What kind business do

you like to put up?

FACTORS TO CONSIDER

Resources
SKILLS
INTERESTS
Am I really interested in this kind
of business?
Am I willing and able to sell this
product/service?
Is there a demand for such
product/ service?
Do i have resources
for the business?

Do i have skills to

undertake the
business?
Basic Features of
Customer Satisfaction

Price
QUALITY
CONVENIENCE
What is entrepreneurial
activities?
• Entrepreneurs engage in various
activities- some big, some small and
others in between. Their activities could
be trading, manufacturing or service
business. They are supported by either
the family members or members of the
community as employees.
Entrepreneurs are found not only in big
cities but in small towns as well,
catering to the needs of people.
 Three types of
entrepreneurial business

1. Trading or
merchandising
2. Manufacturing
3. Service business
1.) Trading
Trading or merchandising is the buying of goods and
selling the same without change in form. When goods
are sold in small quantities, it is called retailing. When
goods are sold in big quantities or in volume, it is
called wholesaling. The process of buying and selling
is also called trading or merchandising. A common
example of retailing is the “sari-sari” store. Most
retailing is done in retail stores.
Types of retail store
• Self-service retailer
• Department store
• Convenience store
• Door to door seller or direct marketer
• Vending machine
• Superstore
• Combination store
2.) manufacturing
Process of converting raw materials into finished
products. The manufacturer buys the raw materials. He
makes the raw materials to finished products by
applying direct labor and factory overhead.
• Raw materials
• Direct labor
• Factory 0verhead
3.) Service business
Service business is doing work for others.
Examples of service businesses are beauty
parlors, spas, barber shops, laundry shops, and
repair shops. Medical, dental, accounting, legal
and other services of professionals are also
examples of service businesses.
Business Opportunities in
Rural Communities
• Rural areas have abundant with
cheap raw materials and labor
force.

• The productive resources in the

rural sector are sleeping
business potentials.
Resources in the Community to be
evaluated:
Market
Individual Interests
CAPITAL
SKILLS
SUPPLIER OF INPUTS
MANPOWER
TECHNOLOGY
SWOT Analysis
- is a management tool of
analyzing business
opportunities. It studies the
strengths and weaknesses
of the product/service,
together with its threats
and opportunities.
- stands for STRENGTHS,
WEAKNESSES, OPPORTUNITIES
and THREATS
 STRENGTHS
 Cheap and abundant raw materials
 Sufficient funds Availability of technology
 Presence of skilled workers
 Management and technical expertise
 Good quality/service
Ease of production
 Small capital
 WEAKNESSES
High price
 Poor quality/service
 Weakness in management
 Lack of skilled workers
 Irregular supply
 Unattractive design
 High costs of production
OPPORTUNITIES
 Big demand for the
product/service
 Favorable government
policy/support
 Scarcity of the product/service
 Poor quality of existing
product
 Absence of product/service
 Possibilities of good profits
 THREATS
 Shortage of raw materials at a given time
 Entry of many competitors
 Increasing costs of production
 Expectation of unfavorable government
laws, such as taxes
 Deteriorating peace and order
 Emergence of unfair demands of workers
through labor union activities.
LINKAGES OF RESOURCES
- Can be the source of business
opportunities using backward
or forward integration.
Backward Integration – is the
ownership or control of the inputs
of production by the enterprise.

Forward Integration – it is the

ownership or control of the
marketing system by the
enterprise.
 Horizontal Integration – it buys or
control some of its competitor.
However, this is unfavorable in the
point of social interest.

Example: Sun Cellular Company

and Smart Corporation
PRODUCT LIFE CYCLE
• The product life cycle describes the period of time over
which an item is developed, brought to market and
eventually removed from the market.
• PLC management makes the following three assumptions:
– Products have a limited life and thus every product has a life cycle.
– Product sales pass through distinct stages, each posing different challenges,
opportunities, and problems to the seller.
– Products require different marketing, financing, manufacturing, purchasing,
and human resource strategies in each life cycle stage.
PRODUCT LIFE CYCLE

Four Stages:

Introduction
Growth
Maturity
Decline
PRODUCT LIFE CYCLE

Sales

Profit
Profit

Intro Growth Maturity Decline

Introduction Stage
• In the introduction stage, the firm seeks to build product awareness and
develop a market for the product. The impact on the marketing mix is
as follows:
– Product branding and quality level is established, and intellectual property
protection such as patents and trademarks are obtained.
– Pricing may be low penetration pricing to build market share rapidly, or high
skim pricing to recover development costs.
– Distribution is selective until consumers show acceptance of the product.
Promotion is aimed at innovators and early adopters.
– Marketing communications seeks to build product awareness and to
educate potential consumers about the product.
Growth Stage
• In the growth stage, the firm seeks to build brand preference
and increase market share.
– Product quality is maintained and additional features and
support services may be added.
– Pricing is maintained as the firm enjoys increasing
demand with little competition.
– Distribution channels are added as demand increases and
customers accept the product. Promotion is aimed at a
broader audience.
Maturity Stage
• At maturity, the strong growth in sales diminishes. Competition
may appear with similar products. The primary objective at this
point is to defend market share while maximizing profit.
– Product features may be enhanced to differentiate the
product from that of competitors.
– Pricing may be lower because of the new competition.
– Distribution becomes more intensive and incentives may be
offered to encourage preference over competing products.
– Promotion emphasizes product differentiation.
Decline Stage
• As sales decline, the firm has several options:
– Maintain the product, possibly rejuvenating it by adding
new features and finding new uses.
– Harvest the product - reduce costs and continue to offer
it, possibly to a loyal niche segment.
– Discontinue the product, liquidating remaining inventory
or selling it to another firm that is willing to continue the
product.
Extending the Product Life Cycle
• For successful products, a business will want to do all it
can to extend the growth and maturity phases of the life
cycle, and to delay the decline phase.
• Examples of extension strategies are:
– Advertising
– Price reduction
– Adding value
– Explore new markets
– New packaging
Extending the Product Life Cycle
 MARKET RESEARCH
The systematic way of evaluating
business opportunities is by
Market Research.

Definition:

The process of systematically

gathering, recording, and
evaluating data regarding a
specific marketing problem.
Market research method
-The process of gathering, analyzing
and interpreting information about a
market, about a product or service and
about the past, present and potential
customers for the product or service.
Types of market research data
• Primary information. This is research you compile
yourself or hire someone to gather for you.
• Secondary information. This type of research is already
compiled and organized for you. Examples of secondary
information include reports and studies by government
agencies, trade associations or other businesses within
your industry. Most of the research you gather will most
likely be secondary.
Most effective source of primary information
• A group survey. Used mostly by big business, group interviews
or focus groups are useful brainstorming tools for getting
information on product ideas, buying preferences, and
purchasing decisions among certain populations.
• The in-depth interview. These one-on-one interviews are
either focused or nondirective. Focused interviews are based
on questions selected ahead of time, while nondirective
interviews encourage respondents to address certain topics
with minimal questioning.
Secondary information sources:
• Public sources. These are usually free, often offer a lot of good
information, and include government departments, business departments
of public libraries, and so on.
• Commercial sources. These are valuable, but usually involve cost factors
such as subscription and association fees. Commercial sources include
research and trade associations, such as Dun & Bradstreet and Robert
Morris & Associates, banks and other financial institutions, and publicly
traded corporations.
• Educational institutions. These are frequently overlooked as valuable
information sources even though more research is conducted in colleges,
universities, and technical institutes than virtually any sector of the
business community.
Common types of market research
Market Segmentation
• Market Segmentation is a process of dividing the
market of potential customers into different groups
and segments on the basis of certain characteristics.
The member of these groups share similar
characteristics and usually have one or more than
one aspect common among them.
Product Testing
• A detailed understanding of how your product meets
(or doesn’t meet) your customer’s needs is crucial
both to product development and marketing, so
these types of market research studies need to be
conducted throughout a product’s life.
Advertising Testing
• Like product testing, tests of your advertising
campaigns can save you valuable time and resources.
By taking potential campaigns directly to your
audience and gauging their response you can focus
on creating truly impactful advertising.
Satisfaction and Loyalty Analysis
• Satisfied customers are not necessarily loyal, but
consistently measuring customer satisfaction is a
great way to increase customer retention. This type
of research is aimed at identifying key drivers of
satisfaction and measuring the likelihood of
customers to continue using a company’s products
and services.
Goal of Satisfaction and loyalty analysis
• Determine what factors influence loyalty, advocacy, and repeat
purchases, including product/service attributes, company
operation, customer service, price, etc.
• Carefully monitor overall satisfaction, recommendation likelihood,
and defection likelihood over time.
• Provide early warnings about emerging gaps in product/service
performance, customer service, and processes that might lead to
customer defection.
• Help identify areas of the product or service that need
improvement to meet changing needs.
Brand Awareness and Reach
By conducting regular, well-designed brand awareness surveys you can keep
tabs on how effective your marketing campaigns really are. When done right,
a brand awareness survey can help you measure:
• Brand Recall
• Brand Recognition
• Brand Identity
• Brand Image
• Brand Trust
• Brand Loyalty
• Customer Profile
Pricing Research
• Surveys that ask customers to choose between different
products with unique features and price points, typically
done via conjoint analysis(how people think, advance
market research method), can help you identify what
features are most valuable to your audience and what
they’d be willing to pay for them. Combined with some
basic research on your competitors’ pricing, these
insights can give you a distinct advantage in pricing your
products and services.
 Uses of Market Research
Market research helps entrepreneurs identifying the
following:

1. Profitable markets
2. Saleable products/services
3. Strength and weaknesses of the
competitors.
4. Available resources
5. Business risks
STEPS in Market Research
1. Defining the problem
2. Making a preliminary
investigation
3. Planning the research
4. Gathering the data
5. Analyzing the data
6. Researching a
conclusion/decision
7. Implementing and evaluating
decisions
6. Trends in consumer
tastes/preferences.
7. Better marketing
strategies
8. Proper business locations
9. New market opportunities
10. Realistic business
objectives
Community needs
What is a need?
• anything one can not do without it , in other words,
the concept of needs describes the situation or
circumstances in which something is lacking, or
necessary or requiring some course of action to
provide satisfaction.
What is Community Needs
Assessment?
• It seeks to gather accurate information
representative of the needs of a community.
Assessments are performed prior to taking action
and are used to determine current situations and
identify issues for action. Needs assessments
establish the essential foundation for vital planning.
Needs Assessment
• an extension of the strategic planning process. Strategic
planning confirms, transforms or develops a new mission
and vision; characterizes the nature of the business;
furnishes a sense of direction for the organization;
identifies the goals necessary to achieve the mission;
develops specific plans to carry out each goal; and
identifies essential resources such as people, property,
time, money, and technology to attain the goals.
How to conduct a training needs
assessment?
• Step 1: Determine the Desired Business Outcomes
• Step 2: Link Desired Business Outcomes With
Employee Behavior
• Step 3: Identify Trainable Competencies
• Step 4: Evaluate Competencies
• Step 5: Determine Performance Gaps
• Step 6: Prioritize Training Needs
• Step 7: Determine How to Train
• Step 8: Conduct a Cost Benefit Analysis
• Step 9: Plan for Training Evaluation
 Location of the Business
Location of the enterprise is a vital
factor in the success of a business. A
prime location is a great competitive
advantage.
To be able to make the right
choice of location, it requires
MARKET SURVEY.
Factors in Selecting a
Business Location
1. Population trends
2. Income trends
3. Retail sales trends
4. Competition
5. Transportation facilities
6. Government policies
7. Environment (health and sanitation)
8. Electricity
9. Water supply
10. Communication facilities
11. Peace and order
12. Fire protection
13. Parking space