Entrepreneurship Quarter 1 Lesson 2, Summaries of Business

Download Entrepreneurship Quarter 1 Lesson 2 and more Summaries Business in PDF only on Docsity! Recognize a Potential Market What’s In In the previous lesson, you already know about the difference between businessman and entrepreneur. Knowing all the entrepreneurial concepts will not assure a person of becoming a successful entrepreneur and not all business people are entrepreneurs. Some says being an entrepreneur is a calling; a lot of qualities must be possessed to be considered successful and sustainable. So, if you are given a great opportunity to venture into the field of entrepreneurship, it may be a long process to undertake and the willingness to take a risk. Also, you're not only the one who’s in progress but at the same time, you're helping for the development growth of our economy. What’s New FIX ME Direction: Arrange the scrambled letters to form a correct word. 1. UPSIERSPL 6. UTSBETIUST 2. NISSUBES 7. ICEVERS 3. KERTAM 8. PECITIONMTO 4. EDICRRSTO 9. IMCLTEA 5. SUTEMOSRC 10. NTERTSAN What is It The creation of an entrepreneurial ideas leads to the identification of entrepreneurial opportunities, which in turn results in the opening of an entrepreneurial venture. The entrepreneurial process of creating a new venture is presented in the diagram below. (Aduana, 2017) Entrepreneurial Ideas Creation of Identification of entrepreneurial Opportunities Opening of entrepreneurial Venture entrepreneurial Ideas Figure 1. The Entrepreneurial Process of Creating New Venture Essentials in Entrepreneur’s Opportunity Seeking These are the basic foundation that the entrepreneur must have in seeking opportunities: Entrepreneurial mind frame. This allows the entrepreneur to see things in a very positive and optimistic way in the midst of difficult situation. Being a risk - taker, an entrepreneur can find solution when problems arise. Entrepreneurial heart flame. Entrepreneur's driven passion, they are attracted to discover satisfaction in the act and process of discovery. Passion is the great desire of an entrepreneur to achieve his/her goals. 10 The expertise and skills developed by a person who has worked in a particular field may lead to the opening of related business enterprise. For example an accountant who has learned the appropriate accounting and management skills and techniques in a prominent accounting firm can start his/her business venture by opening his/her own accounting firm. Forces of Competition Model It is also known as the “five forces of competition,” An industry environment is a competitive environment. Regardless of what product or services you have, competition is always present. Competition - it is the act or process of trying to get or win something. For example, the prices are lower when there is a competition among the stores. These are the five forces competing within the industry: e Buyers e Potential new entrants e Rivalry among existing firms e Substitute products e Supplier 1. Buyers The buyers are the one that pays cash in exchange to your goods and services. For example, the influenced of the price or in the bargaining strategy. The buyer has a strong and magnified bargaining power. The threat of its bargaining power will be less if the following factors notice: a. There are several suppliers available in the market. b. The buyer has the potential for backward integration. c. The cost of switching the supplier cost is minimal. d. The product represents a high percentage of the buyer’s cost. e . The buyer purchases large portions of the seller's product or services. 13 2. Potential New Entrants A new entrant is defined as the one who enters something. For example, the level of capital requirements, if the business requires huge capital, new entrants should decline to join the business. This gives a threat to the business. This can be notice if there is the presence of the following factors: a. Substantial capital requirement. . Strict government policy. Difficulty in accessing distribution channels. b. C d. Economies of scale e. High cost of product differentiation. f. High switching cost 3. Rivalry among Existing Firms Rivalry is a state or situation in which people or groups are competing with each other. For example it depends on the Marketing strategy of your competitor, like giving freebies and special offers. The intensity of rivalry among existing firms is characterized to the following factors: a. Diversity of rivals. Number of competing firms. Characteristics of the products or services. Increased capacity. Amount of fixed costs. ~"p ao Rate of industry growth. 4. Substitute Products Substitute means anything that takes the place or function of another. For example the consumers decide to use margarine as a substitute for butter. In case the price of butter increases, preferably the consumer will gradually switch to margarine. A substitute product can give a big threat in the industry environment if the following factors are notice: 14 o ao ® Switching cost is low. Preferences and tastes of the customers easily change. Product differentiation is highly noticeable The quality of substitute products dramatically improves. The price of substitute product is substantially lower. 5. Suppliers The Suppliers are the one that provide something that is needed or wanted. For example if the supply and services being offered is unstable or keep. The intensity of the threat is strong in this kind of the competitive force in the industry. This can be notice if there is the presence of the following factors: a. eoaog The supplier has the ability for forward integration. Suppliers in the industry are few, but the sales volume is high. Substitute products are not readily available in the market The switching cost is very high The product or service is unique. 15 © ©, " What I Can Do ( COMPLETE ME Complete the table below by supplying it with products that you consider similar. Write the product and not the brand in their respective columns. Then describe and differentiate its characteristics and uses. No. Primary Product Substitute Product . (Product name ) ( Product name ) Example Butter - expensive price used | Margarine — lesser price also used as as bread spread. bread spread 1. 2. 3 4 5. Assessment Direction: Encircle the letter of your choice. 1. It is the process of considering, evaluating, and pursuing market-based activities that are believed to be advantageous for the firm. A. Opportunity seeking C. Opportunity screening B. Opportunity seizing D. Sources of opportunity 2. This is essential to opportunity seeking which allows the entrepreneur to see things in a positive and optimistic light in the midst of crisis or difficult situations. A. Entrepreneurial mind frame C. Entrepreneurial heart flame B. Entrepreneurial gut game D. Entrepreneurial heart frame 18 3. It is the ability of entrepreneur that can sense without using the five senses, also known as intuition A. Entrepreneurial mind frame C. Entrepreneurial heart flame B. Entrepreneurial gut game D. Entrepreneurial heart frame 4. One of the essetials of entrepreneur's opportunity seeking that refers to the driven passion of an individual. A. Entrepreneurial mind frame C. Entrepreneurial heart flame B. Entrepreneurial gut game D. Entrepreneurial heart frame 5. What variable of societal environment includes income level and employment rate? A. Economic forces C. Political forces B. Sociocultural forces D. Technological forces For questions 6 and 7 refer to the following statements: A. Preferences and tastes of the customers easily change. B. The buyer has the potential for backward integration. C. The cost of switching the supplier cost is minimal. D. Product differentiation is highly noticeable. 6. Which are the factors of the substitute product that pose a great threat in the industry environment? A. AB,C,D Cc. AandD B. AandC D. BandC 7. Which are the factors that influenced the buyer to have a less threats because of the bargaining power? A. Aonly Cc. AandD B. AandC D. Band C 8. They are the one that pays cash in exchange to your goods and services. A. Buyers C. sellers B. Competitors D. suppliers 19 9. The intensity of rivalry among existing firms is characterized to the following factors except one: A. Diversity of rivals. B. Number of competing firms. C. Characteristics of the products or services. D. The product represents a high percentage of the buyer's cost. 10. The following are the forces competing within the industry except one: A. Potential new entrants and Substitute Products B. Buyers and Suppliers C. Rivalry among existing firms D. Needs and Wants 11. Which of the following good sources of entrepreneurial ideas determine the interest, hobbies and preferences of people. A. Changes in the environment C. People’s enterest B. Technological discovery D. Past experiences 12. Societal environment includes the following, except: A. Economic forces C. Political forces B. Sociocultural forces D. Natural resources 13. Which among the following is the result of identifying entrepreneurial opportunities? A. Creation of entrepreneurial ideas C. Sources of opportunity B. Opening of entrepreneurial venture D. Entrepreneurial process 14.What entrepreneurial idea will you recognized, if you consider the new discovery and advancement of technology as source of opportunity? A. Changes in the environment B. Technological discovery and advancement C. Government's thrust, programs, and policies D. People’s interest 15. Source of entrepreneurial idea where expertise and skills developeb by a person from its previous work can lead to the opening of a related business enterprise. A. Government's thrust, programs, and policies B. Past experiences 20