unfashionable or no longer popular.\*\* **2.Services -** Are intangible products that satisfaction can be measured in future preferences. **a. Rented-goods services** are the consumer rented facility of the sellers in a certain period of time. **b. Owned-goods services** are the repair and maintenance services rendered by the seller to the products of the customer. **c. Non-goods service** is personal service on the part of the seller; most common are the expertise and profession of the seller. **CONSUMER PRODUCTS** These are goods and services destined/produced for the final consumer for personal, family, or household use. The use of the goods or services designates it as a consumer product. *Examples: products normally and routinely used by consumers* **Convenience products** are purchased with the minimum or less effort because the buyer has knowledge of product characteristics prior in shopping.\*\* **1. Staples --** are low priced items that are routinely purchased on a regular basis and are products that are used everyday. Examples : rice, soap, toothpaste **2. Impulse --** products are the items that the consumer does not plan to buy. **Shopping products** are products that the consumers acquire through further knowledge and information in order to make final purchase decision.\*\* **1. Attribute**-based shopping products provide customers with information and evaluated product features, performance, options, warranties and other factors. **2. Price-**based shopping products enables customers to judge product attributes to be the same and look around for the least expensive item. **Specialty products** are the items with particular brands and stores to which consumers are loyal. **INDUSTRIAL PRODUCTS** are goods or services purchased for use/consumption in the production/manufacturing of other goods or services, in the operation of a business or for resale to other customers. Are used as raw materials of other manufacturing entities. **STAGES OF THE PRODUCT IN THE MARKET** **1.Introductory stage -** A new product is introduced into the marketplace and the objective is to generate customer interest. **2.Growth stage -**The product gains wider consumer acceptance and the objective are to expand distribution and the range of available product alternatives. **3.Maturity stage -** The products sales level and companies try to maintain lower price, better product features for as long as possible. **4.Decline stage -** The products sales falls as substitutes, and new competitors enter the market. **PRODUCT SATISFYING FEATURES** **1.Design -** It matters to the elements that collectively form of good or service that will satisfy customers and gain competitive advantage. **2.Product Colors -** It is customers rejection or acceptance of the product. This could be true in clothing, cars or furniture and other fixtures. **3.Product Quality -** This is set of features and attributes of a product or service that determine its ability to satisfy human needs **4.Product Warrantees-** It is the state where the buyer is assured that the product meets the specifications stated in the product labels. 12 HUMSS-2