Entrepreneurship With all of the training and education someone

has received learning about entrepreneurship,

 The people who create these businesses are they are well prepared for this type of position.
called entrepreneurs. Entrepreneurship has been
described as the "capacity and willingness to 5. Not-for-profit fundraiser
develop, organize and manage a business  Being able to raise funds requires understanding
venture along with any of its risks in order to the importance of business and networking
make a profit". relationships. It is a great place for someone
with this type of degree because you will have
An entrepreneur is a person who starts a new experience in studying advanced concepts that
business and usually risks his own money to start the can be used to your advantage on the job.
venture. Examples of well-known entrepreneurs
include Bill Gates, Steve Jobs, Mark Zuckerberg, Pierre 6. Teacher
Omidyar, Arianna Huffington and Caterina Fake.  Now here me out on this one. I am not
suggesting that you go teach entrepreneurship. I
8 Jobs You Can Get With An suggest you teach a core competency (e.g., math,
history, literature, etc.), but teach students the
Entrepreneurship Degree entrepreneurial side. Teach them the benefits of
math to business, history to innovation, and
 Mid-level management. At big companies, the literature to persuasive
C-level folks develop ideas, the ground force
does the work, and mid-level management 7. Recruiter
converts the idea into execution. ...  Having had courses that cover operations
 Business consultant. ... management, leadership, and a variety of others,
 Sales. ... you most likely have a keen sense of what type
 Research and development. ... of person is needed to fulfill a position.
 Not-for-profit fundraiser. ... Companies who use recruiters rely upon
 Teacher. ... someone being not just people savvybut having
 Recruiter. ... an in-depth business sense as well.
 Business reporter.
8. Business reporter
1. Mid-level management  If you can write articles, or pick up a quick class
to learn it, you are in a prime position to take the
 At big companies, the C-level folks develop lead on covering a local business beat. You will
ideas, the ground force does the work, and mid- understand the field and concepts and can use
level management converts the idea into your knowledge to make the business section
execution. Graduates with entrepreneurial that much more interesting and telling.
degrees are well suited for this opportunity.
Importance
2. Business consultant
 The Fortune 500 is ripe with business Why Entrepreneurs Are Important for the
consultants. They need people who can go to a Economy. ... If successful, their innovations may
client site, identify problems and fix them. That improve our standard of living, and in addition to
is what an entrepreneur does, and that is why creating wealth with their entrepreneurial ventures,
this job is perfect for you. You have the training they also create jobs and the conditions for a prosperous
to help identify things that others may not pick society
up on and the training to know how to fix them.
10 Benefits of Entrepreneurship
3. Sales
 Someone who works in sales or runs the
department needs to know how businesses run. Why do people become self-employed? Some people do
They need to know how to represent a company, it to bring to life their visions and ideas. Others do it for
manage accounts, and follow up on leads.  the potentially higher income. Still others do it because
they know they are meant to be an entrepreneur.
4. Research and development
 To work in R&D, you need to understand You have your own reason for starting a business.
business concepts, procedures, and practices.
1. The freedom to pursue your own vision. store, getting compliments from customers on
how your business has helped them, and being
written about by the media. In many respects,
• You can have your own view of the world, and your business is your baby, and nurturing it and
entrepreneurship is the only venue where you seeing it grow can give any parents a sense of
pursue that view and see the fruition of your fulfillment.
vision. Self-employment allows you to do your
own thing, and pursue those areas that you feel 6. The confidence you gain in knowing that you
passionate about. can do it.
2. The control and flexibility you have over your
own time. • Entrepreneurship is tough. There will be
moments where you will question yourself, or
your decisions into going into the business.
• As your own boss, you work when you want to Sometimes, you’d even think that you couldn’t
work; and stop if you want to stop. You can do it when the obstacles seem insurmountable.
tailor your work according to your lifestyle and But once you succeed and overcome the
accommodate various tasks. You can work in challenges, you gain a renewed confidence and
however way you please — in your pajamas, respect for yourself that you can do it.
with the TV loudly blaring — without getting a
memo from the personnel department. Self- 7. Potential earnings exceed a salaried employee.
employment means freedom from rules.

3. The opportunity to learn and gain knowledge. • As an employee, no matter how hard you work,
the financial remuneration you receive is limited
to your salary and an occasional bonus. As a
• The entrepreneur often wears many hats — the self-employed person, you can earn so much
strategic planner, the marketer, the customer more if you hit the right business idea and
service rep, and the sales rep, even the execute the business well. The potential
bookkeeper. There are a million things you financial windfall is so much higher as an
probably didn’t know before you started the entrepreneur rather than a corporate person.
business that you are now forced to learn — and
gaining all these knowledge enriches you as a 8. Business owner reaps the full rewards.
person.

4. The highs and lows of self-employment. • You are the business; anything the business
gains is yours. If you are an employee in the
corporate world, your bosses may even claim
• Entrepreneurs face tremendous challenges and your success as theirs! If you are working for
experience incredible joys when these others, you are only a cog in the whole machine
challenges are overcoming. If you crave
excitement, become an entrepreneur. One 9. Each new day is a challenge.
moment, the local newspaper is featuring you;
and the next, you are losing your biggest
customer. There’s never a dull moment in self- • You never get bored as an entrepreneur: every
employment. day brings a new challenge, new tasks and new
discoveries. You set your pace and you can go
5. The sense of pride and fulfillment in fast if you choose or slow down if you feel like
accomplishing things. it.

10. The chance to share your learning.

• As an entrepreneur, you make things happen.
You create a vision, lay out the plans to bring
the plan to fruition and pursue the steps needed • At the end of the day, you can have the chance
to make the business a success. Doing all these to teach and share with others the things you’ve
things can give you an incredible feeling of learned as an entrepreneur. Sharing what you
pride and joy – seeing your website used by learned can be your way of giving back to the
people, finding your products in the department community – it can take the form of mentoring
 other would-be entrepreneurs, writing a book so 4. Independence
others may see how you did it, or even talking  As the founder of a business, you’ll be in charge
about your experiences. There is so much of all the decisions. You’re the ultimate source
pleasure in giving, and entrepreneurship gives for accountability, and you’re the one who
you a life full of rich experiences. makes the rules. At first, this will be both
exciting and intimidating, but as you become
Characteristics of Entrepreneur more familiar with your role, you’ll start to
accept that level of independence and direction
1. Critical thinking as fundamental to your being.
 There’s no application that doesn’t demand at  After you gain some experience, you’ll be more
least some level of critical thinking. Being able decisive and confident, and less dependent on
to spot and compensate for your own biases, others, which will be beneficial no matter what
analyze the roots of various problems and you do afterward.
discover alternative perspectives on certain
subjects can help you address issues more 5. Management
thoroughly, and make smarter plans for future  It doesn’t take long to realize how much
development. entrepreneurship demands. You’ll be spending
 In the professional world, this means being more countless hours working on your ideas, and
efficient and seeing better results. In your managing full teams of people (not to mention
personal life, it may mean better understanding partner, vendor and client relationships).
your relationships and identifying key areas for  In some ways, entrepreneurship can be seen as a
personal improvement. juggling act. In others, it's a game of micro-
economics, demanding that you work with
2. Creativity limited resources, like time, to gain the greatest
 Entrepreneurship also forces you to be creative. value for the money you put in. In any case,
While you can’t force creativity, you can entrepreneurship teaches you the fundamentals
practice it -- and the more time you spend of management, which makes you a better
generating creative thoughts, the better and decision-maker, better planner and better
faster you’ll be at doing it in a practical allocator of resources. There’s no downside to
environment. How you apply that creativity is these benefits.
entirely up to you.
 It could help you in a creative hobby, like 6. Personal branding
painting or photography, or give you fuel for  Spending time at the helm of your company,
professional visions like marketing campaigns -- you’ll have the chance to develop your personal
or maybe even another business in the future. brand. You’ll get some press coverage as the
“face” of your organization, you’ll attract more
followers to your social accounts and you’ll
likely have the opportunity to publish more
3. Adversity content under your name.
 Entrepreneurship is rife with hard times. The  All of this can be used in the future to build your
strategies you thought were brilliant (and, resume, help you stand out from the crowd and
hypothetically, perfect) may not work nearly as prove your expertise in at least one niche.
well as you thought they would, or you may
reach a point where your finances are stretched 7. Connections
so thin that you have to consider closing up  Even if you don’t consider yourself a social
shop. butterfly, you'll gain from adding connections
 Though times of adversity and failure will test to your network. Entrepreneurship gives you a
your patience and fill your life with stress, good excuse to find and retain those
they’ll also teach you valuable lessons about the connections. You’ll have greater access to
nature of challenges and hardship. You’ll learn employers, mentors, employees and teachers,
that failure is only temporary, and you’ll grow but also hobbyists and specialists, whom you
more confident -- not to mention, likely to stop may call upon for personal projects, as well. Just
worrying about the smaller problems you face in be sure to keep in touch even after your stint as
everyday life. entrepreneur.
 No matter what other goals you have in life --
whether you want to be a poet, salesperson,
 scholar, chef or anything in between -- 10. You rise to the occasion.
entrepreneurship can give you the skills that will
improve your chances of success in your  When things get tough, you feel motivated and
professional life. get into gear.

The 15 Characteristics of Effective BUSINESS PLAN

Entrepreneurs
I. THE BUSINESS CONCEPT AND THE
BUSINESS MODEL
1. You think on your feet.
• CONTAINS THE ESSENCE OF THE
 While you have a facility for planning and ENTERPRISE IN A CONCISE BUT
organization, you aren't afraid to throw out the POWERFUL MANNER
outline and go in a different direction. 
• PRODUCT CONCEPT MUST THEN BE
2. You doubt yourself. TRANSLATED INTO A BUSINESS MODEL.
A BUSINESS MODEL IS A FORMULA ON
 If you feel insecure, you know that it doesn't HOW THE ENTERPRISE EXACTLY PLANS
mean you will fail. Instead, you channel that TO MAKE MONEY OUT OF THE
nervous energy. You can find that you have a BUSINESS.
renewed focus for the task at hand.
1. HOW WILL THE BUSINESS REVENUE
3. You are inventive.
2. WHAT WILL BE THE COST OF THE
 Even if you don’t have the resources you think ENTERPRISE PRODUCTS & OTHEHER
you need, you're able to take a step back and use COST IN DOING THE BUSINESS
what’s at your disposal.
3. WHAT WILL BE THE MAJOR
4. You have a mind for money. INVESTMENT OF THE ENTERPRISE

 Ah, yes, revenue. You are endlessly intent on 4. HOW WILL THE ENTERPRISE FINANCE
making sure your venture is profitable. THE INVESTMENT? HOW WILL THE THE
ENTERPRISE FUND ITS GROWTH?
5. You don't fear controversy.
THE BUSINESS GOAL: VISION, MISION,
 Being successful often means disrupting the AND PERFORMANCE TARGETS
status quo.
• THE BUSINESS GOAL SHOW THE FUTURE
6. You take risks. AND LONG TERM PROSPECTS OF THE
ENTERPRISE. IT IS COMPOSED OF THE
 And you see the risks you take as fruitful VISION, MISSION, OBJECTIVES, KEY
possibilities and opportunities to grow. RESULT AREAS, AND PERFORMANCE
7. You are active. INDICATORS OF THE ENTERPRISE.

 Constantly hustling and one the move, you OBJECTIVE

understand that it is your drive that powers your  MUST BE MORE SPECIFIC THAN THE
company and energizes your employees. VISION AND MISSION STATEMENTS. THE
8. You are open to change. KEY SHOULD BE MEASURABLE,
ACHIEVABLE , AND TIME-BOUND.
 You know that your company will only triumph
 SHOULB BE TRANSLATED INTO KEY
if you evolve and change as the customer and
RESULT AREA OR KRAs. KRAs ARE THE
market demands
QUALITATIVE MANIFESTATIONS THAT
9. You can sell yourself. THE OBJECTIVES ARE BEING ACHIEVED.

 Promoting your vision is like second nature to  IN SHORT, KEY RESULT AREA MUST BE
you. Meanwhile, you often look inward to RENDERED INTO QUANTIFIED
improve your performance.
 PERFORMANCE, MEASUREMENTS, OR • IT SHOULD PRESENT THE CAPITAL
PERFORMANCE INDICATORS (PI) STRUCTURE OF THE PROPOSED
BUSINESS
II. EXECUTIVE SUMMARY
III. THE BUSINESS PROPONENTS
• THIS CONTAINS EVERYTHING THAT IS
RELEVANT AND IMPORTANT TO THE THIS SECTION CONTAINS INFORMATION
BUSINESS AUDIENCE. IT IS THE ABOUT THE BUSINESS PROPONENTS OR
SYNTHESIS OF THE ENTIRE PLAN STAKEHOLDERS.

• IT CONTAINS THE MAJOR FOUR TYPES OF STAKEHOLDERS

ARGUMENTATIONS OF THE BUSINESS
PROPONENT ON WHY THE BUSINESS 1. RESOURCE MOBILIZERS AND FINANCIAL
WILL WORK AND SUCCEED/ BACKERS

• IT SHOULD PROVIDE THE BUSINESS *THEY WANT TO KNOW WHO ELSE ARE ON
PLAN AUDIENCE ALL THE ARGUMENTS BOARD TO SHARE THE BURDEN OF RAISING THE
ON WHY THEY SHOULD PARTICIPATE IN MONEY TO SEE THE WHOLE THING THROUGH
THE BUSINESS VENTURE.
2. TECHNOLOGY PROVIDERS AND
• THIS WILL INTRODUCE AND HIGHLIGHT APPLICATORS
THE GOOD QUALITIES OF:
*THEY WANT TO KNOW IF THERE WILL BE
1. THE BUSINESS PROPONENTS AND THEIR SUFFICIENT FUNDS TO PAY FOR THE
PARTNERS TECHNOLOGY

2. THE ENTERPRISE ORGANIZATION AND 3. GOVERNANCE AND TOP MANAGEMENT

ITS CAPABILITIES
*THEY WANT TO KNOW THE STRATEGIES
3. THE TECHNOLOGY PROVIDERS AND AND PERFORMANCE INDICATORS PROPOSED
THEIR EXPERTISE AND EXPERIENCE
4. OPERATING AND SUPPORT TEAM
4. THE SUPPLIERS AND ALL THE MAJOR
SERVICE PROVIDERS *THEY WANT TO KNOW WHAT PROGRAMS,
ACTIVITIES, TASKS, AND RESOURCES WOULD BE
• IT SHOULD DESCRIBE THE IN PLACE
PRODUCTS/SERVICES OF THE
ENTERPRISE IV. THE TARGET CUSTOMER & THE MAIN
PROPOSITION
• IT SHOULD PROCEED TO DISCUSS AND
JUSTIFY THE ENTERPRISE STRATEGY • THE BUSINESS PROPOSITION MUST BE
AND DELIVERY SYSTEM VERY PRECISE ABOUT THE TARGET
AUDIENCE OR CUSTOMER
• IT SHOULD RENDER ALL THE MAJOR
INSTITUTIONAL, MARKET, OPERATIONS, TARGET CUSTOMERS – MUST BE OF
AND ORGANIZATIONAL STRATEGIES SUFFICIENT SIZE, SUFFICIENT PAYING
CITED IN FINANCIAL STRATEGIES AND CAPACITY, AND SUFFICIENT INTEREST TO
FORECASTS PURCHASE THE PRODUCTS BEING OFFERED.

• INVESTMENT REQUIREMENTS SHOULD MAIN VALUE PROPOSTION - IS THE UNIQUE

BE PRESENTED ALONG WITH THE SELLING PROPOSITION OF THE ENTERPRISE
SUMMARIES OF PROJECTED INCOME,
• THE TARGET CUSTOMERS ARE EXACTLY
BALANCE SHEET & CASH FLOW
CONCENTRATED, THE BUSINESS PLAN
• IT ALSO CONTAINS A SECTION ON THE SHOULD THEN PINPOINT WHAT THE
ENVIRONMENTAL AND REGULATORY CUSTOMERS BUY, HOW THEY BUY,
COMPLIANCE OF THE BUSINESS WHEN THEY BUY, WHERE THEY BUY,
AND WHAT CONVINCES THEM TO BUY.
V. MARKET DEMAND AND SUPPLY, • THE BUSINESS PLAN SHOULD ALSO
INDUSTRY DYNAMICS, AND MACRO PROVE THAT THE PRODUCTS/ SERVICES
ENVIRNMENTAL FACTORS WOULD BE ACCEPTED AND CARRIED BY
THE DISTRIBUTION CHANNELS
• THIS ARE THE FORCES AFFECTING THE
BUSINESS OF THE ENTERPRISE VII. ENTERPRISE STRATEGY & DELIVERY
SYSTEM
• THIS SHOULD EXAMINE ALL THE
OPPORTUNITIES IN THE BIGGER • THE BUSINESS PLAN SHOULD EXPOUND
MARKET IN ORDER TO DETERMINE THE ENTERPRISE STRATEGY (ES) BY
WHAT EXACTLY INFLUENCE THE MAPPING LANDSCAPE AND SITUATING
MARKET DEMAND & SUPPLY THE ENTERPRISE AND ITS COMPETITORS
AS TO THEIR STRATEGIS AND CHOSEN
• THE BUSINESS PLAN ESTIMATES THE POSITIONINGS
TOTAL MARKET SUPPLY & DEMAND FOR
THE PRODUCT OFFERINGS & THE MAJOR • THE BUSINESS PLAN SHOULD SHOW
CRITICAL FACTORS THAT INFLUENCE HOW THE ENTERPRISE DELIVERY
THE MARKET. SYSTEM (EDS) WOULD ENABLE THE
BUSINESS TO IMPLEMENT THE
• ONCE IT WAS DETERMINED, THE ENTERPRISE STRATEGY.
BUSINESS PLAN SHOULD FORECAST THE
FUTURE DEMAND & SUPPLY • THE EDS INVOLVES HARNESSING
HUMAN, MONEY AND PHYSICAL
RELEVANT INDUSTRY DYNAMICS RESOURCES FROM WELL-SELECTED
SOURCES
• WHO ARE THE COMPETING
ENTERPRISES? WHAT ARE THEIR • THESE ARE THE INPUT (HUMAN, MONEY,
COMPARATIVE ADVANTAGES & MACHINES, MATERIALS, METHODS, AND
DISADVANTAGES? MANAGEMENT) THE OPERATIONS
(MANUFACTURING, OR SERVICE
• WHO ARE SUPPLIERS OF THE INDUSTRY DELIVERY PERSONNEL)
AND WHAT ARE THEIR CAPABILITIES &
BARGAINING POWER? • THE OUTPUT – WILL BE DELIVERED TO
CUSTOMERS THU MARKETING UNIT
• WHAT ARE THE CHANNELS OF
DISTRIBUTION BEING USED BY THE • THE OPERATIONS & MARKETING-
INDUSTRY? HOW EFFECTIVE ARE THESE FINANCE, ADMINISTRATION, AND
CHANNELS? HUMAN RESOURCE MANAGEMENT
UNITS
*The business plan should discuss the major trend
changing patterns in the macro-environment, which • THE DESIRED OUTCOMES –
would have significant impacts on the relevant DEMONSTRATES HOW THE ES & EDS
industry. Both industry players & market are affected TANDEM LEAD TO THE ATTAINMENT OF
by SPEET – (social ; political; economic; ecological; DESIRED ENTERPRISE OUTCOMES
& technological environment)
VIII. FINANCIAL FORECAST: EXPECTED
RETURNS, RISK, AND CONTENGENCIES
VI. PRODUCT.SERVICE OFFERING: • THE BUSINESS PLAN MUST TRANSLATE
DESCRIPTION, EVOLUTION, AND EVERYTHING INTO FINANCIAL
JSUTIFICATION FORECAST AND OUTCOMES

• THE PRODUCT / SERVICES MUST BE • FROM HERE YOU SHOULD CALCULATE

DESCRIBED BY HIGHLIGHTING THE THE EXPECTED RETURNS FROM THE
FEATURES AND ATTRIBUTES THAT BUSINESS.
WOULD MOST APPEAL TO THE TARGET
CUSTOMERS. IMPORTANT RETURN CALCULATIONS:

1. EXPECTED RETURN ON SALES

 2. EXPECTED RETURN ON ASSETS OR may also tinker on improving their
INVESTMENTS operational capability.
3. EXPECTED RETURN ON STOCKHOLDERS Entrepreneurnal mind frame, heart flame and
EQUITY gut game
IX. ENVIRONMENTAL AND REGULATORY o essential to an entrepreneur’s opportunity
COMPLIANCE seeking.
• THE BUSINESS PLAN MUST ARTICULATE
Entrepreneurial Mind Frame: allows the
THE LAWS, RULES AND REGULATIONS
GOVERNING THE BUSINESS, AND THE entrepreneur to see things in a very positive and
INDUSTRY THAT ENTERPRISE IS IN. optimistic light in the midst of crisis or difficult
situations.
• IT SHOULD ASCERTAIN THE NECESSARY
PERMITS, LICENSES & AUTHORITY TO In fact. In Chinese writing, the word crisis is
USE PROPIETARY INTELLECTUAL composed of two characters. The first character
CAPITAL WOULD DEFINITELY BE means danger while the second character means
SECURED opportunity.
X. CAPITAL STRUCTURE & FINANCIAL o If there is one commonality between an
OFFERING : RETURNS & BENEFITS TO inventor and an entrepreneur, it is their
INVESTORS, FINANCIERS, & PARTNERS surging passion or the entrepreneurial heart
flame. Driven by passion, they are drawn to
• INCLUDES DISCUSSIONS ON WHO ARE
THE INVESTORS, THE FINANCIERS, & find fulfilment in the act and process of
PARTNERS OF THE ENTERPRISE discovery.
o Passion is that great desire to attain a vision
• THE BUSINESS PLAN MUST APPEAL TO or fulfil a mission.
ITS TARGET MARKET. IT HIGHLIGHT THE
MAIN FEATURES OF THE BUSINESS PLAN The heart flame is also about emotional
THEY ARE LOOKING FOR. intelligence or EQ, which is often manifested in the
entrepreneur’s efforts to nurture relationships with
Opportunity Seeking customer, employee and suppliers.
o The ongoing process of considering, o The entrepreneur also looks after interests of
evaluating, and pursuing market-based his or her people by motivating and
activities that are believed to be encouraging them to be the best they can
advantageous for the firm.Prior experience become.
informs the process, but it may also limit it:
opportunity seeking calls for continuous The Entrepreneurial Gut Game refers to the
reconsideration and adaptive learning. ability of entrepreneur to sense without using the
five senses . This is also know as intuition.
What is the importance of opportunity seeking?
MANY SOURCES OF OPPORTUNITIES
o If you actively seek opportunities, you will
find new products for old markets or There are many ways to uncover or discover
customers. The successful entrepreneurs opportunities. Some have to do with looking at the
seek to find new ways to please old big picture and notice emerging trends and patterns.
customers. Each new need or new want Others have to do with finding out what specific
exhibited by your market is an opportunity customer segments are being targeted in the
which you can take advantage of. marketplace. Still, Others come from new
o They may also consider expanding their technologies and new knowledge.
reach by creating new markets or
maximizing existing market reach. They MACRO ENVIRONMENTAL SOURCES OF
OPPORTUNITIES
 o Refers to the big or macro forces that affect foreign exchange rates that fluctuate with
the area, the industry, and the market , the movement of the market forces.
which the enterprise belongs to. o income levels and the purchasing power of
o influence how business should be its people as well as the competitiveness (or
conducted, how consumers will behave, how uncompetitiveness) of its industries and
supply and demand will move, how different enterprises are sources of opportunities
competitors would position themselves, and o the entrepreneur must be able to think
how the cost of doing business will proceed. critically through each and every single
o This can be divided into five categories economic event that impacts his or her
composed of Social, Political. Economic, enterprise
Ecological and Technology or SPEET
TECHNOLOGICAL ENVIRONMENT
SOCIO-CULTURAL ENVIRONMENT
o New scientific and technological
o Includes the demographics and cultural discoveries, which often lead to the launch
dimensions that govern the relevant and commercialization of new products with
entrepreneurial endeavor superior or to rendering the old ones
o taking this consideration helps the obsolete , are the entrepreneurs nightmares
entrepreneur assess the trends and dynamics o technology does not only come in the form
of the bigger consumer population, their of advanced machinery or equipment, but it
beliefs, tastes, customs, and traditions can also be in the form of new systems, new
o looks at social structure and shifts in social processes, or new products
status and behaviour
Industry Sources of Opportunities
POLITICAL ENVIRONMENT
o After macro environment, the next biggest
o Defines the governance system of the sources of opportunities are the industry and
country or the local area of business. It the market. One of the most difficult aspects
includes all the laws, rules, and regulations, about industry analysis is defining what
that govern business practices as well as the constitutes an industry in the first place.
permits, approvals, and licenses necessary to o The proper classification of what industry
operate the business. the enterprise is competing in is important if
o Specifically, it regulates the use of natural the entrepreneur’s intention is to define who
resources; the disposal of wastes; the are the relevant customers, who are the
taxation of income; the importation of goods direct and indirect competitors, and what are
and services; the accounting and reporting of the critical characteristics of the market as to
business financial statements; public and the quality of products or services to be
private education ; health programs, use of delivered
public funds and other such concerns
o includes the establishment of vital There are several ways of defining an industry:
infrastructures, logistical access, and 1. Product types or functions of product or
interventions that affect the cost of doing service.
business. 2. Product or value-added chain
o These factors are important influencers in
evaluating the attractiveness of any political Participants in an industry includes:
domain where the entrepreneur intends to
locate and do business in. 1. Rivals or competitors in a particular
business.
ECONOMIC ENVIRONMENT 2. Suppliers of input to rivals as well as
suppliers of machinery and equipment.
o Supply and demand forces mainly drive Manpower, and merchandise.
macro economic environment. They are the
same factors that drive the interest and
 3. Consumer market segments being served by 3. What piques customers is a great source of
rivals. opportunities.
4. Substitute products or services, which 4. Before the customer is won over, there is
customer shift or turn to. first a battle for the mind. Next, there is
5. All other support or enabling industries. a battle for the heart. Finally, there is a
battle for the wallet.
5. The longer the customer wants to use the
product, the greater the chances of creating
A thorough analysis of industry structure and
lasting loyalty.
dynamics yields opportunities for the clever
6. Opportunities abound in shaping consumer
entrepreneur. Situating his or her enterprise within
perceptions or occupying spaces in their
the realm of an industry provides many profitable
minds or places in their hearts that have not
opportunities for the entrepreneur
yet been filled.
MARKET SOURCES OF OPPORTUNITES 7. New inventions, new systems and work
processes, new insights about the human
o The entrepreneur must be able to measure psyche, new applications for old knowledge,
the actual demand and supply. new revelations about how the physical
o Can be discovered from increased and worlds works, new interpretations, new
decreased demand as well as higher or lower combinations based on the convergence of
supply. previous technologies, new outlooks about
o Market trend analysis is also conducted by how life should be led and a host of other
determining the critical variables. new things are tremendous sources of
opportunities.
MICROMARKET 8. Determining personal preferences and
competencies lay the foundation for a new
o Specific target market segment of a business venture.
particular enterprise. 9. Unexpected occurrences in both the external
o The need for segmentation would be crucial and internal environment of the enterprise
because the definition of value for money indicate that significant changes are
differs from group to group.. happening and opportunities are sprouting.
CONSUMER PREFERENCES, PIQUES AND Opportunity Screening
PERCEPTIONS
》 Many opportunities possible for the entrepreneur
o Can be sources of opportunities.
o Consumer Preferences 》Important to come up with a short list of a few
very promising opportunities
》 tastes of particular group of people
PERSONAL SCREENING
》 in contrast, Consumer Dislikes are the things that
irritate customers Possible questions:

OTHER SOURCES OF OPPORTUNITIES 1. Do I have the drive to purpose this business

opportunity to the end?
Another source of potential source of opportunity is 2. Will I spend all my efforts and money to
the entrepreneur’s own set of skills or expertise or broke the busy opportunity
hobby. New knowledge as well as new technology
can be the source of highly innovative opportunity. 12 RS OF OPPORTUNITY SCREENING

1. Customer preferences change over time. 1. Relevance to vision, mission, and objectives
2. People’s tastes in clothes, music, shoes, of the entrepreneur. The opportunity must be
entertainment, dance, sports, hobbies, and aligned with what you have as your personal
even careers have evolved over the years. vision, mission, and objectives for the
enterprise you want to set up.
2. Resonance to values. Other than vision, such as those with high technological,
mission, and objectives, the opportunity market, financial, and people risks.
must match the values and desired virtues
that you have or wish to impart. PRE FEASIBILITY STUDY
3. Reinforcement of Entrepreneurial
Factors that are contained in pre- feasibility study:
Interests. How does the opportunity
resonate with the entrepreneur’s personal 》 Market potential and prospect
interests, talents, and skills?
4. Revenues. In any entrepreneurial endeavor, 》 Availability and oppropriteness of technology
it is important to determine the sales
potential of the products or services you 》 Project investment and detilaed cost estimate
want to offer. Is there a big enough market
》 Financial forecost and determination of financial
out there to grab and nurture for growth?
feasibility
5. Responsiveness to customer needs and
wants. If the opportunity that you want to MARKET POTENTIAL AND PROSPECT
pursue addresses the unfulfilled or o market potential is based on the estimated
underserved needs and wants of customers, number of possible costumers who might
then you have a better chance of succeeding. avail of the product is service
6. Reach. Opportunities that have good
chances of expanding through branches, COSTUMERS WOULD OFTENTIMES TO
distributorships, dealerships, or franchise MAKE FINAL CHOICE ON WHAT TO BUY
outlets in order to attain rapid growth are ACCORDING TO SEVERAL FACTORS
better opportunities. SUCH AS:
7. Range. The opportunity can potentially lead
to a wide range of possible product or 1. The purchasing power or dispoble income
service offerings, thus, tapping many market 2. Their proximity accessibility to the good
segments of the industry.++ 3. Their individual desires and preferences
8. Revolutionary Impact. If you think that the 4. Their age or generational grouping
opportunity will most likely be the “next big 5. Their social, cultural, or ethnic background
thing” or even a game-changer that will 6. Their poor group preference
revolutionize the industry, then there is a big 7. Their gender
potential for the chosen opportunity 8. Their the season of the year
9. Returns. It is a fact that products with low 9. Their personal, identification with hand
costs of production and operations but are setter
sold at higher prices will definitely yield the 10. Their educational attainment
highest returns on investments. Returns can 11. Their technical proficiency and product
also be intangible; meaning, they come in expertise
the form of high profile recognition or 12. Their motivation impetus
image projection. 13. Their lifestyle prepare
10. Relative Ease of Implementation. Will the 14. Their susceptibility to certain advertising
opportunity be relatively easy to implement and promotional appeals and many others
for the entrepreneur or will there be a lot of SEGMENTING THE MARKET
obstacles and competency gaps to
overcome? o Using a set of demographics will be the
11. Resources Required. Opportunities most basic approach in determining the
requiring fewer resources from the target segment.
entrepreneur may be more favored than
those requiring more resources. ASSESSING COMPETITION
12. Risks. In an entrepreneurial endeavor, there
will always be risks. However, some 》 Market potential is also affected by the number
opportunities carry more risks than others, of establishment supplies and serving your target
customers.
》 Would be best for the entrepreneur to "keep out Operating Cost- there are the cost related to
of a market where competition is fierce". the preparation for the launch of the
business.
ESTIMATING MARKET SHARE AND SALES 2. Production / Service Facilities Investment
- refers to the long term investment for the
》 Conservatively the entrepreneur can go for small
actual business establishment including
market share unless the entrepreneur has a very
investment in land.
superior product or service that can immediately
3. Working Capital Investment- the
command a large market shares.
entrepreneur must see to it that he or she has
ENTREPRENEUR MUST TO DO: enough cash to cover the inventories to be
purchased (or manufactured ) the accounts
》 First is to determine the market coverage our receivable to accumodated customer and the
reach he our she want to serve. operating expenses to be incurred.
》Second entrepreneur must determine the broad OPERATING EXPENSES:
mark segment within this area or total targeted
population a) Employee salaries, wage, and benefits
b) Rent and Lease Expenses
》Final task of entrepreneur is to determine what c) Utilities
slice or share of the targeted market segment he or d) Transportation
she wants to carve out. e) Fees and license
f) Commission
SALES FORECAST CAN BE COMPUTED:
g) Office supplies etc.
( Estimated Sales Volume x Estimated Price)
FINANCIAL FORECASTS AND
DETERMINATION OF FINANCIAL
4 TARGET CUSTOMER EXPECTATIONS FEASIBILITY
AFFECTING THE SCALE:
o refers to the monetary transactions that the
1. Quantities demanded - this would determine business is expected to engage in.
the needed capacity or operations o Its end result will indicate the feasibility of
2. Quality specification demended: the enterprise
a) Quality of input or raw material
b) Quality assurance process in 4 Critical financial statements
transforming input to output
》Income statements
c) Quality output that meet the
operation, standard set 》Balance Sheets
d) Quality outcomes who will be
looking for specific result 》Cash flow statement
3. Delivery Expectation- knowing how much,
how frequent and when to deliver to 》Fund flow statement
customer
4. Price Expectation- selling price of the Income statement
product or service would be evaluated by o Measures an enterprises performance in
customers.
terms of revenue and expenses over a period
INVESTMENT REQUIREMENTS AND of time
PRODUCTION/ SERVING COST
REVENUES-EXPENSES= INCOME/ PROFIT
1. P LOSS
r
Example: Monthly Income of Mang Juan’s
e
Manufacturing
-
Balance sheet
Assets - represents all the investments in the
enterprise including initial investments that you
considered in pre- feasibility study ( investment
requirements).
Liabilities - represent the enterprise's debts to
suppliers, to banks, to government, to employees
and other financiers.
Stockholder's equity- represents the investors'
investments in the stock (or shares) of the busines

Balance sheet equation

Assets= Liability + Equity
Balance Sheet of Mang Juan’s Manufacturing:

Financial Ratios and Measurements:

》In any business endeavor, the investor or
entrepreneur himself or herself will always be
interested in knowing the PAYBACK PERIOD or
how long will it take for him or her to get back what
he or she has invested in the enterprise. THE FEASIBILITY STUDY
o Use to convince bankers and investors to put
PAYBACK PERIOD money into business
OPPORTUNITY SEIZING

To compute for the income payback period based After Opportunity Seeking and Screening, the
on ABC Company’s financial statements, which entrepreneur is ready for Opportunity Seizing, the
specify investments of P 1,500,000 and net income final stage.
after taxes of P500,000 a year we can conclude that
it would take around 3 years for the company to o Has an idea to where he or she will locate
recover the investment. the business
o How he or she will market the product or
service.
INCOME PAYBACK PERIOD=
= 3years “Will I be able to manage, to my advantage, the
critical success factors and avoid the critical failure
In the Cash Payback Period, the entrepreneur should factors?”
add back the non-cash deductions from the income
statement, which is the depreciation expense. Thus, CRAFTINNG A POSITIONING STATEMET
If the depreciation expense is P 250,000 a year, the
In order to craft a positioning statement the
net income after taxes plus depreciation would
entrepreneur is advised to look at the competitors in
amount to P750,000 a year. This would then
the market place.
represent a cash payback period of two years only
Customer profiling will come into the picture
Key points that can help the entrepreneur about above processes while the product or service
the questioning is continuously subjected to testing and
improvement.
1. What are the main customer segments?
2. What are the different product attributes and IMPLEMENTING, ORGANIZING AND
features of each of the competitors? FINANCING
3. What are the existing marketing practices of
the various competitors? Good planning and good programming are essential
4. What are the market preferences of consumers to have a good implementation.
when it comes to the product being offered?
A good planner and programmer must make several
important choices to achieve the desired end results.
o First is to choose the correct technology, the
one that would produce the output that
would meet the quality specifications of the
customers
o Second is to choose the right people who
can perform the technical and the
managerial functions necessary to realized
the desired end results.
o Third is to design the operating workflow
that would assure the effective, economical,
and efficient production of the output
o Fourth is to specify the systems and
procedures that would govern the enterprise,
motivate and discipline the work force, and
satisfy the customers.
o Fifth is to design the organizational
architecture that would allow the people to
function at their best.
CONCEPTUALIZING THE PRODUCT AND
SERVICE OFFERING
o A concept is an idealized abstraction of the
product or service to be offered to the
DESIGNING, PROTOTYPING, AND
preffered market of the ent 0.repreneur
TESTING THE PRODUCTS
CHAPTER 3: GETTING TO KNOW THE
o From conceptualization, the entrepreneur
MARKET
proceeds to the design, prototyping, and
testing of the concept, designing means that Entrepreneur, know thy market well!
the entrepreneur must render the concept
and translate it into its very physical and  Entrepreneur should exert all efforts to know
very real dimension (measurement). This the market he or she wants to exploit.
entails building a prototype of the product
that will be ready for the actual testing by Market Research
the entrepreneur and then, later on subject to  Seven basic questions
testing by potential customers through focus
group discussion (FGD), surveys, product, 1. WHY- purpose and objective for conducting the
demonstration sessions, and the like. market research
o The entrepreneur must be able to “perfect”
the product or service as it goes through the
2. WHAT- determines the scope and the limitations
of the market research to be conducted.
3. WHICH- determines which segment of the
market must be studied; this must be the market
segment yhet the entrepreneur is eyeing.
4. WHO- identifies who among the members of the
selected market segment will participate in the
market research
5. WHEN- determines the time and timing of the
research. This is critical for entrepreneurs whose While the above illustrative representations are
product or service will be offered to a time- helpful, the interpretation of data does not end with
constrained market such as office workers. generating a frequency table and a graph

6. WHERE- pinpoints the relevant location of the In order for the data to be more useful to the
market research. entrepreneur, a cross-tabulation is highly
recommended
7. HOW- determines the methodology to be used
for the market research ( e.g. survey focus group dis
cussion, observation)
Market Research methodologies
• Important market information can only be
obtained by conducting a good market
research.
• Entrepreneurs and investors do not want to
put resources in unknown markets.
Focus group discussion
• Good market research allows entrepreneurs
and investors to make wiser decisions. • One of the most common qualitative
research tools.
Sales data mining
Using the information from Case 3, the data can • It is effective in extracting consumer and
logically be arranged chronologically from 7am to non-consumer experiences regarding
6pm otherwise known as data array (Table 3.1). products, places or programs.
The data can be further grouped into intervals of • This method can also be used for generating
two, three, or four hours. On the other hand, the initial insights
hotdog customers can be further classified into male
and female customers. They can be sub-classified FGD can be used to address substantive issues
into small children (12 years old and below), such as:
teenagers (13 to 19 years), and
• Understanding consumers’ perceptions,
Adults (20 years and above). preferences and behavior concerning a
product category;
• Obtaining impressions on new product
concepts;
• Generating new ideas about older products;
• Developing creative concepts and copy 9 steps in conducting a focus group
material for advertisements; discussion:
• Securing price impressions; and 1. Develop the research objective.
2. Determine the participants’ profile.
• Obtaining preliminary consumer reaction to 3. Determine the appropriate token or
specific marketing programs “compensation” for the participants.
4. Develop a participant screener
• FGD is an interview by a facilitator of a
questionnaire.
small group of people that normally lasts for
5. Recruit the participants.
an hour and a half up to 3 hours.
6. Select a good facilitator. The key qualities of
• Participants are selected because of their
a good facilitator are:
knowledge about the topic.
o Kindness with firmness
• Objectives must be clear and precise.
• It takes a great deal of planning from the o Involvement and
researcher’s end to ensure that objectives set encouragement
are met. o Complete understanding
Four key decisions to be made:
o Flexibility
1.Respondent selection;
o Sensitivity
2.Sample size
3.Data gathering and 7. Develop a Facilitator’s discussion guide.
4.Data analysis
 Number of respondents per group should 8. Arrange for the venue and logistics.
range from 6-8, depending on the skill of the
facilitator and the topic being discussed. 9. Analyze the results of the focus group
 If the number falls below 6, the likelihood of discussion.
generating a momentum and group
• Researcher should compare and contrast all
dynamics necessary for a good discussion
points raised by the different respondents
will not happen.
and note from what point of view they are
 However if the group exceeds 8, it may be
coming from.
too crowded, resulting in the passive
participation of some respondents and a • Must summarize the points where
discussion that is not as cohesive. participants strongly agreed upon or
disagreed on about an issue.
Data gathering methods in FGD involve:
• Write down quotations that seem
1. Selection and preparation of the venue and
particularly relevant to his or her identified
equipment;
objectives and must group similar comments
2. Formulation of the discussion agenda; and
together.
3. A facilitator who is very skilled in
moderating and possess the ability to draw • In final analysis, the objective of FGD must
out significant insights from the participants. be addressed and conclusive insights must
be drawn.
Data analysis includes:
• Again in sighting is needed after the results
1. Integration of the information gathered;
of the FGD have been documented.
2. Some observations on respondent behavior;
and
3. Listing of recommendations and report
writing.
OBSERVATION TECHNIQUE 1. The researcher cannot get the reason
behind the behavior
• Is probably one of the best ways of
gathering data about customers in their 2. The researcher can only focus on the
natural setting without having to interact or “here and now”. It cannot cover the
talk to them. past nor cover the future.
• Simply observe people as they go about 3. Finally, the observation technique
their usual activity such as buying and using may border on the unethical because
products and services and assess how they the respondents have not agreed to
behave. be observed.

• Researchers must be discreet so as not to Two different types of observation techniques:

attract the attention of the one being
observed. 1. Human observation
2. Mechanical observation
• In the absence of a video recording, jotting
down observations will do. Guidelines in conducting observation research:

Observations must be documented and tallied 1. Determine the pre-observation objectives.

for proper analysis later on. Prior to going the 2. Prepare your pre-observation tips:
observation, it is important for the researcher to
ensure that the following conditions are met: a. Prepare and clarify your observation
points and issues.
1. The needed information must be observable
or inferable from the behavior that can be b. Prepare your observation materials
observed.
2. The subject matter contains some sensitivity c. Identify the persons to be observed.
that needs detached observation.
3. The behaviors of interest must be repetitive, d. Position yourself strategically
frequent, or predictable in some manner. without being noticed
4. The behavior of interest must be of a . Focus on what you want to observe:
relatively short duration.
a. Is it customer demographics?
Advantages of observation research
b. Customer buying behavior?
1. It allows the researcher to see what
customers actually do rather than rely on c. Customer usage behavior?
what they say they do.
d. Other customer information?
2. It allows the researcher to observe customers
in their natural setting. 4. Observation Proper:

3. It does not subject the researcher to the a. Observe keenly and listen intently.
unwillingness of customers or their inability
b. Be mindful of surroundings.
to reply to certain questions.
c. Be alert for obvious movements.
4. Some information are better gathered
quickly and accurately through observation d. Be sensitive to subtle movements
Disadvantages of observation research e. Look at the customer
The researcher can only see the outside behavior 5. Post-observation tips:
of the customer, but cannot determine the inner
motivation of the customer. a. Review your notes.
 b. Make sure that the flow is correct. - Where respondents are
randomly selected from a
c. Tabulate what needs to be tabulated population.
d. Interpret and analyze your data  Non-Probability sampling
e. Make a formal report. - Refers to the technique that is
restored to “when it is
Survey research
difficult the population of the
• Survey is the most preferred instrument for study because they are
in-depth quantitative research. mobile or transitory in a
given location”.
• The respondents are asked a variety of
questions which are often about their Sample size
personal information, their motivations, and
3 basic sample size determinants:
their behavior.
1. Data variability of a proportion
• Probably the most popular type of survey
research is the Usage, Attitude and Image  Dispersion of the data or how
(UAI) survey. widely spread the data is from a
central point.
3 Important concerns that has to look into in
planning a survey: 2. Confidence level in the estimation
process
1. Sampling technique
2. Getting the sample size  The higher the confidence level
3. Designing the questionnaire desired, the bigger the sample size
needed; the current industry
Questionnaire design
standard has 95% confidence level.
Some basic rules that have to be followed in
3. Error in the result of the estimation
question formulation:
process
• The questions in their totality, should
 The less error margin desired, the
be able to elicit all the necessary
bigger is the required sample size; it
information required in the research.
is expressed as plus or minus (+/-) a
• Each question should be clear and certain percentage.
definite. • Assuming that the population is unknown,
the formula for computing the sample size is
• Each question should cover one topic as follows:
at a time.
• Each question should be presented in
a neutral manner.
• Each question should be translated
Where:
into dialect that the target
respondents are familiar with. Z = 1.96 (The value of the normal variable for
Sampling techniques a confidence level of 0.95. this means that the
probability of finding the true population value
Are classified into probability and non
within a given interval is 95%. If 99% is the chosen
probability sampling:
confidence level, the value of Z is 2.58.)
 Probability sampling
P = 0.50 (the proportion of getting a good sample). • Be mindful of the comments of the
respondents so that you may revise the
1-p = 0.50 (the proportion of getting a bad sample). questions accordingly and appropriately.
d = error margin in decimal 6. Conduct interviews and enter data
n = sample size • Plan and execute the implementation of your
survey well.
• Be professional in conducting the
interviews.
• Ensure that data are entered legibly.
7. Analyze the data
• Review your notes
• Organize the questionnaires for more
orderly processing.
• Tabulate, use graphs, and do statistics.
• Write the report including the insights
Do-it-yourself survey: steps in conducting a gained from the results.
survey research
Customer profiling
Steps in conducting a survey research:
• When the entrepreneur starts doing the
1. Develop the research objectives market research, he or she is also beginning
• Determine what you want to know and to understand his or her customers, and
learn. therefore profiling them.
• Define the goals of your research.
2. Determine your sample • Costumers knowledge starts with good
• Identify who and what kind of people you customers profiling.
will interview.
Methods of customers profiling
• Where you are going to find them.
• Determine the number of target respondents Demographics
you need and how you are going to choose
them. • in demographics classification, we
categorize customers into the following:
3. Choose the interviewing methodology - Age
- Income classes
• From different interview methods, such as
- Social classes/ Reference groups
face-to-face, by phone, or by mail, choose
- Ethnic backgrounds and Religious
the appropriate methodology to use for your
beliefs
research.
- Occupations
4. Create your questionnaire - Domiciles

• Identify the key information you will have Income levels determine the purchasing power of
to ask from your respondents. Design your customers. Usually, the customers are classified
questionnaire based on the process given according to the following income classes:
above. 1. Class A, the high income class
5. Pre-test the questionnaire 2. Class B, the upper middle income
• Determine a similar profile of target class
respondents and test the questionnaire. 3. Class C, the middle income class
 4. Class D, the lower middle income 2. The second way is to profile the different types of
class customers in a given industry or area as to their needs
and wants.
5. Class E, the low income class
a. From these types, the entrepreneur
• Ethnic backgrounds and religious beliefs could then choose the customer
affect the cultural beliefs of people. group with the best potentials
• Social classes and reference groups often
dictate what is acceptable or unacceptable b. Products or services can be
• Occupations also determine what kind of developed by the entrepreneur to
goods and services these people would buy match this chosen customer group.
• Domiciles define and limit the choices
available to customers. Market segmentation

Psychographics • Customers with similar needs and wants and

similar willingness and ability to pay can be
- Defines the customer’s motivations, grouped into one customer segment.
perceptions, preferences, and lifestyle.
 Motivation goes to the roots of customer’s • We can have different customer sub-
needs and want, can be classified into segments.
physiological and psychological • Therefore, we can produce products and
 Perception the way a person chooses to services that are highly specialized for any
receive or interpret information from the type of consumer segment.
external world.
Market aggregation
 There are lifestyle classifications that talk
about what most people value most in their • Some entrepreneurs prefer to appeal broader
lives. market if possible.

Techno Graphics • They want market aggregation rather than

market segmentation.
- Classifies people according to their level of
expertise in using a product or service. Market mapping

- Products and services can range from - Refers to grouping customers and products
general purpose items to highly specialized, according to certain market variables.
customized and “technologized” goods.
Application of customer profiling
The entrepreneur can use or apply customer
profiling in two ways,
1. The first way is to develop a product or service to
test out in the market place.
a. The customers most attracted to the
product or service can then be
profiled.
b. After profiling, the next step is to
find out how huge this market is for • To provide the market analyst a better
exploitation purposes. understanding of the market as a whole.
 • Allow entrepreneurs to discover market The competitive landscape of the enterprise, relative
segment that are relatively unserved or to its market, can be clearly mapped out by laying
underserved. out both the latitudinal and longitudinal market
dimensions.
Chapter 4:
Latitude
LET THE MARKET KNOW YOU BETTER
Lays out what is important to the different customer
Marketing plans are designed to capture market share segments from their differing points of view.
and defeat competitors. The marketing function and the
marketing mix serve the overall business strategy. • Certain customers may claim that what is
important to them are the quality features of
• It is summarized in seven Ps by which the durability and functionality.
enterprise will engage competitors and gain
customers. • Other customers may be looking for style,
design, and aesthetic appeal. There would be
• Positioning, Product, Packaging, Place, People, customers who do not have the purchasing
Promotion, and Price. power to afford any of the above quality
definitions. They would buy lower priced
MARKETING products with lesser quality.
• is about creating and accumulating customers. Longitude
Positioning In the marketing map represents the product features and
• In the context of a marketing battle plan, has attributes of competitors in the marketplace.
three overlapping objectives • Most competitors would be offering product
features, which the major customer segments
First- positioning has an enterprise perspective.
want to buy.
The enterprise scans the market environment and
decides to position itself with products that • A few will focus on niche customers who are
specifically address the needs of a chosen target not in the mainstream
market.
In determining its positioning, the enterprise should be
Second -positioning has a competitive perspective. The mindful of the Main Value Proposition (MVP) to its
enterprise has to differentiate and distinguish itself from customers relative to its competitors. In determining the
its competitors. MVP, the enterprise must assess its products from the
customers, viewpoint.
Third- positioning takes the customers' perspective.
Positioning is the way the customers perceive the • The enterprise should carefully assess whether
enterprise and its products or services in their minds. its chosen MVP is the most sought after by its
The stronger the overlap is in these three perspectives, targeted market segment. Some enterprises have
the more defined the positioning of an enterprise is in discovered that their intended customers are not
the marketplace.. the ones buying their products but some other
segments. Their choice, then, is to either
Enterprises reposition their products toward the unintended
customers or to reinvent their products to fit
• can establish their positioning either by their intended customers. Sometimes, all that is
starting with their own product creations or necessary is a change of message but, most of
with their customers' outcome expectations. the time, what is required is an overhaul of the
The competitors will always be part of the marketing mix
positioning equation, whether the enterprise • To establish the positioning of its various
starts with the product or the customer products in the marketplace, the enterprise
perspective. After all, marketing warfare endeavors to build the brand of each product.
takes place in a competitive arena.
 PACKAGING

Branding serves three purposes. Packaging is a material used to wrap or protect goods.

1) Differentiate the product from other products. There used to be a time when products came wrapped in
2) Avoid a commodity image for the product. ordinary packaging displayed the brand name, the main
3) Fill a space in the consumer's mind that would attributes of the product, the company’s logo, and its
prevent other products from occupying the same place of business.
space.
Packaging today can even be more important than the
Once a space gets filled in the consumer's mind, it is product itself. If done imaginatively.
very hard to change. We all remember the first man on
the moon, the first person to circumnavigate the world, PURPOSES OF PACKAGING
and the first murderer, but we do not remember the
second. Number two will only be remembered if it 1) Packaging identifies the product, describes its
makes a big thing out of being number two. features and benefits, and complies with
government rules on specifying its contents,
Product weight, chemical composition, and potency.
2) Packaging differentiates the product from its
There are four general types of products that are competitors and even from its other brand
marketed by enterprises: offerings.
3) Packaging lengthens the lifespan, physically
1. Breakthrough products protects, and extends the usefulness of the
product.
2. Differentiated products 4) packaging has become an environmental issue
3. Copycat products by itself. Recyclability and biodegradability are
now a major concern of packagers and
4. Niche products consumers alike
5) The aforementioned uses of packages have
Breakthrough products offer completely new increased the cost of packaging and, therefore,
performance benefits. They may double the performance the price of the product. To counteract this, the
at half the cost. They may be much more convenient packaging must possess its own service for the
and easy to use. They may cater to a unique set of customers as well as for the enterprise.
customer needs that have not yet been tapped. They may Customers may put some premium on
create a new demand. Marketing breakthrough products environment-friend packaging.
need a higher level of customer education and
orientation. Customers may even convert the packaging into money
if the packaging were exchangeable for cash. Some
Differentiated products try to claim a new space in the packaging are so beautiful, they can create their own
mind of the customer different from the spaces occupied value as collectibles
by existing products. The performance benefits may be
close to existing products but there would be additional Place
benefits on special aspects of the product.
INITIAL LOCATION SCREENING
Copycat products will not make much impression on
the consumer's mind. The marketer should make up for • The number of customers residing or working in
this lack of mental space by offering more physical the area, and the number of customers who
space in the shelves, lower prices, easier access, frequently pass through the area
promotional freebies, and the like. Aggressive • The density or number of customers per unit
advertising may add to market demand but at a greater area.
cost than the leading brands. • The access routes of alternative locations and
their traffic count in those routes.
Niche products do not intend to compete directly with • The buying habits of customers or where they
the giants. They are products with lower reach, lower buy, at what time and how frequent.
visibility, lower prices, and lower top of mind. They are • Location features such as parking spaces, foot
content to play minor roles in specific and smaller access, creature comforts, and the like.
market segments.
In a similar way, the entrepreneur must be able to always important. For instance, most parents will send
determine the price that comes with the location because their kids to the nearest elementary or high school.
it will spell out the success or failure of the business. However, when it comes to college, most students
The entrepreneur has to consider the following: wouldn’t mind going to a faraway university if it means
getting the best education possible in the course of their
1. The cost of buying or renting, renovating, and choice.
operating the location.
2. Customer Traffic Flow - Customer traffic flow refers
2. Customer volume, drop-in rates (what to the people that regularly come into contact with your
percentage of customer traffic would stop by the business establishment. Your shop might not be near to
store) and sales conversion rates (what customer’s homes or workplaces but it might be suited
percentage of drop-ins would actually purchase somewhere along their daily routes. Higher traffic flows
something from the store). mean higher drop-in rates for stores along the traffic
route. Important data to research include daily volume of
3. Revenues based on the volume and mix of goods people and/ or vehicles passing through, as well as
and services expected to be sold at certain information on the “peak hours” and the “slow hours.”
prices.
3. Industry Clustering - A lot of competitors clustered
4. Profits in one location usually draw in a bigger market to the
The final choice of location must be based on the area. Three stores side-by-side offer more choices to
following: customers than one stand-alone store. The downside is
that clustering also results in fiercer competition. As
1. IMAGE AND LOCATION CONDITIONS. such, some entrepreneurs prefer to establish a monopoly
This refers to the physical look of a location, far away from competitors.
sanitary conditions, crime and safety levels, etc.
The reputation of a location is also important. 4. Convergence of Multiple Industries - Location
where multiple industries converge, such as central
2. EXACT FIT TO TARGET CUSTOMERS. Is business districts, shopping malls, and public markets
the location traffic generally composed of your are able to attract more customers because of one-stop
target customers? shopping convenience. But again, competition is usually
strong in such areas.
3. CLUSTER OF COMPETITOR
ESTABLISHMENTS. This oftentimes results 5. Population Concentrations - Urbanization creates
in drawing a bigger market to the location. population concentrations. Where people live, goods and
service follow. The greater the number of people, the
4. FUTURE AREA DEVELOPMENT. A certain greater the number of needs and wants to be satisfied.
location might not have the most customers or Simply put, the more populous the location is, the
the best economics in the short term, but it might greater is the opportunity for the business and profit.
become a central business hub within the next
five years. 6. Activity Hubs - Like large schools, high-rise
buildings, public parks, transport terminals, and
5. FISCAL AND REGULATORY entertainment centers where activities take place that is
REQUIREMENTS. An entrepreneur would participated by good number of people.
want to set up shop in a town or city with low
tax rates, good governance, excellent 7. Growth Potential - when a place gets saturated with
infrastructures, and great public services. many providers of goods and services, it is time to look
for a new site. Early locators will catch the early
RELEVANT LOCATION DRIVERS customers.

• It would benefit the entrepreneur to do an in- 8. Business Climate - when finding a location for your
depth analysis. The entrepreneur can make use business, you have to take note of the environment or
of the following relevant location drivers for what we call business climate.
location selection. These are the ‘musts’ in
choosing the location for your business. o High economic growth Stable political
situation Effective social services Good
1. Physical Proximity to Target Market - Ideally, the infrastructures Cheap utilities Efficient
best locations should be easily accessible from home or Transportation and logistics Availability
the workplace. However, physical proximity is not of skilled labor force Low crime rates
 Good fiscal incentives Trusted public find it more convenient than going to the
official shop themselves. However, this limits
them to taste, feel, and smell the product
9. Cost of Doing Business and Producing Goods and they are trying to buy.
Services - Locations with lower cost of doing business
and lower cost of producing goods and services must 6. Upscale vs Downscale – Well-off
also be taken into consideration when choosing a place customers tend to spend more in upscale
for your business. places but downscale places attract great
number of customers even with lower
Comparative Location Analysis purchasing power.
Most common way entrepreneurs use to survey the right The geography and atmosphere decision tensions
location is to compare it with others that have the same provide alternative choices to the marketing strategist.
features. The final decision would depend on the positioning of
the enterprise and its product in the marketplace.
Keen observation is required if the entrepreneur wants to
draw insights from these favored locations. People
Geography and Atmosphere Determinants • Are the ultimate marketing strategy.
Another way of looking for the perfect location for your • People sell and push the products.
business can be based on two major place determinants:
Geography and Location • People search hard to find the right market.

Six Decision Tensions for Geography Determinant • People distribute, promote, price, and sell the products
in the most attractive market places.

1. Concentration vs Destination – • People aim to please the customers through continuing

Naturally, entrepreneurs would choose a service and product enhancements long after the
location where there is a large customers have bought the product.
concentration of target customers but the
eagerness of the customers to get away • People are the regular contact points between the
from the city-living stress gave way for enterprise and its market.
destination places.
The marketing efforts of people are organized at four
2. Access vs Abundance – Having easy levels
access to stores and shops to
1) To create customer awareness
accommodate your needs and wants is
2) To arouse customer interest
great but having the chance to choose
3) To educate customers as they evaluate their
from a wide variety of selections give
buying choices
you a different satisfaction.
4) To close the sale and deliver the products.
3. Clustered vs Dispersed – Clustered
To arouse the interest of customers, the enterprise can
competitors are offering diverse
use several people or organizational modalities
products and services while dispersed
competitors experience better results • First Modality is to outsource the people from
because they practically “own” the advertising agencies, events management outfits, call
market. centers, and telemarketers.
4. Developed vs Underdeveloped – • Second Modality is to build in-house capabilities by
Highly-developed areas of business hiring market researchers, brand managers, salespeople,
versus locating in relatively public relations officers, website writers, orchestrators,
underdeveloped areas differ in the price etc.
to put up your business. Developed
areas are usually expensive while the • Third Modality is to collaborate or enter into
latter is cheaper. partnerships with principals, distributors, dealers,
industry associations.
5. Physical vs Virtual – Some people
prefer virtual shopping because they
Educating customers in their evaluation process requires Availability — means that the enterprise has the goods
the enterprise to knwo the customer's or services on hand.
decision-making process.
Accessible — means that the customers can easily get
1. What and who are involved in the buying process? the product from their usual buying places or the
products can be conveniently delivered to them.
2. Where are the customers in the buying process? Are
they still canvassing and "shopping around"? Are they Adequate — means the product meets the quality and
currently focusing on a few candidates? Are they delivery specifications of the customer.
seriously evaluating the company's product?
Acceptable — means that the customer is convinced by
3. What are the next steps of the customers and how can the selling points of the product, finds very little or no
the company facilitate their next steps? What else do the objectionable features in the product, and accepts the
customers need to know and what issues must be conditionality, warranties, and amenities given by the
addressed by the marketer? seller.

CONSUMER EVALUATION PROCESS Affordable — means the price and payment terms are
right.
INITIAL PROCESS
Promotions
• Comparison of Product features and probable
results by: • Is the explicit communication strategy adopted
by an enterprise to elicit the patronage, loyalty,
o Window Shopping and support not only from its customers but also
from its other significant stakeholders. 
o Internet Browsing
• Promotion encompasses all the direct
o Brochures collection and comparison communication efforts of the enterprise, such as
advertising, public relation campaigns,
o Asking friends and relatives
promotional tours, product offerings, point-of-
• Word of mouth feedback sale displays, websites, flyers, emails, letters,
telemarketing, and others.
• Gut Reaction
Effective promotion depends on three critical factors:
MID PROCESS the credibility of the communicator, the message and the
medium of the message, and the receptiveness of the
• Customers who have tried the products before audience to all that is being communicated.

• Professional evaluator’s guidebook on • Before crafting promotion and communication

competing products strategy, the communicator must profile the target
audience very well.
• Testimonials from credible endorsers
• For a business promoter, it is important to get a very
• How often others are seen actually using the positive emotional reaction from the target audience. All
product or services messages must make an impact on the target audience—
sensory, emotional, and intellectual impact at that.
FINAL PROCESS
In developing a promotion campaign, the enterprise
• Final tests
should start with the target audience in mind.
• Physical Demo
At the beginning of its operations, the enterprise may
• Free trial period have a very limited market to cover. The narrower the
market coverage is, the more focused the promotion
• Money-Back Guarantee Offer campaign should be.

Finally, the sale must be closed and the products should As the targeted audience becomes bigger, the marketer
be delivered to the customer. Closing the sale demands can shift from a rifle to a shotgun approach. Electronic
that the product he available, adequate, acceptable, and mails, websites, letter blasts, radio broadcasts, and print
affordable. ads in certain publications might serve the purpose.
 8. Subsidy Pricing — a price for a product that is
reduced because the government has paid part of
Price the cost of producing it.

• Pricing depends on the business objectives set 9. Marginal Pricing — sets the price higher than
by the enterprise. the variable costs of a product but lower than the
• Non-price factors outweigh the price factor full costs in order to increase overall
whenever a customer is buying a premium item profitability.
because he or she is more particular about the
'premium-ness' in terms of quality, the status or CHAPTER 5: The Right Product for the Right
image that the product brings, shorter waiting Market:
time or immediate delivery, and other such
decision criteria. New Product Development

The enterprise should set the prices of its products or Successful new products spring from the convergence of
services based on its business objectives such as the the following:
following:
1) Creative Mind
1. Profit Maximization — is a short or long run 2) Technical Mind
process by which a business firm determines the 3) Business Mind
price, input, and output level that lead to the
maximized profit. All 3 minds come together in the entrepreneurial mind.
In reality, However, the 3 minds are seldom found in one
2. Revenue Maximization — the revenue- entrepreneur. However, the entrepreneur is certainly the
maximizing is derived by multiplying the orchestrator of the three minds.
different prices by their expected demand
volumes. The Entrepreneurial Mind

3. Market Share Maximization — is achieved by 1.) The Creative Mind

the price that obtains the highest volume of sales
• The Creative minds conceptualized and designs
possible without sacrificing too much
a product that consumers find some use for. It
profitability.
likewise produces a product that is pleasing to
4. Attainment of the Desired Prestige or Quality see, touch, smell, hear, and taste.
Leadership — as mentioned earlier, prices could • It also produces a product that creates emotional
be set at a premium to project a quality image attachment and eventually becomes a significant
and to distance the product from its inferior personal expression of the consumer
competitors. The idea is to attract customers
who are willing to pay extra for the quality 2.) The Technical Mind
difference. • The Technical Mind is the technology
5. Penetration, Survival, or Liquidation — at the originator. The entrepreneur may not necessarily
other end, prices can be set very low to survive possess the technical mind but is what drives
in a competitive market or to get rid of mounting him or her to convert new knowledge into
inventories and convert them into cash. The something highly functional and operational.
other objective of a low pricing strategy is to • The technical mind is also a technology adaptor.
penetrate the market fully and overtake the He or she uses old knowledge for application in
competition. various fields of human endeavor.
• The Technical Mind is the renderer. He or She
6. Scarcity Pricing or Market Skimming — resolves to make a new product work for the
products that are very scarce or rare would product creator by configuring and reconfiguring
appeal to a wealthier customers who wish to the technical design of the new product
belong to an exclusive club of owners.
3.) The Business Mind
7. Cost Recovery — charges a price that allows the
organization to merely recover its full costs. • The business Mind harness the potential of the
new products by creating the market space for
them. It also organizes sufficient forces and
resources to develop, launch and
 commercialized the new product in order to
maximize its market value.
• The business mind also manages the external &
internal business environment of the new
products, which goes beyond the product
development process itself