UNIT I: DEVELOPING A BUSINESS PLAN

Module 1: Overview of Entrepreneurship

Learning Outcomes:

At the end of this module the learners can:

Discuss the relevance of entrepreneurship in
general, including its economic importance.
Define who is an entrepreneur.
Explain the key concepts of common and core
competencies in entrepreneurship.
Delineate clearly between entrepreneurship employment.
Explore opportunities for entrepreneurship as a career.

What is Entrepreneurship?

Entrepreneurship

It is a proactive process of developing a

business venture to make a profit.

It involves seeking opportunities for market, establishing and operating a

business out of the opportunity, and assessing its risks and rewards
through close monitoring of the operations.

Here are the societal and economic benefits of entrepreneurship.

Entrepreneurship produces more jobs thequate to an increase in national income.

a
Entrepreneurship amplifies economic activities of different sectors of
society.
Entrepreneurship introduces new innovative
a
n
d products and
services.
Entrepreneurship improves people’s living standards.
Entrepreneurship disperses the economic power and creates equality.
Entrepreneurship controls the local wealth and balances regional development.
Entrepreneurship reduces social conflicts and political unrest.
Entrepreneurship elicits economic independence and capital formation.

Who is an Entrepreneur?

The word “entrepreneur” has a French origin and was coined from the
words entre, which means “between”, and prendre, which means “to
take”.

Who is an Entrepreneur?
Entrepreneur
A unique individual who has the innate ability and extraordinary dedication to
establish and manage a business, acknowledging all the risks and reaping its
rewards.
It entails a holistic business talent to considered
b
e one, ranging from product and
marketing expertise to operations agility, and to financial proficiency.
 Five levels of entrepreneurial development –
Action Coach

The self-employed
The manager
The leader
The investor
The true entrepreneur
The world of entrepreneurship these days has already evolved, and new terms
are coined to suit
an entrepreneurs’ field of expertise. Here are some:

Technopreneur
An entrepreneur who puts technology at the core of his or her business model.

Social entrepreneur
One who takes advantage of the country’s social problems and turn them to
profitable institutions with the intention of helping the disadvantaged
community rather than making a profit.
Intrapreneur
An entrepreneur in a large company or corporation who is tasked to think,
establish, and run a new big idea or project.
Intrapreneurs are usually the product managers or the business
development managers of a company.

Extrapreneur
An entrepreneur who hops from one company to another to act as the innovation
champion, providing creative and efficient solutions

The Role of Entrepreneurs in the Society

They innovate
They nurture healthy competition
They allow money to circulate
Common and Core Competencies in Entrepreneurship

Proactive
Agents of change
Risk takers
Have a sharp eye for opportunities
Sociable
Networkers
Decisive
Balanced
Innovative

Core Traits of Entrepreneurs

Leaders
Communicators
Specialists
Problem solvers
 Entrepreneurship or Employment

Pros and cons of entrepreneurship vs. employment

Important Career Entrepreneur Employee
Factors

1. Income
 Income generated  Income generated actively
passively even (i.e., on working hours only); no work = no pay
when the
entrepreneur is
 Income usually fixed per
resting month and increases every year depending on

 Opportunity
the employee performance

income
 Income earned whether
the business is successful or unsuccessful
unlimited,
depending on
the success of
the business

 Income only

earned
when the business
is successful
 Important Career Entrepreneur
Factors
2. Hiring and Firing,
Organizational
 Provides jobs; is the owner
of the business and conducts the talent
Setup, and Major
selection
Key Result Areas
 Fully responsible for
serving customers, making the business
profitable/sustainable, and providing
employee satisfaction
 Has the power to disengage
non-performing employees applying the
due process policy of disengaging
personnel
 Can venture into expansion
of business such as franchising and
buying other similar businesses
Employee
 Seeks for a job; is the one
applying for and is interviewed by the
company’s hiring officers
 Has the goal of satisfying
only the employer or the
direct supervisor
 Fully dependent on the employer’s
performance; is at risk of losing his or
her job if the company does not
perform well; may find it difficult to just
leave their below par employer if this
is their only source of income
 Can only work for the
current employer exclusively

Important Career Entrepreneur Employee

Factors

 
3. Daily Tasks
Performs all necessary Has routine tasks
variable tasks to establish and manage a and works on regular or normal
startup business, which usually takes most hours


of the entrepreneur’s time; spend more
hours on work than a regular employee Follows policies,
and sometimes gets no sleep procedures, and memoranda from
 Prepares policies,
the employer

procedures, and memoranda for the

business
 Important Career Entrepreneur Employee
Factors
4. Leisure Time
and Vacations
 Has a flexible schedule  Has limited number of
and can take unlimited number of vacation days imposed by the employer
vacation days (applicable only if the
business has
stabilized already)

5. Taxation
 Taxed on the net income; can
claim taxable income
deductions for allowable
expenses incurred by the
business
 Taxed on the gross income; cannot
use expenses incurred related to the
job such as food and transportation
expenses to claim for deductions from
taxable income

Important Career Entrepreneur Employee

Factors
6. Comfort Level at Work
 Is comfortable in  May be comfortable
doing multiple and challenging with routines and minimal risks;
tasks and takes accountability may also be comfortable in working
with the risks and profits of the for the company itself
business; does not want to be
confined in a box; thinks outside
the box or sometimes thinks
there is no box
Careers in Entrepreneurship

List of most common small

businesses in the Philippines: Flea market business or tiangge
Sari – sari store Online sellingbusiness
Rice retailing Cellphone loadingbusiness
Food cart business Laundry and dry cleaning business
Printing business Hair styling and makeup business
Buy-and-sell business Spa, gym, and nail care business
Street food business Video and photographybusiness
Tutorialbusiness
Careers in Entrepreneurship
Careers in Entrepreneurship
Baking business
Web site development and design/blogging
Direct selling business
Car wash and car care business
Bar, café, and restaurant
Water station and LPG (liquefied petroleum gas) station

Franchising
A business arrangement wherein the franchisor, who is the owner of the business, acquires
distribution centers through the franchisees or the affiliated dealers.
Entrepreneur Philippines’ franchise business options in the Philippines:

Franchise or Startup Businesses

Bakeries, bakeshops, and bread products
Bars, cafes, and coffee shops
Beverage and confectionery
Car care
Clothing and accessories
Convenience stores
Drug stores and pharmacies
Fast food establishments and restaurants
Food and snacks
Gas stations/petroleum products
General merchandise and retail
Health and wellness (salon, massage, sp
,and gym)
a
Schools
Services (personal and business)
Waters stations

Other Additional Business Opportunities

Dealerships

Direct selling

Distributorship