entrep - prelims

entrepreneurship

Entrepreneurship is the practice of social and economic empowerment through free enterprise

entrepreneurship

the process of recognizing opportunities and transforming them into visible, marketable concepts that benefit the entrepreneur, the consumers and the rest of society.

entrepreneur

a person who destroys the existing economic order via new products, new methods, new organizations and new uses of available materials.​

micro enterprise (M)

\
* **1-9 employees​**
* **977,670  (90.5%)​**

**Combined small, medium large enterprise**​

**(SMEs+)**​

* Employed at 10-99, 100 – 199, 200 and over​
* 102,968 (9.5%) ​

clousure

happens when **companies start to cease business operations for a period of time**, **lay-off employees**, and then **file for bankruptcy before ceasing operations permanently**.

o   Increasing job loss among population

o   A damaged and fluctuating supply chain

o   The ongoing massive closure of big and small business

What are the effects of the global pandemic on our business environment and how business is done today? The most visible “grassroots” effects are that we have been impacted by:

* capitalization
* quality of human resources for operations and strategic positioning
* position in the E-commerce space
* consumer response ro crisis/market
* market size
* understanding the digital economy
* adoptability and responsive

Factors Determining Business Survival in a Crisis

capitalization

* How much money a business has, and how deep their pockets can go​
* Does a business have enough money to last through the length of potential crisis/ downturns

Quality of human resources for operations and strategic positioning

Qualified and competent manpower, flexibility of planned strategies and processes (production, marketing, training, quality assurance, etc.) are the anchors of business stability and growth

Position in the E-commerce space

* To what extent a company has pivoted itself into creating and working with an online infrastructure as a channel for business activities to happen​
* Readiness and access to adapting online alternatives as essential to business

Consumer Response to Crisis/ market changes

* Consider how sensitive your consumers are to market conditions and to what extent these impact their spending and consumption habits​
* excessive consumer dependency where you are more of a “market taker” can make or break a business 

market size

* Niche vs mass markets, small vs large-crowd markets​

understanding of the digital economy

Businesses who are technologically aware and in touch with digital trends in the market have an edge over those that do not.

apadtability and responsiveness

Businesses who are able to pivot their practices to fit the situation and respond quickly to shifts in market demand will do better compared to those who do not.

startups

young companies founded to develop a unique product or service, bring it to market and make it irresistible and irreplaceable for customers.​

disruptors

Many startups are known within their respective industries as:

startup

**Rooted in innovation**, a ______ **aims to remedy deficiencies of existing products or create entirely new categories of goods and services**, disrupting entrenched ways of thinking and doing business for entire industries.

aptitude-abilities

* WHAT YOU CAN DO
* Refer to **natural inclinations** and **acquired skills** that people have, which allow them to do certain activities and do them really well.​

attitude

* WHAT YOU ACTUALLY DO
*  refers to how people process their thoughts and feelings (this includes their perception and feelings about different aspects of life (family, money, friendships, work, etc.), and demonstrate them in the form of observable behaviors​
* are often more innate and thus people are usually tied to what comes naturally to them​
* in some cases, people can choose to alter their _______ in ways that are personally and professionally beneficial to them.

aspiration

* WHAT DRIVES YOU
*  refers to what drives an individual’s disposition to do what they do & how they respond to adversity (the extent of one’s personal motivations, inspirations & triggers)​
*  This includes: ​
* goal-orientation/ ambition​
* grit/ resilience​
* locus of control​
* ambiguity/ risk-tolerance​
* Opportunity-seeking

ego

decisions can be clouded by one’s __

sense of entitlement

Thinking that the world owes you something

self-focus

Losing sight of what customers need​

pessimism

negativity can be toxic especially in a crisis

complacency

Leads to diminished or missed opportunities.

**Resistance to Change**

Refusal to accept what is new - Change is permanent, YOU are NOT. ​

**fear of the unknown**

 hinders calculated risks.

entrepreneurial ecosystem

o   A dynamic (changing), self-regulating (check itself overtime, independence to sustain yourself) network of many different types of actors and factors involved in entrepreneurial activity

o   Its essence lies in the successful interactions (collaboration & trust) among the actors (people) involved and how they respond to conditions outside their control

o   Any form of economic activity can also bring about physical changes in the environment

6 pillars of the entrepreneurial ecosystem

* from the vantage point of the entrepreneur, there are internal and external factors that need to be considered in the ecosystem they operate in

markets

* the nature of consumers; expertise in production; efficiency of distribution to business partners and stakeholders
* entrepreneur’s network (connections), the diaspora of networks; the relationship among businesses micro, SME’s, MNCs

policy

* quality of leadership and government
* the extent of support for enterprise (finance, R&D, tax, incentives, legislation)
* response to urgent crisis or challenge

finance

* access to financial capital to fund business
* understanding of debt management

culture

* attitudes, belief, and practices, in the workplace or within institutions; perception towards enterprise
* success stories that can be models of enterprise

human capital

* level of skilled/unskilled workers
* quality and access to education and training

supports

* infrastructures (facilities, transport, telecommunications, etc)
* accessibility to/ availability of essential professional services
* non-government support programs (private sector)

policy

* Public support for the industry verbalized by key politicians​

markets

* Healthy exports and buyer traffic in domestic & international fashion fairs​

human capital

* Diverse design schools and internships in major designer brands​

supports

* Industry association of fashion designers organize bi-annual fashion week​

culture

* High brand value and pride in local/ domestic fashion​

finance

* Private firms investing in steady performing startups​

sole proprietorship

* personally owned by one individual. This also means that the **owner** has **unlimited liability**.​
* It is the default business entity that some freelancers establish to legitimize their business transactions. However, freelancer and proprietor are not synonymous. ​
* legally required to register with the Department of Trade and Industry (DTI), BIR, LGU Business Permit and other regulating gov’t agencies applicable. ​

partnership (joint venture)

* owned by two or more people, referred to as partners ​
* Partners invest money, property and/or expertise in a common business fund and share business profits among themselves (Capital partner vs. industry partner vs. Limited partner vs. General partner)​
* Partners still have a shared liability of all debts and obligations of the business, depending on each partner’s level of participation in the business and liability agreements they have agreed and arranged among themselves ​
* the bulk of liability within a partnership is also dependent on the extent of one’s involvement in the business ​
* Legally obliged to register with SEC, BIR, relevant LGUs and other regulating agencies​

corporation

* owned by several individuals called *shareholders*​
* is seen as a separate and distinct legal entity from its shareholders​
* Shareholder’s liability as owners is limited only to the extent of the capital contributions they have made to the corporation​
* This business is controlled by a board of directors OR board of trustees, and can be stock (organized for profit), or non-stock (not organized for profit), respectively​
* corporations are expected to have more extensive business activities and transactions, and thus are subject to more requirements and regulation. ​
* Registration of corporations are with the Securities and Exchange Commission (SEC), BIR, LGU and other regulating agencies​

VAT

* Any person or entity that exceeds PHP 3 million of Gross Sales or Receipts
* 12% VAT Payable (Output Tax less Input Tax)

Non-VAT

* Any person or entity that does not exceed PHP 3 million of Gross Sales and Receipts
* 3% of the Gross Sales/Revenue

opportunity

* a specific set of conditions that will encourage and allow entrepreneurs to create new business concepts (tangible and intangible), by combining and using resources for profit, while empowering the community and the environment around them. (Edralin, 2019)​

ideation

It is the identification and generation of  viable business ideas - through creative analysis, brainstorming and observation of the environment. Ideas can be found from **problems, changing trends, one’s own interests and experiences, existing products,** and **unique skills**.

* desirable - meets costumer need
* viable - generates profit
* feasible - technically doable

Characteristics of good business ideas

Desirability

(real) answers questions that assess whether there is a true need for the product by the market. \*\*(Desirability)\*\*​

Feasability

(win) answers whether you have a competitive edge & capability

viability

(worth it) ascertains that you are able to evaluate the profitability and strategic sense of your business idea.

partners

invest money, property, and/or expertise in a common business fun and share business profits among themselves.

captial partner

financial investor; majority partner which means invested the most.

industry partner

may not have the financial resources but have the expertise to run the business.

limited partner

similar to capital partner but doesn’t give a big amount of money

general partner

a partnership wherein there is equal liability of everyrthing