Q2 Lesson 1

Nature and Type of

Entrepreneurial Venture
❖Describe the forms of
entrepreneurial venture,
❖Classify the business
according to nature
❖Discuss the elements
of production system.
Forms of Entrepreneurial Venture
1.Sole proprietorship
2.Partnership
3.Corporation
4.Cooperative
1.Sole Proprietorship
•is a form of business organization
that is owned by a single individual
who is singly responsible for
running the business and is
accountable for all debts and
obligations related to the business.
1.Sole Proprietorship
The characteristics of sole proprietorship are as
follows:
1. It is easy to form and manage.
2. It is simple business operation.
3. It has limited pool of resources.
4. Its growth is limited.
5. The owner has unlimited liability.
2.Partnership
•Is a form of business
organization in which two or
more persons combine their
resources in a business with a
view to making profit.
2.Partnership
The life of the partnership is easily dissolved compared
to a corporation, particularly for the following
reasons:
1. Death of one of the partners.
2. Admission of a new partner in an existing partnership.
3. Personal insolvency of one of the partners.
4. Permanent withdrawal of the investment of a partner.
3.Corporation
• Is a legal entity that is separate from its owners,
the shareholders. No shareholder is personally
liable for the debts, obligations or acts of the
corporation.
• It is formed by at least five but not more than
fifteen persons. The persons originally forming
the corporations are called incorporators.
3.Corporation
A corporation can either be:
▪Stock or non-stock
▪Profit or non-profit
▪Domestic or foreign
3.Corporation
• Stock corporation – when it is authorized to
issue shares of stock to stockholders
• Non-stock corporation – is not authorized to
issue shares of stock to the members.
The owner of a stock corporation are called
stockholders or shareholders, while the owners
of a non-stock corporation are called members.
3.Corporation
• Certificate of stock – is an evidence of
ownership of a corporation.
• Domestic corporation – is organized under the
laws of the Philippines.
• Foreign corporation – is organized under the
laws of the foreign country but has the
authority to operate in the Philippines.
4.Cooperative
•Is an entity organized by people
with similar needs to provide
themselves with goods or services
or to jointly use available resources
to improve their income.
Nature of Entrepreneurial Venture
The term Nature simply refers to
whether the business is simply
selling a product, manufacturing a
product, or rendering a service to
customers.
Nature of Entrepreneurial Venture
The classifications of entrepreneurial venture according
to its nature are as follows:
1. Merchandising
2. Service
3. Manufacturing
4. Agriculture
5. Hybrid business
6. Special corporation
Merchandising
•Is engaged in the buying and
selling of the products or
goods. It does not alter the
appearance of the product
purchased from the seller.
Merchandising
Service
• provides services to customers
•Service entrepreneurial
ventures are classified as non-
professional service and
professional service.
Service (non-professional service venture)
Service (professional service venture)
Manufacturing
• is a producer of goods or products.
•It is engaged in buying raw
materials and supplies to be
processed into finished products.
Manufacturing
•
Agriculture
•Is engaged in the production
of agricultural goods and
animals. It may sell its
products as raw material or
as finished goods.
Agriculture
Hybrid Business
•Possesses the characteristics and
nature of combined types of
business entities. It is inherent in
the business to produce and sell
goods and the at same time
provide services to customers.
Hybrid Business
Special Corporation
•Special types of business
may include cooperatives,
joint ventures and non-
profit organizations.
The concept of
innovation or creativity
must be introduced and
practiced by
entrepreneurs….
Production System
Input
The input includes the following:
1.Manpower
2.Materials
3.Machines
4.Design
5.Instructions
Production Process
•Referred to as the transformation or
conversion process.
•Is the stage of production where
the materials are transformed into
the final product with the aid of
manpower and machine.
Production Process
It involves the following activities:
1. Procurement or acquisition of raw materials and manufacturing
supplies.
2. Inspection of materials and supplies upon receipt at the receiving
section.
3. Storage of acquired materials and supplies.
4. Issuance of materials and supplies to the production line.
5. Inspection of damaged or broken goods and assessment of losses.
6. Rework or repair of defective goods.
7. Transfer of finished goods to the storeroom.
Output
•Represents the final
products from the
production process and
distributed to the
customers.
Words to
ponder…