Achieve Great Things, Initiate Changes, Transform from Better to Best, Excel and Remain Humble

Asian Institute of Technology and Education

Gret-Fisico Bldg., Maharlika Highway, Brgy. Lumingon, Tiaong, Quezon, Philippines

Telefax Number: (042)-545-6547 / Cell No. 0922-8934738

ENTREPRENEURSHIP
LESSON 6:
VIABILITY, PROFITABILITY, AND
CUSTOMER REQUIREMENTS
INTRODUCTION
The entrepreneurs desire to establish
his business is a visible idea yet it must
come into a test whether it is viable
business option. It needs a careful
analysis of opportunity evaluation.
The following steps will help the prospective entrepreneur
evaluate the idea before going into business.
01 Conceiving a new product

02 New product needs customer evaluation

03 The entrepreneur must find a new approach

04 He must know the strengths and weaknesses

of his competitor
A. THE ENTREPRENEUR SHOULD LOOK DEEPER INTO
THE FOLLOWING AREAS BASED ON VIABILITY:
• Management must be able to set the direction of the enterprise with a
clear MISSION AND VISION as the guiding tool for its plans and
programs.
• Plans and Programs are tentative activities that will make a definite
step towards the accomplishments of target objectives.
• Objectives set into motion the goals of the enterprise to profitability.
• Technical and Manpower complements are important factors in
the success of the business.
• The Management must introduce new technology to make work
easier for the working team.
B. THE ENTREPRENEUR SHOULD LOOK DEEPER INTO THE
FOLLOWING AREAS BASED ON PROFITABILITY:
• Venturing into business needed financial resources.
• Money is needed to finance the activities of business.
• Savings and wise investments are characteristics of successful
business entrepreneur.
• The internal source of capital will come from the savings and assets
of the starting entrepreneur.
• Real properties and personal properties may be put in a
guarantee for loans that may be used for operating expenses.
• Banks are external sources of funds.
• Other sources of funds are partnership and stock options.
C. THE ENTREPRENEUR SHOULD LOOK DEEPER INTO THE
FOLLOWING AREAS BASED ON CUSTOMER
REQUIREMENTS:
• The marketing program needs demand and analysis for the last 5
years as to the major users of the product. A new product would need
customer view point before it is launched into the market.
• The demographic profile of the customer must be taken into account
as the success of the product depends on the target customer. The
target market must be specified accordingly and their needs and
wants must be satisfied.
• Customer would like to have a lot of choices; yet when they like the
product we turn them into regular customers.
• Product Competitiveness is determined by quality and price.
D. THE ENTREPRENEUR SHOULD LOOK DEEPER INTO THE
FOLLOWING AREAS BASED ON PRODUCTIVITY:

• Product specifications must be maintained according to the product

standards that are acceptable to customers.
• Product quality is now the name of the game in business.
Customers are now aware of product quality and they must be able to
get their money’s worth.
• The management must look into cheap available raw materials in the
production of goods. Good quality materials should not be sacrificed
in terms of price as poor quality will affect the production of quality
products.
D. THE ENTREPRENEUR SHOULD LOOK DEEPER INTO THE
FOLLOWING AREAS BASED ON PRODUCTIVITY:

• Production schedule must be made together with product

specifications.
• Work schedules must be followed to save energy and time.
• Production capacity must be followed according to target production
so that delayed in shipment could be avoided.
• The rated daily production and monthly plant output must be put in
graph and charts for easy reference.
 LESSON 7:
BEST PRODUCT FOR MARKET NEED
TIPS IN CHOOSING THE BUSINESS NAME

1.Easy to Recall or Remember

2. Pleasant meaning creates pleasant feelings
3. Easy to pronounce
4. Easy to spell
5. Related to the product
 THE FOLLOWING STEPS WILL HELP THE PROSPECTIVE
ENTREPRENEUR EVALUATE THE IDEA BEFORE
GOING INTO BUSINESS.

• Conceiving a new product

• New product needs customer evaluation
• The entrepreneur must find a new approach
• He must know the strengths and weaknesses of
his competitor
 PRODUCT

• What is a Product?
• Product is anything which we use and also
satisfies our needs.
 PRODUCT LIFE CYCLE

• The product life cycle concept describes a product’s

sales, profits, customers, competitors, and
marketing emphasis from its beginning until it is
removed from the market.
• Product Life Cycle deals with the life of a product in
the market with respect to business or commercial
costs and sales measures
 PRODUCT DEVELOPMENT

• The company must think of a new product. A new

product is a modification, creation, and innovation
of an existing product which makes the product
more meaningful to the customer.
 PRODUCT DEVELOPMENT
The new product planning process involves a series of
steps:
» Idea Generation
» Idea Screening
» Concept Testing
» Business Analysis
» Product Development
» Test Marketing
» Commercialization
 INTRODUCTION

• The new product is introduced into the market place

and the objective is generate customer interest.
• High Cost
• The size of the market for the product is small,
which means sales are low, although they will be
increasing.
• Limited competition
 GROWTH
• The product gains wider consumer acceptance and the
objective are to expand distribution and the range of available
product alternatives.
• Increasing Competition
• Lower Prices
• Different Marketing Approach
• Greater Consumer Awareness
• Increase in Profits
 MATURITY
• The product sales level and companies try to maintain lower
price, better product features for as long as possible.
• Sales Volumes Peak
• Decreasing Market Share
• Profits Start to Decrease
• Continued Reduction in Costs
 DECLINE
• The product’s sales falls as substitutes and new competitors
enter the market.
• Falling Sales and Profits
• Product Withdrawal
• Cheaper Production
• Cheaper Markets
EXAMPLE FOR STAGES OF PARTICULAR MARKET
EXAMPLE FOR STAGES OF PARTICULAR MARKET
EXAMPLE FOR STAGES OF PARTICULAR MARKET
EXAMPLE FOR STAGES OF PARTICULAR MARKET
“Success is how high you bounce after
you hit bottom”
_General George Patton