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1612 118642 Chapter 15 14 13 107531 9 Entrepreneurship)

(The

concept

of

3. Challenge the opportunities to grow and diversify are endless. 4. Direct payoffs entrepreneurship benefit directly from whatever profit the business yields. 5. Unlimited earnings income is derived in full and no one can expect even more.

Lesson 1 (Understanding Entrepreneurship) Barter - entrepreneurship takes its roots from trading in prehistoric times Arabs(first barters in the Philippines) Chinese (2nd) Entrepreneur each individual who change something for value *When the barter could no longer satisfy the trading parties, that is, when the transaction failed 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.

Disadvantages of Entrepreneurship 1. No regular monthly salary - absence of a regular paycheck 2. Unpredictable schedule work hours run at no fixed 3. Risky- one may hit it big, break even, or lose. If a blunder is committed, the entire investment may be lost Business Ideas 1. Capitalizing on ones skills - a hobby can actually translate into a profitable business enterprise 2. Filling a vacuum even if there are existing outlets of these sought-after goods and services, a little competition wont hurt. 3. Thinking a franchise franchise is a reproduction of an existing business down to the last detail 4. Starting a something new it is just a matter of putting ones innate creativity in motion. Lesson 2 (Entrepreneurship and the Economy) *There is no one-size-fits-all approach when it comes to putting up a business. Small-scale and Medium-scale Enterprises Size of an enterprise is defined by the asset base and number of workers of a business. Microenterprise a subcategory of the small business enterprise

o o

less than P3,000,000 as capital 1 to 9 workers

6. Entrepreneurship creates new market The creativity one puts his business helps create new products in the process. Economic Concepts 1.Laissez-faire economy Laissez-faire which literary means leave us alone, is an economic system in which the individual and firms do not get any direction or regulation from the government in terms of a production. It is the behavior of the market(an institution through which buyers and sellers interact and engage in exchange) that helps us answer the economic systems three basic questions(1.What will be produced? 2. How will it be produced? 3. Who will get what is produced?) 2.Keynesian economics

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 and quantity 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.

British economist John Maynard Keynes believed that governments could intervene the economy and affect the level of output and employment.

3.Theory of comparative advantage British economist David Ricardo said that countries will benefit more with specialization and trade even if one country has absolute advantage over another country in the production of several goods. 4.Consumption and production Two basic economy decision-making units of an

1.Households(consumers)- demand goods and services that firms produced 2.Firms(business enterprise) need land labor and capital to produce those goods and services. Nations level of production is a key determinant of its national income.

Chapter II (Entrepreneurial Requirements) Lesson 1(Applying Requirements) Entrepreneurial

effective product as well as efficient service. The effectivity of a product depends on source, while he efficiency of service depends on employee motivation and training. 2.Risk management Remember that great efficiency in managing a business would depend on how well an entrepreneur deals with risks or failure. Risks are there to help one persevere and reach his or her goals. There are marketing risks, financial risks, expansion risks, and other danger zones to conquer. Lesson 2(Business Layout and Location) Layout- refers to the design o plan for the shopits structural arrangement. Location refers to the site or place where the shop is built. The things to consider good store layout: Suitability to the type of merchandise Volume of equipment required furniture and

*An aspiring entrepreneurs starts by listing the points to consider in deciding the type of business to run. Workbook technique a workable agenda in running a business is what any start-up entrepreneur 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.

The number of employees Business Layout 1. Closed layout(for controlled items like medicines are being sold)- the layout of the store should be done in such a way that only service crew are allowed to get the merchandise from the shelves 2. Parallel shelves layout(for supermarket layout) It is a different case altogether when over the counter health products or supplements are sold. It requires few service personnel since this is a self service store. U-shaped layout (for specialty store such as flower shop)- This will allow the customer to

Managerial Concerns 1.Effective product or service delivery To boost product sales, an entrepreneur has to develop a successful entrepreneurial atmosphere of having an

clearly sea the items they wish to buy. It does not require many salespersons. 3. U-shaped and parallel shelves layoutfor a store that is a combination of selfservice and counter-service outlet like convenience stores or drugstores A suitable business location would take into: Consideration accessibility transportation to consumers Adequate parking space Neighborhood safety Customer base Adequate store space And suitability competition for expansion, cost, of

You must have heard that first impressions are lasting The logo and merchandise display of the business should communicate ones message and get the word out. *A creative name and creative visual merchandising could prove to be a crowd drawer. *Entrepreneurs can either introduce something new or improve(make an innovation) something that already exists.

Chapter III(Entrepreneurial Competencies) *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 risk. Paranoia stops entrepreneurs from doing something, but there may also be instances when they cannot stop but cross dark alleys. Dark alleys consist of uncertainties brought about by the changing business environment(competition, economic situation, political stability, etc.) 2. Leadership (headship) - involves influencing others toward the achievement of goals. 3. Hard work (difficult task) - entrepreneurs do not count the minutes or dread the hours they spend running their enterprise 4. Persistence (determination) entrepreneurs do not just give up or give in even under the most trying circumstances. a

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 opportunities easily spot business

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

5. Commitment devotion)

(dedication

and

inefficiency in production, difficulties in the business begin to surface. Brain drain or skill drain the wages are insufficient 4. Marketing problems If an entrepreneur does not bother as much with the marketplace as with the wares he or se is peddling, then he or she has a problem. 5. Competition Rivals will always be around 6. Customer satisfaction- entrepreneurs will not have much luck with customers if they are clueless about their tastes, preferences and buying habits. Creative Solutions By maintaining a network of contacts to give them sound of advice Thinking of an incentive program that would make their staff their partners in the growth of their business Employing alternative come-ons for customers , among other thing.

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 c entrepreneurs do. 7. Adaptability compliance) (flexibility and

The business environment keeps on changing. 8. Organization establishment) (company

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 he or she wants to stay in the field, that is, before matters come to a head , it is best to know what to expect.

Entrepreneurs scientific method to solve problems 1. Identifying a problembefore attempting to find temporary or lasting solutions to a problem, entrepreneurs must clearly identify the problem and its nature 2. Formulating an educated guess or hypothesis entrepreneurs should hypothesize on the root cause of the problem and the possible solutions 3. Testing the hypothesis entrepreneurs should conduct a experiment to be able to obtain data that validate the guess 4. Checking and interpreting the results of the study entrepreneurs should consider the nature of the problem Drawing a conclusion the conclusion should include concrete steps to be taken to solve proble

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 employees or disputerivalry of

3. Production problems when the needed materials become scarce and the workers lack the necessary skills or there is

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 and effectively. 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 Latin manus (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 plans for 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 getting people to do it. 5. Controlling/Monitoring progress against plans checking

1. Interpersonal roles that involve coordination and interaction with employees. 2. Informational roles that involving handling, sharing, and analyzing information. 3. Decisional roles that require decisionmaking. Management Skills 1. Technical used for knowledge required in work specialized

Political used to build a power base and established connections 2. Conceptual used to analyze complex situations 3. Interpersonal used to communicate, motivate, mentor and delegate. 4. Diagnostic ability to visualize most appropriate response to a situation Formation of the business policy 1. Mission of the business is the most obvious purpose, which may be, example, to make soap. 2. Vision of business reflects its aspiration and specifies its intended direction or future destination. 3. Objectives of the business refers to the ends or activity at which a certain task is aimed 4. Businesss policy is a guide that stipulates rules, regulations and objectives, and may be used in the managers decision-making. It must be flexible and easily interpreted by the employees. 5. Business strategy refers to the coordinated plan of action that is going to take, as well as the resources that it will use, to realize its vision and long term objectives. Levels of management

6. Motivation without this, employees cannot work effectively. Basic roles of management

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 mobilization of outside resources in the

Scientific management uses time-andmotion studies to identify this one best way. 2. General administrative approach Henri Fayol developed 14 principles basic management concepts which include division of work, authority, discipline, unity of command, among others. Max Weber introduced concept of bureaucracy an organization where there is division of labor, a clearly defines hierarchy, detailed rules and regulations, and impersonal relationships. 3. Quantitative approach (operations research or management science)- this approach uses quantitative techniques such as statistics, linear programming, and management decision models that would aid managers in decision making. 4. Organizational behavior the most important contribution to the development of organizational behavior came from Hawtorne studies, a series of studies conducted at the Western Electric Company Works in Cicero, Illinios. 3 Theories of Motivation 1. Maslows theory of motivation Abraham Maslow said that there are five levels of needs: physiological needs(need for food, drink and other physical requirements) Safety needs (need for security, and protection from harm, whether physical or emotional) social needs (need for affection, belongingness, acceptance, friendship) esteem needs (need for self-respect, autonomy, achievement, status, recognition and attention) Self-actualization needs (need to become what one is capable of becoming)

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 managersconsist Supervisors, Section Officers, Foreman of

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 ability think, 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

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 more persons a co-owners of an unincorporated business According to book, it has a legal personality separate and distinct from that 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 association of two or more person, each with unlimited liability, who are actively involved in the business.

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, including 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 of five and a maximum of 15 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 organize SEC Double taxation More government restrictions reporting requirements and and complicated to

5. Multinational Corporation

or

Transnational

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 (ESOPS) Stock Ownership Programs

Institutional Ownership Mergers and Acquisitions Divestitures and Spin-offs Entrepreneurship vs. Small Business Entrepreneur: Accepts the risks and opportunities of creating, operating, and growing a new business. Small Business: Doesnt have plans for 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:

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

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 Activities) (Types of Entrepreneurial -

SM Supermarket, and The Landmark Supermarket Convenience store a retail store that is located near a residential area that is usually open 24 hours a day, 7 days a week. Eg are 7-eleven, ministop and shell select Department store - a retail store that carries a wide variety of product lines, usually clothing, shoes, accessories, and home furnishing. Eg are Robinsons Department Store, SM, Rustans Specialty Store -a retail store that specializes on a certain product line. Eg are Kamiseta and Bayo(clothes), Mendrez and Celine(shoes), and The Body Shop(skin care) 2. Online retailing In this type of retailing, retailers connect to individual consumers through the Internet 3. Nonstore Retailing call it a revolutionary way of retailing, it keeps up with competition by reaching a wider base Catalog and Direct-Mail retailing is a retail format that allows customers to choose products from catalogs or brochures that are sent them directly via mail. Direct Selling- is a retail format wherein in the distributor (seller) contacts the customer directly at home or at work to offer products. It is a highly form of retailing where face-to-face discussions between the buyer and seller take place Television home shopping is a retail format that uses television as a medium to demonstrate the feature and benefits the product and allows customers to place their orders through the telephone. Vending-machine retailing is a nonstore format wherein products such as soft drinks, coffee, and chips are available to customers through the vending machine Types of Retailing by Ownership

*An entrepreneur goes into business to earn or gain profit. Lesson 1 (Retailing) Retailing consumers. is selling goods directly to

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,

1. Independent, establishments

single-store

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 agreement between 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 marrying someone you have not known for very long. The average length of franchise 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 is putting big money on the line and his or her success does not entirely depend upon him or her. 1. What type of franchise is it? Packages franchises businesses such as fast-food, restaurants, muffler shops, or hotels that come complete with every business model laid out by the parent company. That model covers everything from financial controls to hiring guidelines. Product franchises - businesses such as a car dealerships and gas stations that mainly to distribute the parent companys goods. Owners of product franchises have more control over the way they run their businesses. 2. Does business lend franchise model? itself to the

3. How many franchises organization have?

does

the

4. How much is the franchisee fee? franchisee fees depend on how indemand a product or service is, or how established the parent company is 5. How much will one has to pay in royalties? Franchisors generally charge royalties equal to three percent of each franchises revenues. 6. How much money will ones business really make? 7. Can one work with these people? 8. How will be the franchisor help the franchisee? 9. Is the legitimate? franchisors company

Department of Trade and Industry (DTI) and the Philippine Franchise

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 their selling skills. Lesson 2 (Manufacturing) Manufacturing is a business activity wherein raw materials are transformed into finished goods mechanically or chemically by means of high-powered machine or equipment, or simply by hand. Manufacturing production. is synonymous to

appliances, paper products, agribusiness, and furniture and fixture Creativity pursuit Creativity is important in manufacturing to maintain competitiveness, bring down costs, and build more interactive workforce. Creativity contributes to improving the quality of a product or in bringing something new together. Choosing the best manufacturing business 1. Identify a need Aspiring manufacturer must have clear thought-out business idea that would satisfy the needs and wants of the target market. 2. Research about the market Production Planning Production Planning involves the acquisition and allocation of scarce resources needed in production to satisfy demand over a specific period. 4 stages of production 1. Operation is the initial (main) step in production, where raw materials undergo transformation in preparation to the next step. 2. Assembly is the step wherein parts of product are put into one whole piece. 3. Finishing is the enhancement of the appearance or value of product such as varnishing, coating, or glazing. 4. Inspection is the run- through stage that checks a product for its acceptability and merit. This is better known as quality control. Consider the following to avoid production slips: Source of raw materials for products The method of production to be employed

What a Manufacturing business requires 1. Define the business. 2. Determine the kind business requires. of skills the

3. Find out how much space the business 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

Special skills requires of the workers Location and business. layout best suited for

1. High- contact services this type of service involves personal visits by the customer to the service establishment. There is a high level of physical interaction in this kind of service Eg are haircut, massage, education, banking services and hotel services

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 manufacturing business: Accessibility to transportation Adequate water and electric supply Accessibility to the distribution sites such 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 location in

2. Low contact services this type of service involves minimal or no physical interaction between customer and the service provider Eg are phone banking, telecommunication services or

Forms of Service Business 1. Lifestyle-related services laundry and dry- cleaning shops, beauty salons, body fitness center or gym 2. Education services tutorial, computer training, review, and day-care services 3. Information services publishing and printing services desktop

4. Professional and business services recruitment agencies, remittance service centers, security agencies 5. Repair services shoes, bags, and computer repair shops 6. Rental services internet shops, carrental companies 7. Entertainment and recreational services party needs shops, amusement centers 8. Tourism services agencies, hotels travel-and-tours

*Service Business will be measured in terms of appeal, quality, and diversity. Service Boost

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 responding to the consumers needs and providing jobs to the residents.

product is higher than its selling price, bringing negative profit to the entrepreneurs. Entrepreneurs first order of business Filling Tracking Managing customers Issuing receipts not only serve as acknowledgements for cash transactions but also an efficient means to monitor purchases while exhibiting transparency bin business. Promotions and packaging Promoting ones product and services means communicating the merits of ones offer to target customers so that they will choose his or her product over rival brands Attractive come-ons- innovative promotions and packaging Long term campaigns not one-shot deals Advertising is a sure-fire formula for any business crisis or even in a no-crisis situation. One has a variety of options: print, radio, television, outdoor display, or direct-mail advertising. It is the most efficient way to drum up interest for ones business. Personal selling a cheaper, more personal approach One does a one-on-one, face-to-face sales talk with prospective customers, in or out of ones store.

Lesson 4 (Business Practices) Price Tags Price tag through this, customers can check the price of an item and compare it with prices of other brands. Markup is the profit entrepreneurs make from individual 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 in price, even to the extent that the cost of a

Sales Promotions come in the form of special offers, free samples, buy-one-take-one treats. Through these kinds of promotions, customers can actually road test a product and give more value for their money. Courtesy call

*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 successful business. Customer rights Republic act 7394 (Consumer Act of the Philippines) state policy of protecting the rights of customer This act shall implement measure achieve the following objectives: to is a key to a

7. The right to consumer education 8. The right to a healthy and sustainable environment

Chapter VI (Entrepreneurial Qualities and Self-assessment) Lesson 1 (Entrepreneurial Characteristics) 10 Personal Entrepreneurial Characteristics (PECs) Pecs Clusters: Achievement, planning, and power The Achievement Clusters 1. Opportunity seeking Entrepreneurs know a good business opportunity when they see one. They seize the chance and start taking action. 2. Persistence Entrepreneurs think positively, face every difficult squarely, and hang on. They do not let setbacks get in the way of their business decisions. 3. Commitment Entrepreneurs help their employees get things done. They think full responsibility for problems that may arise and work ways to solve these problems. 4. Risk taking Entrepreneurs take chances in the hope of reaping the benefits later 5. Value for efficiency and quality Entrepreneurs always aim to go beyond the standards and do not settle for less. The Planning Cluster 1. Goal setting Entrepreneurs are firm in the way that specifically want to achieve

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 representatives in 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

2. Information seeking Entrepreneurs want to know more about the choice venture(clients, suppliers, competitors) 3. Systematic planning and monitoring Entrepreneurs make intelligent forecasts and from there chart the business path they have to take.

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 of Business Matters, a nonstick, nonprofit organization that drives Filipinos to strive for success in the international community. Kongs piece of entrepreneurs: advice for would be

Passionate about learning Chapter VII (Business Opportunities in the Environment) Lesson 1 (Identifying Business Opportunities) Community is the first place to identify business opportunities. If one is not sure of the right product or service to offer, he or she should consider the five categories of human needs (physiological, 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 daily 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 of business: 1. Demographic conditions Demography is the study of human populations in terms of size, density, age, gender, race, occupation, and other statistics. Baby Boomers (those born 19461964) -are not so much interested in digital technology as compared members of Generation X.

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

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 laws that regulate business, like E- commerce Act of 2000, which regulates trading via Internet. 6. Sociocultural conditions Religion, customs, values shape culture. traditions, and

7. Competitors Business is like war. Entrepreneurs have to know their competitors so they can think of strategies to help them go ahead. 8. Internal environment Ones company including resources (finances, equipment, and manpower), processes, management style, strategies, and organizational culture should be taken into consideration. Questions to ask: Do you have strong financial capability to support your strategies? Are you doing the right approach to attract your target market? Are you an effective leader? Are your employees motivated?

*Environmental scanning helps an entrepreneur screen information to anticipate and interpret changes in the business. Without this, one will find it difficult to come up with strategies or appropriate actions in response to relevant issues in the environment. SWOT Analysis -is used to assess how the changes or trends in the environment can affect a business. It helps one identify and overcome his or her weaknesses, build on his or her strengths, seize opportunities, and handle threats to his or her business. -it is used as basis for the appropriate strategies entrepreneurs should be successful. It can help entrepreneurs capitalize on their strength and seize opportunities. Strengths refer to the things one possesses that enable him or her to set standards in quality and efficiency. These strong points serve as his or her advantage in effectively delivering products and services. An excellent track record in sales and marketing and good

Culture dictates the kinds of product and service people would prefer.

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 and license. 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 to run his or her enterprise and implement activities to meet his or her business objectives. It is a business model a sort of road map that gives one direction to where his or her business is headed. Lesson 1(Business Plan) Importance 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 has a clear business plan, he or she can focus on his or her goals even in the face of advertise. With business plan, ones objectives are well laid down. 3. Operate effectively - With business plan, ones venture can run steadily, especially where money matters are concerned. Business Plan Components 1. Name and description of a business this includes the name, address, contact numbers, and contact persons of business. Business description indicates the nature of the venture. 2. Objectives this refers to what entrepreneurs like his or her business to attain over a given period. It can be in terms of revenues, profits, or market share. Objective must be SMART(specific, measurable, attainable, realistic and timebound) example is to earn 1 000 000 in revenues in one year 3. Market study this presents the kind of product or service one intends to offer, the target market, the volume of product or the scope of service to be offered, and the location of the business. This also includes ones product or service strategies, pricing, forms of promotions, and methods of distribution. 4. Productive study this presents the process of production, the equipment needed, facility requirements, supply-chain necessities, and the people who will help in the production. 5. Financial aspect This involves the working capital to cover all business expenses, source of funds, product or service costs, and financial projections (expected revenues, profits, and profitability ratios)

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. In surveying the market, an entrepreneur should ask himself the ff questions: What will my market buy? Some goods are more difficult to sell because of certain factors like 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 services) and dental

*To get fairly accurate response to these questions, entrepreneurs can conduct a survey. They can give consumers questionnaires to know their target markets reference. Lesson 2 (Production Planning) *Production involves a set of inputs (resources such as land, labor, and capital) to yield a set of outputs (finished goods or products that are usable). Production planning helps entrepreneurs know how much goods they should make available to their customers at any given time. The ultimate goal of this is to make the right amount of goods available at the right time to keep customers satisfied. It includes sales forecasts, activity schedule, materials, work force, and machine requirements. Importance of Production planning: It enables entrepreneurs to allocate their funds properly for purchase of raw materials and equipment Identification of inventory levels Determining the right number of people needed and other costs like utilities and insurance costs Sales Forecast dictates when to produce more and when to produce less. It is an important component of a production plan. Lesson 3 (Organizational Planning) Organizational plan is the wise management of human resources. Organizer a notebook that works as a daily planner of entrepreneur. Organizational Planning Organizational Planning is arranging and controlling human resources to attain maximum efficiency. Organizational structure prevents duplication of tasks and ensures efficiency of work, healthy working relationships, and full

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 have diverse 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.

development of employees capabilities. One creates this so that workers will know their roles in 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 in an 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 organization positions in the

1. Marketing assessment an essential part of a feasibility analysis is determining the size of the market. The idea is to draw many customers who will boost revenues. Customers who will ultimately decide whether ones business is workable or not. 2. Financial assessment an entrepreneur should have an idea of how much money his or her business will make. 3. Technical and production assessment this tests looks into such factors a how the products will be manufactured, the technology to be utilized, the volume of the products, the facility site, the manpower requirements, and the equipment to be used. 4. Socoieconomic assessment an entrepreneur should know the benefits of his or her product to society. 5. Management assessment This assessment responds to organizational management, where business organization and skills specifications are concerned. Financial Requirements *Before getting the business moving, it is important for an entrepreneur to do the math. Financial planning is necessary to identify the need for and source of ones funds and to know how to maximize ones financial position. Financial requirements come in the form of: 1. Financial capital This includes cost of land and building, machinery, and equipments. These are investments for the long haul. 2. Preoperational capital This includes cost of license and other fees necessary in putting up a business. 3. Working capital This is the spare money one will needs to keep his or her business doing. This will take care of the workers wages, bills payments, and stocks purchase.

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 classified according to product lines.

Lesson 4 (Feasibility Analysis) How realistic ones business idea is can be determined by making a/ feasibility analysis:

*These are needed to produce funds for his business.