ENTREP REVIEW NOTES Entrepreneurship – the term and idea on

entrepreneurship appears to be familiar,

INTRODUCTION TO ENTREPRENEURSHIP
however there is much more than what is
 Entrepreneurship has become commonly perceived. Its origin remains to be
increasingly important for businesses of unclear but there are indications that the term
all sizes around the world entrepreneurship originated in Europe
 It opens new opportunities and sometimes in Middle Ages
possibilities for the businesses to create
Entreprendre means to undertake – French
values for themselves and for the society
origin
at large
 Despite its popularity, studies suggest
that the scope of entrepreneurship
remains unknown, and therefore the
prospects of entrepreneurial activities
remains not fully realized

Entre- enter

Pre – before

Neur- Nerve center

“Entrepreneurs are made not born” coined by Basis for Businessman Entrepreneur
Lyoyd Khefsky Comparison
Meaning A businessman An entrepreneur
Joseph Alois Shumpeter – Father of is someone is a person who
Entrepreneurship who sets up a starts an
In the modern day markets, the term business with enterprise with a
entrepreneur has been closely linked with an existing new idea or
economic development, An economic idea offering concept,
development can emerge due to several reasons products and undertaking
includes: services to the commercial
customers activities
 The launch of new source of Market Market Player Market Leader
procurement of raw materials Position
 The introduction of a new production Nature Calculative Intuitive
mechanism
Market Creates place Create new
 The introduction of a new quality of
in existing market
product, or a novel product
markets
 The opening of a new market
Risk Factor LESS Comparatively
 The re-organization of a business
HIGH
The management of all these aspects are Methods Conventional Unconventional
carried by an enterprise, and the people whose applied for
functions are to carry out these activities are doing
called entrepreneurs (Bull & Willard, 1993) things
Approach Holistic Atomistic  Trends and fashion
Orientation Profit People  Club/Society meeting
Competition Very HIGH LOW
Successful Entrepreneurs in the
Philippines
The 6C’s of Entrepreneurial Success
Henry Sy
 Courage
 Dec 25, 1924, China
 Conviction
 1958, open shoe mart stores later on
 Capabilities become SM group
 Collaboration  Identify market gaps to consumer needs
 Capital
 “If you want to become successful you
 Consciousness have to have a vision, a mission, and a
Entrepreneurial Process – it is a continuous clear goal”
process that needs to be followed by an Tony Tan Caktiong
entrepreneur to plan and launch the new
ventures more efficiently  Oct 7, 1953, Davao
 Founded Jollibee Corporation
The Entrepreneurial Process Flowchart
 Early business: Ice cream parlor
 “Passion is a key ingredient to success”
Socorro Ramos

 Feb 13, 1923, Santa Cruz Manila

 Founder of National Bookstore
 1942, early business of selling bookstore
in St Thomas
 “Education is a powerful tool for
empowerment”
John Gokongwei Jr
Where to get ideas?  Aug 11, 1926, Cebu
 Trade journal  Founded JG Summit Holdings, INC
 Trade Association  “We cannot change the past, but we can
 Conventions, exhibit, trade shows, and learn from it, we cannot predict the
conauner shows future but we can prepare for it”
 Country or government affairs Edgar Sia (Inyeop)
 Consumer magazines
 Opportunity magazines  January 7, 1977, Iloilo
 Government publications  Founded Mang Inasal in 2003
 Directories  Mang Inasal acquired by Jollibee Corp in
 Old Advertisements 2010
 Import/Export bulletins Mariano Que
 Current events and announcements
 February 28, 1920, Manila
  1945, open a drugstore in sta cruz manila  This is used for the continuity of
later on become mercury drug operations in the future without
necessarily seeking for funding
Cresilda Torres
In the context of Entrepreneurship, the business
 Founded in 1971
plan is prepared by the Entrepreneurship and at
 Jollibee acquired Greenwich in 1994 by
time in coordination with key people in the
80%
organization. Typically, these people are
Cecilip Kwok Pedro knowledgeable in the major functional ideas of
the business; sakes, marketing, production,
 Founded Lamoiyan Corporation
administration, finance. Each of the plans are
 “We are competing against a giant
supposed to interrelated with each other
without fate and intervention by
guidance of the divine, it’s really difficult INTERESTED PARTIES
to survive in this industry”
Management
Alfredo M. Yao
 Aside from the preparation of such plans.
 January 10, 1943 The management is concerned with its
 Founded Zest.O own future with the company or business
organization
Gregorio G. Sanchez Jr
 Managers and employees would like to
 Founded LactoPAFI Probiotics know which direction the company will
eventually follow and what will be its
Joe Magsaysay
effect on their careers, lifestyle,
 Founded Potato Corner employment status, and personal
 Founded in 1990 ambitions
Milagros, Clarita, and Doris Leelin Creditors
 Founded Goldilock  While some business plans are created
 Open franchise on 1991 for the purpose of business continuity, a
large proportion of business plans are
Business Plan
created for the purpose of securing funds
 Definition: A business plan is a for the project. Potential and existing
comprehensive document that outlines creditors like banks and other lenders
the goals, strategies, and operational read the business plan, evaluate the
details of a business operations, and find out if the plans will
 Purpose: It serves as a roadmap, guiding be able to generate income to pay back
entrepreneurs in making informed the debts of the business given funding
decisions and navigating the complexities is approved
of business
Potential Investors
 Purpose: This is used to present it to
capitalization to raise capital for the  Business plans are developed to entice
business future investors into putting their money
on the specific venture. Without the
 plans, these investor will not have any  This chapter delves into the market
idea on how the company is going to landscape, including industry trends,
operate, manage, and pursue its mission. market size and growth potential, target
Unlike the banks, the investors money market segments, customer and
will now form part of the ownership of preferences, and an analysis of
the company, partnership, or competitors. It should demonstrate a
corporation. deep understanding of the market and
how the business fits into it.
Owners/Entrepreneur
Organization and Management
 The owners themselves are very much
interested in the preparation of the  You outline the organization structure of
business plan. They are concerned with the company, including key personnel
the detail on how they will achieve their and their roles, management team
plan, and the future results of such profiles and any advisory board members
activity. They also concerned if the or external advisories. It demonstrates
direction which the business entity will be the expertise and capabilities of the team
heading to consistent with they have execute the business plan successfully
envisioned the company to be.
Product or Service Line
COMPONENTS OF BUSINESS PLAN
 You provide detailed descriptions of the
Executive Summary products or services offered by the
business, including their features,
 This is the major components which the
benefits, and unique selling points.
interested parties will read (minor
Discuss any intellectual property or
sections preceding this section are the
propriety technology associated with the
title page and the table of contents).
offerings
 It defines the company itself, its product
or services, and the reason why the Marketing & Sales Strategy
company exists (business continuity
 Outlines the marketing sales approach
purpose) or the need for its existence
for the business, including target market
 Sometimes referred to as Project
demographics, positioning strategies,
Highlights, this section summarizes what
pricing strategies, distribution channels,
the company is all about – products or
and promotional tactics. It should
services, markets, management teams,
demonstrate how the business plans to
operations, and the financial highlights.
attract and retain customers
Company Description/Analysis
Funding Request
 You provide detailed information about
 If seeking funding, this section details the
the business, including its mission and
amount of funding expired, how it will be
vision, legal structure, location, history (if
used, and the desired terms (eg. Equity,
applicable), and any unique aspects that
debt, or combination from the founders
set it apart from competitors
Financial Projection
Market Analysis
  You presented detailed financial
forecasts for the business, including
income statements, cash flow
projections, and balance sheet for at
least the next 3 – 5 years. These
projections should be based on realistic
assumptions and demonstrate the
business potential for profitability and
growth

Appendices

 Includes additional information that PRICING

supports the business plan, such as
resumes of key team members, market  Is defined as the amount of money that
research data, product/service you charge for your products, but
prototypes, legal documents, and other understanding it requires much more
relevant materials than that simple definition. Baked into
your pricing are indicators to your
MARKETING MIX 7 Ps potential customers about how much you
 Product value your brand, product, and
 Price customers. It’s one of the first things that
 Place can push a customer towards, or away
 Promotion from, buying your product. As such, it
 People should be calculated with certainty
 Process What is Price?
 Physical Evidences
 It is a sum of all values that consumers
PRODUCTS – Good, Places, Information, give up to gain the benefits of having
Services, Experiences, Idea using a product
OTHER PRODUCT CONSIDERATION Factors Affecting Pricing Decisions
 Product features and benefits Product Cost
 Product line and mix
 Branding and packaging  Product development, Research, Testing,
 Product lifecycle management Packaging, Raw Materials, Promotions,
 Product quality and standards Distribution and others
 Product positioning and differentiation Competition
 Product development and innovation
 Product pricing strategy  Price War
 Product distribution channels  Indirect or Direct Competitor
 Product promotion and communication Overall Marketing Strategy
  Clarifying the product positioning as well  It is introduced in the market at a high
as identifying its consumers will easily lay price, and as the time goes on, the price
down the price decisions for the product is reduced gradually

Economic Condition PRODUCT MIX PRICING STRATEGIES

 Economic boom, Recession, Inflation, or Product Line Pricing

changes in interest rate affect consumer
 Models, sizes, capabilities, and storage
spending, as well as the company costs
spaces, features
of producing and setting a product
Optional Product Pricing
Government Laws and Regulations
 A company may opt to offer accessories
 Sin Tax Law or Republic Act 10351
or optional product that are
 It is a tax imposed on alcohol and
complementary or can be used with the
tobacco product, the thereby increasing
main product
the prices of the product
Captive Product Pricing
GENERAL PRICING STRATEGIES
 Companies make consumable products
Value Based Pricing
that must be used along with the main
 Needs and wants of the consumer product
 Perceived value
By Product Pricing
 The price set after the costs of producing
the product have been identified  In manufacturing main product,
companies sometimes generate by
Cost Based Pricing
product that must be used along with the
 Fixed Cost main product
 Variable Cost
Product Bundle Pricing
Competition Based Pricing
 Companies determine products that can
 Competition strategies be combines and offer the bundle at a
 Costs reduced price
 Prices
 Market Offerings

Market Penetration Pricing

 The company decides to offer a new

product at a low initial price to quickly
penetrate the market
 This attract a big number of buyers who
do not want to take risk of trying out a
new product at its regular price

Market Skimming
PRICE ADJUSTMENT STRATEGIES

Discount Pricing

 Quantity discount
 Seasonal discount
 Cast discount

Segmented Pricing

 Gender
 Age
 Location based
 Economic status

Psychological Pricing

 Php 99.75 or Php 199

Promotional Pricing

 Companies can temporarily reduced price

to build demand or create excitement for
their product