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123456789101112131456 Chapter 1 (The concept of

Entrepreneurship)

Lesson 1 (Understanding Entrepreneurship)

Barter - entrepreneurship takes its roots from

rading in prehistoric times

Arabs(first barters in the Philippines)

Chinese (2nd)

Entrepreneur each individual who change

omething for value

When the barter could no longer satisfy the

rading parties, that is, when the transaction

ailed to meet the needs and wants, a unit of

monetary exchange was employed.

Mock cowrie shells(1000 BC) in China

Pieces of silver(500 BC) in Turkey

Leather money(118 BC) in China

First actual paper currency(9th Century)

in China

Development of money- contributed to the

promotion of trade

Entrepreneurship

It s a creative initiative of setting up

business to meet the needs of consumers

in the hope of getting profit from it.

is a venture a lot of people have

capitalized on and not without a reason

is synonymous to self-employment,

being your own boss, and writing your own

paycheck

Advantages of Entrepreneurship

1. Independence- entrepreneurship offers

young entrepreneurs to assume a

managerial role in their own venture,

hence they become their own boss.

2. Flexibility entrepreneurship offers

young entrepreneurs the chance to work

on their own pace and space.

3. Challenge the opportunities to grow

diversify are endless.

4. Direct payoffs entrepreneurship ben

directly from whatever profit the busin

yields.

5. Unlimited earnings income is deri

in full and no one can expect even more

Disadvantages of Entrepreneurship

1. No regular monthly salary - absenc

a regular paycheck

2. Unpredictable schedule work ho

run at no fixed

3. Risky- one may hit it big, break evenlose. If a blunder is committed, the en

investment may be lost

Business Ideas

1. Capitalizing on ones skills - a ho

can actually translate into a profita

business enterprise

2. Filling a vacuum even if there

existing outlets of these sought-agoods and services, a little competi

wont hurt.

3. Thinking a franchise franchise

reproduction of an existing business do

to the last detail

4. Starting a something new it is ju

matter of putting ones innate creativit

motion.

Lesson 2 (Entrepreneurship and the Economy

*There is no one-size-fits-all approach whe

comes to putting up a business.

Small-scale and Medium-scale Enterprise

Size of an enterprise is defined by the as

base and number of workers of a business.

Microenterprise a subcategory of

small business enterprise


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o less than P3,000,000 as capital

o 1 to 9 workers

Small-scale industries P3,000,001 to

P15,000,000 as capital

o 10 to 99 employees

Medium-scale industries P15,000,001

to P60,000,000 as capital

o 100 to 199 employees.

Small- and medium-scale industries

Are considered the main driving force in

economic development.

The support new concepts and

technologies, cultivate business

leadership, and enhance access to export

markets.

Economic Boost

1. 1.Entrepreneurship increases the

countrys per capita income Two of

the components of gross national income

are consumption (demand) and

investment (supply). By the increase of

this two the income will get higher.

2. Entrepreneurship creates jobs -

Entrepreneurship creates employment

opportunities for the employed and

underemployed that is welcome

development on new graduates and

victims of company closures.

3. Entrepreneurship meets consumer

demands By producing products and

services in their required volume andquantity

4. Entrepreneurship provides social

service Entrepreneurship provides

revenues to the government by way of

taxes and fees entrepreneurs pay.

5. Entrepreneurship links industries

Where exchange knowledge and

technology to come up with more quality

goods and more efficient services.

6. Entrepreneurship creates new mar

The creativity one puts his busin

helps create new products in the proces

Economic Concepts

1.Laissez-faire economy

Laissez-faire which literary means

leave us alone, is an economic syst

in which the individual and firms do get any direction or regulation from

government in terms of a production.

It is the behavior of the market

institution through which buyers

sellers interact and engage in exchan

that helps us answer the econo

systems three basic questions(1.W

will be produced? 2. How will it

produced? 3. Who will get what

produced?)

2.Keynesian economics

British economistJohn Maynard Key

believed that governments could interv

the economy and affect the level of out

and employment.

3.Theory of comparative advantage

British economist David Ricardo said t

countries will benefit more with specializa

and trade even if one country has abso

advantage over another country in

production of several goods.

4.Consumption and production

Two basic decision-making units of economy

1.Households(consumers)- demand go

and services that firms produced

2.Firms(business enterprise) need l

labor and capital to produce those goods

services.

Nations level of production is a

determinant of its national income.


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Chapter II (Entrepreneurial Requirements)

Lesson 1(Applying Entrepreneurial

Requirements)

An aspiring entrepreneurs starts by listing the

points to consider in deciding the type of

business to run.

Workbook technique a workable agenda in

unning a business is what any start-upentrepreneur need

Business Checklist

1. Personal expertise- An assessment of

ones skills and strength is important

2. Research a person must know

everything about the particular business

he or she wants to pursue.

3. Business networking learn from the

survival strategies of entrepreneurs who

have been in various business situations

4. Customer satisfaction keep the

customers constantly in mind. Know the

economic level and geographical location

of the target consumers.

5. Capital or Financing a business would

only go as far as the entrepreneurs

money would go.

6. Location Choose a site where the

demographic and lifestyle profiles of

the people are suited to the product or

service to be offered.

7. Competition analyze the competition

and consider the obvious: Customers

would go for the better alternative,

particularly when it comes to product or

services rates and quality.

Managerial Concerns

1.Effective product or service delivery

To boost product sales, an entrepreneur

has to develop a successful

entrepreneurial atmosphere of having an

effective product as well as effic

service.

The effectivity of a product depends

source, while he efficiency of ser

depends on employee motivation a

training.

2.Risk management

Remember that great efficiency managing a business would depend

how well an entrepreneur deals with ri

or failure.

Risks are there to help one persevere

reach his or her goals. There

marketing risks, financial ris

expansion risks, and other danger zo

to conquer.

Lesson 2(Business Layout and Location)

Layout- refers to the design o plan for the sh

its structural arrangement.

Location refers to the site or place where

shop is built.

The things to consider good store layout

Suitability to the type of merchandise

Volume of required furniture equipment

The number of employees

Business Layout

1. Closed layout(for controlled items

medicines are being sold)- the layou

the store should be done in such a w

that only service crew are allowed to

the merchandise from the shelves

2. Parallel shelves layout(for superma

layout) It is a different case altoget

when over the counter health product

supplements are sold. It requires f

service personnel since this is a

service store.

U-shaped layout (for specialty store such a

flower shop)- This will allow the customer to


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clearly sea the items they wish to buy. It does

not require many salespersons.

3. U-shaped and parallel shelves layout-

for a store that is a combination of self-

service and counter-service outlet like

convenience stores or drugstores

A suitable business location would take

nto:

Consideration accessibility of

transportation to consumers

Adequate parking space

Neighborhood safety

Customer base

Adequate store space

And suitability for expansion, cost,competition

Lesson 3(Creativity in Business)

Creative entrepreneur

To a creative entrepreneur, it is just too

impossible to resist opportunities to offer

people something new.

They can easily spot business

opportunities

They can actually work on every

opportunity that comes along without

following the well-trodden paths.

Creativity

is important in business.

It can expand a business idea making it

more vibrant and adaptable to change

TapSi TurBi- tapa, sinangag, turon and

bibinka

Maruya Carey- a fast-food joint that sells

turon and maruya

Your business name - could be the

single biggest factor that could make or

break your business.

Creative visual merchandising

You must have heard that first impress

are lasting

The logo and merchandise display

the business should communicate on

message and get the word out.

*A creative name and creative vis

merchandising could prove to be a cro

drawer.

*Entrepreneurs can either introduce someth

new or improve(make an innovat

something that already exists.

Chapter III(Entrepreneurial Competencie

*Venturing into business is like joining

competition. The main goal is to win.

Lesson 1 (The effective entrepreneur)

Traits of an Effective Entrepreneur

1. Risk-taking (thrill seeking)

-When there is uncertainty, there is ri

Paranoia stops entrepreneurs f

doing something, but there may also

instances when they cannot stop but cr

dark alleys.

Dark alleys consist of uncertain

brought about by the changing busin

environment(competition, econo

situation, political stability, etc.)

2. Leadership (headship)

- involves influencing others toward

achievement of goals.

3. Hard work (difficult task)

- entrepreneurs do not count the minu

or dread the hours they spend runn

their enterprise

4. Persistence (determination)

entrepreneurs do not just give up or g

in even under the most try

circumstances.


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5. Commitment (dedication and

devotion)

entrepreneurs make a strong resolve to

follow through with whatever it is they

have started.

6. Confidence (self reliance)

It is the can do attitude that

transcends boundaries in whatever centrepreneurs do.

7. Adaptability (flexibility and

compliance)

The business environment keeps on

changing.

8. Organization (company

establishment)

This refers not only to organizing things

but to organizing people.

9. Creativity (originality)

the creative and intuitive thinking

processes of entrepreneurs say a lot in the

way they run the affairs of their business.

Lesson 2 (Problem Solving)

An entrepreneur needs to have foresight if heor she wants to stay in the field, that is, before

matters come to a head , it is best to know what

o expect.

Common Problems of Entrepreneurs

1. Financial problems- costs sometimes

exceed revenues

Collateral- use to avail loans on banks

2. Organizational problems If personnel

would rather squabble than agree with

each other, then tension is likely to set in.

Grievances or dispute- rivalry of

employees

3. Production problems when the needed

materials become scarce and the workers

lack the necessary skills or there is

inefficiency in production, difficulties in

business begin to surface.

Brain drain or skill drain the wa

are insufficient

4. Marketing problems If an entrepren

does not bother as much with

marketplace as with the wares he or s

peddling, then he or she has a problem

5. Competition Rivals will always

around

6. Customer satisfaction- entreprene

will not have much luck with custome

they are clueless about their tas

preferences and buying habits.

Creative Solutions

By maintaining a network of contato give them sound of advice

Thinking of an incentive program t

would make their staff their partners in

growth of their business

Employing alternative come-ons

customers , among other thing.

Entrepreneurs scientific method to so

problems

1. Identifying a problem- be

attempting to find temporary or las

solutions to a problem, entreprene

must clearly identify the problem a

its nature

2. Formulating an educated guess

hypothesis entrepreneurs sho

hypothesize on the root cause of

problem and the possible solutions

3. Testing the hypothesis entreprene

should conduct a experiment to be a

to obtain data that validate the guess

4. Checking and interpreting the resu

of the study entrepreneurs sho

consider the nature of the problem

Drawing a conclusion the conclusion shou

include concrete steps to be taken to solv

proble


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Chapter IV (Core management Concepts)

Lesson 1 (Management in an Entrepreneurial

Activity)

Management

In all business and organizational activities

is the act of getting the people together to

accomplish desired goals and objectives

using available resources efficiently andeffectively.

Acc to our book it is ensuring that all tasks

are accomplished efficiently (doing

things right) and effectively (doing the

right things) to attain the goals of the

organization.

The verb manage comes from the Italian

maneggiare ( to handle- especially tools),

which in turn derives from the Latinmanus (hand). The French word

mesnagement (later menagement)

influenced the development in the

meaning of the English word

management in the 17th and 18th

centuries.

Basic Functions of management

1. Planning deciding what needs to

happen in the future and generating plansfor action.

2. Organizing (implementation) making

optimum use of resources requires to

enable successful carrying out of plants

3. Staffing job analyzing, recruitment, and

hiring individuals for appropriate jobs.

4. Leading/Directing Determining what

needs to be done in a situation and gettingpeople to do it.

5. Controlling/Monitoring checking

progress against plans

6. Motivation without this, employees

cannot work effectively.

Basic roles of management

1. Interpersonal roles that inv

coordination and interaction w

employees.

2. Informational roles that involv

handling, sharing, and analyz

information.

3. Decisional roles that require decis

making.

Management Skills

1. Technical used for special

knowledge required in work

Political used to build a power base and

established connections

2. Conceptual used to analyze comp

situations

3. Interpersonal used to communic

motivate, mentor and delegate.

4. Diagnostic ability to visualize m

appropriate response to a situation

Formation of the business policy

1. Mission of the business is the m

obvious purpose, which may be, exam

to make soap.

2. Vision of business reflects

aspiration and specifies its inten

direction or future destination.

3. Objectives of the business refer

the ends or activity at which a certain t

is aimed

4. Businesss policy is a guide t

stipulates rules, regulations

objectives, and may be used in managers decision-making. It must

flexible and easily interpreted by

employees.

5. Business strategy refers to

coordinated plan of action that is going

take, as well as the resources that it

use, to realize its vision and long t

objectives.

Levels of management


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1. Top-level managers- consist of Board of

Directors, President, Vice President, Chief

Executive Officers.

These individuals are mainly responsible

for controlling and overseeing all

departments in the organization.

They play a significant role in the

mobilization of outside resources

2. Middle-level managers- consist of

General Managers, Branch Managers,

Department Managers.

These individuals are mainly responsible to

the top management for the functioning of

their department.

They devote more time to organizational

and directional functions.

3. First-level managers- consist of

Supervisors, Section Officers, Foreman

These individuals focus more on the

controlling and direction of management

functions

They are the managers that are the

image builders of the company

considering they are only the ones who

have a direct contact with employees.

Management skills

1. Technical skills refer to ones expertise

in a given field

2. Human skills refer to ones ability to

work well with other people.

3. Conceptual Skills refer to ones abilitythink, which includes ones ability to plan

and identify opportunities and to think of

solutions whether a problem comes up.

Management Theories

1. Scientific management Frederick w.

Taylor (father of scientific management)

Output will be increased, while input will

be decreased

Scientific management uses time-a

motion studies to identify this one b

way.

2. General administrative approach

Henri Fayol developed 14 principle

basic management concepts which incl

division of work, authority, discipline, u

of command, among others.

Max Weber introduced concept

bureaucracy an organization wh

there is division of labor, a clearly defi

hierarchy, detailed rules and regulati

and impersonal relationships.

3. Quantitative approach (operat

research or management science)-

approach uses quantitative techniq

such as statistics, linear programming,

management decision models that wo

aid managers in decision making.

4. Organizational behavior the m

important contribution to the developm

of organizational behavior came f

Hawtorne studies, a series of stud

conducted at the Western Elec

Company Works in Cicero, Illinios.

3 Theories of Motivation

1. Maslows theory of motivation

Abraham Maslow said that there

five levels of needs:

physiological needs(need for food, d

and other physical requirements)

Safety needs (need for security,

protection from harm, whether physica

emotional)

social needs (need for affection, belongingne

acceptance, friendship)

esteem needs (need for self-resp

autonomy, achievement, sta

recognition and attention)

Self-actualization needs (need

become what one is capable of becomin


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2. McGregors Theory X and Y Douglas

McGregor has two assumptions about

human nature:

Theory X (that an average person hates

work, wants no responsibility, resists

change, and needs close supervision at

work)

Theory Y (that an average person enjoys

work, seeks responsibility, and exercises

self-direction at work). McGregor

believed that theory Y best captures the

true nature of workers and should guide

management practice

3. Herzbergs motivation-hygiene theory

Frederick Herzberg said that:

Intrinsic factors (called motivators

such as achievement, recognition, work

itself, responsibility advancement, growth)

are related to job satisfaction.

Extrinsic factors ( called hygiene

factors such as supervision, company

policy, relationship with supervisor,

working conditions, salary, relationship

with peers, relationship with subordinates,

status, security) are associated with job

dissatisfaction.

Lesson 2 (Business Ownership)

Small Business- independently owned and

managed business that doesnt dominate its

market

Small business plays a critical role in the

economy:

1. Job creation

2. Innovation

3. Importance to big businesses

Single Proprietorship is the simplest form of

organization.

It is a business structure owned by an

individual who has full control or

ownership over the business and owns all

the assets, personally owes and answers

all liabilities or suffers all losses, but

enjoys all the profits.

Advantages of sole proprietorship

Ease and cost of formation

Secrecy

Distributions and use of profits

Government regulations

-taxation -closing the business

Disadvantages of sole proprietorship

Owner lacks liability and experience

Difficulty in attracting good employees

Difficulty in raising capital

Limited life of firm

Unlimited liability

Partnership a legal association of two or m

persons a co-owners of an unincorpora

business

According to book, it has a le

personality separate and distinct from t

of each partners.

Advantages of Partnership:

Ease of formation

Pooling of knowledge and skills

More funds available

Ability to attract and retain employees

Tax advantage

Disadvantages of Partnership:

Limited life

Potential conflict between partners

Difficulty in dissolving the business

Unlimited Liability

Types of Partnerships:

1. General partnership an associatio

two or more person, each with unlim

liability, who are actively involved in

business.


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2. Limited partnership an arrangement in

which the liability of one or more partners

is limited to the amount of assets they

invested in the business.

Corporation - A legally chartered enterprise

with most of the legal rights of a person,

ncluding the right to conduct a business, to own

and sell property, to borrow money, and to sue or

be sued.

According to book, it is a business entity

that acquires a legal personality separate

and distinct from its owners

Has a name, and has a maximum of 50

years (renewable to another 50 years)

At the time of its creation, a corporation must

have a minimum offive and a maximum of15

owners (incorporators). Other people may also

become owners(stockholders) upon purchase of

the corporations shares of stocks.

Advantages of corporation:

Limited liability

Ease of expansion

Ease of transferring ownership

Relatively long life continuity

Disadvantages of corporation:

More expensive and complicated to

organize SEC

Double taxation

More government restrictions and

reporting requirements

Employees lack personal identification and

commitment

Types of Corporations

1. Closely Held ( Private ) Corporation

2. Publicly Held ( Public ) Corporation

3. Limited Liability Corporation (LLC)

4. Professional Corporation

5. Multinational or Transnatio

Corporation

Stockholders - owners of corporations

Stock- share of ownership in a corporation

- Common Stock -Preferred Stock

Corporate Governance Hierarchy

Stockholders > Board of Directors > Officers

Special Cases in Corporate Ownership

Joint Ventures & Strategic Alliances

Employee Stock Ownership Progra

(ESOPS)

Institutional Ownership

Mergers and Acquisitions

Divestitures and Spin-offs

Entrepreneurship vs. Small Business

Entrepreneur: Accepts the risks

opportunities of creating, operating,

growing a new business.

Small Business: Doesnt have plans

growth

Trends in Small Business Start-ups

Emergence of E-commerce

Crossovers from big businesses

Opportunities for minorities and women

Global opportunities

Increased survival rates

Reasons for Success and Failure

For Failure:

Poor management

Neglect

Weak control systems

Insufficient capital

For Success:


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Hard work drives dedication

Market demand

Strong

Financing the Small Business

Personal resources

Loans

Venture capital companies

Small business investment companies

Small Business Association (SBA) -

Financial aid and management advice

Franchising an ownership opportunity

Advantages of franchising:

Proven business opportunity

Access to management expertise

Disadvantages of franchising:

Start-up costs

On-going payments

Management rules and restrictions

Chapter V (Types of EntrepreneurialActivities)

*An entrepreneur goes into business to earn or

gain profit.

Lesson 1 (Retailing)

Retailing is selling goods directly to

consumers.

Types of Retailing

1. Store-based retailing Store retailing

can take the form of an over-the-counter

service or a self-service store, a big

department store, or a small kiosk offering

a variety of goods. Store retailers

operate on a fixed location which can draw

a lot of walk-in customer.

Supermarket a large self-service store that

carries a wide variety of household, food, and

laundry products. Eg are Rustans Supermarket,

SM Supermarket, and The Landmark

Supermarket

Convenience store a retail store tha

located near a residential area tha

usually open 24 hours a day, 7 day

week. Eg are 7-eleven, ministop and s

select

Department store - a retail store t

carries a wide variety of product lin

usually clothing, shoes, accessories,

home furnishing. Eg are Robinso

Department Store, SM, Rustans

Specialty Store -a retail store t

specializes on a certain product line.

are Kamiseta and Bayo(clothes), Mend

and Celine(shoes), and The B

Shop(skin care)

2. Online retailing In this type of retail

retailers connect to individual consum

through the Internet

3. Nonstore Retailing call it

revolutionary way of retailing, it keeps

with competition by reaching a wider ba

Catalog and Direct-Mail retailing

retail format that allows customers

choose products from catalogs

brochures that are sent them directly

mail.

Direct Selling- is a retail format whe

in the distributor (seller) contacts

customer directly at home or at work

offer products. It is a highly form

retailing where face-to-face discuss

between the buyer and seller take place

Television home shopping is a re

format that uses television as a medium

demonstrate the feature and benefits

product and allows customers to p

their orders through the telephone.

Vending-machine retailing is

nonstore format wherein products such

soft drinks, coffee, and chips are availa

to customers through the vending mach

Types of Retailing by Ownership


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1. Independent, single-store

establishments

2. Corporate retail chains is a company

operating several retail units under a

single ownership management

Decision making is centralized in this

type of retailing.

3. Franchising is a contractual agreementbetween a franchisor (one who grants a

franchise) and a franchisee (one who

buys a franchise) that allows a franchisee

to buy the rights to use the parent

companys name and sell its product or

service in exchange for an up-front

franchise fee (price vary between

industries) and on going royalties, usually

3-6 percent of sales.

Advantages of franchises

1. An established brand

2. Training

3. Volume purchasing power

4. Advertising

5. A proven business model

6. Accounting and budgeting systems

7. Other help in running ones business

Disadvantages of franchises

1. Franchises can be expensive.

2. Franchisors may require the franchisee to

follow their operations manuals to the

letter.

3. Buying a franchise is like marryingsomeone you have not known for very

long.

The average length offranchise contract

is 10.6 years, according to International

Finance Association

4. The relative security offered by franchises

may be exaggerated.

Questions to ask before buying a franchise:

*When one buys a franchise, he or she

putting big money on the line and his or

success does not entirely depend upon him

her.

1. What type of franchise is it?

Packages franchises businesses s

as fast-food, restaurants, muffler shops

hotels that come complete with ev

business model laid out by the par

company. That model covers everyth

from financial controls to hiring guidelin

Product franchises - businesses such

a car dealerships and gas stations t

mainly to distribute the parent compan

goods. Owners of product franchi

have more control over the way they

their businesses.

2. Does business lend itself to

franchise model?

3. How many franchises does

organization have?

4. How much is the franchisee fee?

franchisee fees depend on how

demand a product or service is, or established the parent company is

5. How much will one has to pay

royalties?

Franchisors generally charge royalt

equal to three percent of e

franchises revenues.

6. How much money will ones busin

really make?

7. Can one work with these people?

8. How will be the franchisor help

franchisee?

9. Is the franchisors compa

legitimate?

Department of Trade and Indus

(DTI) and the Philippine Franch


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Association determine the legitimacy of

franchise.

The Retail Advantage

1. Entrepreneurs do not worry about delays

in production or excess inventory.

2. They do not need large capital to start

their business.

All they have to do is to choose the right

products for their target market and exercise

heir selling skills.

Lesson 2 (Manufacturing)

Manufacturing is a business activity wherein

aw materials are transformed into finished

goods mechanically or chemically by means of

high-powered machine or equipment, or simply

by hand.

Manufacturing is synonymous to

production.

What a Manufacturing business requires

1. Define the business.

2. Determine the kind of skills the

business requires.

3. Find out how much space thebusiness needs to occupy and how

suitable it is for future expansion.

The place should complement and adapt

to future development as the business

grows and improves in the competitive

landscape.

4. Consider operational costs.

Loan guarantee is usually required to

prove that the borrowed money can be

paid in case of the business fails.

Personal loan is a more preferable

option, although the interest rates may be

a bit higher.

Types of manufacturing business

Food, beverage, cosmetics, apparel,

pharmaceutical, electronics, household

appliances, paper products, agribusin

and furniture and fixture

Creativity pursuit

Creativity is important in manufacturing

maintain competitiveness, bring do

costs, and build more interact

workforce.

Creativity contributes to improving quality of a product or in bring

something new together.

Choosing the best manufacturing busines

1. Identify a need

Aspiring manufacturer must h

clear thought-out business idea that wo

satisfy the needs and wants of the tar

market.

2. Research about the market

Production Planning

Production Planning involves the acquisi

and allocation of scarce resources needed

production to satisfy demand over a spe

period.

4 stages of production

1. Operation is the initial (main) ste

production, where raw materials unde

transformation in preparation to the n

step.

2. Assembly is the step wherein part

product are put into one whole piece.

3. Finishing is the enhancement of

appearance or value of product such

varnishing, coating, or glazing.

4. Inspection is the run- through st

that checks a product for its acceptab

and merit. This is better known as qua

control.

Consider the following to avoid product

slips:

Source of raw materials for products

The method of production to be employ


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Special skills requires of the workers

Location and layout best suited for

business.

Choosing a location

Location and layout requirements in a

manufacturing business are more stringent

than those in retail and service businesses.

Factors in choosing suitable location in

manufacturing business:

Accessibility to transportation

Adequate water and electric supply

Accessibility to the distribution sitessuch as markets, schools, and the

community

Efficient water disposal system

Size of the property

Suitability of the building to business

activity

Availability of adequate community

institutions like banks, stores,churches, and hospitals

Availability of labor skills that match the

work force needed.

In mapping layout and design of the workplace

or plant, consider effective space utilization

and flow of movement.

Economic Benefits

Manufacturers gain access to global

markets, raise the standard of living,

and generate jobs for their business

and for the sectors where they get

their sales.

Lesson 3 (Services)

Services refers to jobs done for you

Types of Services

1. High- contact services this type

service involves personal visits by

customer to the service establishm

There is a high level of phys

interaction in this kind of service

Eg are haircut, massage, educat

banking services and hotel services

2. Low contact services this type

service involves minimal or no phys

interaction between customer and

service provider

Eg are phone banking,

telecommunication services

Forms of Service Business

1. Lifestyle-related services laundry

dry- cleaning shops, beauty salons, b

fitness center or gym

2. Education services tutorial, compu

training, review, and day-care services

3. Information services - desk

publishing and printing services

4. Professional and business servicerecruitment agencies, remittance serv

centers, security agencies

5. Repair services shoes, bags,

computer repair shops

6. Rental services internet shops,

rental companies

7. Entertainment and recreatio

services party needs shops, amusemcenters

8. Tourism services travel-and-to

agencies, hotels

*Service Business will be measured in term

appeal, quality, and diversity.

Service Boost


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1. Advertisement use a catchy

advertisement at very first opportunity

to introduce the business.

2. Press releases Press releases deliver

the same message in the same way

advertisements do, only they require

words.

3. Newsletters a publication that can be

distributed to customers can provide them

additional information about the service

business such as promotions and other

activities.

4. Flyers and leaflets - Flyers and leaflets

can be handed out to people within the

business area or pinned under windshield

wipers to freely and readily promote ones

business to target market

5. Web site Entrepreneurs can come up

with their own sites on World Wide Web

where they can present their business

profiles and invite customers to comment

or ask questions about their offerings

Service Business it supports a community by

esponding to the consumers needs and

providing jobs to the residents.

Lesson 4 (Business Practices)

Price Tags

Price tag through this, customers can check

he price of an item and compare it with prices of

other brands.

Markup is the profit entrepreneurs make from

ndividual items sold.

Selling price= unit cost/ (1-desired return

on sales)

desired return on sales the percent

divided by 100 or move the decimal place

twice to the left.

Markdown happens when there is a reduction

n price, even to the extent that the cost of a

product is higher than its selling price, bring

negative profit to the entrepreneurs.

Entrepreneurs first order of business

Filling

Tracking

Managing customers

Issuing receipts not only serve

acknowledgements for cash transactions but a

an efficient means to monitor purchases w

exhibiting transparency bin business.

Promotions and packaging

Promoting ones product and servi

means communicating the merits of ones o

to target customers so that they will choose

or her product over rival brands

Attractive come-ons- innovative promot

and packaging

Long term campaigns not one-shot deals

Advertising is a sure-fire formula for

business crisis or even in a no-crisis situation.

One has a variety of options: print, ra

television, outdoor display, or direct-m

advertising.

It is the most efficient way to drum

interest for ones business.

Personal selling a cheaper, more perso

approach

One does a one-on-one, face-to-face sa

talk with prospective customers, in or

of ones store.

Sales Promotions come in the form of spe

offers, free samples, buy-one-take-one treats.

Through these kinds of promotio

customers can actually road test

product and give more value for t

money.

Courtesy call


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Even in the heat of moment, one should display

absolute courtesy, attention, and endurance

where customers are concerned.

One should remember that success of his or her

business is very much dependent on his or her

customers patronage.

Customer satisfaction is a key to a

uccessful business.

Customer rights

Republic act 7394 (Consumer Act of the

Philippines) state policy of protecting the

ights of customer

This act shall implement measure to

achieve the following objectives:

Protection against hazardous to health and

safety

Protection against deceptive, unfair, and

unconscionable sales acts and practices

Provision of information and education to

facilitate sound choice and the proper

exercise of rights by the consumer

Provision of adequate rights and means of

redress

Involvement of consumer representativesin the formulation of social and economic

policies

8 Consumer Rights

1. The right to satisfaction of basic needs

2. The right to safety

3. The right to be informed

4. The right to choose

5. The right to be heard

6. The right to redress

7. The right to consumer education

8. The right to a healthy and sustainaenvironment

Chapter VI (Entrepreneurial Qualities a

Self-assessment)

Lesson 1 (Entrepreneurial Characteristics)

10 Personal Entrepreneurial Characterist

(PECs)

Pecs Clusters: Achievement, planning, a

power

The Achievement Clusters

1. Opportunity seeking Entreprene

know a good business opportunity w

they see one. They seize the chance

start taking action.

2. Persistence Entrepreneurs t

positively, face every difficult squar

and hang on. They do not let setbacks

in the way of their business decisions.

3. Commitment Entrepreneurs help t

employees get things done. They think

responsibility for problems that may a

and work ways to solve these problems

4. Risk taking Entrepreneurs take chan

in the hope of reaping the benefits later

5. Value for efficiency and quality

Entrepreneurs always aim to go bey

the standards and do not settle for less

The Planning Cluster

1. Goal setting Entrepreneurs are firm

the way that specifically want to achiev

2. Information seeking Entreprene

want to know more about the cho

venture(clients, suppliers, competitors

3. Systematic planning and monitorin

Entrepreneurs make intelligent forec

and from there chart the business p

they have to take.


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The Power Cluster

1. Persuasion and networking

Entrepreneurs make connections with

people, cultivate relationships with people,

and talk to people into their ideas

2. Self confidence Entrepreneurs

believe in themselves and their ability to

achieve what they want.

Entrepreneurial Assessment

Ronnie Pasola invented the board

game which, unlike chess, cannot be

mastered by the human mind.

Jane del Rosario can mount colors

upon colors in a different work of art that

goes beyond the customary landscape,

portrait, and still life.

Lesson 2 (Entrepreneurial Potentials)

Francis Kong Entrepreneur that perform his

mission out of duty and conviction

He was keen on the idea of this new experience,

enough to believe that he was capable of

conquering the odds. He established Company

B.

He is now the president ofBusiness Matters, a

nonstick, nonprofit organization that drives

Filipinos to strive for success in the international

community.

Kongs piece of advice for would be

entrepreneurs:

Have the knowledge

The passion

The network of supportive people

The firm determination to succeed

To enhance ones entrepreneurial

potentials, Kong suggests that an

entrepreneur should:

Go out attend conventions

Training program

Build a network

Passionate about learning

Chapter VII (Business Opportunities in

Environment)

Lesson 1 (Identifying Business Opportunities)

Community is the first place to iden

business opportunities.

If one is not sure of the right product or serviceoffer, he or she should consider the f

categories of human needs (physiolog

safety, social, esteem, and self-actualization)

Business Ideas

Idea is the start of business venture

Internal Considerations include:

Ones personal goals and interests

Ideas from ones observations of d

living conditions

Ones educational background

Ones skills and training

External considerations include:

Government support and assistance

Industry growth prospects

Lesson 2 (Environmental Scanning)

Factors that affect the performance

business:

1. Demographic conditions

Demography is the study of hum

populations in terms of size, dens

age, gender, race, occupation,

other statistics.

Baby Boomers (those born 19

1964)

-are not so much interested

digital technology as compa

members of Generation X.


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Generation X (born 1965-1977) is the

target of manufacturers of digital gadgets

in promoting their products

Generation Y(born 1978 - 1994)

-more interested in digital technology

GenXers- are presumed to have stable

jobs giving them more purchasing power

than members of Generation Y.

2. Economic conditions affect the

consumers buying power and spending

patterns.

Changes in disposable income,

fluctuations in the exchange rate,

inflation (general increase in the price of

goods and services), and interest rates

all affect the performance of a business.

3. Natural environment

A business needs natural resources as

inputs.

From time to time, an entrepreneur might

experience a shortage of raw

materials.

Natural disasters(typhoons,

earthquakes, and volcanic eruptions)

affect the supply of raw materials

4. Technological conditions

Technological developments

(computers, internet, mobile phones) -

have contributed much to faster and more

efficient ways of doing business.

5. Political or legal conditions

Entrepreneurs must also be aware of lawsthat regulate business, like E- commerce

Act of 2000, which regulates trading via

Internet.

6. Sociocultural conditions

Religion, customs, traditions, and

values shape culture.

Culture dictates the kinds of product

and service people would prefer.

7. Competitors

Business is like war.

Entrepreneurs have to know t

competitors so they can think

strategies to help them go ahead.

8. Internal environment

Ones company including resour(finances, equipment, and manpow

processes, management style, strateg

and organizational culture should be ta

into consideration.

Questions to ask:

Do you have strong financial capabilit

support your strategies?

Are you doing the right approach to att

your target market?

Are you an effective leader?

Are your employees motivated?

*Environmental scanning - helps

entrepreneur screen information to anticip

and interpret changes in the business. With

this, one will find it difficult to come up w

strategies or appropriate actions in response

relevant issues in the environment.

SWOT Analysis

-is used to assess how the changes or trend

the environment can affect a business. It he

one identify and overcome his or

weaknesses, build on his or her strengths, se

opportunities, and handle threats to his or

business.

-it is used as basis for the appropriate strategentrepreneurs should be successful. It can h

entrepreneurs capitalize on their strength

seize opportunities.

Strengths refer to the things

possesses that enable him or her to

standards in quality and efficiency. Th

strong points serve as his or

advantage in effectively delive

products and services. An excellent tr

record in sales and marketing and g


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management skills are examples of these

plus points.

Weaknesses refer to the traits that keep one

from meeting his or her targets. These may

include ones apparent resistance to change or

fear of unknown.

Opportunities refer to outside factors

that one can take advantage of to achieve

his or her business goals. These may come

in the form of great demand for the

product or service, the absence of

competition, or the expected large profit.

Threats refer to the eventualities one

has to look out to protect his or her

business. These are the external factors

that may work against him or her such as

reduced purchasing power, increased

production costs, and higher taxes andlicense.

Chapter VIII (Basics of Business Planning)

Being on top of business enterprise is a

plum post of which an entrepreneur has to prove

himself or herself worthy. One must have a

managerial philosophy to live by and a

clear-cut vision of what lies ahead for his or her

business.

Business planning is defining ones business

and identifying ones goals. It is how one intends

o run his or her enterprise and implement

activities to meet his or her business objectives.

t is a business model a sort of road map that

gives one direction to where his or her business

s headed.

Lesson 1(Business Plan)

mportance of business pan/business plan

helps entrepreneurs:

1. Adapt to changing conditions An

entrepreneur who insists to change is

bound to fail because conditions are

always uncertain.

Planning will enable an entrepreneur to

keep his or her options open and make

wise business decisions. It will also help

him determine specific actions taken.

2. Concentrate on targets if one ha

clear business plan, he or she can focus

his or her goals even in the face

advertise. With business plan, o

objectives are well laid down.

3. Operate effectively - With business p

ones venture can run steadily, especi

where money matters are concerned.

Business Plan Components

1. Name and description of a busines

this includes the name, address, con

numbers, and contact persons of busine

Business description indicates

nature of the venture.

2. Objectives this refers to w

entrepreneurs like his or her busines

attain over a given period.

It can be in terms of revenues, profits

market share.

Objective must be SMART(spec

measurable, attainable, realistic and ti

bound) example is to earn 1 000 00

revenues in one year

3. Market study this presents the kind

product or service one intends to offer, target market, the volume of product

the scope of service to be offered, and

location of the business.

This also includes ones product or ser

strategies, pricing, forms of promotio

and methods of distribution.

4. Productive study this presents

process of production, the equipm

needed, facility requirements, supply-chnecessities, and the people who will h

in the production.

5. Financial aspect This involves

working capital to cover all busin

expenses, source of funds, product

service costs, and financial projecti

(expected revenues, profits,

profitability ratios)


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6. Organizational aspect this explains

the business type (single proprietorship,

partnership, or corporation), the people

who will manage the business, and the

role of the owner in the enterprise.

Market Survey

The people who patronize a product or service

comprise the market.

Market dictates the product an

entrepreneur should sell or produce, or the

service he or she offer.

Products or services should meet the

needs and demands of the market.

n surveying the market, an entrepreneur

should ask himself the ff questions:

What will my market buy? Some goods aremore difficult to sell because of certain factors

ike purchasing power and inflation. Examples are

luxury items such as jewelry and motor

vehicles.

Consumables(food, beverages, toiletries,

detergents) more sealable goods

Essential Services

Communication services (newspapers)

Transportation services(taxi)

Health services(medical and dental

services)

1. Why will my market buy from me?

Ones market purchases goods and avails

itself of services to meet certain needs

and wants

2. Who will buy from me? People havediverse needs and wants.

3. How will the buying be done? -

Consumers usually go for a product or

service to satisfy a need, just as they

would buy a cold drink to satisfy their

thirst. Consumer purchase is usually

determined by price, quality, brand,

packaging, and availability of the product.

*To get fairly accurate response to th

questions, entrepreneurs can conduct a surv

They can give consumers questionnaires to k

their target markets reference.

Lesson 2 (Production Planning)

*Production involves a set of inputs (resou

such as land, labor, and capital) to yield a se

outputs (finished goods or products that

usable).

Production planning helps entreprene

know how much goods they should m

available to their customers at any given time

The ultimate goal of this is to make

right amount of goods available at

right time to keep customers satisfied.

It includes sales forecasts, activ

schedule, materials, work force, amachine requirements.

Importance of Production planning:

It enables entrepreneurs to allocate t

funds properly for purchase of

materials and equipment

Identification of inventory levels

Determining the right number of peo

needed and other costs like utilities

insurance costs

Sales Forecast dictates when to produce m

and when to produce less. It is an impor

component of a production plan.

Lesson 3 (Organizational Planning)

Organizational plan is the wise managem

of human resources.

Organizer a notebook that works as a d

planner of entrepreneur.

Organizational Planning

Organizational Planning is arranging

controlling human resources to attain maxim

efficiency.

Organizational structure preve

duplication of tasks and ensures efficiency

work, healthy working relationships, and


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development of employees capabilities. One

creates this so that workers will know their roles

n the organization and perform it.

Ultimate goal is for an organization to operate

effectively and economically.

Organizational Chart

Organizational Chart is a diagram of the

order of authority and relationships that exist inan organization. It is used to guide people in an

organization to work harmoniously and efficiently.

For small business tasks can be

lumped together into one department.

Bigger companies can have several

departments to take care of different

tasks.

Departments the positions in theorganization

Highest position highest level in the

diagram

Vertical diagram shows the chain of

the command (the line of authority from

top level to the bottom level) which

indicates who reports to whom.

The advantage of having organizational

chart is that it shows clearly the

arrangement of functions, separation

of duties, and the chain of command.

Simple organizational chart is prepared

based on:

1. Function shows related positions in a

department according to tasks or functions

formed.

2. Product shows related positions classifiedaccording to product lines.

Lesson 4 (Feasibility Analysis)

How realistic ones business idea is can be

determined by making a/ feasibility

analysis:

1. Marketing assessment an essen

part of a feasibility analysis is determin

the size of the market. The idea is to d

many customers who will boost revenue

Customers who will ultimately de

whether ones business is workable or n

2. Financial assessment an entrepren

should have an idea of how much mo

his or her business will make.

3. Technical and production assessm

this tests looks into such factors a h

the products will be manufactured,

technology to be utilized, the volume

the products, the facility site,

manpower requirements, and

equipment to be used.

4. Socoieconomic assessment -

entrepreneur should know the benefit

his or her product to society.

5. Management assessment - T

assessment responds to organizatio

management, where business organiza

and skills specifications are concerned.

Financial Requirements

*Before getting the business moving, it

important for an entrepreneur to do the math

Financial planning is necessary to identify

need for and source of ones funds and to kn

how to maximize ones financial position.

Financial requirements come in the form

1. Financial capital This includes cos

land and building, machinery,

equipments. These are investments for

long haul.

2. Preoperational capital This inclu

cost of license and other fees necessar

putting up a business.

3. Working capital This is the sp

money one will needs to keep his or

business doing. This will take care of

workers wages, bills payments, and sto

purchase.


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These are needed to produce funds for his

business.