HOLY FACE OF JESUS LYCEUM OF SAN JOSE INC.

285 Mabolo St. Cor. Sampaguita St., San Jose, Rodriguez, Rizal

MARICAR E. ELOCADO
Subject Teacher

Entrepreneurship Page 1
TABLE OF CONTENTS

ACKNOWLEDGEMENT…………………………..…………...………………….…….5
Lesson 1:
Introduction to Entrepreneurship………………......................................,,.......................6

Learning objectives …………………………………………………………..….………. 6

Introduction ………………………………………………………………….…….……...6

Lesson Proper……...........................................................................................................6-7
Activity 1: Self Assessment.................................................................................................8
Activity 2: Interview the Known.........................................................................................9
Assessment 1………......................................................................................................9-10
Lesson 2:
Recognize a Potential market.............................................................................................11

Learning objective …………………………………………….…………..…………….11

Lesson Proper ………………………………………………..................................…12-16

Activity 3: Word Hunt.……………………………………………………………….16-17

Activity 4: Complete Me……….…………………………..……………………………17
Assessment 2…………………………………………………………………………18-19
Lesson 3:
Recognize and Understand the Market……......................................................................20

Learning objective…………………………………………………………………….…20

Lesson Proper…………………………………………………………………...……21-23

Activity 5: Chat me Out………..…………………………..................................….........24

Activity 6: Known Product ………………………………………………...……………25
Assessment 3 ………………………………………………………….……………25-26
Lesson 4: Market Research…………………....................................................................27

Learning objective ……………………………………………………..………….…….27

Entrepreneurship Page 2
Lesson Proper ……………………………………………………………….…….…27-28
Activity 7: …………..…………………………….….……………………….….…….. 29
Assessment 4..………………………………………………….………………………30

Lesson 5: 7 P’s of Marketing ............................................................................................31

Activity 8: …………..……………………….….……………………….….…….. 34-35

Lesson 6: Develop a Brand Name…...……….…………………..…............................. 35

Learning objective …………………………………………….…..………….…………35

Lesson Proper ……………………………………………………………..…...…….35-37

Activity 9: ………………………………………………..…………………..………37-38
Activity 10: ……………………………………………..………………..…………..38-39

Lesson 7: 4 M’s of Production and Business Model.........................................................40

Learning objective ………………………………………………….…..………….……40

Lesson Proper…….......................................................................................................40-45
Activity 11: Identify Me ……..………………..……………..………..........................45
Activity 12: ……………………………………………..……………….……….......46-47
Activity 13: Business Plan making …………………..………………..……….........48-49

Lesson 8: Forecasting Revenues and Cost……………………..…………………..…….49

Learning objectives ……………………………………………….……………….……49

Lesson Proper …………………………………………………..….………...………49-53

Activity 14:…………………………………….……………………………………...…53

Lesson 8.1: Forecasting Revenues and Cost to be Incurred………..…………...……….54

Activity 15…………………………………….…………….………………………..56-57
Lesson 9: Computation of Gross Profit.............................................................................58

Entrepreneurship Page 3
Learning objectives ……………………………………………….……………….……59

Lesson Proper ………………………………………………………..………..…….…...59

Activity 16: …………………………………...………………………………..….……59

Activity 17: …………………...………………………………………………..….……60
Assessment 5 …………………………………………………...……………………60-61
Performance Task 1……………………………………………………………………62
Lesson 10: Business Implementation.................................................................................63

Learning objectives ……………………………………………….……………….…….63

Lesson Proper…….......................................................................................................63-64
Activity 18: ………………………...................................................................................64
Performance Task 2…………………………………………………………………...…66
Assessment 5 ………………………………………………………………………66-67
References ...................................................................................................................68-70

Entrepreneurship Page 4
Acknowledgement

This module would not be successful without the help of our beloved head, our
co-teachers, families and relatives who believe in our power and abilities. We would like
to extend our ultimate thanks-giving to the following for without them, this module
wouldn’t be work.

ALMIGHTY GOD, who gave us strength, power and guidance and for giving all
we need to finish this module.

DR. MARMELO V. ABANTE, who gave all his full support in order for the
school to prosper

MRS. MARICHU M. VISICO, who supports the school’s personnel and

creating a good environment for the students and teacher

MRS MA. ELENA SALAZAR, who gave her genuine support for the teachers
and other personnel

MRS. AIREEN C. CANTOS, who gave all of her efforts and creating a good
environment for the students and teacher

Entrepreneurship Page 5
Lesson 1: Introduction to Entrepreneurship

In going through the module, you have to extend your patience in understanding,
analyzing what you are reading. Follow the directions and/or instructions in the
activities. Answer the entire given test and exercises carefully. Comply the
required activities provided.
Before we will proceed to our lesson, Can you tell me what comes into your mind
when you hear the word Entrepreneur? Write it one fourth sheet of paper and
give it to your teacher. (All answers will be accepted)
Learning Objectives
At the end of this topic the student will:
1. discuss the relevance of the course;
2. explain the key concepts of common competencies;
3. explain the core competencies in Entrepreneurship;
4. explore job opportunities for Entrepreneurship as a career.
Lesson Proper
Relevance of Entrepreneurship to an organization

1. Development of Managerial capabilities- this means that one of the benefits

an entrepreneur gets is to develop his managerial skills.
2. Creation of Organizations- which means that because of entrepreneurships
many organizations will exist.
3. Improving standard of living- this means that entrepreneurship can lift up
the economic status of an individual.
4. Means of economic development- this means that not only the life of the
entrepreneur is improved but also the society where the business is located.

Concept of Entrepreneurship
The word “entrepreneur” was derived from the French verb enterprendre,
which means “to undertake” This is pinpointing to those who ”undertake” the risk
of enterprise. The enterprise is created by an entrepreneur and the process is
called “Entrepreneurship”

Entrepreneurs are innovators, willing to take risks and generate new ideas to
make it unique and profitable solutions to the present-day problems.

Factors Affecting Entrepreneurship

1. Personality Factors which includes:

a. Initiative- which means doing things even before being told

Entrepreneurship Page 6
b. Proactive-which means he can classify opportunities and seize it.
c. Problem Solver- which means he can retain good relations with other people

d. Perseverance-meaning he will pursue things to get done regardless of

challenges
e. Persuasion- means that he can entice people to buy even if they don’t.
f. A Planner- meaning he makes plan before doing things and do not fail
to monitor it.
g. Risk-taker which means that he is willing to gamble but he will
calculate it first.
2. Environmental Factors which include political, climate, legal system,
economic and social conditions and market situations.

Common Competencies in Entrepreneurship

1. Decisive- an entrepreneur must be firm in making decisions.
2. Communicator- an entrepreneur must have a convincing power.
3. Leader-an entrepreneur an entrepreneur must have the charisma to be
obeyed by his employees
4. Opportunity seeker- an entrepreneur must have the ability to be the first to
see business chances.
5. Proactive- controlling a situation by making things to happen or by preparing
for possible future problems.
6. Risk Taker- they have the courage to pursue what are their business ideas.
7. Innovative- the entrepreneurs have big business ideas and they do not stop
improving and thinking of new worthwhile ideas for their business.

Core Competencies in Entrepreneurship

1. Economic and dynamic activity- Entrepreneurship is an economic activity
because it involves the creation and operation of an enterprise with a view to
creating value or wealth by ensuring optimum utilization of limited resources.
2. Innovative- Entrepreneurs constantly look for new ideas, thus he needs to be
creative.
3. Profit Potential- meaning the entrepreneur can be compensated by his profit
coming from the operation.
4. Risk bearing –meaning the entrepreneur needs to gamble but wise enough to
offset the risk.

Entrepreneurship Page 7
Types of entrepreneurs
1. Innovative entrepreneur- they are those who always make new things by
thinking of new ideas.
2. Imitating entrepreneurs- they are those who don’t create new things but only
follow the ideas of other entrepreneurs.
3. Fabian entrepreneurs- they are those skeptical. They don’t initiate but follow
only after they are satisfied.
4. Drone entrepreneur- they are those who lives on the labor of others. They
are die-hard conservatives even ready to suffer the loss of business.
5. Social entrepreneurs-they are those who initiate changes in the various fields
such as education, health, human rights, environment and enterprise
development.

Career Opportunities of Entrepreneurship

1. Business Consultant- with the expertise of the entrepreneur he can be a very
good source of advices to other entrepreneurs and would be business man.
2. Teacher- a graduate of an entrepreneurship can be use his knowledge in
teaching
3. Researcher- the entrepreneur can be employed as researcher by an
enterprise.
4. Sales- the entrepreneurship graduate can apply as salesman
5. Business Reporter- the entrepreneur being expert in the field, he can be
employed as business reporter.

Activity # 1: Self- Assessment

Direction: Find out if you have the qualities of an entrepreneur. Put a check mark
on the box.
Qualities YES NO
Risk Taker
Communicator
Leader
Opportunity Seeker
Proactive
Innovator
Decisive

Entrepreneurship Page 8
Activity # 2: Interview the Known

Choose three successful entrepreneurs in your community or nearby places and

conduct an interview using the guide questions below. Discuss the result of your
interview to your teacher.

1. What motivated you to become an entrepreneur?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
2. What do you think are your characteristics and competencies that made you a
successful entrepreneur?
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
3. What do you think of being employed? Why didn’t you choose that path?
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
Assessment #1

Now, that you are finished accomplishing the module, let us check what you have
learned. Answer the questions given below by encircling the letter of the correct
answer.
1. The entrepreneurs who create new ideas are called? a. Innovative
b. Imitating
c. Fabian
d. Drone

2. The entrepreneur who lives on the labor of others is called? a. Drone

b. Fabian
c. Imitating
d. Innovative

Entrepreneurship Page 9
 3. These are entrepreneurs who are to follow the path shown by
innovative entrepreneur. a. Innovative
b. Imitating
c. Social Entrepreneurs
d. Fabian

4. Which of the following is NOT a function of an entrepreneur? a. Skills

management
b. Risk taking
c. Conduct research
d. Make no changes with his product

5. Entrepreneur means:
a. Risk taker
b. To undertake
c. To research
d. To improve standard of living

Entrepreneurship Page 10
Lesson 2: Recognize a Potential Market

In the previous lesson, you already know about the difference between
businessman and entrepreneur. Knowing all the entrepreneurial concepts will not
assure a person of becoming a successful entrepreneur and not all business
people are entrepreneurs. Some says being an entrepreneur is a calling; a lot of
qualities must be possessed to be considered successful and sustainable. So, if
you are given a great opportunity to venture into the field of entrepreneurship, it
may be a long process to undertake and the willingness to take a risk. Also,
you’re not only the one who’s in progress but at the same time, you’re helping for
the development growth of our economy.
Learning objective
After completing this module, you need to:
1. Learn and understand the sources of opportunities for business;
2. Determine the essentials in the entrepreneur’s opportunity seeking;
3. Identify market problems and propose potential products or services that will meet
the market needs;
4. Know the problem in which a business opportunity arises from;
Identify, screen and proposed solution to meet the problem
5. Select the best product or service that will meet the market’s need with a
consideration of generating profit.

Lesson proper

Entrepreneurial Ideas

The creation of an entrepreneurial ideas leads to the identification of

entrepreneurial opportunities, which in turn results in the opening of an
entrepreneurial venture.
The entrepreneurial process of creating a new venture is presented in the
diagram below. (Aduana, 2017)

Creation of Identification of Opening of

entrepreneurial entrepreneurial entrepreneurial
Ideas Opportunities Venture

Figure 1. The Entrepreneurial Process of Creating New Venture

Entrepreneurship Page 11
Essentials in Entrepreneur’s Opportunity Seeking
These are the basic foundation that the entrepreneur must have in seeking
opportunities:
Entrepreneurial mind frame. This allows the entrepreneur to see things in a
very positive and optimistic way in the midst of difficult situation. Being a risk -
taker, an entrepreneur can find solution when problems arise.

Entrepreneurial heart flame. Entrepreneur's driven passion, they are attracted

to discover satisfaction in the act and process of discovery. Passion is the great
desire of an entrepreneur to achieve his/her goals.
Entrepreneurial gut game. This refers to the ability of the entrepreneur of being
intuitive. This also known as intuition. The gut game also means confidence in
one’s self and the firm believes that everything you aspire can be reached.

Sources of Opportunities
There are many ways to discover opportunities. Looking at the big picture some
has noticed the emerging trends and patterns for business opportunities. While
others are trying to find out their target market. Some are the following sources of
opportunities:
1. Changes in the environment
Entrepreneurial ideas arise when changes happen in the external environment. A
person with an entrepreneurial drive views these changes positively. External
environment refers to the physical environment, societal environment, and
industry environment where the business operates.

1.1 The physical environment includes

a. Climate- the weather conditions.

b. Natural resources- such as minerals, forests, water, and fertile land that
occur in nature and can be used for economic gain.
c. Wildlife- includes all mammals, birds, reptiles, fish, etc., that live in the
wild.

1.2 The Societal environment includes the various forces like

a. Political forces- includes all the laws, rules, and regulations that govern
business practices as well as the permits, approvals, and licenses necessary to
operate the business.
b. Economic forces- such as income level and employment rate.
c. Sociocultural forces- customs, lifestyles and values that characterize a
society.

Entrepreneurship Page 12
 d. Technological environment- New inventions and technology
innovations.

1.3 The industry environment of the business includes:

a. Competitors
b. Customers
c. Creditors

d. Employees
e. Government
f. Suppliers

For example, one factor in the physical environment that can easily change is the
climate. The temperature is very high during summer but very low during the
rainy season. An individual with entrepreneurial drive can be extremely
imaginative and inventive in identifying opportunities. He/she can venture a
business that responds to the needs of the people during summer and rainy
season.
2. Technological discovery and advancement

A person with entrepreneurial interest sees possibility of business opportunities

in any new discovery or because of the use of latest technology.
For example, an individual with knowledge in repair and installation of a machine
engine discovers that additional engine parts that considerably reduce fuel
consumption.

3. Government’s thrust, programs, and policies

The priorities, projects, programs, and policies of the government are also good
sources of ideas.
For example, the use of firecrackers to celebrate New Year’s Eve is strictly
prohibited. People without entrepreneurial interest will view the ordinance as a
plain restriction. However, for an entrepreneur, it is a business opportunity to
come up with a new product that will serve as a substitute for firecrackers.
4. People’s interest

The interest, hobbies, and preferences of people are rich source of

entrepreneurial ideas. Like the increasing number of Internet Café at present
could be lead to the strong attachment of young people to computers.
5. Past experiences

Entrepreneurship Page 13
The expertise and skills developed by a person who has worked in a particular
field may lead to the opening of related business enterprise.
For example an accountant who has learned the appropriate accounting and
management skills and techniques in a prominent accounting firm can start
his/her business venture by opening his/her own accounting firm.
Forces of Competition Model
It is also known as the “five forces of competition,” An industry environment is a
competitive environment. Regardless of what product or services you have,
competition is always present.
Competition – it is the act or process of trying to get or win something.
For example, the prices are lower when there is a competition among the stores.
These are the five forces competing within the industry:
• Buyers
• Potential new entrants
• Rivalry among existing firms
• Substitute products
• Supplier

1. Buyers

The buyers are the one that pays cash in exchange to your goods and services.
For example, the influenced of the price or in the bargaining strategy. The buyer
has a strong and magnified bargaining power. The threat of its bargaining power
will be less if the following factors notice:
a. There are several suppliers available in the market.
b. The buyer has the potential for backward integration.
c. The cost of switching the supplier cost is minimal.
d. The product represents a high percentage of the buyer’s cost.
e. The buyer purchases large portions of the seller’s product or services

2. Potential New Entrants

A new entrant is defined as the one who enters something. For example, the
level of capital requirements, if the business requires huge capital, new entrants
should decline to join the business. This gives a threat to the business. This can
be notice if there is the presence of the following factors:
a. Substantial capital requirement.
b. Strict government policy.
c. Difficulty in accessing distribution channels.
Entrepreneurship Page 14
 d. Economies of scale.
e. High cost of product differentiation.
f. High switching cost

3. Rivalry among Existing Firms

Rivalry is a state or situation in which people or groups are competing with each
other. For example it depends on the Marketing strategy of your competitor, like
giving freebies and special offers. The intensity of rivalry among existing firms is
characterized to the following factors:
a. Diversity of rivals.
b. Number of competing firms.
c. Characteristics of the products or services.
d. Increased capacity.
e. Amount of fixed costs.
f. Rate of industry growth.

4. Substitute Products

Substitute means anything that takes the place or function of another. For
example the consumers decide to use margarine as a substitute for butter. In
case the price of butter increases, preferably the consumer will gradually switch
to margarine.

A substitute product can give a big threat in the industry environment if the
following factors are notice:
a. Switching cost is low.
b. Preferences and tastes of the customers easily change.
c. Product differentiation is highly noticeable
d. The quality of substitute products dramatically improves.
e. The price of substitute product is substantially lower.

5. Suppliers
The Suppliers are the one that provide something that is needed or wanted. For
example if the supply and services being offered is unstable or keep. The
intensity of the threat is strong in this kind of the competitive force in the industry.
This can be notice if there is the presence of the following factors:
a. The supplier has the ability for forward integration.
b. Suppliers in the industry are few, but the sales volume is high.

Entrepreneurship Page 15
 c. Substitute products are not readily available in the market
d. The switching cost is very high.
e. The product or service is unique.

Activity # 3
WORD HUNT
Think of words or terms related to the topic and find the words in the grid
horizontally, vertically, or diagonally. Write the words or terms on the space
provided below.

Entrepreneurship Page 16
V E N T U R E A B C D E F A B C D E F S
A B N P O H W Q G S D L O S J E T U E Q

B C T R P R O D U C T S R
L R E H R B E
C V R E P G O Y T R E P T
G S T V A C N
V H E N O V R F D A B C
D E I U
O G V T
H K B E R C T K R F G E N
H C J R K H R
K I C I T H U L V D E O C
E U A T U K E
I D V D U K N S J Y I R Z
O Q E U Y I P
D G H G N O U A O F G T U X N X N D R
G L K L I P W L R E P U R E P O J O G E

L H Z H T S P K L I O N H L I O M E L N
H A X Q I M I L G C V R I V A L R Y H E
A D S J E T U R E A B B S T I T U H A U
S S U B S T I T U T E S J E T U R F J R
V T U R E A B Q R S J E T U T U R E A B

1. ____________________ 6. ____________________
2. ____________________ 7. ____________________
3. ____________________ 8. ____________________
4. ____________________ 9. ____________________
5. ____________________ 10. ____________________

Activity # 4
COMPLETE ME
Complete the table below by supplying it with products that you consider similar.
Write the product and not the brand in their respective columns. Then describe
and differentiate its characteristics and uses.
No. Primary Product Substitute Product
( Product name ) ( Product name )
Exampl Butter - expensive price used as Margarine – lesser price also
e bread spread. used as bread spread
1.
2.
3.
4.
5.

Entrepreneurship Page 17
Summary
Definition of Terms
Opportunity seeking - Process of considering, evaluating, and pursuing market
based activities that are accepted to be beneficial for the business.
Entrepreneurial process - can be defined as the steps taken in order to begin a
new enterprise. It is a step-by-step method, one has to follow to set up a
business.
Entrepreneurial ideas - an innovative concept that can be used for financial
gain that is usually centered on a product or service that can be offered for
money.
Essentials of entrepreneur’s opportunity seeking - These are the basic
foundation that the entrepreneur must have in seeking opportunities, such as
entrepreneurial mind frame, heart flame and gut game.
Sources of opportunity - can be attain by assessing and looking at changes in
the environment; technological discovery and advancement; government’s thrust,
programs, and policies; people’s interest, and past experiences.
External environment - refers to the physical environment, societal
environment, and industry where the business operates.
Government - refers to the local government (municipality, city, or provincial) or
the national government and its branches.
Competition – it is the act or process of trying to get or win something.
Substitute – anything that takes the place or function of another.
New entrants – the one who enters something
Suppliers – are the one that provide something that is needed or wanted.
Buyers – are the one that pays cash in exchange to your goods and services.
Rivalry – is a state or situation in which people or groups are competing with
each other.
Assessment # 3

Direction: Encircle the letter of your choice.

1. It is the process of considering, evaluating, and pursuing market-based
activities that are believed to be advantageous for the firm.
A. Opportunity seeking C. Opportunity screening
B. Opportunity seizing D. Sources of opportunity
2. This is essential to opportunity seeking which allows the entrepreneur to see
things in a positive and optimistic light in the midst of crisis or difficult situations.
A. Entrepreneurial mind frame C. Entrepreneurial heart flame
B. Entrepreneurial gut game D. Entrepreneurial heart frame

3. It is the ability of entrepreneur that can sense without using the five senses,
also known as intuition.

Entrepreneurship Page 18
A. Entrepreneurial mind frame C. Entrepreneurial heart flame

B. Entrepreneurial gut game D. Entrepreneurial heart frame

4. One of the essentials of entrepreneur’s opportunity seeking that refers to the

driven passion of an individual.

A. Entrepreneurial mind frame C. Entrepreneurial heart flame

B. Entrepreneurial gut game D. Entrepreneurial heart frame

5. What variable of societal environment includes income level and employment

rate?

A. Economic forces C. Political forces

B. Sociocultural forces D. Technological forces

Entrepreneurship Page 19
Lesson 3: Recognize and Understand the Market

In previous lesson we learn about the creation of entrepreneurial ideas that lead
to the identification of entrepreneurial opportunities, which in turn results in the
opening of an entrepreneurial venture. In opening the new venture or a business,
you need to determine the Unique Selling Proposition (USP) and Value
Proposition (VP) of your product as well as your target market

Learning objective
After completing this module, you need to:
1 – Describe the unique selling proposition and value proposition that
differentiate one’s product/service from existing products/services;
2 – Determine who the customers are in term of Target market, Customer
requirement and Market size.

Lesson proper
Value Proposition (VP) is a business or marketing statement that summarizes
why a consumer should buy a company's product or use its service. This
statement is often used to convince a customer to purchase a particular product
or service to add a form of value to their lives. In creating Value Proposition,
entrepreneurs will consider the basic elements:
• Target Customer
• Needs/opportunity
• Name of the product
• Name of the enterprise/company

There are many competitors in the market to establish superiority to them.

Entrepreneurs should think some alternative and how it works better. An
important aspect in Value Proposition must be truthful that will establish
credibility to the consumers.
Example: Potential value proposition is most common in small businesses of
your locality.
Aling Charing Sari-sari Store open only from 6:00 am to 6:00 pm, but Aling
Charing noticed that there are customers who go nearby town to look for a
convenience store at around 10:00 pm to 6:00 am. She believes that this is a
great opportunity for her store to operate 24/7. In this example, proposed value
proposition: “Charing Sari-sari Store, opens 24/7”.
The business describes sari-sari store – a basic retail store. The assurance from
this value proposition is because of the phrase “opens 24/7”, Aling Charing Sari-
sari Store opens 24/7, which make it different from other competitors.

Entrepreneurship Page 20
Unique selling proposition (USP) refers to how you sell your product or
services to your customer. You will address the wants and desires of your
customers.
As entrepreneur, you think of marketing concept that persuade your target
customers. The following questions you may ask in doing this, What the
customers want? What brand does well? What your competitor does well?

Some tips for the entrepreneur on how to create an effective unique selling
proposition to the target customers:
• Identify and rank the uniqueness of the product or services character
• Very Specific
• Keep it short and simple (KISS)

As entrepreneur, present the best feature of your product or services that are
different from other competitors. Identifying the unique selling proposition
requires marketing research that you will learn from the other modules. In
promoting your products or services, make sure that it is very specific and put
details that emphasize the differentiator against the competitors. Keep it short
and simple and think of a tagline that is easy to remember. Right now, the
proposed unique selling proposition: “Charing Sari-sari Store, opens 24/7”.
Readers get confused between value proposition and unique selling proposition.
The two propositions are used to differentiate the products from competitors. For
example, Jollibee is known to have a Filipino taste burger. This brand has a
unique selling point because of its tagline “Langhap Sarap”
Unique Value Proposition and Value Proposition are two most famous tools used
to explain why prospect customers buy each products and services. Base on
each definition, we learn that USP and VP are frameworks of each business
industry. The two propositions are valuable for the entrepreneurs.
After you understand the value proposition and the unique selling proposition,
now it’s time to understand the target market, customers requirement and market
size.

A. Target Market
Market Targeting is a sage in market identification process that aims to
determine the buyers with common needs and characteristics. Prospect
customers are market segment that entrepreneurial venture intends to serve.
In targeting a specific market, it will exclude people even if it will not fit your
criteria. Rather, target marketing allows you to focus your marketing money and
brand message on a specific market that is more likely to buy from you than
other markets. Product is more affordable, efficient, and effective way to reach
potential clients and generate business.

Entrepreneurship Page 21
Commonly used methods for segmenting the market are follows.
1. Geographic segmentation – the total market is divided according to
geographical location.
• Variable to consider
a. Climate
b. Dominant ethnic group
c. Culture
d. Density (either rural or urban)
2. Demographic Segmentation – divided based consumers.
• Variable to consider
a. Gender
b. Age
c. Income
d. Occupation
e. Education
f. Religion
g. Ethnic group
h. Family size
3. Psychological Segmentation- divided in terms for customers think and believe.
• Variable to consider
a. Needs and wants
b. Attitudes
c. Social class
d. Personality traits
e. Knowledge and awareness
f. Brand concept
g. Lifestyle

Entrepreneurship Page 22
4. Behavioral Segmentation- divided according to customers behavior pattern as
they interact with a company.
• Variable to consider
a. Perceptions
b. Knowledge
c. Reaction
d. Benefits
e. Loyalty
f. Responses

B. Customer Requirements
Customer requirements are the specific characteristics that the customers need
from a product or a service.
There can be two types of customer requirements:
1. Service Requirement
2. Output Requirement

Service Requirement:
Intangible thing or product that is not able to be touched but customer can feel
the fulfillment. There are elements in service requirement like on-time delivery,
service with a smile, easy-payment etc. It includes all aspects of how a customer
expect to be treated while purchasing a product and how easy the buying
process goes.

Output Requirements:
Tangible thing or things that can be seen. Characteristic specifications that a
consumer expects to be fulfilled in the product. Costumer that will avail services
as a product, then various service requirements can take the form of output
requirements. For example, if the consumer hires a multi cab, then on-time
arrival becomes an output requirement. Customer buys gadgets (phone
speaker), the specification like the loudness and clarity are the output
requirements.

C. Market Size

Entrepreneur’s most critical task is to calculate the market size, and the potential
value that market has for their startup business. Market research will determine
entrepreneur possible customers in one locality.

Entrepreneurship Page 23
What is Market Size?
Market size is like a size of arena where the entrepreneurs will play their
business. It is the approximate number of sellers and buyers in a particular
market. Companies are interested in knowing the market size before launching a
new product or service in the area. In determining the market size, entrepreneur
will conduct a strategic marketing research from reliable sources using the
following method. First step is to estimate the potential market – approximate
number of customers that will buy the product or avail your services. Second step
is to estimate the customers who probably dislike buying your product or availing
the services. Third step is for the entrepreneur to estimate the market share that
means plotting and calculating of the competitor’s market share to determine the
portion of the new venture. Market size becomes the most important if you ever
need to raise funding for your business.

Activity # 5: Chat Me Out!

Based on the previous discussion:

1. Discuss the unique selling proposition and value proposition.

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
2. What are commonly used methods for segmenting the market?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

Entrepreneurship Page 24
 Activity # 6
Give at least 5 products being advertised or promoted on television. Evaluate
each one according to its USP, VP, and method of segmentation used, customer
requirements, and who are target customers.

Product USP VP Method of Customer Target

Name Segmentation Requireme customers
nts
Ex. Langhap Filipino Psychological Service & All people
Jollibee Sarap taste Output
burger
1.

2.

3.

4.

5.

Assessment #3

Multiple Choice: Select the best answer.

____1. What is the relationship between unique selling proposition and value
proposition.
a. a framework of each business industry
b. meet your competitors needs wants.
c. persuades another to exchange money for a product service’s
d. connected with only one particular thing.

____2. The following variable to consider in behavioral segmentation, except.

a. perception
b. brand concept
c. reaction
d. benefits

Entrepreneurship Page 25
____3. What is the function of Value Proposition?
a. use to power up sales
b. convince customer to purchase a particular product or services.
c. customers buying habits
d. provide value to your customers

____4. Give example in promotion using Value Proposition and Unique Selling
proposition.
a. with the slogan “Langhap Sarap”
b. ordinary sari-sari store
c. multinational business
d. fruit shake stand

____5. ________________ will determine entrepreneur possible customers in one

locality.
a. Market design c. market research
b. Market strategy d. market size

Entrepreneurship Page 26
Lesson 4: Market Research

Firms and other business companies need to understand their service

offerings and their customers to ensure that their services will be adopted as
solutions to consumer needs. In order for the firms to recognize the needs of the
market or the customers, they need to conduct market research.
The Market Research or Marketing Research Process can be defined
as the process of gathering, analyzing and interpreting the information about the
products or the services to be offered for sale to the potential consumers in the
market,
There are different ways to collect the data. The most important methods you can
consider are surveys, focus group discussion and interviews.

Learning objectives
Students are expected to:
1. Discuss market research;
2. Know the meaning of data gathering;
3. Identify the different data gathering techniques.

Lesson proper
DATA COLLECTION is the most valuable tool of any type of research study.
Inaccurate data collection may cause mistakes and ultimately lead to invalid
results.

TIPS in GATHERING DATA

• Organize collected data as soon as it is available
• Know what message you want to get across and then collect data that is
relevant to the message

• Collect more data

• Create more data
• Regularly run experiments or collect data
• Challenge your assumptions
• Set reasonable expectations
• Take note of interesting or significant data

Entrepreneurship Page 27
 In this lesson, we will consider the three different data collection
techniques – SURVEY (Questionnaire), INTERVIEW and FOCUS GROUP
DISCUSSION – and evaluate their suitability under different circumstances
SURVEYS are the most common way to gather primary research with the use of
questionnaires or interview schedule. These can be done via direct mail, over the
phone, internet (e.g. Google) or email, face-to-face or on Web (e.g. Skype or
Viber).
When designing or constructing your own research questionnaire, remember the
following guidelines. (Edralin, 2016)

• Keep it simple as possible.

• Make sure it is clearly appealing and easy to read.
• Cluster or block related questions.
• Move from complex questions to more specific questions.
• Make sure questions are concise and easily understood.
• Avoid questions that are difficult to answer.
• Make sure any response scales used are consistent with categories that are
mutually exclusive.

INTERVIEW is one of the most reliable and credible ways of getting relevant
information from target customers. It is typically done in personal between the
researcher/entrepreneur and a respondent where the researcher asks pertinent
questions that will give significant pieces of information about the problem that he
will solve. The interview is also helpful even when the business has already
started because the customers’ feedback provides the entrepreneur a glimpse of
what the customers think about the business.
Interviews normally last from 15 to 40 minutes, but they can last longer,
depending on the participants’ interest in the topic.
In a structured interview, the researcher asks a standard set of questions and
nothing more.(Leedy and Ormrod, 2001)
• • Personal interviews are the traditional method of conducting an
interview. It allows the researcher to establish relationship with potential
participants and therefore gain their cooperation. It generates highest response
rates in survey research. They also allow the researcher to clarify indefinite
answers and when necessary, seek follow-up information.
• • Telephone interviews are less expensive and less time consuming, but
the disadvantages are that the response rate is not as high as the face-to- face
interview, but considerably higher than the mailed questionnaire.

Entrepreneurship Page 28
FOCUS GROUP DISCUSSION (FGD) - is an excellent method for generating
and screening ideas and concepts. It can be a moderated group interviews and
brainstorming sessions that provide information on user’s needs and behaviors.
The following are considerations in the use of focus group discussions in market
research:
• The length of the session is between 90 and 120 minutes.
• Usually, conduct focus groups discussion with 8 to 10 participants per group.
• Assign an expert moderator / facilitator who can manage group dynamics..
• Use a semi-structure or open-format discussion

• Strive for consistency in the group’s composition (for example, it may not
be advisable to have business customers and retail customers in the same focus
group, their needs are very different)

Activity # 7
Explain briefly but in a concise manner
1. What is Market Research? (5 pts.)

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
_______________________________________________________________

2. Enumerate and discuss the three data gathering techniques (5 pts.)

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

Entrepreneurship Page 29
Assessment # 4

Encircle the letter of your choice.

1. It is the process of gathering, analyzing and interpreting the information about
the product or the services to be offered for sale in the market, the market and
about past, present and any potential consumers for the products.

a. Data Gathering
b. Primary Research
c. Secondary Research
d. Market Research
2. A data gathering technique where it can be moderated to group interviews and
brainstorming sessions that provide information on user’s needs and behaviors.
a. Personal Interview
b. Focus Group Discussion
c. Survey
d. Data Gathering

3. A data gathering technique where it can be done via direct mail, over the
phone, internet or e-mail.
a. data gathering
b. survey
c. focus group discussion
d. personal interview

4. It refers to information gathered directly from the respondents who

answered set of questions.

A. Primary Research
B. Secondary Research
C. Survey
D. Data Gathering

5. A data gathering technique where it can be done via direct mail, over the
phone, internet or e-mail.
A. Data Gathering
B. Survey
C. Focus Group Discussion
D. Interview

Entrepreneurship Page 30
 Lesson 5: The Marketing Mix (7P’s) in Relation to the Business
Opportunity
This module introduces the Marketing Mix, more popularly referred to as the
7P’s of Marketing. It is a set of controllable and interrelated variables composed
of product, place, price and promotions that a company assembles to satisfy a
target group better than its competitor. Marketing Mix strategy is selecting and
applying the best potential means to achieve the organization’s vision and gain
competitive edge.

Learning objective:
After reading this module, you should be able to:

1. describe the Concept of Marketing Mix;

2. identify the seven P’s in the Marketing Mix;
3. identify the commonly used brand strategy;
4. developed a Brand Name.
Lesson proper
In the previous lesson, you already know about a data collection. It is an
important factor of any research study. The three (3) ways of collecting data are
Survey, Interview, and Focus Group Discussion (FGD). This will help
entrepreneurs in gathering information about their target market.
Marketing Mix is a set of controllable and connected variables that a company
gathers to satisfy a customer better than its competitor. It is also known as the
“Ps” in marketing. Originally, there were only 4Ps but the model has been
continually modified until it became 7P’s. The original 4 P’s stands for product,
place, price and promotion. Eventually, three elements have been added,
namely: people, packaging and positioning to comprise the 7 P’s.

The 7 P’s of Marketing Mix

1. PRODUCT

Marketing strategy typically starts with the product. Marketers can’t plan a
distribution system or set a price if they don’t know exactly what the product will
be offered to the market.
Product refers to any goods or services that are produced to meet the
consumers’ wants, tastes and preferences. An example of goods includes tires,
MP3 players, clothing and etc. Goods can be categorized into business goods or
consumer goods. A buyer of consumer goods may not have thorough knowledge
of the goods he buys and uses. An example of services includes hair salons and
accounting firms. Services can be divided into consumer services, such as hair
styling or professional services, such as engineering and accounting.

Entrepreneurship Page 31
2. PLACE

Place represents the location where the buyer and seller exchange goods or
services. It is also called as the distribution channel. It can include any physical
store as well as virtual stores or online shops on the Internet.

STAGES OF DISTRIBUTION CHANNEL

Channel 1 contains two stages between producer and consumer - a wholesaler

and a retailer. A wholesaler typically buys and stores large quantities of several
producers' goods and then breaks into bulk deliveries to supply retailers with
smaller quantities. For small retailers with limited order quantities, the use of
wholesalers makes economic sense.
Channel 2 contains one intermediary. In consumer markets, this is typically a
retailer. A retailer is a company that buys products from a manufacturer or
wholesaler and sells them to end users or customers. In a sense, a retailer is an
intermediary or middleman that customers use to get products from the
manufacturers.
Channel 3 is called a "direct-marketing" channel, since it has no intermediary
levels. In this case the manufacturer sells directly to customers.
3. PRICE
The price is a serious component of the marketing mix. What do you think is the
meaning of a Price?
In the narrowest sense, price is the value of money in exchange for a product or
service. Generally speaking, the price is the amount or value that a customer
gives up to enjoy the benefits of having or using a product or service. One
example of a pricing strategy is the penetration pricing. It is when the price
charged for products and services is set artificially low in order to gain market
share. Once this is attained, the price can be higher than before. For example, if
you are going to open a Beauty Salon, you need to set your prices lower than
those of your competitors so that you can penetrate the market. If you already
have a good number of market shares then you can slowly increase your price.

Entrepreneurship Page 32
4. PROMOTION

Promotion refers to the complete set of activities, which communicate the

product, brand or service to the user. The idea is to attract people to buy your
product over others. Advertising, Personal Selling, Sales Promotion, Direct
Marketing, and Social Media are examples of promotion.
5. PEOPLE
Your team, a staff that makes it happen for you, your audience, and your
advertisers are the people in marketing. This consists of each person who is
involved in the product or service whether directly or indirectly.
People are the ultimate marketing strategy. They sell and push the product.
People are one of the most important elements of the marketing mix today. This
is because of the remarkable rise of the services industry. Products are being
sold through retail channels today. If the retail channels are not handled with the
right people, the product will not be sold. Services must be first class nowadays.
The people rendering the service must be competent and skilled enough so that
that the clients will patronize your service.
Therefore, the right people are essential in marketing mix in the current
marketing scenario.

6. PACKAGING
Packaging is a silent hero in the marketing world. Packaging refers to the outside
appearance of a product and how it is presented to the customers. The best
packaging should be attractive enough and cost efficient for the customers.
Packaging is highly functional. It is for protection, containment, information, utility
of use and promotion.

7. POSITIONING
When a company presents a product or service in a way that is different from the
competitors, they are said to be “positioning” it. Positioning refers to a process
used by marketers to create an image in the minds of a target market.
Solid positioning will allow a single product to attract different customers for not
the same reasons. For example, two people are interested in buying a phone;
one wants a phone that is cheaper in price and fashionable while the other buyer
is looking for a phone that is durable and has longer battery life and yet they buy
the same exact phone.

Entrepreneurship Page 33
Activity # 8
Directions: find the words that start with letter “P” in the grid horizontally,
vertically, or diagonally. Write the Words or Terms on the space provided and
write something about the word using your own words.

1.
________________________________________________________________
________________________________________________________________
_______________________________________________________________

2.
________________________________________________________________
________________________________________________________________
_______________________________________________________________

3.
________________________________________________________________
________________________________________________________________
_______________________________________________________________

4._______________________________________________________________
________________________________________________________________
________________________________________________________________

5.
________________________________________________________________
________________________________________________________________
________________________________________________________________

Entrepreneurship Page 34
6.
________________________________________________________________
________________________________________________________________
_______________________________________________________________

7.
________________________________________________________________
________________________________________________________________
________________________________________________________________

Lesson 6: Develop a Brand Name

Brand Name is a name, symbol, or other feature that distinguishes a

seller's goods or services in the marketplace. Your brand is one of your greatest
assets because your brand is your customers' over-all experience of your
business. Brand strategy is a long-term design for the development of a popular
brand in order to achieve the goals and objectives. A well-defined brand strategy
shakes all parts of a business and is directly linked to customer needs, wants,
emotions, and competitive surroundings
Experts believe that a good brand can result in better loyalty for its customers, a
better corporate image and a more relevant identity.
As more customers continue to differentiate between emotional and experienced
companies, a brand may be the first step forward in your competition instead of
price points and product features. The question is, can you build a brand which
truly talks to your audience?
Branding is a powerful and sustainable high-level marketing strategy used to
create or influence a brand. Branding as a strategy to distinguish products and
companies and to build economic value to both customers and to brand owners,
are described by Pickton and Broderick in 2001.

Commonly Used Branding Strategy

1) Purpose
"Every brand makes a promise. But in a market in which customer confidence is
little and budgetary observance is great, it’s not just making a promise that
separates one brand from another, but having a significant purpose,"
(Allen Adamson).

Entrepreneurship Page 35
How can you define your business' purpose? According to Business Strategy
Insider, purpose can be viewed in two ways:
a. Functional. This way focuses on the assessments of success in terms
of fast and profitable reasons. For example the purpose of the business is to
make money.
b. Intentional. This way focuses on fulfillment as it relates to the capability
to generate money and do well in the world.

2) Consistency
The significant of consistency is to avoid things that don’t relate to or improve
your brand. Consistency aids to brand recognition, which fuels customer loyalty.
3) Emotion

There should be an emotional voice, whispering "Buy me". This means you allow
the customers have chance to feel that they are part of your brand.
You should find ways to connect more deeply and emotionally with your
customers. Make them feel part of the family and use emotion to build
relationships and promote brand loyalty.

4) Flexibility

Marketers should remain flexible to in this rapidly changing world. Consistency

targets at setting the standard for your brand, flexibility allow you to adjust and
differentiate your approach from your competition.
According to Kevin Budelmann, "Effective identity programs require sufficient
consistency to be identifiable, but sufficient variation to keep things fresh and
human" so if your old tactics don't work anymore, don't be afraid to change. It
doesn’t mean it worked in the past it may still work now.

5) Employee Involvement
It is equally important for your employees to be well versed in how they
communicate with customers and represent the brand of your product
6) Loyalty
Loyalty is an important part of brand strategy. At the end of the day, the
emphasis on a positive relationship between you and your existing customers
sets the tone for what potential customers can expect from doing business with
you.

7) Competitive Awareness
Do not be frightened of competition. Take it as a challenge to improve your
branding strategy and craft a better value in your brand.

Entrepreneurship Page 36
What I Have Learned
Marketing mix constitutes of the 7P’s in case of products – product, price,
place and promotion. In case of services it constitutes of 3 more P’s – people,
packaging and positioning.

All P's should be compatible in marketing mix. The price is compatible with
the product's placement. The product must be consistent with the promotion. In
general, all P’s are connected intrinsically.

As a result, when you make a marketing mix, it becomes a chain of strong

bonds. Then these connections will lead you to lengthen the chain. Whenever
you plan to add or change existing features, you need to see the general image
which helps create a fresh product in marketing mix.

Branding is absolutely critical to a business because of the overall impact

it makes on your company. Branding can change how people percept your
brand; it can drive new business and increase brand awareness.
Activity # 9: Paste the P’s
Look for newspapers or magazines. Find and identify pictures related to the P’s
in Marketing Mix. Cut out the pictures, sort and paste them on the box, then write
a short description on the line next to the picture.
PICTURE 1

PICTURE 2

Entrepreneurship Page 37
PICTURE 3

PICTURE 4

Rubrics for Scoring

Score Description
15 The table is complete with pictures and the
descriptions are correct.
12 The table is lacking one (1) picture and the
descriptions are correct.
9 The table is lacking two (2) pictures and the
descriptions are correct.
6 The table is lacking three (3) pictures and the
descriptions are correct.
3 The table is lacking one (4) pictures and the
descriptions are correct.

Activity #10
The Power of Color!
I am going to show you some colors. For each one, write down the FIRST
company or product that comes in to your head when you see the color.
What’s the FIRST BRAND you think of when you see this colors?

Entrepreneurship Page 38
Entrepreneurship Page 39
Lesson 7: 4 M’s of Operations in Relation to the Business Opportunity and
Developing Business Model

In developing a business plan we also have to consider the importance of

the 4M’s of operations in all business opportunities. Because it helps you to
identify the problems of the business in the future and in actual situation
especially in the production process and marketing.
In application of your 4M’s of production, it is best to consider the customer’s
point of view in terms of their influences as to why they will buy a particular
product, does your product aim to answer each consumer’s wants or needs and
meet up with their expectations over the product, and how do suppliers, value
chain and supply chain affects the business and production.
Learning objective:
At the end of this topic the student will:

• Describe the 4M’s (Manpower, Method, Machine, Materials) of operations in

relation to the business opportunity;
• Develop a product description;
• Create a prototype of the product;
• Test the product prototype.

Lesson proper

Entrepreneurship Page 40
In your previous lesson, you learned about the 7P’s of
Marketing Mix; Product, Place, Price, Promotion, People,
Packaging and Positioning in relation to business opportunity,
wherein marketing is about creating and accumulating
customers. Marketing plans are intended to capture a market
portion and to setback competitors.
Brand name was also introduced, where it is a name, symbol,
or other feature that distinguishes a seller’s goods or services
in the marketplace. Your brand is one of the greatest assets
because your brand is your customers’ over-all experience of
your business.
Experts believed that a good brand can result in better loyalty
for its customers, a better corporate image and a more relevant
identity.

The most serious issues in the whole production system are the inputs and the
transformation process. Their quality determines the quality of the output.
The factors involved in the input and the production process are usually referred
to as the Four M’s of production, namely Manpower, Method, Machine, and
Materials.

Four M’s
• • Manpower
• • Method OUTPUT
• • Machine
• • Materials

Manpower
- Talks about human labor force involved in the manufacture of products.
- It is measured as the most serious and main factor of production. The
entrepreneur must determine, attain and match the most competent and skilled
employees with the jobs at the most appropriate time period.
- Educational qualifications and experience, status of employment, numbers of
workers required, skills and expertise required for the job are some of the
manpower criteria that must be highly considered by the entrepreneur.

Material
- Talks about raw materials necessary in the production of a product. Materials
mainly form part of the finished product. Just in case the resources are below
standard, the finished product will be of unsatisfactory as well.

Entrepreneurship Page 41
- The entrepreneur may consider cost, quality, availability, credibility of suppliers
and waste that the raw material may produce.
Machine
- Discusses about manufacturing equipment used in the production of goods or
delivery of services.

- In the process of selecting the type of equipment to purchase, the entrepreneur

may consider types of products to be produced, production system to be
adopted, cost of the equipment, capacity of the equipment, availability of spare
parts in the local market, efficiency of the equipment and the skills required in
running the equipment.
Method
- Production method discusses the process or way of transforming raw materials
to finished products. The resources undergoes some stages before it is finalized
and becomes set for delivery to the target buyers.
- The selection of the method of production is dependent on product to produce,
mode of production, manufacturing equipment to use and required skills to do the
work.
Product Description
- Is the promotion that explains what a product is and why it’s worth buying? The
purpose of a product description is to provide customers with details around the
features and benefits of the product so they’re obliged to buy.
- Know who your target market is, focus on the product benefits, tell the full story,
use natural language and tone, use power words that sell, and use good images.
These are guidelines for you to have a good product description; since some
customers are very particular with it since they consider the welfare of their
family, if it is safe to use.

Prototyping
A duplication of a product as it will be produced, which may contain such details
as color, graphics, packaging and directions. One of the important early steps in
the inventing process is making a prototype. Benefits are the reasons why
customers will decide to buy the products such as affordability, efficiency or ease
of use. The features of the product or service merely provide a descriptive fact
about the product or service.
It is better to test your product prototype to meet customers’ needs and
expectations; and for your product to be known and saleable. Pretesting of the
product or service is similar to a sample of the product or service given to the
consumer free of cost in order that he/she may try the product before committing
to a purchase.
Supplier
An entity that offers goods and services to another business. This entity is among
of supply chain of a business, which may offer the main part of the value

Entrepreneurship Page 42
contained within its products. Certain suppliers may even involve in drop
shipping, where they ship goods directly to the customers of the buyer.
Suppliers are your business partners, without them your business will not live.
You need them as much as you need your customers to be satisfied. But as an
entrepreneur you have to choose a potential supplier that has loyalty and value
your partnership; a supplier that would lead you to the fulfillment of your business
objectives, mission and vision.
Value chain is a method or activities by which a company adds value to an item,
with production, marketing, and the provision of after-sales service. The main
goal and benefit of a value chain, and therefore value chain analysis, is to make
or support a competitive benefit.
A supply chain is a structure of organizations, people, activities, data, and
resources involved in moving a product or service from supplier to customer.
The main objective of supply chain management includes management of a
varied range of components and procedures, for instance, storing of raw
materials, handling the inventory, warehousing, and movement of finished
product from the point of processing to the point of consumption.

Business model describes the reasons of how an organization creates, delivers,

and captures value in economic, social, cultural or other contexts. The
development of business model construction and variation is also called business
model innovation and forms a part of business plan.

Entrepreneurship Page 43
It is a company's plan for how it will make revenues and make a profit. It
describes what products or services the business plans to manufacture and
market, and how it plans to do so, as well as what expenses it will incur.
There are important phases in developing your business model, namely;
Identifying the specific audience; establishing business process; recording a
business resources; developing strong value proposition; determining key
business partners; and creating a demand for today’s generation strategy and be
open for innovations.
After developing a business model, we will proceed in developing a business
plan. To be able to successfully complete this module, you need to prepare a
business plan and operate your plan and finally keep records of your business
transactions.
Business plan is an important tool for you to have an idea about the future of
your business. Your business plan will be your guide in the moment you will be
implementing and operating your business proposal.
You can also make use of the business plan in securing investment capital from
financial institutions or lenders. It can also be used to influence people to work for
your enterprise, to secure credit from suppliers, and to fascinate potential
customers.
Read the stories of Jessie, Mercy and Monna below to fully understand the
importance of having a business plan:
“Jessie is the eldest of five children of Mr. & Mrs. Natividad. The family is having
difficulty to support for their everyday needs. Because of this, Jessie tried to
enter selling banana cue and with his dream to make his business grow, he put
up many stalls in the community without considering the advises of his friends to
make a business plan before implementing his decision. After a few months his
stalls shutdown.”
“Mercy is the youngest in the family. She found out that she loves to cut hair and
apply make up to her friends. Until such time that her friends introduced her to
their friends too for haircut and make up when there are occasions. Few months
after, Mercy was told by her friends to put up a beauty parlor in their place. So
she asks her mother who is also a businesswoman to teach her how to make a
business plan and eventually ended with a successful business.”
“Monna is a diligent student. Because of her knowledge gained from school
about business plan she was able to enhance her skills in business and finally
found herself into his laundry shop business.”
Each scenario taught us that business is not just about how much income or
profit you can get but it’s about the life of your business. And in having a
business, you also have to consider technological forces, Social forces, Political
forces, Cultural forces, Economic forces and Legal forces.

Entrepreneurship Page 44
The following are the components found in a Business Plan.

• Introduction- this part discusses what the business plan all about is.
• Executive Summary- is part of the business plan which is the first to be
presented but the last to be made.
• Management Section- shows how you will manage your business and the
people you need to help you in your operations.
• Marketing Section- shows the design of your product/service; pricing, where
you will sell and how you will introduce your product/service to your market.

Financial Section- shows the money needed for the business, how much you
will take in and how much you will pay out.
• Production Section- shows the area, equipment and materials needed for the
business.
• Competitive Analysis- is the strategy where you identify major competitors
and research their products, sales and marketing strategies.
• Market- The persons who will buy the product or services
• Organizational chart- is the diagram showing graphically the relation of one
official to another, or others of a company.

Activity # 11: Identify me

With the pictures shown below, identify each picture whether it is Value Chain or
Supply Chain.

1.____________________

Entrepreneurship Page 45
2.
_____________________

3.
______________________

Activity # 12
Answer the following questions base on the picture shown below. Write your
answers on the space provided. (5) Points in each correct answer

Entrepreneurship Page 46
1. Are you familiar with the picture above? Give one example of a food business
establishment that you think is famous among teenagers today.
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

2. What do you think is the reason why this particular food business
establishment becomes famous amongst teens nowadays?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________.

3. Do you know some other ways to enjoy their product other than coming in
personally into their store and buying their product for yourself?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________.

4. Do you think such strategies are effective to make the business more
productive? Why or why not?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

Entrepreneurship Page 47
Activity #13: Business Plan Making

Below is a template for business plan. You need to fill this out using the business
you want to pursue.
MANAGEMENT SECTION This section will show how you will
manage your business and the
people you need to help you in your
operations

a. Manager: ______________________________

b. Workers: ______________________________

MARKETING SECTION This section shows the design of your

product/service; pricing, where you
will sell and how you will introduce
your product/service to your market.

a. Product Description:
_______________________________________

b. Price: ______________________________________

c. Selling location: ____________________________

d. Promotional Activity: _________________________

FINANCE SECTION This section shows the money

needed for the business, how much
you will take in and how much you will
pay out

a. Capital Amount: __________________________

b. Expected Daily Sales: _______________________

c. Expected Daily Expenses: _______________

d. Income per Day: _____________________

PRODUCTION SECTION This section shows the area,

equipment and materials needs for
the business.

a. Draw a lay out of your production area:

Entrepreneurship Page 48
 b. Enumerate the equipment needed:

c. Enumerate the materials needed:

RUBRIC FOR BUSINESS PLAN MAKING

Content The content was 15
well-thought ,guide
questions were
thoroughly
answered
Organization The paper was 10
well-written with
ideas easily
conveyed to
readers.
Development Points are 5
thoroughly
developed
TOTAL 30

Now that you have identified what business to undertake and are familiar
with the tools and materials needed in the operation of your business, let us
apply what you have learned in the previous module by forecasting the revenues
and costs incurred in your business. You might probably be wondering how
profits are computed. This module will help guide you realize the revenues and
profits of your chosen business.
Revenue is a result when sales exceed the cost to produce goods or render the
services. Cost on the other hand simply refers to the amount of money used to
produce or manufacture goods/merchandise as well as costs incured in selling
the goods/merchandise. How much revenues and costs incurred in the operation
of the business? How are these projected? And how are these used to compute
profit/loss of the business shall be learned in this module.

Lesson 8: Forecasting the Revenues of the Business

Why forecast? We often watch news as Kuya Kim reports the direction of the
typhoon in the next 2 days, what Kuya Kim is doing is giving us information taken
by satellites and gives us the direction of the typhoon. In weather forecasting, the
reporter is giving us advance information that could help us prepare and be ready
for upcoming typhoon. This way, risks such as accidents, devastation of
properties and loss of life may be prevented.
Forecasting is a tool used in planning that aims to support management or a
business owner in its desire to adjust and cope up with uncertainties of the
future. Forecasting depend on data from the past and present and make

Entrepreneurship Page 49
meaningful estimates on revenues and costs. Forecasting revenues and costs is
the same as weather forecasting, though forecasting revenues and costs is in the
context of business. Entrepreneurs use forecasting techniques to determine
events that might affect the operation of the business such as sales expectations,
costs incurred in the
Learning objective:
After carefully studying the contents of this module, you should be able to:
• Identify essential factors in forecasting revenues and costs;
• Calculate mark-up and selling price of a product or merchandise;
• Compute projected revenues;
• Compute projected costs.
• Create a table showing projected revenue and costs.

Lesson proper
You have learned in the previous lesson the 4Ms of operations, you now
have the idea on what product/s to manufacture and sell. Now, you also have a
business model. One of the most challenging parts in developing a business plan
is the financial plan. This part allows the entrepreneur to make decisions based
on financial assumptions without even having started the business. Therefore,
these financial projections should be given the most attention by the
entrepreneur.
Let us now examine how the sale of products generates revenues. In this lesson,
we will identify the mark-up and selling price of the product. We will also project
the revenues that the business will make from the sale of products
Making informed estimates requires careful considerations on several
factors that might affect the outcome of your travel such as, distance from home
to school, the means of transportation you will be taking, the number of
passengers and etc. Traveling from home to school on regular basis had helped
you arrive with an estimate that was very close to the actual time of arrival.
Considering these factors are essential in making informed estimates by the
entrepreneur. Since the business he/she is venturing hasn’t started yet, it is
important that these factors affecting forecasting will be determined to better help
him/her in making the best decisions for the business.
The entrepreneur after realizing the potential for profit of his/her business
concept, the next step is to estimate how much the revenue is on daily, monthly
and annual basis. Before going to forecasting and projecting the revenues of the
business, let us determine first what revenue is.

Revenue is a result when sales exceed the cost to produce goods or render the
services. Revenue is recognized when earned, whether paid in cash or charged

Entrepreneurship Page 50
to the account of the customer. Other terms related to revenue includes Sales
and Service Income. Sales is used especially when the nature of business is
merchandising or retail, while Service Income is used to record revenues earned
by rendering services.
You have just learned about what revenue is. This time, let us study the various
factors to consider in forecasting revenues.
The entrepreneur would want his/her forecasting for his/her small business as
credible and as accurate as possible to avoid complications in the future. In
estimating potential revenue for the business, factors such as external and
internal factors that can affect the business must be considered. These factors
should serve as basis in forecasting revenues of the business. These factors are:

1. The economic condition of the country. When the economy grows, its growth is
experienced by the consumers. Consumers are more likely to buy products and
services. The entrepreneur must be able to identify the overall health of the
economy in order to make informed estimates. A healthy economy makes good
business.
2. The competing businesses or competitors. Observe how your competitors are
doing business. Since you share the same market with them, information about
the number of products sold daily or the number of items they are carrying will
give you idea as to how much your competitors are selling. This will give you a
benchmark on how much products you need to stock your business in order to
cope up with the customer demand. This will also give you a better estimate as to
how much market share is available for you to exploit.

3. Changes happening in the community. Changes’ happening in the

environment such as customer demographic, lifestyle and buying behaviour
gives the entrepreneur a better perspective about the market. The entrepreneur
should always be keen in adapting to these changes in order to sustain the
business. For example, teens usually follow popular celebrities especially in their
fashion trend. Being able to anticipate these changes allows the entrepreneur to
maximize sales potential.
4. The internal aspect of the business. Another factor that affects forecasting
revenues in the business itself. Plant capacity often plays a very important role in
forecasting. For example, a “Puto” maker can only make 250 pieces of puto
every day; therefore he/she can only sell as much as 250 pieces of puto every
day. The number of products manufactured and made depends on the capacity
of the plant, availability of raw materials and labour and also the number of
salespersons determines the amount of revenues earned by an entrepreneur.
Now that all factors affecting forecasting revenues are identified, you can now
calculate and project potential revenues of your chosen business. The table
below shows an example of revenues forecasted in a Ready to Wear Online
Selling Business.

Entrepreneurship Page 51
Example: Ms. Fashion Nista recently opened her dream business and named Fit
Mo’to Ready to Wear Online Selling Business, an online selling business which
specializes in ready to wear clothes for teens and young adults. Based on her
initial interview among several online selling businesses, the average number of
t-shirts sold every day is 10 and the average pair of fashion jeans sold every day
is 6. From the information gathered, Ms. Nista projected the revenue of her it Fit
Mo’to Ready to Wear Online Selling Business.
She gets her supplies at a local RTW dealer in the city. The cost per piece of t-
shirt is 90 pesos, while a pair of fashion jeans costs 230 pesos per piece. She
then adds a 50 percent mark up to every piece of RTW sold.
Mark up refers to the amount added to the cost to come up with the selling price.
The formula for getting the mark up price is as follows:
Mark Up Price = ( Cost x desired mark up percentage)

Mark Up for T-shirt = ( 90.00 x .50)

Mark Up for T-shirt = 45.00

In calculating for the selling price, the formula is as follows:

Selling Price = Cost + Mark Up

Selling Price = 90.00 + 45.00

Selling Price for T-shirt = 135.00

Table 1 shows the projected daily revenue of Ms. Nista’s online selling business.
Computations regarding the projected revenue are presented in letters in upper
case A, B, C, D, and E.
Table 1
Projected Daily Revenue
Fit Mo'to Ready to Wear Online Selling
Business

Type of Cost per Mark-up Selling Projected Projected

RTW's Unit 50% Price Volume Revenue
(A) (B) (C) (D) (E)
Average
No. of
Items Sold
(Daily)
(Daily)

Entrepreneurship Page 52
(A) (B)= (A x (C)= (D) (E) =(C x
.50) (A+B) D)
T-Shirts 90.00 45.00 135.00 10 1,350.00

Jeans 230.00 115.00 345.00 6 2,070.00

Total 320.00 160.00 480.00 16 3,420.00

Lesson 8.1: Forecasting the Costs to be incurred

You have learned in Lesson 1 that the revenue generated by selling
RTW’s has a corresponding amount of costs incurred. This cost was the amount
of RTW before adding its mark-up price. Each piece of t-shirt has a
corresponding cost of 90.00 pesos, while each pair of jeans has a corresponding
cost of 230.00 pesos. These costs are incurred each time revenues are
generated. On the other hand, the business also incurs costs in its operation,
these costs are called Operating Expenses. Operating expenses such as
payment on Internet connection, Utilities expense (i.e.Electricity), Salaries and
Wages and Miscellaneous are essential in the operation of the business; this
allows the business to continue operate in a given period of time.
Now that you have learned what cost is, let us identify the costs and expenses
incurred by the business in generating revenues.
Activity # 14
Have you tried recording the amount of money you spend from your daily
allowance? You might be experiencing difficulties in making your allowance meet
your daily needs as student. Try to fill in the information below to come up with a
breakdown of your daily allowance.
Breakdown on Daily Allowance
Name: __________________________________
Daily Allowance: Ᵽ ________________________
Less: Daily Expenses
Food Ᵽ__________________________________
Fare ____________________________________
School Supplies ___________________________
Recreation _______________________________
Others _______________________ ___________
Total Ᵽ _________________________________

Entrepreneurship Page 53
 Were you able to get a positive total? You may have spent your daily
allowance wisely and saved some of your daily allowance. Did you spend all your
allowance and ended up with a zero total? You may have spent your allowance
on expenses essential to your need as a student.
Considering your expenses as a student, a business also has expenses
necessary for its upkeep. It would be best for any business to arrive with a
positive total; this would mean profit for the business. Careful consideration and
projection of these factors could mean success for the business.
You have just learned about what cost is. This time let us identify costs and
expenses incurred by the business.

Cost of Goods Sold / Cost of Sales refer to the amount of merchandise or

goods sold by the business for a given period of time. This is computed by
adding the beginning inventory to the Net Amount of Purchases to arrive with
Cost of goods available for sale from which the Merchandise Inventory end is
subtracted.

Merchandise Inventory, beginning refers to goods and merchandise at the

beginning of operation of business or accounting period.
Purchases refer to the merchandise or goods purchased. Example: Cost to buy
each pair of Jeans or t-shirt from a supplier.
Merchandise Inventory, end refers to goods and merchandise left at the end of
operation or accounting period.
Freight-in refers to amount paid to transport goods or merchandise purchased
from the supplier to the buyer. In this case, it is the buyer who shoulders this
costs.

Table 4
Projected Cost of Goods Sold (Monthly)
Fit Mo'to Ready to Wear Online Selling
Business

Type of RTW's Cost per Unit Projected Projected Costs

Volume of Purchases
(Monthly)
Average No. of
Items Sold
(Monthly)
(A) F = (D x 30 J = (A x F)
days)
T-Shirts 90.00 300 27,000.00
Jeans 230.00 180 41,400.00
Total 320.00 480 68,400.00

Entrepreneurship Page 54
Let us calculate the cost of goods sold of Ms. Fashion Nista’s online selling
business for the month of January.

Table 4 shows the costs incurred during the first month of operation of Fit Mo’to
Ready to Wear Online Selling Business. Since Ms. Nista get her stocks from an
online supplier, there is no need to order ahead and stock more items. Therefore,
there is no Merchandise Inventory, beginning as well as Merchandise Inventory,
end. Ready to wear items purchased online from the supplier are then sold as
soon as they arrived.
Cost of goods is calculated by simply multiplying the number of items sold every
month (300 t-shirts and 180 pairs of jeans) to its corresponding cost per unit
(90.00 pesos for every t-shirt and 230.00 pesos for every pair of jeans). A cost in
transporting the goods from the supplier to the seller (Ms. Nista) or Freight-in is
then added to Net Cost of Purchases.
Table 5 shows how freight-in is calculated.
It is assumed that at an average, Ms. Nista pays at least 250.00 pesos for every
12 items delivered successfully by her supplier through a courier service. Since
her average order is 480 pieces every month, she pays:
480 pcs. / 12 pcs. = 40
40 x 250.00 = 10,000.00
Table 5
Freight-in paid by Ms. Nista every
month
Type of No. of Items Sold Projected Freight In
RTW's (Daily) Volume (January Only)
Average No.
of Items
Purchased
(Monthly)
(A) F = (D x 30 K = (F/12) x 250
days)
T-Shirts 10 300 6,250.00

Jeans 6 180 3,750.00

Total 16 480 10,000.00

Let us now substitute the values from table 4 and table 5. Since there is no
Merchandise Inventory, beginning and end, let us add Cost of Purchases and
Freight-in to get the Cost of Goods Sold.

Entrepreneurship Page 55
Merchandise Inventory, beginning P 00.00
Add: Net Cost of Purchases 68,400.00
Freight-in 10,000.00
Cost of Goods Available for Sale P 78,400.00
Less: Merchandise Inventory, end 00.00
Cost of Goods Sold P 78,400.00

Now that the cost of goods sold is now calculated, let us now identify expenses
that the business incurs in its operation. Operating expenses such as Internet
connection, Utilities like electricity and miscellaneous expense are important to
keep the business running. These expenses are part of the total costs incurred
by the business in its day-to-day operation and are paid every end of the month.
The operating expenses and assumed amount are presented below:

Operating Expenses
Add: Internet Connection P 1,299.00
Utilities (Electricity) 800.00
Miscellaneous expense P 300.00
Total Operating Expense P 2,399.00

To calculate the total costs incurred by the business, cost of goods sold and total
operating expenses are then added. The calculation for the costs incurred for the
month of January is presented below:

Cost of Goods Sold P 78,400.00

Total Operating Expense P 2,399.00
Cost P 80,799.00

Activity # 15

Now that you know how to calculate the projected costs of a business, look
around and interview any business existing in your community such as sari-sari
stores or buy and sell business. Using the table for Projected Costs of Goods
Sold (Daily) below
Fill in the necessary figures from the business you have selected.
Projected Cost of Goods Sold (Daily)
Business Name:
______________________

Entrepreneurship Page 56
Goods/ Cost per Unit Projected Volume Projected Costs
Merchandis of Purchases
e Average No. of (Daily)
Items Sold
(Daily)

Total

As we all know that profit is a financial gain from a transaction or from a

period of investment or business activity, usually calculated as income in excess
of costs or as the final value of an asset in excess of its initial value.
It is a total revenue minus total expenses, profit is the amount of money a
business "makes" during a given accounting period. The more profit you make,
the better, as profit can be re-invested into the business or retained by the
business owners. Being able to accurately determine your business's profit is an
essential part of being able to judge its financial health. It can also help you
decide how to price your goods and services, how to pay your employees, and
more.
To make your business gain more profit, begin by adding up all of the money
your business has made in a set period of time (either, quarterly, yearly, monthly,
etc. Other sources, like products sold, services rendered, membership payments,
or, in the case of government agencies, taxes, fees, the sales of resource rights,
and so on.
Note that you will need to subtract any amount of cash refunded to customers for
returns or disputes in order to find an accurate figure for your total income.
It's easier to understand the process of calculating a business's profit by following
along with an example.
Let's say that we own a small publishing business. In the last month, we sold
P20,000 worth of books to retailers in the area. However, we also sold the rights
to one of our intellectual properties for P7,000 and received P3,000 from book
retailers for official promotional materials. If these represent all of our revenue

Entrepreneurship Page 57
sources, we can say that our total income is P20,000 + P7,000 + P3,000 =
P30,000.

After carefully studying the contents of this module, you should be able to:
• • compute for profits
• • define profitability, liquidity & solvency
• • identify commonly used profitability ratios.

Lesson 9: Computation of Gross Profit

As we all know that profit is a financial gain from a transaction or from a

period of investment or business activity, usually calculated as income in excess
of costs or as the final value of an asset in excess of its initial value.
It is a total revenue minus total expenses, profit is the amount of money a
business "makes" during a given accounting period. The more profit you make,
the better, as profit can be re-invested into the business or retained by the
business owners. Being able to accurately determine your business's profit is an
essential part of being able to judge its financial health. It can also help you
decide how to price your goods and services, how to pay your employees, and
more.
To make your business gain more profit, begin by adding up all of the money
your business has made in a set period of time (either, quarterly, yearly, monthly,
etc. Other sources, like products sold, services rendered, membership payments,
or, in the case of government agencies, taxes, fees, the sales of resource rights,
and so on.

Let’s review of what is revenue of the business. This is an important tool

and materials needed in the operation of the business. It is said that revenue is
the result when sales exceed the cost to produce or manufacture
goods/merchandise as well as costs incurred in selling.
Forecast is advance information that could help us prepare and ready for any
incoming event. Forecasting is the tool used in planning that aims to support
management or a business owner in its desire to adjust and cope up with
uncertainties of the future. If anyone of us can predict that we can be rich so it
means all of us will be rich. This fantasy is played out every day in boardrooms
across the globe with the practice of business forecasting.
It is important to have a good organization in the business to easily grow and
expand in the future.

Entrepreneurship Page 58
Activity # 16
Read and understand the given problem.
Rodrigo is engaged in a buy-and sell business of perfumes. He bought 10 boxes
of perfumes. Each box costs 12,000.00 and contains a dozen of perfume bottles.
He is planning to sell one perfume bottle at P1,500. What is his expected profit
on the 10 boxes of perfumes?
The ultimate goal of any business whether a retail or wholesale is to earn a profit.
Getting the difference between the amount of money earned from the selling 10
boxes containing a dozen of perfume bottles and the cost of those 10 boxes
gives the profit.

In the example that I gave, answer the following questions:

1. How much does Rodrigo earned profit?

________________________________________________________________
________________________________________________________________
________________________________________________________________

2. Is it good to engage in a business? Yes or No?

________________________________________________________________
________________________________________________________________
________________________________________________________________

3. What do you think of Rodrigo’s business? Is it good for a beginner?

________________________________________________________________
________________________________________________________________
_______________________________________________________________
Compute the Gross Profit
The profitability ratios are a group of financial statement that primarily determine
the profitability of the business operation.
The gross profit rate on a product is computed as:
Net Sales xxxxxxx
Less: Cost of sales xxxxxxx
Gross profit xxxxxxx
By using the formula , the gross of XYZ Trading in the year 2017
Net Sales P 734, 000.00
Less: Cost of Sales 577, 000.00
Gross Profit 157, 000.00

Entrepreneurship Page 59
Profit is the gross income. The amount of gross profit provides information to the
entrepreneur about revenue earned from sales.
The term cost refers to the purchase price of the product including of the product
including the total outlay required in producing it.
The gross profit margin is computed as follows:
Gross profit
Gross profit rate Net sale

The gross profit rate measures the percentage of gross profit to sales, indicating
the profit that the business realizes from the sale of the product.
Activity # 17
Now ask yourself the following questions:
1. Is creativity present in the operation of ordinary small businesses along the
streets and highways and in your neighborhood? Why do you say so?

________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________

2. Will you consider the daily business practices of the small owner within the
concept of entrepreneurships? Why?
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
Assessment # 5

How did you understand the lessons that you have studied in this module?
Answer the following questions.
Write True if the statement is correct & write False if you think the answer is not
correct.
_________1. The gross profit rate of the entrepreneurial venture is computed by
dividing the cost of goods sold by net sales.
_________ 2. The gross profit rate provides information on the cost ratio of the
business.
Entrepreneurship Page 60
_________3. In evaluating the profitability of the entrepreneurial venture the
evaluation must focus on the information reflected on the face of the
balance sheet.
_________4. The operating profit margin rate indicates information on the
percentage of operating expenses on the net sales.
_________5. Mr. Q is a practicing Doctor of Medicine. During the month of
March
2019 he received Professional Fees amounting to P 1,000,000 and
total expenses of P250,000. The net income of Mr. Q is P 750,000.
_________6. Profit is the money received from customer in exchange of
products given to customer.
_________7. The gross profit rate of the entrepreneurial venture is computed by
dividing the cost of goods sold by net sales.
_________8. The gross profit rate provides information on the cost ratio of
business.
_________ 9. One of the objectives in evaluating the gross profit rate of the
business is to determine whether the amount of the gross profit is
sufficient to cover the operating expenses.
_________10. The operating profit margin rate indicates information on the
percentage of operating expenses to net sales.

Summarization
The profitability and ratios are a group financial statement ratios that primarily
determine the profitabilty of the business operation. They provide information on
the efficiency of resource utilization.
The gross profit represents the difference between net sales and cost of sales of
the entrepreneurial venture during a given period. It is computed as follows:

Net Sales xxxxxx

Less: Cost of Sales xxxxxx
Gross Profit xxxxxx
By using the formula, the gross profit of XYZ Co., in the year 2017 is computed
as follows :

Net Sales P734, 000.00

Less: Cost of Sales 577,000.00
Gross profit P 157,000.00

Entrepreneurship Page 61
Profit is determined by:
• the money you get from sales
• the cost of stock – if you're selling a product
• all the expenses you incurred

Income earned by the business are sales & gross profit. Commissions, discounts
, fixed expense are business expenses.

How to Increase your Sales

❖ Improve profit by looking at the money you earn from sales, and
increase: o The number of customers
o The volume of goods or services existing customers to buy
o The sales price

Performance task #1
Conduct an interview of at least three (3) successful business people in your
locality, use the following questions as your guidelines:
1. What made him motivate to start a business?
_______________________________________________________
_______________________________________________________
_______________________________________________________
2. What is the nature of his business?
_____________________________________________________
_______________________________________________________
_______________________________________________________
3. How much capital involved?
______________________________________________________
_______________________________________________________
_______________________________________________________
4. How many years of existence?
_______________________________________________________
_______________________________________________________
_______________________________________________________
5. Did you consider the population of the community?
_______________________________________________________
_______________________________________________________
_______________________________________________________

6. How much gross profit did you earn for the first year of operation?
________________________________________________________
_______________________________________________________
_______________________________________________________

Entrepreneurship Page 62
Lesson 10: Business Implementation
In this module, you will be able to practically implement your newly developed
Business Plan. In which case, will help your target business most likely to
succeed. Because this is where you will actually operate the business.
Thus, selling your product/service to the potential customers.
You are expected to operate your own business and keep your business records
to monitor the progress of your business operation.

Learning objective:
• Implementing the business plan;
• Operating the business ;
• Selling the product;
• Identifying reasons for keeping business records.

Lesson proper

Before you proceed, let us first recall our previous lesson.

Profit is the amount you gain after selling your product. In computing your profit,
you just simply follow this formula:
Sales - Cost of Goods Sold = Gross Profit
The gross profit represents the difference between net sales and cost of sales.
Variable costs are those things that change based on the amount of product
being made and are incurred as a direct result of producing the product.
Variable costs include:
1. Materials used
2. Direct labor
3. Packaging
4. Freight
5. Plant supervisor salaries
6. Utilities for a plant or a warehouse
7. Depreciation expense on production equipment
8. Machinery
Fixed costs generally are more static in nature. They include:
1. Office expenses such as supplies, utilities, a telephone for the
office, etc.
2. Salaries and wages of office staff, salespeople, officers and owners
3. Payroll taxes and employee benefits
4. Advertising, promotional and other sales expenses
5. Insurance
6. Auto expenses for salespeople
7. Professional fees
8. Rent

Entrepreneurship Page 63
Activity # 18
Identify the services offered by the following offices to you as an entrepreneur.
1. Department of Trade and Industry (DTI)_____________________
2. Securities and Exchange Commission (SEC)_________________
3. Bureau of Internal Revenue (BIR)__________________________
4. Mayor’s Office_________________________________________
5. Social Security System (SSS)____________________________
6. Philhealth____________________________________________
7. Pag-ibig Fund_________________________________________

Guidelines for successful business plan implementation:

1. Objectives- the entrepreneur should have a clear idea on what is his purpose
of putting up his enterprise.

2. Tasks- this means that the entrepreneur must know what the tasks are he has
to perform in order that his objectives will be realized.

3. Time allocation- This means that the entrepreneur should have a timetable or
a schedule to follow every task, so that it will be accomplish on time and realize
his objective.

4. Progress- This means that the entrepreneur should monitor the development
of the tasks and the accomplishment of the objective.
In Operating a business, the entrepreneur should first consult professional for
advices, like accountants or consultants from small enterprises. In your case, you
can consult your teacher in entrepreneurship or anyone you think that could help
you.

The following are the basic requirements to start a business in the Philippines:
Securities and Exchange Commission (SEC) Registration-for partnership or
Corporation
Department of Trade and Industry (DTI) Registration- for your business
tradename

Mayor’s Business Permit- for getting the license to operate in the city or
municipality and payment of your local business taxes.
Bureau of Internal Revenue (BIR) Registration - for getting TIN, official
receipts and invoices, registering your books of accounts and paying your
national Internal revenue taxes

Entrepreneurship Page 64
• • SSS, PhilHealth, and Pag-Ibig Fund registration- for registering
yourself or company as an employer and for remitting your employees’
contribution together with your employer’s share

Other steps to follow before operating a Business are as follows :

1. Set up an accounting system or hire an accountant. Knowing how the
business is doing financially is important for planning and survival.
2. Advertise the business. No one will buy the products or services if customers
do not know that the company exists. You can make use of the social media.
3. Secure insurance for the business. Liability insurance protects the business
in the event of litigation. Consider life and disability insurance, health insurance
and fire insurance when you are leasing an office or storefront.

Keeping Business Records

Good record keeping can help protect the business, measure the performance
and maximize profit.
Records are the source documents, both physical and electronic, that specify
transaction dates and amounts, legal agreements and private customer and
business details.
Developing system to log, store and dispose of records can benefit the business.
A systematic recording allows you to;
A. Plan and work more efficiently
B. Meet legal and tax requirements
C. Measure profit and performance
D. Protect your rights, and
E. Manage potential risks

Entrepreneurship Page 65
Performance task # 2
What I Can Do
You are going to implement your business for one and a half month. Following
the Business plan you have presented.
RUBRICS FOR THE BUSINESS PLAN IMPLEMENTATION
Feasibility The business is 50
operated according
to the plan.
Bookkeeping The records are 40
properly kept and
accounted for
Profitability The business is 10
gaining as to its
projected financial
plan

TOTAL 100

Prepare a journal entry of all your business transactions. Give the benefits you
get from keeping all your records.

Assessment # 6

Now that you are finished accomplishing the module, let us check what you have
learned. Answer the questions given below by encircling the letter of the correct
answer.
1. Which office will you go to register your single owned business?
A. SEC C. BIR
B. DTI D. Mayor’s Office

2. Which office do you visit to register partnership or corporation business?

A. SEC C. BIR
B. DTI D. Mayor’s Office

3. To secure Tax Identification Number (TIN) , which office will you go?
A. SEC C. BIR
B. DTI D. Mayor’s Office

4. SSS, Philhealth and Pag-ibig fund contributions is made by ___

Entrepreneurship Page 66
 A. Employees only C. Both Employees and Employers
B. Employers only D. None of the choices

5. Which of the following is not a step to follow before operating a business

A. Register your business
B. Set up accounting system
C. Advertise the business using Facebook
D. Selling the product

6. Which of the following is true? A. Good record keeping is not important to

the business owner
B. Good record keeping is important only to the accountant
C. Good record keeping gives benefits to the enterprise
D. Good record keeping gives no importance at all.

7. Which of the following is NOT a benefit to the enterprise? A. Plan and work
more efficiently
B. Meet legal and tax requirements
C. Can check if the business is doing good.
D. It cannot protect the rights of the owner

8. The objectives of the entrepreneur should be A. Specific and clear

B. Specific and long term
C. Short and blurred
D. Long and not specific

9. The tasks before operating the business must be ____

A. Specified to be accomplished by the owner alone
B. In detail so that the owner will know what to do
C. Kept by the owner for future reference
D. None of the choices

10. The tasks to be accomplished before operating the business should have:
A. Design C. Time allotment
B. Decoration D. Measurement

Entrepreneurship Page 67
References
BOOKS
Ronaldo S. Batisan, DIWA Senior High School Series: Entrepreneurship Module. Diwa
Learning Systems Inc.
Angeles A. De Guzman. Entrepreneurship (For Senior High School, Applied subject,
ABM Strand. Lorimar Publishing, Inc 2018, 25 – 26.
Edralin, Divina M. Entrepreneurship. Quezon City: Vibal Group, Inc. 2016, 80 – 83.
Leedy, P. and Ormrod, J. Practical Research: Planning and Design 7 th Edition. (Merrill
Prentice Hall and SAGE Publications, 2001),
Nick L. Aduana, Entrepreneurship in Philippine Setting (for Senior High School), 2017
Dr. Eduardo A. Morato Jr., Entrepreneurship, 2016
Angeles A. De Guzman, Entrepreneurship for Senior High School Applied Subject ABM
Strand,Lorimar Publishing,p.1-5
Ronaldo S. Batisan, Entrepreneurship: Diwa Senior High School Series, Diwa Learning
Systems Inc., p. 16-20
Eduardo A. Morato Jr., Entrepreneurship, 1st ed., Manila, Philippines: REX Books
Store,p.13
Nick L. Aduana, Etrepreneurship in Philippine Setting for Senior High School, 2017, C&E
publishing, Inc.p.46-51
Angeles A. De Guzman, Entrepreneurship for Senior High School Applied Subject ABM
Strand,Lorimar Publishing,p.25-26
Raymund B. Habaradas and Tereso S. Tullao,Jr., Pathways to
Entrepreneurship,2016,Phoenics publishing house,p.17-28
Aduana, Nick L. "Chapter 5/Lesson 3 The Marketing Mix." In Entrepreneurship In
Philippine Setting For Senior High School, 184-199. Quezon City, Philippines: C&E
Publishing, 2016.
Aduana,N (2015). Financial statements; Preparation, presentation, analysis and
interpretation, presentation.Quezon City, Philippines: C & E Publishing,Inc.
Angeles A. De Guzman, Entrepreneurship for Senior High School Applied Subject ABM
Strand,Lorimar Publishing,p.25-26
Banastao,C.,& Frias, S.(2008) Entrepreneurship.Quezon City Philippines: C & E
Publishing,Inc.
Nick L. Aduana, Etrepreneurship in Philippine Setting for Senior High School, 2017, C&E
publishing, Inc.p.46-51
Raymund B. Habaradas and Tereso S. Tullao,Jr., Pathways to
Entrepreneurship,2016,Phoenics publishing house,p.17-28
Aduana, Nick L. Entrepreneurship in the Philippine Setting for Senior High School.
Quezon City.C & E Publishsing, Inc. 2016.
Morato, Eduardo A. Entrepreneurship. Manila. Rex Bookstore, Inc. 2016.
Batisan, Ronaldo S. Entrepreneurship Module, Diwa Senior Highschool Series, Diwa
Learning System Inc. Legaspi Village, Makati City Philippines, copyright 2016.
Lopez, Rafael Jr. Basic Accounting for Non-Accountants. 2015
Lopez, Rafael Jr. Fundamentals of Accounting. 2016
Rabo, Tugas, and Salendrez, H.E. Fundamentals of Accountancy, Business and
Management. Vibal Group Inc. 2016
Lopez, Jr. Rafael M. Fundamentals of Accounting, 2014-2015 Edition
Morato, Eduard, Jr. A. Entreprenuership, Rex Bookstore 2016
Teaching Guide for Senior High School, Fundamentals of Accountancy, Business, &
Management 1, CHED in collaboration with PNU

Entrepreneurship Page 68
Teaching Guide for Senior High School, Fundamentals of Accountancy, Business, &
Management 2, CHED in collaboration with PNU
Teaching Guide for Senior High School, Business Finance, CHED in collaboration with
PNU
ELECTRONIC RESOURCES
https://articles.bplans.com
https://smartasset.com
https://www.scirp.org/(S(351jmbntvnsjt1aadkposzje))/reference/ReferencesPapers.aspx
?ReferenceID=2026950
https://www.google.com.ph/search?q=what+is+a+supplier+in+business&oq=what+is+a+
sup plier&aqs=chrome.0.69i59j69i57j0l4.6134j0j7&sourceid=chrome&ie=UTF-8
https://www.google.com.ph/search?q=value+chain&oq=value&aqs=chrome.1.69i57j69i5
9j0l4.3827j0j9&sourceid=chrome&ie=UTF-8
https://www.google.com.ph/search?ei=IDdFXIaUMtrrwQPKrrqgCA&q=supply+chain&oq=supp&
gs_l=psy-ab.1.0.0i67l8j0l2.337222.338710..340558...1.0..0.512.1404.0j1j3j5-1......0....1..gws-
wiz.......0i71j0i131.pwF4FAungm0

https://www.google.com/search?sxsrf=ACYBGNS4jjQJj3vRJDboe06xVydYg9Segg%3A
1580443120499&source=hp&ei=8KUzXqGRHNP7wAO29K2YDg&q=what+is+prototype
+product&oq=what+is+prototype&gs_l=psy-
ab.1.1.0i131j0l9.1525.6742..9589...2.0..0.146.2012.1j16......0....1..gws-
wiz.....10..35i362i39j35i39j0i67j0i20i263.Eo6MP-6t984
https://en.wikipedia.org/wiki/Business_model
https://www.google.com/search?sxsrf=ACYBGNSPBhu3TIpORq6cUraQO0W4-
kVv9A%3A1580443131001&ei=-
qUzXo_kPJvZhwPSgpaYDw&q=business+plan&oq=business&gs_l=psy-
ab.1.1.0i131i273l2j0i67l2j0i131i67l2j0i67j0i131l2j0.45360.47333..48595...0.3..0.139.920.
1j7......0....1..gws-wiz.......0i71j35i39j0i273j0i20i263.X5Tyn8npzGw
https://www.tutorialspoint.com/entrepreneurship_development/entrepreneurship_develo
pment_process.htm
Santos, ELi. "Marketing Mix the 7 Ps of Marketing." LinkedIn SlideShare. February 06,
2012. Accessed January 04, 2019. https://www.slideshare.net/elisantos11/marketing-
mix-the-7-ps-of-marketing.
Tracy, Brian. "The 7 Ps of Marketing." Entrepreneur. May 17, 2004. Accessed January
04, 2019. https://www.entrepreneur.com/article/70824.
"Marketing Mix Definition - 4Ps & 7Ps of the Marketing Mix." The Marketing Mix.
Accessed January 04, 2019. https://marketingmix.co.uk/.
"Branding Explained." Luminosity Branding Agency. Accessed January 04, 2019.
https://www.luminosity.com.au/what-we-do/brand/branding-explained/.
"Marketing: Distribution Channels (GCSE) | Tutor2u Business." Tutor2u. Accessed
January 04, 2019. https://www.tutor2u.net/business/reference/marketing-distribution-
channels.
"What Is a Price? - Definition of Price." Marketing-Insider. July 13, 2015. Accessed
January 04, 2019. https://marketing-insider.eu/what-is-a-price/.
"5 Basic Functions of Packaging in Marketing a Product." Your Article Library. January
03, 2014. Accessed January 15, 2019. http://www.yourarticlelibrary.com/marketing/5-
basic-functions-of-packaging-in-marketing-a-product/22204.
"Market Positioning - Creating an Effective Positioning Strategy." Corporate Finance
Institute. Accessed January 15, 2019.
https://corporatefinanceinstitute.com/resources/knowledge/strategy/market-positioning/.

Entrepreneurship Page 69
Jwayne2013 Follow. "Branding Ppt." LinkedIn SlideShare. January 16, 2013. Accessed
January 18, 2019. https://www.slideshare.net/jwayne2013/branding-ppt-16015717.
Stec, Carly. "Brand Strategy 101: 7 Essentials for Strong Company Branding." HubSpot Blog.
Accessed January 21, 2019. https://blog.hubspot.com/blog/tabid/6307/bid/31739/7-
components-that-comprise-a-comprehensive-brand-strategy.aspx.

Amanda Jesnoewski, Four ways to identify more business opportunities. November 20,
2018 retrieve from: https://www.smartcompanyng.com.au/ startupsmart/advice/business-
planning/four-ways-to-identify-more-business-opportunities/
https://www.tutorialspoint.com/entrepreneurship_development/entrepreneurship_develo
pment
Business Dictionary. http://www.businessdictionary.com/defination/market-size.html
“Forecasting” Businessdictionary, Accessed December 10, 2018,
http://www.businessdictionary.com/definition/forecasting.html
“How to Make Revenue Forecasts” Smarta, Accessed December 10, 2018,
http://www.smarta.com/advice/business-planning/business-plans/how-to-make-revenue-
forecasts/
Katie Jensen, “Factors Considered in Financial Forecasting.” Chron. Hearst
Newspapers. Acessed December 10, 2018. https://smallbusiness.chron.com/factors-
considered-financial-forecasting-80716.html
https://www.slcbookkeeping.com/blog/bid/207078/Bookkeeping-Tasks-for-Every-Part-of-
the-year
https://www.thebalancesmb.com/steps-to-increase-small-business-profits-1200720
https://www.wikihow.com/Calculate-Profit

Entrepreneurship Page 70
 For inquiries and feedback

Holy Face of Jesus Lyceum of San Jose Inc.

285 Nabolo St. Cor. Sampaguita St. San Jose Rodriguez, Rizal

Subject Teacher
MARICAR E. ELOCADO
09473532827
https://www.facebook.com/maricar.elocado.5/
[email protected]

Entrepreneurship Page 71