01 How to make a business plan

02 Misconceptions on Entrepreneurship

03 Importance of Entrepreneurship

04 Sources of Entrepreneurial Ideas

Character Traits Common to Succesful

05 Entrepreneurs

06 Skills and Core Competencies in Entrepreneurship

Lesson 1
Major Parts of the Business Plan

1. Introduction
2. Executive Summary
3. Environmental Analysis
4. Business Description
5. Organizational Plan
6. Production Plan
7. Operation Plan
8. Marketing Plan
9. Financial Plan
10. Appendix

A. Title Page
B. Table of contents
C. List of tables
D. List of Figures
E. List of Appendices
F. Introduction
1. Proposed name of the business
2. Address of the business
3. Name of the Owner/s
4. Description of the business
5. Location of the business
6. Funding requirements and
sources
The Business Plan
G. Executive Summary
1. Vision, mission, goals, and
objectives of the business
2. Business model
3. Business and product positions
4. Wealth Improvements
approaches
5. Parties supporting the business
H. Environmental Analysis
1. Global Analysis
2. Social Analysis
3. Industry Analysis
I. Business Description
1. Nature of the organization
2. Product or service that it plans to
produce or serve
3. Various plants and office
equipment
4. Size of the proposed business
5. Future parties with whom
contracts may be necessary
6. Personnel Requirements
7. Administrative operation
J. Organizational Plan
1. Form of business organization
2. Liability of the owner/s
3. Organizational Structure
4. Roles and Responsibilities
5. Salary Requirements
The Business Plan
K. Production Plan
1. Production schedule
2. Production Process
3. Processing plant and equipment
4. Sources of Materials
5. Production cost
L. Operation Plan
1. Evaluation of suppliers
2. Materials requisition and receiving
procedures
3. Storage and inventory control system
4. Shipment system and control
5. Functions of support services
M. Marketing Plan
The Business Plan
1. Product
2. Place
3. Price
4. Promotion
5. People
6. Packaging
7. Positioning
N. Financial Plan
1. Major Assumptions
2. Projected statement of comprehensive income
3. Projected statement of cashflows
4. Projected statement of changes in equity
5.Projected statement of financial position
6. Financial statement analysis
O. Apendix
 The Business Plan
• Prepared using a
scientific approach
• Roadmap of a new
business
• Must be prepared
Feasibility
before opening a new
Study
business
 Feasibility Study
- To determine whether the
proposed business is feasible or
not
Test
of Business idea should have
Possibility positive results

Test
Also known as the Test of
of
Viability
Feasibility
 INTRODUCTION
- presents the general
perspective of the business
- may consist one to two pages
1. Proposed name of the business
2. Address of the business
3. Name of the owner or owners
4. Description of the business
5. Location of the business
6. Funding requirement and source
 Proposed name of the
business
must:
1. reflect the business identity
and image
2. promote the philosophical
values and culture that the
business values most
3. Profess the brand identity of
the product
4. attract or influence the target
customers
 Proposed name of the
business
must:
1. reflect the business identity
and image
2. promote the philosophical
values and cuture that the
Three suggested business values most
trade names 3. Profess the brand identity of
must be the product
submitted to DTI
4. attract or influence the target
customers
SOME UNIQUE
BUSINESS
NAME
 Address of the Business
- should be correctly written
because all business
correspondence are mailed to
the business address
- email address is also necessary
nowadays to facilitate
electronic communication
betweeen the business and
the customers
 Name of the Owner

- must be properly stated

- for partnership, the names of the
owners, including the extent of
their liabilities, must be indicated
Incorporators
- for business venture that will
are persons
who originally operate as a corporate entity, the
formed the names, nationalities, and addresses
corporation of the incorporators must be given
 Description of the Business
- must include information about the
type of product or service the
business intends to provide
- may include brief information
about the ultimate mission, vision,
and objectives of the business
- you can also mention other
products or services that the
business plans to produce or
provide
 Location of the Business
- Basic entrepreneurial consideration
is to place the proposed business in
a strategic location that will assure
competitive advantage.
• Exact business
address
• Indicates the
• No additional
reason/s for
description is
the selection
provided to
of the location
highlight the
exact business
address
 Location of the Business
Factors to be considered:
1. Proximity of the target customers
2. Distance from the sources of raw
materials, labor, and utilities
3. Availability and cost of
transportation
4. Peace and order situation
5. Presence of direct competitors
6. The geographic and climatic
conditions
Funding Requirement and Source
- Estimated initial cost of the
business venture must be clearly
indicated
- should include the projected
breakdown of allocation of the
total cost
- presents the source/s of funds
- must also mention the estimated
period to settle the funding source
provided by creditors.
 EXECUTIVE SUMMARY
- points out the overall highlights of
the business plan as well as a
bird's-eye view of its sections
- must not provide a summary of the
different major sections of the
business plan
- must be written in a simple
language that can be easily
understood and at the same time
attract the attention and influence
the decision of the reader
 Executive Summary

include the following sections:

- Vision, Mission, Goals, and

Objectives of the Business
- Business model
- Business and product position
- Wealth improvement approaches
- Parties Supporting the business
 Vision, Mission, Goals, and
Objectives of the Business
Executive Summary
- embodies the fundamental
characteristics, nature,
philosophical values, identity, and
image of the business.
- must be clearly stated and easily
understood
- must be reviewed and revisited at
least every three years to
determine whether they are still
reasonable and achievable
 Business model
Executive Summary
- defines the perspective of the business in terms
of its structure, production, operation, and
financial activities that will lead to the
achievement of the VMGO
- must basically reflect the certain innovations that
will indicate the competitiveness of the business
in the industry
- must define how the business gives importance
to its relations with customers, creditors,
suppliers, and internal human resources
 Business and product position
Executive Summary
- help determine how the business defines its
coarse and the process of the accumulating
wealth
- tells the size of the market and the target market
share of the business and product
- must be able to convince the readers that the
proposed business has a competitive advantage
in the market
 Wealth and Improvement approches
Executive Summary
- describes the methodologies or approaches that
will be taken by the business in order to:
1. Maintain a competitive advantage
2. Position the business in the market
3. Improve the market share
4. Maximize the utilization of the resources
- this also includes a brief discussion of the
marketing policies and financial operations of the
business, and the profitability level of the
industry and of the business
 Parties supporting the business
Executive Summary
- must include the description of the parties that
have a direct relationship with the business like:
1. Consumers
2. Creditors
3. Suppliers
4. Employees and staff
- must cover 3-5 pages
 ENVIRONMENTAL ANALYSIS

- A strategic tool that helps determine the external

and internal factors affecting the performance of the
business. (political, economic, social, or
technological)
- may consist of at least 20 pages including the
graphical representations, tables, and computations
- considered the heart of the business plan
- consists:
• Global Analysis
• Societal Analysis
• Industry Analysis
 BUSINESS DESCRIPTION

- Presents the nature (merchandising,

service, manufacturing, or a hybrid) and
form (sole proprietorship, partnership, or
corporation) of the business to be
undertaken
- may cover 2-3 pages
- must include the innovative features of the
business
- reason/s for the selection of the form
 BUSINESS DESCRIPTION

must also include the following:

• product or service that it plans to
produce or serve
• various plant and office equipment
• size of the proposed business
• future parties with whom contacts
may be necessary
• personnel requirement
• Administrative operation
 ORGANIZATIONAL PLAN

- Provides a detailed description of the

business in terms of the following:
1. Form of the business organization
2. Liability of the owner or owners
3. Organizational Structure
4. Roles and responsibilities
5. Salary requirements
 PRODUCTION PLAN
- Presents or describes activities related to the
production of goods
- it is the result of the industry analysis,
particularly on the study of supply and demand
and consumer behavior
- includes the following:
1. Production schedule
2. Production process
3. Processing plant and equipment
4. Source of materials
5. Production cost
 OPERATION PLAN
- outlines the various activities, from the
acquisition of raw materials to the delivery of
the products
- covers the following areas:
1. Evaluation of suppliers
2. Materials requisition and receiving
procedures
3. Storage and inventory control system
4. Shipment system and control
5. Functions of support services
 MARKETING PLAN
- Details how the proposed business will sell its
product to the target consumers
- may consist of the following important sections:
1. Product
2. Place
3. Price
4. Promotion
5. People
6. Packaging
7. Positioning
 FINANCIAL PLAN
- accumulates and describes all the data expressed in
monetary units from the other sections of the business
plan
- simply collates and describes the various sets of
information derived from the other sections of the
business plan
- composed of the following important areas:
1. Major assumptions
2. Projected statement of comprehensive income
3. Projected statement of cashflows
4. Projected statement of changes in equity
5. Projected statement of financial position
6. Financial statement analysis
 APPENDIX

➢is like the business plan's own mini

library
➢holds the entire plan's supporting
documents in a clear, well-organized
fashion
➢consist of an array of documentation
that ranges from receipts and bank
statements to contacts and
inventories
ENTREPRENEURSHIP:
A GROWING REALITY
 ENTREPRENEURS
INTRAPRENEURS
ENTREPRENEURSHIP
ENTREPRENEURS
• is an individual who starts and runs a business with limited resources
and planning, taking account of all the risks and rewards of his or her
business venture.
• are people that notice opportunities and take the initiative to mobilize
resources to make new goods and services.
INTRAPRENEURS
• also notice opportunities and take initiative to mobilize resources,
however they work in large companies and contribute to the
innovation of the firm.
ENTREPRENEURSHIP
• Art of observing correct practices in managing and operating a self-
owned wealth-creating business by providing goods and services that
are available to the customers.
LESSON 1
ENTREPRENEURSHIP:
A GROWING REALITY

✓What is entrepreneurship?
✓Does entrepreneurship always involve an opportunity?
✓Does entrepreneurship always involve something new?
✓What are some types of enterprises according to
concept?
✓What are the types of enterprises according to size?
✓In which industries can the msme’s be found?
✓HOW DO msme’s cOntribute tO emplOyment?
✓What are the types of enterprises according to goals?
 What is entrepreneurship?

ENTREPRENEURSHIP has been defined as that

ability to be able to know what products and
services are need by the people, and to be
able to provide these things at the right time,
at the right place, and to the right people,
and at the right price. It usually involves
introducing something new or novel, which is
called innovation.
 Does entrepreneurship always involve an
opportunity?

Entrepreneurship happens when a person or the

entrepreneur identifies an opportunity where he can
make a profit. It may be as simple as buying a product at
a lower price in one location, and selling it at a higher
price in another location or it can be more complicated
as when an entrepreneur buys new materials, combines
them in a new manufacturing process, produces a new
product, and then sells it at a price greater than the cost
of producing it.
 Does entrepreneurship always involve
SOMETHING NEW?
Usually, entrepreneurship involves introducing something
new or novel. But this novelty can be found in many forms-
some way involve very dramatic changes, while others
can be in small or subtle modifications. This concept of
introducing something new is called innovation, which is
defined as a new method, idea, or product. To innovate is
to be able to translate an idea or invention into a good or
service that has commercial value, i.e., it is something that
people will pay for.
 What are some types of enterprises
according to concept?

✓An enterprise can involve a new concept

✓An enterprise can be built on an existing concept,
but giving rise to a new business
✓An enterprise can involve an existing concept and
an existing business
An enterprise can involve a new concept.
This usually means
creating or stumbling
on a new idea or
concept, and
creating or inventing
something radically
new. The inventor then
builds a new business
STEVE JOBS around this product.
An enterprise can be built on an existing concept,
but giving rise to a new business
JOLLIBEE which created a new business based on the existing
concept of selling hamburgers and chicken. What was originally
an ice cream parlor gave rise to a more profitable version of
hamburgers and chicken, which its giant competitor, McDonald’s,
had already been doing. But Jollibee created its own tasty version
of the hamburgers and chicken, and together with clever
marketing strategies of calling it “langhap sarap” and partnering it
with Filipino values, produced a new business that beat the global
giant in its own game.
Another example of an existing concept is that of chicken as fast
food. Mang inasal is a concept that offers chicken in a new light:
grilled chicken as fast food. The business started in the Visayas, took
the country by storm because its founder correctly perceived a
need of people for affordable, quick-serve inihaw or grilled
chicken. Thus, this business was founded and flourished , to the
extent of offering very real competition to Jollibee’s popular
Chicken Joy.
 An enterprise can involve an existing concept and
an existing business

An entrepreneur can have a laundry business. Dean of

Clean, for example, had three branches of Metro Manila,
mostly in the center and south areas of the metropolis.
 What are the types of enterprises
according to size?

Most enterprises in the Philippines are often categorized as

MSMEs: micro-enterprise, small enterprise, and medium
enterprise. These businesses are often classified according
to the assets they possess and the number of employees
they have. Assets are properties owned by a person or
company, which are regarded as having economic value.
Some examples of assets are cash, real estate, office
equipment, manufacturing equipment, vehicles, securities,
and inventory.
MICROENTERPRISES are businesses with total assets of less than Php
3 million and employ less than ten people. Examples are sari-sari
store, a food stall, a watch repair stall, and a meat stand in the
public market.

SMALL ENTERPRISES are those businesses that have total assets

between Php 3 million and Php 15 million pesos, and employ
between 10 and 99 people. Examples are small printing press, a
chain of laundry shops, a travel agency, a restaurant, a small
beauty salon, and a consulting company.

MEDIUM ENTERPRISES are those businesses that have total assets

worth Php 15 million and employ 100 people and more. Medium
enterprises can comprise a food manufacturing corporation, a
large supermarket.
As of 2009 count, there are 780, 437 business
enterprises operating in the Philippines. Of these,
99.6% or 777, 357 of them are micro, small and
medium enterprises (MSMEs) while the remaining
0.4% or 3, 080 are large enterprises. Of the total
number of MSMEs, 91.4% (710, 822) are
microenterprise, 8.2% (63, 529) are small enterprise,
and 0.4% (3, 006) are medium enterprise. Thus, it can
be concluded that the great majority of the business
enterprises in the Philippines are microenterprises
that usually provide for the immediate needs of the
entrepreneurs and their families.
In which industries can the msme’s be found?

sectOrAl DistributiOn OF msme’s

INDUSTRY NUMBER OF MSMEs PERCENTAGE
Wholesale and Retail Trade 476 105 61.2 %

Manufacturing 111 987 14.4 %

Hotels and Restaurants 97 298 12.5 %

Real Estate, Renting, Business 47 654 6.2 %

Activities
Other Community, Social, and 44 313 5.7 %
Personal Services
TOTAL
777 357 100 %
 HOW DO msme’s cOntribute tO emplOyment?
REGIONS WITH THE GREATEST NUMBER OF JOBS CREATED
BY MSMEs IN THE PHILIPPINES (2009)
RANK REGION JOBS CREATED BY MSMEs

1 National Capital Region (NCR) 1 360 440

2 Region 4-A (CALABARZON) 466 648

3 Region 3 (Central Luzon) 319 340

4 Region 7 (Central Visayas) 235 091

5 Region (Western Visayas) 193 543

 What are the types of enterprises according to goals?
Enterprises can be broadly categorized into two groups: BUSINESS
ENTERPRISES and SOCIAL ENTERPRISES

BUSINESS ENTERPRISE
✓Are engage in commercial activities for the purpose of livelihood or
profit.
✓Entrepreneurs start and develop businesses to earn a living for
themselves and their families.
Examples: Manufacturing, Trading, Selling, and Distributing
SOCIAL ENTERPRISE
✓Are organizations that use commercial activities to improve human and
environmental well-being.
Three goals: profit, and the well-being of people and planet.
Some examples of famous social enterprises are Gawad Kalinga,
which has successfully built homes and communities; MultiVenture,
Inc. which launched Hapinoy, which aims to turn the sari-sari stores
into community branded stores; and Cordillera Coffee, which helps
poor coffee farmers get a better price for their produce.
 SALIENT FEATURES OF ENTREPRENEURSHIP
Providing values to customers
Opening and managing self-
Wealth – Creating Venture owned business

ENTREPRENEURSHIP

Art of correct practices Risk-taking venture

✓ Entrepreneurial concepts and principles are not fixed.
They constantly change and are highly influenced by the
changes in the environment. The evolutionary processes
happening in entrepreneurship are mainly due to
creativity and innovation born or created from business
opportunities. As new ideas are created, new
entrepreneurial ventures open.
✓ A wealth-creating venture is an entrepreneurial
undertaking wherein wealth is created. It is a business
endeavor where the resources of the enterprise have
been utilized fully to maximize the investment of the
entrepreneur. The venture improves the life of the
entrepreneur in terms of economic, financial, social,
moral, and psychological aspects.
✓ Value is basically the opposite waste. Products and
services are considered valuable when they provide
additional benefits to the buyers and users. In
entrepreneurship, value is always measured from the
perspective of the consumers. The goods and services
become valuable when the consumers get additional
benefits from using the products or availing of the
services.
✓ All businesses, whether big or small, are operating within
the concept of risk-taking because of uncertainty.
Nobody knows what will happen tomorrow. Business risk
cannot be eliminated. They are inherent in the venture.
Entrepreneurs, however, face the business risks instead of
avoiding them. They find ways to minimize the effects of
the business risks.
 SMALL BUSINESS
and
ORDINARY SMALL BUSINESS
 SMALL BUSINESS

It refers to a business or
enterprise that correctly
adopts and practices the
principles of
entrepreneurships.
It is owned by one person
with a limited workforce of
not more than 20 persons.
 ORDINARY SMALL BUSINESS
It pertains to a business enterprise
managed and operated by an
owner who is not an advocate of
and does not practice the concepts
and principles of entrepreneurship.
They can found almost anywhere
and everywhere – along city streets,
municipal roads and national roads,
and in public markets, hospitals,
schools, and amusement places.
 GLOBAL
AND
PHILIPPINE
DEVELOPMENT
 GLOBAL AND PHILIPPINES DEVELOPMENT

✓ GLOBAL DEVELOPMENT
✓ THE STATE OF PHILIPPINE DEVELOPMENT
✓ PHILIPPINE ECONOMY
 GLOBAL DEVELOPMENT

NEW YORK CITY HO CHI MINH, VIETNAM

✓ The world is composed of more than 187 countries.
✓ These countries can be categorized: DEVELOPED
COUNTRIES, NEWLY INDUSTRIALIZING COUNTRIES,
DEVELOPING COUNTRIES and UNDERDEVELOPED
COUNTRIES

DEVELOPED COUNTRIES
✓ It can be defined through economic growth and security,
✓ The most commonly criteria for evaluating the degree of
development is to look at gross domestic product (GDP),
the per capita income (income per person), level of
industrialization, amount of widespread infrastructure, and
general standard of living.

Examples of developed countries with “very high human

development”: JAPAN, HONG KONG, SINGAPORE,
CANADA, UNITED STATES, AUSTRALIA, NEW ZEALAND,
FRANCE, NORWAY, UNITED KINGDOM, GERMANY and
SWITZERLAND in WESTERN EUROPE.

“high human development” are Mexico, Saudi Arabia,

Russian Federation, Lebanon, Brazil, Uruguay, and Peru.
DEVELOPING COUNTRIES are in general countries which have not achieved a
significant degree of industrialization relative to their populations, and which
have, in most cases a medium to low standards of living. In these countries,
the average income is lower than in developed countries, the economy relies
on a few export crops, and farming is done using primitive methods.
Some examples of countries with “medium human development” are
JORDAN, SRI LANKA, CHINA, THAILAND, MONGOLIA, SYRIA, HONDURAS, INDIA,
PALESTINE, and INDONESIA

An UNDERDEVELOPED COUNTRY is a nation which, compared to others, lacks

industrialization, infrastructure, developed agriculture, and developed natural
resources, and which suffers from a lower per capita income as a result.

Some examples of countries with “low human development” are PAKISTAN,

BANGLADESH, NEPAL, and MYANMAR in ASIA; and KENYA, NIGERIA, UGANDA,
SUDAN, IVORY COAST, ZIMBABWE, CHAD, CONGO, and ETHIOPA in AFRICA
 PHILIPPINE ECONOMY
✓ Is the world's 34th largest economy by nominal
GDP according to the 2017 estimate of
the International Monetary Fund's statistics.
✓ It is the 13th largest economy in Asia, and the 3rd
largest economy in
the ASEAN after Indonesia and Thailand.
✓ The Philippines is one of the emerging
markets and is the sixth richest in Southeast Asia
by GDP per capita values, after the regional
countries of Singapore, Brunei, Malaysia, Thailand
and Indonesia.
✓ The Philippines is primarily considered a newly
industrialized country, which has an economy
transitioning from one based on agriculture to
one based more on services and
manufacturing.