Entrepreneurship 2.

Entrepreneurial Heart Flame

- Surging passion
Entrepreneurship - - Driven by passion or the strong will to succeed
● Important driver of the economic growth and - Drawn to find fullfillment in the act and process
innovation. of discovery.
● Act of creating a business or businesses while - Emotional intelligence which is often manifested
building scaling it to generate profit. in the entrepreneur’s efforts to nurture
● Concept of developing and managing a business relationships with customers, employees and
venture in order to gain profit by taking several suppliers.
risks in the corporate world.
● Pursuit of opportunity beyond resources 3. Entrepreneurial Gut Game
controlled. - Sense without using five senses
- Also known as intuition and connotes courage
Entrepreneur - - In the local dialect “lakas ng loob”
● Comes from the word “entreprendre” means “to
undertake” Factors why Businesses Fail
● One who undertakes a business and takes risks
in order to reap good returns or profits from that 1. Not knowing enough about the market or industry that
business. the entrepreneurs get into.
● Innovators who create and increase value for the
economy and society, endeavor to raise 2. Lack of skill on how to manage money, technology,
productivity levels, and even dare to change employees, customers and suppliers.
business paradigms and industry practices.
3. The hard work, long hours and stress accompanying
the setting up and running of businesses in an ever
changing environment punctuated by the frequent shifts
in customers tastes and preferences.

4. Underestimating the finances needed to run an

enterprise

5. Not enough capital has been raised to take care of

business uncertainties, setbacks, and delays.

6. Contending with strong and experienced competitors

who can aggressively drive new enterprises out of
business by lowering their prices, offering better
products and out-marketing new comers.

Three Qualities of Entrepreneurs 7. The sheer incompetence of the entrepreneur who does
1. Entrepreneurial Mind Frame - not know how to produce a good quality product, deliver
- Allows entrepreneurs to see things in a very the product on time and make the product a low cost
positive and optimistic light in the midst of crisis that would allow the new enterprise to complete.
and difficult situation.
- Optimism and eagerness to explore potentials Business Plan -
and possibilities. - Blueprint of the business
- Able to use these problematic situations as - Aims to establish if a business idea will
inspiration for creating something innovative. 1. Bring in a fair return to one’s
environment
 2. Be beneficial to the society 3. Determine if the buyers will pay to have this problems
3. Bring no harm to the environment when solved.
it is operated.
Tips in Identifying market Problem

Parts of Business Plan 1. Focusing only on innovation and the competition.

1. Executive Summary - 2. Focusing only on customers

- Front page
- Summary of each chapter 3. Focusing only on revenue
- Summary of the whole business plan
- Short, simple very specific Problem - Identification Research
- by conducting new market research projects, learner
2. Management and Organization can discover problems or opportunity
- Form of organization
- Who are the partners Dicover the Following Factors
- Is it a corporation
- Job function 1. Brand Image -
- How will it be controlled - impression in the consumer’s mind of a brand’s total
personality.
3. Product and Service Plan - Developed overtime through advertising campaigns
- Process of the product making with a consistent ideas, that is authenticated through the
- Need for the product consumer’s direct experience.
- How long will it be produced
2. Market Potential
4. Market Plan - estimated maximum total sales revenue of all suppliers
- How will it be promoted of a product in a market during a certain period.

—----------------------------------- 3. Market Characteristics -

Identifying the Market Problem - attributes of the buyers in making decision related
purchasing a certain product.
1. Existing Customers - people who have already
purchased the product you are selling. 4. Market Share -
- percentage of total sales volume in a market captured
2. Target Market - people in your target market who are by a brand, product or company.
not currently looking for solution
Problem - Solving Research
3. Prospects - people who have not yet purchased your
product but have an intention to buy. 1. Distribution Research
- determining on how to transfer the product from the
Evaluate Market Problems manufacturer to the ultimate user.

1. Consider if market problem is urgent, if yes consider 2. Market Segmentation

necessary actions by identifying alternative courses of - grouping customers by similar characteristics or similar
action (ACA) then enumerating their advantages and purchase behaviors
disadvantages.
3. Pricing Research
2. Evaluate if the market problem is pervasive or easily
diffused, if yes think for a temporary solution.
- determining the ideal price for the product. Setting the - Investors must determine the needs of the market
price for the product is one of the most important through analysis based from research conducted fosuing
marketing steps. on their needs.
- Identify what the customer wants to classify their
4. Product Research needs.
- testing the new or revised products or completing test - Needs/Wants
marketing
4. Competition
5. Promotional Research - determine the competitor’s positioning describe their
- determining the best research in the area of strengths and weaknesses.
disseminating information. - analyze competitor’s angle to the market in order to
find a weakness that company will be able to use in its
Market Needs Analysis own market positioning.
- One way to carry the analysis is to benchmark the
1. Who will get interested in my product? competitor against each of the key drivers of demand for
2. What does the market need or want? the market (price, quality, add on, services, etc.) and
3. Who is buying the product? What and how much? Or present the result in a table.
how, were and why are they buying those goods and
services? Barriers to Entry
- hindrances or something material that block or intend
Market Analysis to block passage. Prevents or hinders movement or
- quantitative and qualitative assessment of a market action or even separates the new business.
ability to respond positively.
- It looks into the size of the market both in volume and 1. Investments - projects that requires a huge investment
in value, the various customer segments and buying 2. Technology - application of the combination of
patterns, the competition and the economic environment scientific and engineering knowledge
in terms of barriers to entry and regulation in the 3. Brand - The huge marketing costs required to get a
industry. certain level of appreciation
4. Regulation - licenses and permits in particular
How to do Market Analysis 5. Access to Resources - exclusivity with suppliers,
accessibility of suppliers
1. Demographics and Segmentation 6. Access to Distribution Channels - exclusivity with
- Demographics - statistical characteristics of human distributors, availability of intermediaries
population (as age or income etc.) used especially to 7. Location - place, venue where the business is located.
identify markets; a market or segment of the population
identified by demographic. —--------------------------------------------------
Product -
- Segmentation - process of dividing into segments with - can be tangible or intangible in nature that can be
similar characteristics. Markets are needed to slice it into offered for the satisfaction of the recipient.
different segments. - any item or service you sell to serve a customer’s need
or want.
2. Target Markets
- type of customers that are focused within the market Levels of Product
- group of people that are most likely potential customers 1. Tangible Products (Asset)
for a product because of their shared characteristics such - physical object that can be perceived by touch such as
as age, income, lifestyle, and etc. building, vehicle, gadget or clothing.

3. Market Need 2. Augmented Product

- includes the image and service features of a certain b. Owned - Goods Services
entity. - repair and maintenance services rendered by
- gives emphasis on the intangible benefits that the the sellers to the products of the customer.
customer will be getting from buying the product. - e.g. Laundry Business, Car wash
- an additional benefit or special service supporting the
main product. c. Non - Good Service
- e.g Car Insurance, medical and dental benefits, fire - personal service on the part of the seller, most
insurance common are the expertise and profession of the
seller.
3. Generic Products - - Teacher, accountant, lawyer, receptionist, guest
- emphasizes the impact of the product to the consumer, relation officer.
not the seller.
- signify the purpose of its existence and the primary Characteristics of Services
objective in creating the product.
- products that are named only by their basic product 1. Intangibility - services that cannot be displayed,
type, and not an individual brand. transported, stored, package, or inspected before buying.

Types of Product 2. Credibility - service provided most of the time

1. Goods counts.
- sale of the physical products from the manufacturer to
the consumer or final and ultimate user. 3. Inseparability - service provider and services that
- tangible products that can measure the satisfaction with cannot be separated. It cannot accomplish the purpose if
result or evidences as manifested through physical one is missing.
development.
4. Variability - service is difficult to standardize because
a. Durable Goods - it varies upon the performance of the provider.
- physical products that are used over a long
period of time. Main Categories of a Product
- products that are expensive because of the
quality of the materials used. \ 1. Consumer Product
- e.g. Steel, Stainless, Appliances - goods and services destined/produced for the final
consumer for personal, family or household use.
b. Non- Durable Goods - use of the goods or services designates it as a consumer
- physical products that are quickly and easily be product.
consumed or worn out, become obsolete, - e.g. Products normally and routinely used by
unfashionable or no longer popular. consumers.
- inexpensive and can easily be damaged.
- e.g. Products made with plastic,cartos and a. Convenience Product
paper - purchased with the minimum or less effort
because the buyer has knowledge of the product
2. Services characteristics.
- intangible products that satisfaction can be measured in - Consumer is not willing to search or look for
future preferences. information and will accept a substitute rather
- e.g. Relaxation in salon and spa, Education from school than visit another store.

a. Rented Goods - a.1. Staples - low priced items that are routinely
- consumer rented facility of the sellers in a purchased on a regular basis an are products that
certain period of time are used everyday. (e.g rice, soap, toothpaste)
- e.g. Car rental, space or office for rental
 a.2. Impulse - items that the consumer does not Step 3: Concept Development and testing - trial and
plan to buy. The consumer was attracted to buy error, how to do the product
the product for some reasons like the impressive Step 4: Business Analysis: Is it still feasible? Do we
promotional campaign or low price on sale items still have profit?
etc. Step 5: Product Development - Actual development,
actual making
Step 6: Marketing Testing - grouping the market,
b. Shopping Products getting a tester and get the opinion.
- products that the consumer acquire through Step 7: Commercialization
further knowledge and information in order to
make final purchase decision. —-------------------------------------------------------------

b.1. Attribute-based shopping products - Tips in Choosing the Business Name

provide customers with information and
evaluated features, performance, options, 1. Easy to recall or remember
warranties and other factors. - business name must be understandable so it is easily
stored in the memory.
b.2. Price-based shopping products -
Enable customers to judge product attributes to 2. Pleasant Meaning Creates Pleasant Feelings
be the same and look around for the least - produces positive or favorable feeling upon saying or
expensive item. mentioning to the public.

3. Easy to Pronounce
c. Specialty Products - business name must be cited as freely as it can be.
- items with particular brands and stores to
which consumers are loyal. 4. Easy to Spell
- willing to make a significant or specific effort - the business name must be simple.
toacquire the brans desired units and will pay a - words that are use in everyday communication will be
higher or above the price of similar products. an advantage.
- specific consumer good that is available for
consumer purchase at limited retail locations 5. Related to the Product
with a limited supply. - must describe the product
- reprepsents the features of the product.

2. Industrial products
- goods or services purchased for use/consumption in the Product Life Cycle
production/manufacturing of other goods or services, in - concept that describes a product’s sales, profits,
the operation of a business or for resale to other customers, competitors, and marketing emphasis from its
customers. beginning until it is removed from the market.
- categorized based on degree of decision - making
involved, rapidity of consuptio, role in product, and 1. Product Development
change in form. - must think of a new product
- new product is modification, creation and innovation of
an existing product which makes the product more
New Product Development Process meaningful to the customer.

Step 1: Idea Generation - try to bring a certain idea 2. Introduction

Step 2: Idea Screening - Filtering out the ieas - a new product is introduced into the market place and
objective is to generate customer interest.
- the rate of sale growth depends on the desirability of
the product, competition is limited or selected, losses are
experienced because of high production and marketing
costs.
- Initial and immediate customers are called innovators
who are willing to take risks because the product is new
in the market. Promotions must be informative and free
samples may be desirable.

3. Growth
- product gains wider consumer acceptance and the
objective are to expand distribution and the range of
available product alternatives.
- more firms enter the profitable and tested market.
- profits are high because the mass market buys from a
limited group of firms.
- Basic models are modified and choses; distribution is
expanded coupled with mass advertising to meeti new
goals.

4. Maturity
- product sale levels and companies try to maintain
lower price, better product features for as long as
possible.
- market is saturated, penetrated and competition is at its
highest level.
- company profits decline because discounting becomes
popular and high cost in advertising.
- products are available at most outlets at varying prices.
Promotion is very competitive.

5. Decline
- product’s sales falls as substitutes and new competitors
enter the market.
- during this stage, forms may reduce or lessen the items
produced and outlets used, promotion utilized, or they
can revive and renew the product by repositioning,
repackaging or they can terminate the product.