CHAPTER 1

ENTREPRENEURSHIP
Businesses are the backbone of the economy.
Entrepreneurs play an important role in developing the economy through
providing the needed products and services including the solution
to the problem of unemployment.
Entrepreneurship is encouraged by the economy because it can provide
a lot of opportunities for the unemployed people.
It will increase per capita income, improve standard of living and increase
individual savings, provide revenue to the government in the form of
income tax, value added tax, export duties, import duties, and balanced
regional development
Is a proactive process of developing a business venture to make a profit.

Proactive - active through action, and commitment, not just active through
mindset

DIAROSE C. TAN, LPT It involves seeking opportunities for market, establishing and operating a
business out of the opportunity, and assessing its risk and rewards through
TEACHER close monitoring of the operations. With this definition, being an entrepreneur
may seem difficult, but it can be rewarding if the enterprise flourishes.

Entrepreneurial activities today have become very important and are keys
to economic development.

Growth, industrial development, including employment generation, depend

upon entrepreneurial behavior of the country.

RISKS:

 Walking away from security and career path

 Taking yourself and your family into an unfamiliar storm of stress and
uncertainty
 Risk of miscalculated opportunity, or your own internal resources as you
plunge into a new venture
 Competition

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  Working long hours This means that not only the life of the entrepreneur is improved but also the
 High level of stress society where the business is located.
 Potential loss of income
CONCEPT OF ENTREPRENEURSHIP
The word “entrepreneur” was derived from the French verb
REWARDS:
enterprendre, which means “to undertake.” This is pinpointing to those
 Being your own boss who “undertake” the risk of enterprise.
 Doing something you enjoy The enterprise is created by an entrepreneur and the process is called
 Having opportunity to be creative “Entrepreneurship.”

DIFFERENCE BETWEEN AN ENTREPRENEUR AND A Entrepreneurs are innovators. They are willing to take the risks and
BUSINESS MAN generate unique ideas that can provide profitable solutions to the needs of
the market and the society.
An entrepreneur is an individual having an exclusive idea to establish a new
venture. A businessman is an individual who establishes a business with an FACTORS AFFECTING ENTREPRENEURSHIP
old business idea. 1. Personality Factors
which include:
An entrepreneur is successful if the business that he or she envisioned has
materialized into a thriving industry with regular customers and financial a. Initiative – Doing things even before being told.
gain. He/she either decides to maintain his/her business or expand. This
eventually reflects on the society and the economy as a whole. b. Proactive – Which means he can classify opportunities and seize it.
c. Problem Solver – Which means he can retain good relations with other
RELEVANCE OF ENTREPRENEURSHIP TO AN people.
ORGANIZATION d. Perseverance – Meaning he will pursue things to get done regardless of
1. Development of Managerial Capabilities challenges.

This means that one of the benefits an entrepreneur gets is to develop his e. Persuasion – Means that he can entice people to buy even if they don’t
managerial skills. want to.

2. Creation of Organizations f. A Planner – He makes plans before doing things and does not fail to
monitor it.
Which means that because of entrepreneurship many organizations will
exist. g. Risk-taker – Which means that he is willing to gamble but he will calculate
it first.
3. Improving Standard of Living
2. Environmental Factor
This means that entrepreneurship can lift up the economic status of an which include:
individual.
• Political
4. Means of Economic Development 3

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• Climate 4. Risk bearing
• Legal system The entrepreneur needs to gamble but wise enough to offset the risk.
• Economic and Social conditions TYPES OF ENTREPRENEURS
• Market Situations 1. Innovative Entrepreneurs
COMMON COMPETENCIES IN ENTREPRENEURSHIP They are those who always make new things by thinking of new ideas.
They have the ability to think newer, better and more economical ideas.
1. Decisive – An entrepreneur must be firm in making decisions.
2. Imitating Entrepreneurs
2. Communicator – An entrepreneur must have a convincing power.
They are those who don’t create new things but only follow the ideas of
3. Leader – An entrepreneur must have the charisma to be obeyed by his other entrepreneurs.
employees.
3. Fabian Entrepreneurs
4. Opportunity seeker – An entrepreneur must have the ability to be the first
to see business chances. They are skeptical about changes to be made in the organization. They
don’t initiate but follow only after they are satisfied.
5. Proactive – An entrepreneur can control a situation by making things
happen or by preparing for possible future problems. 4. Drone Entrepreneurs
6. Risk Taker – An entrepreneur has the courage to pursue business ideas. They are those who live on the labor of others. They are die-hard
conservatives even ready to suffer the loss of business.
7. Innovative – The entrepreneur has big business ideas and he does not stop
improving and thinking of new worthwhile ideas for his business. 5. Social Entrepreneurs

CORE COMPETENCIES IN ENTREPRENEURSHIP They are those who initiate changes and drive social innovation and
transformation in the various fields such as education, health, human rights,
1. Economic and Dynamic Activity environment and enterprise development
Entrepreneurship is an economic activity because it involves the creation CAREER OPPORTUNITIES OF ENTREPRENEURSHIP
and operation of an enterprise with a view to creating value or wealth by
ensuring optimum utilization of limited resources. 1. Business Consultant
2. Innovative With the expertise of in the field of entrepreneurship, he can be a very good
source of advices to other entrepreneurs and would be business men.
The entrepreneur constantly looks for new ideas, thus he needs to be
creative. 2. Teacher
3. Profit Potential A graduate of an entrepreneurship can use his knowledge in teaching.
The entrepreneur can be compensated by his profit coming from the 3. Researcher
operation.
The entrepreneur can be employed as a researcher by an enterprise.
4. Salesman A simple eatery in a rural area and a coffee shop in an urban area both ignite
economic activity regardless of their business scale.
The entrepreneurship graduate can apply as a salesman.
3. Entrepreneurship introduces new and innovative products and
5. Business Reporter services.
The entrepreneur being expert in the field, can be employed as a business New products and services are always available in the market because of the
reporter. ingenuity of entrepreneurs to seek opportunities and improve on them.
CHAPTER 2
4. Entrepreneurship improves people’s living standards.
UNLOCKING DIFFICULTIES How can you look good if not for the services of your nearby salon or barber
1. Monopolies – The exclusive possession or control of the supply of or trade shop? How can your day be complete without the food that nearby eatery
in a commodity. cooks? How can you live without the sari-sari store near your house where you
buy your basic needs?
2. Ingenuity – The quality of being clever, original, and inventive.
5. Entrepreneurship disperses the economic power and creates
3. Political unrest – Is defined as the sum of riots, general strikes and anti- equality.
government demonstrations.
It balances the economy by distributing national income to more businesses
4. Capital formation – Is a concept used in macroeconomics, national rather than to only few monopolies.
accounts and financial economics. Occasionally it is also used in corporate
accounts. It can be defined in three ways: 6. Entrepreneurship controls the local wealth and balances regional
development.
 It is a specific statistical concept, also known as net investment, used in
national accounts statistics, econometrics and macroeconomics. In that sense, It makes sure local resources are used properly and that every area has an
it refers to a measure of the net additions to the (physical) capital stock of a appropriate allocation of resources.
country (or an economic sector) in an accounting interval, or, a measure of the
7. Entrepreneurship reduces social conflicts and political unrest.
amount by which the total physical capital stock increased during an accounting
period. To arrive at this measure, standard valuation principles are used. Imagine if there are no or only few sari-saris or super market stores in your
area. All of you will then fight for the food supplies because the store cannot
SOCIETAL AND ECONOMIC BENEFIT OF supply all your needs.
ENTREPRENEURSHIP
8. Entrepreneurship elicits economic independence and capital
1. Entrepreneurship produces more jobs that equate to an increase formation.
in national income.
A country with more entrepreneurs is highly likely to become financially
Millions of unemployed people will have the opportunities to have a decent independent and will less likely need the help of other countries. This also
occupation. Small businesses produce jobs and create wealth. applies to families, barangays, and cities. It creates wealth instead of borrowing
2. Entrepreneurship amplifies economic activities of different wealth.
sectors of society. COMMON SMALL BUSINESSES IN THE PHILIPPINES
1. Sari-sari store • Car care
2. Rice retailing • Clothing and accessories
3. Food cart business • Convenience stores
4. Printing business • Services (personal and business)
5. Buy-and-sell business • Water stations
6. Street food business • Drug stores and pharmacies
7. Flea market or tiangge business • Fast food establishments and restaurants
8. Online selling business • Food and snack carts
9. Cellphone loading business • Gas stations/ petroleum products
10.Laundry and dry-cleaning business • General merchandise and retail
11.Hair styling and make up business • Health and wellness (salon, spa, massages, gym)
12. Spa, gym, and nail care business • Schools
13. Video and Photography business OTHER ADDITIONAL BUSINESS OPPORTUNITIES
14. Tutorial business • Dealerships
15. Baking business • Direct Selling
16. Website development and design/blogging • Distributorship
17. Direct selling business Chapter 3

18. Car wash and car care business THE MARKET

19. Bar, café, and restaurant Market – Is a place where two or more people can gather to facilitate
the trade of goods or services.
20. Water station and LPG
– Total of all the buyers and sellers in the area under a consideration
FRANCHISE OR STARTUP BUSINESS
– Customer/competitors
• Bakeries, bakeshops, bread products
Buyer/seller
• Bars, cafes, coffee shop
Area – Country, province, municipality, city, barangay, sitio/barrio
• Beverage and confectionery
Consideration – Study/Pinag-aaralan
Ex. Turon They may also be referred to as current or repeat customers.
Market Need – A study of need and want of the buyer/customer 2. PROSPECTS
Need – Something that is necessary People who have not yet purchased your product but are considering
it prospect is a potential client, someone who is in the market for your
Want – Something that is a desire to posses product and has the resources needed to buy it but has not purchased it yet.
THE MARKET PROBLEM Once the prospect buys the product, which is always the end goal, they become
a customer.
MARKET PROBLEM: EXAMPLE
3. TARGET MARKET USERS
If you had a gardening tools business, you would interview gardeners to identify
problems that occur on the job. One problem could be that paper yard bags do People in your target market who are not currently your target customers
not stay open while people are weeding. are those who are most likely to buy from you.

While your interviewees might say. “I need a better paper bag,” the bag not Here are some questions to get you started:
staying open is the market problem. You might choose to solve this problem in a  Are your target customers male or female?
number of ways.
 How old are they?
DEFINITION
 Where do they live? Is geography a limiting factor for any reason?
Are the challenges, frustrations, and unmet needs of your market.
 What do they do for a living?
Are your target market’s stated or silent problems.
 How much money do they make? This is most significant if you're selling
This could refer to existing inefficiencies, awkward workflows or non-optimal relatively expensive or luxury items. Most people can afford a carob bar. You
solutions. can't say the same of custom murals.
STATED NEEDS VS SILENT NEEDS  What other aspects of their lives matter? If you're launching a roof-tiling
Stated Needs – Are explicit statement from your market that declare “I want a service, your target customers probably own their homes.
product to do X”. Stated needs are important, they are not as powerful as silent HOW TO EVALUATE MARKET PROBLEMS
needs.
1. Is the market problem urgent?
Silent Needs – Are problems with undefined solutions.
2. Is the market problem pervasive?
To deliver products that solve your target customer’s problems, you identify
first market problems. These maybe stated directly as customers’ needs or 3. Will your buyers pay to have this problem solved?
implied indirectly.
Pervasive – Spreading widely throughout an area or a group of people
YOUR MARKET CONSIST OF:
THE ENTREPRENEURIAL PROCESS
1. EXISTING CUSTOMERS
People who have already purchased your product
The Entrepreneurial Process – Is a step-by-step procedure in establishing
any kind of business that an entrepreneur has to undergo. It is composed of 4
aspects:
1. OPPORTUNITY SPOTTING AND ASSESSMENT
- This is the beginning of the process and is considered the most difficult.
Entrepreneurs at this point take note of interesting trends in their environment.
Consumers are reliable sources of opportunity information because market
needs originate from them.
2. DEVELOPING A BUSINESS PLAN
- Entrepreneurs should formulate a 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 how to obtain these resources efficiently, and running the
business sustainably.
3. DETERMINING THE CAPITAL NEEDED
- To calculate the resources needed to establish the business and compare this
against the entrepreneur’s current resources.
4. RUNNING THE BUSINESS
- The part where the entrepreneur should use the resources allocated for the
new venture.