Entrepreneurship

 Natural Resources - such as minerals,

forests, water, and fertile land that occur in
Essentials in Entrepreneur's nature and can be used for economic gain.
Opportunity Seeking  Wildlife- includes all mammals, birds,
Basic foundation that the entrepreneur must have in reptiles, fish, etc., that live in the wild.
seeking Opportunities:

1. Entrepreneurial Mind
Frame 1.2. Societal Environment
 This allows the entrepreneur to see things in a
a. Political forces- includes all the laws, rules,
very positive and optimistic way in the midst
and regulations that govern business practices
of difficult situation
as well as the permits, approvals, and licenses
 Being a risk - taker, an entrepreneur can find
necessary to operate the business.
solution when problems arise.
b. Economic forces- such as income level and
2. Entrepreneurial Heart employment rate.

Flame 1.2. Societal Environment

 Entrepreneur's driven passion, they are c. Sociocultural forces- customs, lifestyles and
attracted to discover satisfaction in the act and values that characterize a society.
process of discovery.
 Passion is the great desire of an entrepreneur to d. Technological environment- New inventions
achieve his/her goals. and technology innovations.

3. Entrepreneurial Gut Game 1.3. Industrial Environment

 This refers to the ability of the entrepreneur of  Competitors
being [Link] also known as intuition.  Customers
 The gut game also means confidence in one's  Creditors
self and the firm believes that everything you  Employees
aspire can be reached.  Government
 Suppliers
Sources of Opportunities
2. Technological Discovery
1. Changes in Environment and Advancement
➢ Refers to the physical environment, societal
 A person with entrepreneurial interest sees
environment, and industry environment where
possibility of business opportunities in any
the business operates.
new discovery or because of the use of latest
1.1 Physical Environment technology.
 For example, an individual with knowledge in
1.2. Societal Environment repair and installation of a machine engine
discovers that additional engine parts that
1.3. Industrial Environment considerably reduce fuel consumption.
1.1. Physical Environment
 Climate - weather conditions
 Entrepreneurship
3. Government's thrust, METHODS FOR
programs, and policies SEGMENTING THE MARKET
a. The priorities, projects, programs, and policies Geographic segmentation
of the government are also good sources of
ideas. - the total market is divided according to
b. [Link] example, an individual with knowledge
geographical location.
in repair and installation of a machine engine
discovers that additional engine parts that Variable to consider:
considerably reduce fuel consumption.
 Climate
4. People's Interest  Dominant ethnic group
 Culture
a. The interest, hobbies, and preferences of people are  Density (either rural or urban)
rich source of entrepreneurial ideas. Like the increasing
number of Internet Café at present could be led to the
strong attachment of young people to computers.
Demographic Segmentation
- divided based consumers. Variable to consider:
 Gender
5. Past Experiences  Age
a. The expertise and skills developed by person  Income
who has worked in a particular field may lead  Occupation
to the opening of related business enterprise.  Education
b. For example, an accountant who has learned  Religion
the appropriate accounting and management  Ethnic group
skills and techniques in a prominent  Family size
accounting firm can start his/her business
venture by opening his/her own accounting.

Recognize and Understand Psychological Segmentation

the Market - divided in terms for customers think and
[Link] to consider:
Target market
 Needs and wants
 Market Targeting is a sage in market  Attitudes
identification process that aims to  Social class
determine the buyers with common  Personality traits
needs and characteristics.  Knowledge and awareness
 In targeting a specific market, it will exclude  Brand concept
people even if it will not fit your criteria.  Lifestyle
Rather, target marketing allows you to focus
your marketing money and brand message on a Behavioral Segmentation
specific market that is more likely to buy from
you than other markets. - divided according to customers behavior
 Product is more affordable, efficient, and pattern as they interact with a company.
effective way to reach potential clients and Variable to consider:
generate business.
 Perceptions
 Knowledge
 Entrepreneurship
 Reaction  Companies are interested in knowing the
 Benefits market size before launching a new product or
 Loyalty service in the area.
 Responses  In determining the market size, entrepreneur
will conduct strategic marketing research from
Customer Requirement reliable source.

Customer requirements are the specific characteristics

that the customers need from a product or a service.

There can be two types of customer requirements:

1. Service Requirement

2. Output Requirement

Service Requirement
 Intangible thing or product that is not able to
be touched but customer can feel the
fulfillment.
 There are elements in service requirement like
on-time delivery, service with a smile, easy-
payment etc.
 It includes all aspects of how a customer
expect to be treated while purchasing a product
and how easy the buying process goes.

Output Requirement
 Tangible thing or things that can be seen.
Characteristic specifications that a consumer
expects to be fulfilled in the product.
 Costumer that will avail services as product,
then various service requirements can take the
form of output requirements.
 For example, if the consumer hires a multi cab,
then on-time arrival becomes an output
[Link] buys gadgets (phone
speaker), the specification like the loudness
and clarity are the output requirements.

Market Size
 Entrepreneur's most critical task is to calculate
the market size, and the potential value that
market has for their startup business.
 Market research will determine entrepreneur
possible customers in one locality.
 Market size is like a size of arena where the
entrepreneurs will play their business. It is the
approximate number of sellers and buyers in a
particular market
 Entrepreneurship
Concept of Environmental Factors
Entrepreneurship which include political, climate, legal system,
economic and social conditions and market
The word "entrepreneur" was derived from the situations.
French verb enterprendre, which means "to
undertake." This is pinpointing to those who Common Competencies in
"undertake" the risk of enterprise. Entrepreneurship
The enterprise is created by an 1 Decisive - an entrepreneur must be
entrepreneur and the process is called firm in making decisions.
"Entrepreneurship." 2 Communicator - an entrepreneur
must have a convincing power.
Entrepreneurs are innovators. They are 3 Leader - an entrepreneur must have
willing to take the risks and generate unique the charisma to be obeyed by his
ideas that can provide profitable solutions to employees.
the needs of the market and the society. 4 Opportunity seeker - an entrepreneur
must have the ability to be the first to
see business chances.
5 Proactive - an entrepreneur can
Factors Affecting control a situation by making things
Entrepreneurship happen or by preparing for possible
future problems.
Personality Factors 6 Risk Taker - an entrepreneur has the
courage to pursue business ideas.
which include:
7 Innovative the entrepreneur has big
1 Initiative - doing things even before business ideas and he does not stop
being told. improving and thinking of new
2 Proactive - which means he can worthwhile ideas for his business.
classify opportunities and seize it. Core Competencies in
3 Problem Solver - which means he Entrepreneurship
can retain good relations with other
people. 1 Economic and Dynamic Activity
4 Perseverance - meaning he will - Entrepreneurship is an economic
pursue things to get done regardless of activity because it involves the
challenges. creation and operation of an
5 Persuasion - means that he can entice enterprise with a view to creating
people to buy even if they don't want value or wealth by ensuring
to. optimum utilization of limited
6 A Planner - he makes plans before resources.
doing things and does not fail to 2 Innovative - The entrepreneur
monitor it. constantly looks for new ideas,
7 Risk-taker - which means that he is thus he needs to be creative.
willing to gamble but he will calculate 3 Profit Potential - The
it first. entrepreneur can be compensated
 Entrepreneurship
by his profit coming from the 4. Sales - the entrepreneurship graduate can
operation. apply as a salesman.
4 Risk bearing - The entrepreneur 5. Business Reporter - the entrepreneur
needs to gamble but wise enough being expert in the field, can be employed
to offset as a business reporter.
Recognize a
Types of Entrepreneurs potential market
1. Innovative Entrepreneurs - They are
those who always make new things by Entrepreneurial Ideas
thinking of new ideas. They have the The creation of an entrepreneurial
ability to think newer, better and more idea leads to the identification of
economical ideas. entrepreneurial opportunities, which
2. Imitating Entrepreneurs - They are in turn results in the opening of an
those who don't create new things but entrepreneurial venture.
only follow the ideas of other
entrepreneurs.
The entrepreneurial process of
3. Fabian Entrepreneurs - They are
skeptical about changes to be made in creating a new venture is presented in
the organization. They don't initiate the diagram below. (Nick L. Aduana,
but follow only after they are Etrepreneurship in Philippine Setting
satisfied. for Senior High School, 2017, C&E
4. Drone Entrepreneurs - They are publishing page 46, Aduana, 2017).
those who live on the labor of others. 1. Creation of entrepreneurial
They are die-hard conservatives even Ideas
ready to suffer the loss of business. 2. Identification of
5. Social Entrepreneurs - They are entrepreneurial Opportunities
those who initiate changes and drive 3. Opening of entrepreneurial
social innovation and transformation Venture
in the various fields such as education,
health, human rights, environment and Figure 1.
enterprise development. The Entrepreneurial Process of
Career Opportunities of Creating New Venture Essentials in
Entrepreneurship Entrepreneur's Opportunity -
Seeking
1. Business Consultant - with the expertise
of in the field of entrepreneurship, he can These are the basic foundation that the
be a very good source of advices to other entrepreneur must have in seeking
entrepreneurs and would be business men. opportunities:
2. Teacher - a graduate of an
entrepreneurship can use his knowledge in Entrepreneurial mind frame.
teaching.
This allows the entrepreneur to see
3. Researcher - the entrepreneur can be
things in a very positive and
employed as a researcher by an enterprise.
optimistic way in the midst of difficult
 Entrepreneurship
situation. Being a risk - taker, an and industry environment where the
entrepreneur can find solutions when business operates.
problems arise.

Entrepreneurial heart flame.

Entrepreneurs are driven by passion;
1.1 The physical
they are attracted to discover environment
satisfaction in the act and process of A. Climate - the weather conditions.
discovery. Passion is the great desire B. Natural resources - such as minerals,
of an entrepreneur to achieve his/her forests, water, and fertile land that
goals. occur in nature and can be used for
economic gain.
Entrepreneurial gut game. This C. Wildlife - includes all mammals,
refers to the ability of the entrepreneur birds, reptiles, fish, etc., that live in
of being intuitive. This also known as the wild.
intuition. The gut game also means
confidence in one's self and the firm
belief that everything you aspire can
1.2 The Societal
be reached. environment
A. Political forces - includes all the
laws, rules, and regulations that
Sources of Opportunities govern business practices as well as
the permits, approvals, and licenses
There are many ways to discover
necessary to operate the business.
opportunities. Looking at the big
B. Economic forces - such as income
picture, some have noticed the level and employment rate.
emerging trends and patterns for C. Sociocultural forces - customs,
business opportunities. While others lifestyles and values that characterize
are trying to find out their target a society.
market. The following are some D. Technological environment - new
sources of opportunities: inventions and technology
innovations.

1. Changes in the
environment 1.3 The Industry
Entrepreneurial ideas arise when
environment
a. Competitors
changes happen in the external
environment. A person with an b. Customers
entrepreneurial drive views these c. Creditors
d. Employees
changes positively. External
e. Government
environment refers to the physical
f. Suppliers
environment, societal environment,
 Entrepreneurship
For example, one factor in the
physical environment that can easily
change is the climate. The temperature 4. People's interest
is very high during summer but very The interest, hobbies, and preferences
low during the rainy season. An of people are rich sources of
individual with entrepreneurial drive entrepreneurial ideas, like the
can be extremely imaginative and increasing number of Internet Cafés at
inventive in identifying opportunities. present could lead to the strong
He/she can venture on a business that attachment of young people to
responds to the needs of the people computers.
during summer and rainy season.

5. Past experiences
2. Technological discovery
The expertise and skills developed by
and advancement
a person who has worked in a
A person with entrepreneurial interest particular
sees possibility of business field may lead to the opening of a
opportunities related business enterprise.
in any new discovery or because of For example, an accountant who has
the use of latest technology. learned the appropriate accounting
For example, an individual with and management skills and techniques
knowledge in repair and installation of in a prominent accounting firm can
a machine engine discovers additional start his/her business venture by
engine parts that considerably reduce opening his/her own accounting firm.
fuel consumption.

Forces of Competition
3. Government's thrust, Model
programs, and policies It is also known as the “five forces of
The priorities, projects, programs, and competition”. An industry
policies of the government are also environment is
good sources of ideas. a competitive environment.
Regardless of what product or
For example, the use of firecrackers to services you have,
celebrate New Year's Eve is strictly competition is always present.
prohibited. People without
Competition – it is the act or process of trying
entrepreneurial interest will view the
to get or win something.
ordinance as a plain restriction.
However, for an entrepreneur, it is a For example, the prices are lower
business opportunity to come up with when there is a competition among the
a new product that will serve as a stores.
substitute for firecrackers.
 Entrepreneurship
These are the five forces competing This can be noticed if there is the
within the industry: presence of the following factors:

These are the five forces competing a. Substantial capital requirement

within the industry: b. Strict government policy
c. Difficulty in accessing distribution
A. Buyers channels
B. Potential new entrants d. Economies of scale
C. Rivalry among existing firms e. High cost of product differentiation
D. Substitute products f. High switching cost
E. Supplier

3. Rivalry among Existing

1. Buyers Firms
The buyers are the ones that pay cash
Rivalry is a state or situation wherein
in exchange for your goods and
business organizations are competing
services.
with each other in a particular market.
One example is the influence of the
For example, it depends on the
price or in the bargaining strategy.
marketing strategy of your competitor,
The buyer has a strong and magnified
like giving freebies and special offers.
bargaining power. The threat of its
The intensity of rivalry among
bargaining power will be less if the
existing firms is characterized to the
following factors are noticed:
following factors:
a. There are several suppliers available a. Diversity of rivals
in the market. b. Number of competing firms
b. The buyer has the potential for c. Characteristics of the products
backward integration. or services
c. The cost of switching the supplier cost d. Increased capacity
is minimal. e. Amount of fixed costs
d. The product represents a high f. Rate of industry growth
percentage of the buyer's cost.
e. The buyer purchases large portions of
the seller's product or services. 4. Substitute Products
Substitute is one that serves the same
2. Potential New Entrants
purpose as another product in the
A new entrant is defined as companies market. For example, the consumers
or businesses that have the ability to decide to use margarine as a substitute
penetrate or enter into a particular for butter. In case the price of butter
industry. For example, in the level of increases, preferably the consumer
capital requirements, if the business will gradually switch to margarine.
requires huge capital, new entrants
should decline to join the business.
This gives a threat to the business.
 Entrepreneurship
A substitute product can give a big step method one has to follow to set
threat in the industry environment if up a business.
the following factors are noticed:  Entrepreneurial ideas - an
a. Switching cost is low innovative concept that can be used
b. Preferences and tastes of the for financial gain that is usually
customers easily change centered on a product or service that
c. Product differentiation is highly can be offered for money.
noticeable  Essentials of entrepreneur's
d. The quality of substitute products opportunity - seeking - these are the
dramatically improves basic foundation that the entrepreneur
e. The price of substitute product is must have in seeking opportunities,
substantially lower such as entrepreneurial mind frame,
heart flame and gut game.
 External environment - refers to the
5. Suppliers
physical environment, societal
The Suppliers are the one that provide environment, and industry where the
something that is needed in business business operates.
operations such as office supplies and  Government - refers to the local
equipment. In an example where government (municipality, city, or
supplies and services being offered is provincial) or the national government
unstable the intensity of the threat is and its branches.
strong in this kind of the competitive  New entrants - the one who enters
force in the industry. This can be something.
noticed if there is the presence of the  Opportunity - seeking - the process
following factors: of considering, evaluating, and
a. The supplier has the ability for pursuing market-based activities that
forward integration are accepted to be beneficial for the
b. Suppliers in the industry are few, but business.
the sales volume is high  Rivalry - is a state or situation in
c. Substitute products are not readily which people or groups are competing
available in the market with each other.
d. The switching cost is very high  Sources of opportunity - can be
e. The product or service is unique attained by assessing and looking at
changes in the environment;
Definition of terms technological discovery and
advancement; government's thrust,
 Buyers - are the ones who pay cash in programs, and policies; people's
exchange for your goods and services. interest, and past experiences.
 Competition - it is the act or process  Substitute - anything that takes the
of trying to get or win something. place or function of another.
 Entrepreneurial process - can be  Suppliers - are the ones who provide
defined as the steps taken in order to something that is needed or wanted.
begin a new enterprise. It is a step-by-
 Entrepreneurship
value proposition is: “Charing sari-sari Store,
open 24/7”.

The business describes a sari-sari store – a

Recognize Potential basic retail store. The assurance from this
Market value proposition is because of the phrase
“open 24/7”, Aling Charing’s sari-sari store
opens 24/7, which makes it different from
Value Proposition (VP) other competitors.
- is a business or marketing statement that
summarizes why a consumer should buy a Unique Selling Proposition
company's product or use its service. (USP)
This statement is often used to convince a – refers to how you sell your product or
customer to purchase a particular product or services to your customer. You will address
service to add a form of value to their lives. In the wants and desires of your customers.
creating Value Proposition, entrepreneurs will
consider the basic elements: As an entrepreneur, you should think of
marketing concepts that persuade your target
 Target Customer customers. You may ask the following
questions in doing this: What do the customers
 Needs/opportunity
want? What brand does well? What does your
 Name of the product competitor sell well? Some tips for the
entrepreneur on how to create an effective
 Name of the enterprise/company unique selling proposition to the target
There are many competitors in the market who customers are:
establish superiority over other entrepreneurs.  Identify and rank the uniqueness of
Entrepreneurs should think of other the product or services character
alternatives to make their products better. An  Be very Specific
important aspect in Value Proposition is that it  Keep it Short and Simple (KISS)
must be truthful and that it should establish In promoting your products or services, make
credibility to the consumers. sure that it is very specific and put details that
emphasize the differentiator against the
Example: Potential value proposition is most competitors. Keep it short and simple and
common in small businesses of your locality. think of a tagline that is easy to remember.
Aling Charing Sari-Sari Store opens only from Right now, the proposed unique selling
6:00 am to 6:00 pm, but Aling Charing proposition is: “Charing sari-sari store, open
noticed that there are customers who go to a 24/7”
nearby town to look for a convenience store at Readers get confused between value
around 10:00 pm to 6:00 am. She believes that proposition and unique selling proposition.
this is a great opportunity for her store to The two propositions are used to differentiate
operate 24/7. In this example, the proposed the products from competitors. For example,
 Entrepreneurship
Jollibee is known to have a Filipino taste 1. Geographic segmentation – the total
burger. This brand has a unique selling point market is divided according to geographical
because of its tagline “Langhap Sarap” location.
 Variables to consider
Unique Selling Proposition and Value a. Climate
Proposition are two of the most famous tools b. Dominant ethnic group
used to explain why prospect customers buy c. Culture
each product and service. Base on each d. Density (either rural or urban)
definition, we learn that USP and VP are 2. Demographic Segmentation – divided
frameworks of each business industry. The based on consumers
two propositions are valuable for the  Variables to consider
entrepreneurs.
a. Gender
Make sure that you're focusing on a solution b. Age
that is a need, and make sure that you are c. Income
targeting a customer segment that's large d. Occupation
enough and cares enough about your solution e. Education
so that you can build a viable business.. f. Religion
g. Ethnic group
Three factors that will h. Family size
determine your customers
3. Psychological Segmentation – divided in
A. Target Market terms of how customers think and believe
Market Targeting is a sage in market
 Variables to consider
identification process that aims to determine
a. Needs and wants
the buyers with common needs and
b. Attitudes
characteristics. Prospect customers are a c. Social class
market segment that an entrepreneurial d. Personality traits
venture intends to serve. e. Knowledge and awareness
f. Brand concept
In targeting a specific market, it will exclude
g. Lifestyle
people if it will not fit your criteria. Rather,
4. Behavioral Segmentation – divided
target marketing allows you to focus your
according to customers’ behavior pattern as
marketing money and brand message on a
specific market that is more likely to buy from they interact with a company.
you than other markets. Choose a product that
 Variables to consider
is more affordable, efficient, and effective to
a. Perceptions
reach potential clients and generate business.
b. Knowledge
Commonly used methods for segmenting the c. Reaction
markets are follows.: d. Benefits
e. Loyalty
f. Responses
 Entrepreneurship
B. Customer Requirements the potential value that market has for
their start-up business. Market
Customer requirements are the specific research will determine the
characteristics that the customers need from a entrepreneurs’ possible customers in
product or a service. one locality.
There can be two types of customer
requirements: What is Market Size?
Market size is like a size of the arena
[Link] Requirement where the entrepreneurs will play
[Link] Requirement their business. It is the approximate
number of sellers and buyers in a
particular market. Companies are
Service Requirement: interested in knowing the market size
An intangible thing or product that before launching a new product or
cannot be touched but the customer service in the area. In determining the
can feel the fulfillment. There are market size, the entrepreneur will
elements in service requirement like conduct a strategic marketing research
on-time delivery, service with a smile, from reliable sources using the
easy-payment etc. It includes all following method.
aspects of how a customer expects to The first step is to estimate the
be treated while purchasing a product potential market – approximate
and how easy the buying process number of customers that will buy the
goes. product or avail your services.
The second step is to estimate the
Output Requirements: customers who probably dislike to
Tangible thing or things that can be buy your product or avail the services.
seen. Characteristic specifications that The third step is for the
a consumer expects to be fulfilled in entrepreneur to estimate the market
the product. Costumers will avail share, that means plotting and
services as a product, then various calculating of the competitor’s market
service requirements can take the share to determine the portion of the
form of output requirements. For new venture. Market size becomes the
example, if the consumer hires a multi most important factor if you ever need
cab, then on-time arrival becomes an to raise funding for your business
output requirement. Customer buys
gadgets (phone speaker) the
specification like the loudness and
clarity are the output requirements.

C. Market Size
The entrepreneur’s most critical task
is to calculate the market size, and
 Entrepreneurship
SURVEYS
are the most common way to gather
primary research with the use of
questionnaires or interview schedule.
Market These can be done via direct mail,
over the phone, internet (e.g. Google)
Research or email, face-to-face or on the Web
(e.g. Skype or Viber).
When designing or constructing your
Market Research or Marketing Research own research questionnaire,
Process can be defined as the process of remember the following guidelines.
gathering, analyzing and interpreting the (Edralin, 2016)
information about the products or the services  Keep it as simple as possible
to be offered for sale to the potential  Make sure it is clearly appealing and
consumers in the market (De Guzman, 2018, easy to read
p. 25)  Cluster or block related questions
 Move from complex questions to
more specific questions
 Make sure questions are concise and
DATA COLLECTION is the most valuable
easily understood
tool in any type of research study. Inaccurate
 Avoid questions that are difficult to
data collection may cause mistakes and
answer
ultimately lead to invalid results. (Edralin,
2016, p. 80)
Make sure response scales used are consistent
TIPS in COLLECTING DATA
with categories that are mutually exclusive
 Organize collected data as soon as
it is available INTERVIEW
 Know what message you want to
get across and then collect data is one of the most reliable and credible ways
that is relevant to the message of getting relevant information from target
 Collect more data customers. It is typically done in person
 Create more data between the researcher/entrepreneur and a
 Take note of interesting or respondent where the researcher asks
significant data pertinent questions that will give significant
three different data collection pieces of information about the problem
techniques that he will solve. The interview is also
SURVEY (Questionnaire), helpful even when the business has already
INTERVIEW started because the customers' feedback
FOCUS GROUP DISCUSSION - and provides the entrepreneur a glimpse of what
evaluate their suitability under the customers think about the business.
different circumstances
 Entrepreneurship
Interviews normally last from 15 to 40 The following are considerations in the
minutes, but they can last longer, depending use of focus group discussions
on the participants' interest in the topic. in market research:
In a structured interview, the researcher asks a
 The length of the session is between
standard set of questions
90 and 120 minutes.
and nothing more. (Leedy & Ormrod, 2001,
pp.38-39)  Conduct focus groups discussion
with 8 to 10 participants per group.
Personal interviews are the traditional
method of conducting an interview. It allows
 Assign an expert moderator /
the researcher to establish relationship with
facilitator who can manage group
potential participants and therefore gain their
dynamics.
cooperation. It generates highest response
rates in survey research. They also allow the
 Use a semi-structured or open-
researcher to clarify indefinite answers and
format discussion
when necessary, seek follow-up information.
(Leedy & Ormrod. 2001, pp.39)
Telephone interviews are less expensive and  Strive for consistency in the
less time-consuming, but the disadvantages group's composition (for example,
are that the response rate is not as high as the it may not be advisable to have
face-to-face interview, but considerably higher business customers and retail
than the mailed questionnaire. customers in the same focus group,
their needs are very different)
FOCUS GROUP DISCUSSION (Leedy & Ormrod, 2001, pp.40-41)
(FGD)
- is an excellent method for generating and
screening ideas and concepts. It can be
moderated group interviews and brainstorming
sessions that provide information in customer
needs and behavior
 Entrepreneurship
7P’s of Marketing and Brading
The 7 P's of Marketing Mix
There are several important frameworks which you can utilize for the purpose of marketing your
product and services. A very crucial structure among these is the "7 P's of Marketing. The
framework of "7 Ps of marketing" includes product, place, price, promotion people, packaging and
positioning. Realizing these P's in the most ideal manner can turn out to be very profitable,
however, you should totally see each description of the 7 P's first.

1. PRODUCT
The first P in the Marketing Mix is the Product. Marketing strategy typically starts with the product.
Marketers can't plan a distribution system or set a price if they don't know exactly what the product
will be offered to the market.
Product refers to any goods or services that is produced to meet the consumers' wants, tastes and
preferences. Examples of goods include tires, MP3 players, clothing and etc. Goods can be
categorized into business goods or consumer goods. A buyer of consumer goods may not have
thorough knowledge of the goods he buys and uses.
Examples of services include hair salons and accounting firms. Services can be divided into
consumer services, such as hair styling or professional services, such as engineering and
accounting.

2. PLACE
Place is the second P in the Marketing Mix. Place
represents the location where the buyer and seller
exchange goods or services. It is also called as the
distribution channel. It can include any physical
store as well as virtual stores or online shops on the
Internet. t is one thing having a great product, sold
at an attractive price. But what if:

Customers are not near a retailer that is selling the

product?A competing product is stocked by a much
wider range of outlets?

A competitor is winning because it has a team of

trained distributors or sales agents who are out
there meeting customers and closing the sale?

Place matters for a business of any size. It is a

crucial part of the marketing mix. The main
 Entrepreneurship
function of a distribution channel is to provide a customers exchange a certain value for having or
link between production and consumption using the product - a value we call price. In
commerce, price is determined by what (1) a buyer
is willing to pay, (2) a seller is willing to accept,
and (3) the competition is allowing to be charged.
With product, promotion, and place of marketing
mix, it is one of the business variables over which
organizations can exercise some degree of control.
One example of a pricing strategy is the
penetration pricing. It is when the price charged for
products and services is set artificially low in order
to gain market share. Once this is attained, the
price can be higher than before. For example, if
Channel 1 contains two stages between producer you are going to open a Beauty Salon, you need to
and consumer - a wholesaler and a retailer. A set your prices lower than those of your
competitors so that you can penetrate the market. If
wholesaler typically buys and stores large you already have a good number of market share
quantities of several producers' goods and then then you can slowly increase your price.
breaks into bulk deliveries to supply retailers with
smaller quantities.

For small retailers with limited order quantities, the

use of wholesalers makes economic sense.

Channel 2 contains one intermediary. In

consumer markets, this is typically a retailer.A
retailer is a company that buys products from a
manufacturer or wholesaler and sells them to
end users or customers. In a sense, a retailer is an
intermediary or middleman that customers use to
get products from the manufacturers.

Channel 3 is called a "direct marketing" channel,

since it has no intermediary levels.

In this case the manufacturer sells directly to

customers.

3. PRICE
The third P in the Marketing Mix is price. The
price is a serious component of the marketing mix.
What do you think is the meaning of Price?

In the narrowest sense, price is the value of

money in exchange for a product or service.
Generally speaking, the price is the amount or
value that a customer gives up to enjoy the benefits
of having or using a product or service. Thus,
 Entrepreneurship
4. PROMOTION Word-of-mouth advertising is important for every
business, as each happy customer can steer dozens
Promotion is the fourth P in the Marketing Mix. of new ones your way. And it's one of the most
Promotion refers to the complete set of activities, credible forms of advertising because a person puts
which communicate the product, brand or service their reputation on the line every time they make a
to the user. The idea is to create an awareness, recommendation and that person has nothing to
attract and induce the consumers to buy the gain but the appreciation of those who are listening
product, in preference over others. The following
are the most common medium in promoting a • Generic
product and this is called promotional mix. The promotion of a particular commodity is
without reference to a specific producer, brand
PROMOTIONAL MIX name or manufacturer. Producers join together to
expand total demand for the commodity, thereby
1. ADVERTISING helping their own sales. These activities are often
• Radio self-funded through assessments on marketing
Advertising by means of radio gives the advantage called check-off programs.
of selecting the territory and audience to which the
message is to be directed. It is also cheaper than 2. PUBLIC RELATIONS
TV advertising. OR PR
In public relations, the article that features your
company is not paid for. The reporter, whether
 Television broadcast or print, writes about or films your
company as a result of information he or she
ince id populate tan tay ais developie me dism of received and researched.
are is radio as is nesting
Many people use the term PR and advertising
advantages of sound and sight. On account of interchangeably, PR involves sharing information
pictorial presentation, it is more effective and with the public using platforms that do not require
impressive and leaves a lasting impression on the a payment, such as social media or through press
mind of the viewer. releases shared with magazines and newspapers.
• Print PR professionals package information and
The print media carry their messages entirely disseminate it in the hopes that it will be
through the visual mode. Thesemedia consist of organically shared. The goal of public relations is
newspapers, magazines and direct mail. to shape public perception of a business, presenting
a positive image through various strategies to its
• Electronic various constituents.
You can also advertise electronically through your
company website and provide important and
3. PERSONAL SELLING
pertinent information to clients and customers. You Personal selling occurs when an individual
can protect some parts of your website through salesperson sells a product, service or solution to a
passwords and give access to member customers. client. Salespeople match the benefits of their
You can also send advertisements via direct e-mail offering to the specific needs of a client. Today,
as part of your promotional strategy. personal selling involves the development of
longstanding client relationships.
• Word of Mouth
 Entrepreneurship
Personal selling involves a selling process that is product that normally costs 35 pesos at a price of
summarized in the following 3-for-100-pesos during the promotional period.

Five Stage Personal Selling Process. The five

stages are:
5. DIRECT MARKETING
Direct marketing is a promotional method that
1 Prospecting involves presenting information about your
2 Making first contact company, product, or service to your target
3 The sales call customer without the use of an advertising
4 Objection handling middleman. It is a targeted form of marketing that
5 Closing the sale presents information of potential interest to a
consumer that has been determined to be a likely
4. SALES buyer.

PROMOTIONS Forms of Direct Marketing

Sales promotion is any initiative undertaken by an Brochure Coupons
organization to promote an increase in sales, usage Catalogs
or trial of a product or service (i.e., initiatives that Email
are not covered by the other elements of the Fliers
marketing communications or promotions mix). Phone calls
Newsletters
Sales Promotion Technique Post cards
Text messages
• Free Gifts

There are many ways to utilize this particular sales

promotion technique. A newly opened store, for
example, may offer the first 10 customers free 5. PEOPLE
items worth 100 pesos.
The fifth P in the Marketing mix is People. Your
Providing free samples is a technique used to team, the staff that makes it happen for you, your
introduce new products to the marketplace. audience, and your advertisers are the people in
Samples give the consumer a chance to see how marketing. This consist of each person who is
well they like a product or try something they
involved in the product or service whether
otherwise would not normally buy.
directly or indirectly.
• Free Trial People are the ultimate marketing strategy. They
sell and push the product. People are one of the
A free trial is a way for a consumer to try a new most important elements of the marketing mix
product while eliminating risk. It may be used today. This is because of the remarkable rise of the
when a product is unique to the marketplace. services industry. Products are being sold through
• Customer Contests retail channels today. If the retail channels are not
handled with the right people, the product will not
Contests offer the customer a chance to win prizes be sold. Services must be first class nowadays. The
like cash or store merchandise. people rendering the service must be competent
and skilled enough so that that the clients will
• Special Pricing patronize your service. The marketing efforts of
Special pricing is used to offer consumers a lower people are to create customer awareness, to arouse
price for a period of time or to purchase in multiple customer interest, to educate customers, to close
quantities. For example, a retailer may offer a the sale and to deliver the product.
 Entrepreneurship
Therefore, the right people are essential in Packaging also serves to reduce the amount of
marketing mix in the current marketing waste especially in case of food distribution.
scenario.
2. Containment:
6. PACKAGING This involves merging of unit loads for shipping. It
starts with spots of adhesives on the individual
Packaging is the sixth P in the Marketing Mix. shippers that stick them together, straps of steel
Packaging is a silent hero in the marketing world. and plastic, entire coverings of shrinkable or
Packaging refers to the outside appearance of a stretchable plastic films and paper or corrugated
product and how it is presented to the wraps that surround an entire pallet of product.
customers. The best packaging should be There are some special bulk boxes or pallet bins
attractive enough and cost efficient for the made from unusually strong corrugated board or
customers. Packaging is highly functional. It is for fabricated form plastics or metal, the method of
protection, containment, information, utility of use which depends on the type and weight of product
and promotion. and its protective needs. The cargo containers
made of aluminum used to hold many pallet loads
of goods can be transferred to or from ships, trains
Five Basic Functions and flatbed trucks by giant cranes.
of Packaging
1) Protection: 3) Information:
One of the major functions of packaging is to The packaging conveys necessary information to
provide for the effects of time and environment for the consumers. The common information that
the natural and manufactured products. The packaging provides include general features of the
protection function can be divided into some product,
classes. ingredients, net weight of the contents, name and
address of the manufacturers, maximum retail price
(MRP).
A. Natural deterioration: Packaging of medicine and some food products is
It is caused by the interaction of products with required to provide information on methods of
water, gases and fumes, microbiologic organisms preparations, recipes and serving ideas, nutritional
like bacteria, yeasts and molds, heat, cold, dryness, benefits, and date of manufacturing,
contaminants and insects and rodents. Date of expiry, warning messages and cautionary
B. Physical protection: information.
The packaging is also used for physical protection, Sometimes, the color of the packaging itself
which include improving shock protection, internal provides some information.
product protection and reducing shock damage
caused from vibration, snagging, friction and 4) Utility of use:
impact. The convenience packaging has been devised for
C. Safety: foods, household chemicals, drugs, adhesives,
A special kind of protective packaging is required paints, cosmetics, paper goods and a host of other
for products that are deemed harmful to those who products. This type of packaging includes
transport them or use them. These products include dispensing devices, prepackaged hot metals, and
extremely inflammable gas and liquid, radioactive disposable medical packaging.
elements, toxic materials etc. The packaging
should also be done so that children could not 5) Promotion:
easily use or dispose them.
D. Waste reduction:
 Entrepreneurship
Companies use attractive colors, logos, symbols or cognitive stimulation.
and captions to promote the product that can
influence customer purchase decision.
Packaging Decisions:
i. Packaging concept:
This defines what the package should be or do for
the particular product in terms of size, shape,
materials, color, text, and brand mark and
tamperproof ability
11E wil ensure thai the package stands up under
normal conditions
ii. Visual tests:
This is to ensure that the script is legible and colors
are harmonious iv. Dealer tests:
This is to ensure that the dealers find the packages
attractive and easy to handle
v. Consumer tests:
This is to ensure favorable consumer response

7. POSITIONING
Finally, the seventh P in the Marketing Mix is
Positioning. When a company presents a
product or service in a way that is different
from the competitors, they are said to be
"positioning" it. Positioning refers to a process
used by marketers to create an image in the minds
of a target market.
Solid positioning will allow a single product to
attract different customers for not the same
reasons. For example, two people are interested in
buying a phone; one wants a phone that is cheaper
in price and fashionable while the other buyer is
looking for a phone that is durable and has longer
battery life and yet they buy the same exact phone.
There are three basic concepts for positioning.
These are Functional Positions, Symbolic Positions
and Experiential Positions. Functional Positions
deal with solving a problem, providing benefits and
getting a favorable perception from investors,
stockholders and consumers. Symbolic Positions
deal with self-image enhancement, ego
identification, belongingness, social
meaningfulness and affective fulfilment and
Experiential Positions deal with providing sensory
 Entrepreneurship
4 M’s of Production and suppliers and waste that the raw
material may produce.
Business Model
Machine
4 M’S - Discusses about manufacturing
 Manpo equipment used in the production of
goods or delivery services
wer Outpu - In the process of selecting the type of
 Metho t equipment to purchase, the
entrepreneur may consider types of
d products to be produced, production
 Machin system to be adopted, cost of the
Manpower equipment, capacity of the equipment,
availability of spare parts in the local
- Talks about human labor force
market, efficiency of the equipment
involves in the manufacture of and the skills required in running the
products. equipment.
- It is measured as the most serious and
main factor of production. The
entrepreneur must determine, attain Method
and match the most competent and
skilled employees with the jobs at the - Production method discusses the
process or way of transforming raw
most appropriate time period.
materials to finished products. The
- Educational qualifications and resources undergo some stages before
experience, status of employment, it is finalized and becomes set for
numbers of workers required, skills delivery to the target buyers.
and expertise required for the job are - The selection of the method of
some of the manpower criteria that production is dependent on product to
must be highly considered by the produce, mode of production,
entrepreneur. manufacturing equipment to use and
required skills to do the work.

Material Product Description

- Talks about raw materials necessary in - Is the promotion that explains what a
the production of a product. Materials product is and why it’s worth buying?
mainly form part of the finished The purpose of a product description is
product. Just in case the resources are to provide customers with details
below standard, the finished product around the features and benefits of the
will be of unsatisfactory as well. product so they’re obliged to buy.
- The entrepreneur may consider cost, Know who your target market is,
focus on the product benefits, tell the
quality, availability, credibility of
 Entrepreneurship
full story, use natural language and
tone, use power words that sell, and
use good images. These are guidelines Suppliers
for you to have a good product
description; since some customers are are your business partners, without
very particular with it since they them your business will not live. You
consider the welfare of their family, if need them as much as you need your
it is safe to use. customers to be satisfied. But as an
entrepreneur you have to choose a
Prototyping potential supplier that has loyalty and
value your partnership; a supplier that
- A duplication of a product as it will be would lead you to the fulfillment of
produced, which may contain such your business objectives, mission and
details as color, graphics, packaging vision.
and directions. One of the important
early steps in the inventing process is
making a prototype. Benefits are the Value chain
reasons why customers will decide to
is a method or activities by which a
buy the products such as affordability,
company adds value to an item, with
efficiency or ease of use. The features
production, marketing, and the
of the product or service merely
provision of after-sales service. The
provide a descriptive fact about the
main goal and benefit of a value
product or service.
chain, and therefore value chain
- It is better to test your product
analysis, is to make or support a
prototype to meet customers’ needs
competitive benefit.
and expectations; and for your product
to be known and saleable. Pretesting of
the product or service is similar to a supply chain
sample of the product or service given
to the consumer free of cost in order is a structure of organizations, people,
that he/she may try the product before activities, data, and resources involved
committing to a purchase. in moving a product or service from
supplier to customer.
Supplier The main objective of supply chain
management includes management of
- An entity that offers goods and a varied range of components and
services to another business. This procedures, for instance, storing of
entity is among of supply chain of a raw materials, handling the inventory,
business, which may offer the main warehousing, and movement of
part of the value contained within its finished product from the point of
products. Certain suppliers may even processing to the point of
involve in drop shipping, where they consumption.
ship goods directly to the customers of
the buyer.
 Entrepreneurship
You can also make use of the business plan in
securing investment capital from financial
institutions or lenders. It can also be used to
influence people to work for your enterprise,
to secure credit from suppliers, and to
fascinate potential customers.
Read the stories of Jessie, Mercy and Monna
below to fully understand the importance of
having a business plan:
“Jessie is the eldest of five children of Mr. &
Business model describes the reasons of how Mrs. Natividad. The family is having difficulty
an organization creates, delivers, and captures to support for their everyday needs. Because
value in economic, social, cultural or other of this, Jessie tried to enter selling banana cue
contexts. The development of business model and with his dream to make his business
construction and variation is also called grow, he put up many stalls in the community
business model innovation and forms a part of without considering the advises of his friends
business plan. to make a business plan before implementing
his decision. After a few months his stalls
It is a company's plan for how it will make shutdown.”
revenues and make a profit. It describes what “Mercy is the youngest in the family. She
products or services the business plans to found out that she loves to cut hair and apply
manufacture and market, and how it plans to make up to her friends. Until such time that
do so, as well as what expenses it will incur. her friends introduced her to their friends too
for haircut and make up when there are
There are important phases in developing your occasions. Few months after, Mercy was told
business model, namely; Identifying the by her friends to put up a beauty parlor in
specific audience; establishing business their place. So she asks her mother who is
process; recording a business resources; also a businesswoman to teach her how to
developing strong value proposition; make a business plan and eventually ended
determining key business partners; and with a successful business.”
creating a demand for today’s generation “Monna is a diligent student. Because of her
strategy and be open for innovations. knowledge gained from school about business
plan she was able to enhance her skills in
After developing a business model, we will business and finally found herself into his
proceed in developing a business plan. To be laundry shop business.”
able to successfully complete this module, you
need to prepare a business plan and operate Each scenario taught us that business is not
your plan and finally keep records of your just about how much income or profit you can
business transactions. get but it’s about the life of your business.
And in having a business, you also have to
Business plan is an important tool for you to consider technological forces, Social forces,
have an idea about the future of your business. Political forces, Cultural forces, Economic
Your business plan will be your guide in the forces and Legal forces.
moment you will be implementing and
operating your business proposal.
 Entrepreneurship
The following are the
components found in
a Business Plan.
Introduction- this part discusses what is the
business plan all about.

Executive Summary- is part of the business

plan which is the first to be presented but the
last to be made.

Management Section- shows how you will

manage your business and the people you
need to help you in your operations.

Marketing Section- shows the design of your

product/service; pricing, where you will sell
and how you will introduce your
product/service to your market.

Financial Section- shows the money needed

for the business, how much you will take in
and how much you will pay out.

Production Section- shows the area,

equipment and materials needed for the
business.

Competitive Analysis- is the strategy where

you identify major competitors and research
their products, sales and marketing strategies.

Market- The persons who will buy the product

or services

Organizational chart- is the diagram showing

graphically the relation of one official to
another, or others of a company.