THE

ENTREPRENEURIAL
PROCESS
ENTREPRENEURIAL
PROCESS
Is a step by step procedure in establishing any
kind of business .
THE ENTREPRENEURIAL
PROCESS
OPPORTUNITY SPOTTING AND ASSESSMENT
DEVELOPING A BUSINESS PLAN
DETERMINING THE CAPITAL NEEDED
RUNNING THE BUSINESS
OPPORTUNITY SPOTTING
This is the beginning of process and is considered the
most difficult . Entrepreneurs at this point take not of
interesting trends in their environment . Consumers are
reliable sources of opportunity information because
market needs originate from them . Other major sources of
opportunity are the glaring problems in the environment ,
problems encountered by co – entrepreneurs , new trends ,
processes , and developments in the environment . The
entrepreneurs toughest job is to carefully asses the
opportunity through estimation of opportunity length ,
capitalization required , threats , profitability , and
calculation of perceived value .
Entrepreneurs should also assess if the
opportunity is aligned with their personal
goals and attributes . Last , entrepreneurs
should also think in advance how they will
position their products or service in the market
and showcase its unique selling proposition .
EXAMPLE OF OPPORTUNITY
SPOTTING
OPPORTUNITY FINDINGS POTENTIAL
SOURCE PRODUCT OR
SERVICE
Demographics The number of Remittance
OFW families is business ,
increasing in cellphone load
Barangay business
Segismundo
PRODUCTS – are tangible , like bags or shoes .
SERVICES – are intangible , like haircuts or
education .
CONSUMPTION – the act of using goods or
services to satisfy wants .
PRODUCTION – the act of making goods or
services .
SCANNING THE MARKETING
ENVIRONMENT
Scanning the marketing environment is the starting point of
any new venture that involves understanding and knowing
the intricacies of the macroenvironment , microenvironment ,
and internal environment . With this process of scanning the
general environment , an entrepreneur can recognize various
opportunities and at the same time understand thoroughly
the arena where the future business will operate . The
process of seeking , screening , and seizing is adapted to
create the most suited product or service for an opportunity .
The general rule is to find the opportunity first before coming
up with a new product or service , not the other way around .
This is one of the mistakes that budding entrepreneurs
commit in starting a new venture .
SEEKING , SCREENING , AND
SEIZING
The 3S of opportunity spotting and assessment is the
framework that most of the promising entrepreneurs
use to finally come up with the ultimate product or
service suited for a specific opportunity . An
opportunity is an entrepreneurs business idea that
can potentially become a commercial product or
service in the future . The entrepreneur serves as a
catalyst of creating a value for the customers
through the new or innovated product or service . As
a reward , the entrepreneurs earns profits when the
customers are satisfied and delighted .
STEP 1 : SEEKING THE
OPPORTUNITY
Opportunity seeking is the first step and
is the most difficult process of all due to
the number of options that the
entrepreneur will have to choose from .
It involves the development of new ideas
from various sources as follows :
MACROENVIRONMENTAL
SOURCES
A. STEEPLED – this is a mnemonic for sociocultural
, technological , economic , environmental ,
political , legal , ethical , and demographic factors
. This represents the general environment where
the entrepreneur can identify business
opportunities from and where the business is
about to operate . Any external factor or a
combination of external factors from these eight
environmental forces can have a direct effect in
generation and business sustainability .
A macroenvironment affects every business .
It consists of many factors , that if left
unchecked , can destroy a business .
To reduce the effects of negative factors , you
must first understand what macro
environmental analysis is .
SOCIO-CULTURAL FACTORS
Socio-cultural factors – these factors represent a a general view of
locality’s traditions , customs , beliefs , norms or perceptions . These
factors affect how a person of the locality behaves and reacts to marketing
and selling activities .
Health consciousness
Education level
Attitudes towards imported goods
Attitudes towards person’s lifestyle
Attitudes toward product quality and customer service .
Attitude toward saving or investing
Buying habits
Religion and beliefs
TECHNOLOGICAL FACTORS
These are composed of innovations of an
existing technology or an invention of a new
one mostly on applied science and engineering
research areas . Entrepreneurs should always
up –to- date with the technological changes , as
these are catalysts in improving a product or
service or replacing them entirely . The
entrepreneur should take note of the following
technological factors :
Basic infrastructure level
Rate of technological change
Access to newest technology
Internet infrastructure and penetration
ECONOMIC FACTORS
These factors play a vital role in the scanning
of marketing environment because economic
factors directly affect any business venture .
These factors include income , expenses , and
resources that can influence the cost of doing
business and generating income . The
entrepreneur should take note of the following
economic factors :
Growth rates
Inflation rates
Interest rates
Unemployment trends
Price fluctuations
ENVIRONMENTAL OR
ECOLOGICAL FACTORS
These factors should be given much importance in
conducting a business especially when the world
has alreadysuffered severely from human –
induced calamities . The scan of these factors will
help the entrepreneur determine if the business
he or she is entering into will comply with the
environmental standards or will just be a hazard
to people , animals , and nature . Moreover, the
entrepreneur will know if the business venture will
be suited with the weather conditions in his or her
locality .
THE ENTREPRENEUR
SHOULD TAKE NOTE OF THE
FOLLOWING
ENVIRONMENTAL
Weather
FACTORS
Climate change
Air and water pollution
Recycling
POLITICAL FACTORS
These factors are mostly induced by
government policies and administrations ,
which can have a strong effect in the
entrepreneurs business .
THE ENTREPRENEUR
SHOULD TAKE NOTE OF THE
FOLLOWING LEGAL FACTORS
AND EXAMPLES
Consumer protection law
:
Employment law
Health and safety law
Copyright , patents / intellectual property
rights
Anti – trust law
WHAT IS ANTI –TRUST LAW?
Anti – trust law stops businesses from playing dirty in
order to gain profit .
Referred to as competition laws .
These law ensure that fair competition exists in an
open market economy .
These laws have evolved along with the market ,
vigilantly guarding against would be monopolies .
If these laws didn’t exist , consumers would not
benefit from different options or competition in the
marketplace . Furthermore , consumers would be
forced to pay higher taxes and would have access a
limited supply of products and services .
WHAT IS A PATENT ?
Is a title which provides its owner the
right to prevent others from exploiting
the invention mentioned in the patent .
It does not allow itself making / selling
an invention but it rather gives the right
to exclude others from making , using ,
selling , or importing the patented
invention.
For the inventor – a patent is the way to prevent
competitors from copying its invention .

Where to register patent ?

Intellectual Property Office of the Phillippines .
ETHICAL FACTORS
These are the factors that will serve as an
entrepreneurs guide on how to be ethical in
running the business . The entrepreneur
should take note of the following ethical
factors :
Ethical in advertising and sales practices
Accepted accounting , management , and
marketing standards.
DEMOGRAPHIC FACTORS
These are the characteristics of the people in the target market .
The entrepreneur should take note of the following demographic
factors :
Population growth rate
Age distribution and life expectancy
Gender distribution
Social classes
Minorities
CONTINUATION OF MACRO –
ENVIRONMENTAL SOURCES
Industry – This is the source of current trend
on what is happening in the industry where
the future business will belong to . For
example : the entrepreneur should be fully
acclimated on what is happening with the rice
industry if he / she wants to establish a rice
retailing business .
MICROMARKET
Consumer preferences , interests , and
perception . These are the current needs and
wants of the potential customers that should be
discovered right away by a budding entrepreneur .
A need is recognized when a customer believes
that there is a difference between his or her
current situation versus his / her desired condition
. A want , on the other hand , is recognized when a
customer believes that there is a specific product
or service that can perfectly suit the need .
COMPETITORS
Recognizing and understanding potential
competitors will aid the entrepreneur to
develop a product or service that is unique and
will surely stand out from the competition .
The 4 P’S of marketing ( product , place ,
price , and promotion ) will be competitively
positioned if the entrepreneur is familiar with
his / her competitors .
UNEXPECTED
OPPORTUNITIES FROM
CUSTOMERS
Oftentimes , the most brilliant ventures come
from the most unexpected opportunities . It
may happen in unlikely situations , unlikely
places , and with unlikely people . Existing
problems and bottlenecks often give rise to an
unexpected opportunity .
TALENTS , HOBBIES ,
SKILLS , AND EXPERTISE
Business opportunities do not just come from
outside forces , but also from within the
entrepreneur . The entrepreneurs talents ,
hobbies , skills , or expertise can be a source
of business opportunity . For example , if the
entrepreneur is an artist , why not sell
paintings ? If he / she is a musician , why not
put up a bar and perform there ? If he / she is
an expert in home interior design , why not
make it a business ?
IRRITANTS IN THE MARKETPLACE
SUCH AS DETERRENTS , PROBLEMS ,
COMPLAINTS , AND DELAYS
Generally , entrepreneurs see opportunities in
situations where there is a recurring problem
or sometimes when there is no more hope in
solving the problem . When customers are
already sick and tired of the same old issue or
problem , that is when the opportunistic
entrepreneur should come in and make
difference .
LOCATION
Often , entrepreneurs just have to look at their
ecosystem and they will be able to spot a
business opportunity right away . For
example , if the entrepreneurs location has
many schools , then a restaurant , an eatery ,
or probably a computer shop might be a good
business to establish . If the entrepreneur is in
an island with an awesome beachfront , why
not put up a hotel ?
ENTREPRENEURIAL
PROCESS
Opportunity spotting and assessment
Developing a business plan – entrepreneurs
should formulate business plan when they
have already spotted and assessed the
opportunities for a market . A business plan is
a comprehensive paper that details the
marketing , operational , human resource ,
financial , strategic direction , and tactics of
the business . The business plan will be the
core guide and direction of the entrepreneur in
calculating the resources needed , assessing
DETERMINING THE CAPITAL
NEEDED ?
A big idea can never be translated into reality if the
entrepreneurs resources are limited . Therefore , it is
mandatory in the entrepreneurial process to
calculate the resources needed to establish the
business and compare this against the entrepreneurs
current resources . Caution must be applied in
computing the complete set of resources needed and
include only those items that are considered as the
real needs in venture creation . Allowance must be
considered as well because there will be times that
resources will be inadequate or unsuitable .
RUNNING THE BUSINESS
This is the part where the entrepreneur should
use the resources allocated for the new
venture . The business plan in step 2 should
already have been implemented . All aspects of
the business plan should be critically observed
from operations , marketing and sales , human
resources , finance , and strategy
implementation . The entrepreneur should
have a control and monitoring system to serve
as a check and balance of the formulated plans