ENTREPRENEURSHIP

PLANNING THE
ENTERPRISE
 WHAT IS ENTREPRENEUR?

 Someone who exercises initiative by organizing a

venture to take benefit of an opportunity and, as the
decision maker, decides what, how, and how much of
a good service will be produced.
 An entrepreneur supplies risk capital as a risk taker,
and monitors and controls the business activities.
The entrepreneur is usually a sole proprietor, a
partner, or the one who owns the majority of shares
in an incorporated venture.
 WHAT IS ENTREPRENEURSHIP?

Entrepreneurship is the process of

discovering new ways of combining
resources.
 WHAT IS A BUSINESS PLAN FOR?

Business plans written prior to setting up

an enterprise, which are similar to a
prefeasibility study and a feasibility
study.
 BUSINESS PLAN FORMAT

 I. Introducti on
 a. The Business Concept and the Business Model
 b. The Business Goals: Vision, Mission, Objectives, and Performance targets
 c. The Business Offering and Justification
 II. Executive Summar y
 III. The business proponent s: Organizer s with their capabilities and
contributions
 IV. The Target customer s and Main Value propositi on to the customer
 V. The Market, Market Justificati on based on the Industr y Dynamics and the
Macro Environmental factor s af fecting the oppor tunities and threats in the
market, the size, potential and realistic share of the market
 VI. The product and ser vice of ferings
 VII. The enterprise strategy and enterprise deliver y systems: Business
Competitiveness
 VIII. The Financial Forecasts and Expected returns, risks, and contingencies
 IX. Environmental and regulator y compliance
 X. The capital structure and financial of fering: returns and benefits to
investor s financier s, and business par tner s
 CONTENTS OF THE BUSINESS
PLAN
 1. How will the business raise revenues? What
critical factors will cause the revenues to
materialize?
 2. What will be the costs of the enterprise products
and other costs of doing business? How will these
costs be managed to ensure confortable profits?
What critical factors will drive the costs? How can
these factors be controlled?
 3. What will be the major investments of the
enterprise? Why will these investments give the
enterprise a competitive edge?
 4. How will the enterprise finance the investments?
How will the enterprise fund its growth?
 THE BUSINESS GOALS: VISION, MISSION,
OBJECTIVES, AND PERFORMANCE TARGETS

The business goals show the future and long-

term prospects of the enterprise. It is
composed of the vision, mission, objectives,
key result areas, and performance indicators
of the enterprise.
 CASE EXAMPLE 1: DOUBLE HAPPINESS

 The vision of Double Happiness is “to establish a

commanding presence and market leadership as a
food chain servicing major bus terminals in central
luzon within the next five years.”
 The Business goals are communicated by articulating
the basic purpose of setting up the enterprise in a
mission statement. Needless to say, all business
enterprises are established for the purpose of
making money for its investors.
 for Double Happiness, its mission statement is “to provide
quality food and passenger convenience services that would
generate suf ficient profits for the stockholders and improve
the lives of its employees. the vision and mission statements
must then be translated into measurable end results, more
popularly called objectives.
 objectives must be more specific that the vision and mission
statements. They should be measurable, achievable, and time-
bound.
 for double happiness, their stated objectives are:
 1. to establish a strong market presence in central luzon
 2. to earn good financial returns for its owners;
 3. to delight customers with high quality food and services; and
 4. to make double happiness a happy and rewarding place to work in
 The objectives should then be translated into KRAs. KRAs are the
qualitative manifestations that the objectives are being achieved.
Double Happiness, KRAs for each of the objectives are as follows:
Objectives Key Result Areas
 1. To establish a strong market presence in Central Luzon
 a. Number of food outlets in major bus terminal in Central Luzon
 b. Sales volume attained
 c. Market share in central luzon
 2. To earn good financial returns for its owners
 a. Amount of net profits realized for the next five years
 b. Return of equity (ROE)
 c. Return on assets (ROA) or Return on investment (ROI)
 d. Return on sales (ROS)
 3. To delight customers with high quality food and services
 a. Growth in sales per outlet
 b. Percentage of repeat customers
 c. Number of customer commendations or complaints
 d. Awards and recognition given by the community or the government for excellent
service
 e. Customer survey rating to ascertain customers’ degree of delight
 EXECUTIVE SUMMARY

 The executive summary contains everything that is

relevant and important to the business audience.
 It is a synthesis of the entire plan.
 It must contain the major argumentations of the
business proponent on why the business will work
and succeed.
 BUSINESS PROPONENT

There are four types of stakeholders:

1. Resource mobilizers and financial backers.
2. Technology providers and applicators
3. Governance and top management
4. Operating and support team
 TARGET CUSTOMERS AND THE MAIN
VALUE PROPOSITION

Target customers must be of sufficient size,

sufficient paying capacity, and have sufficient
interest to purchase the products being
offered by the enterprise.
Main Value Proposition is the unique selling
proposition of the enterprise.
 Market demand and Supply , Industry Dynamics and
Macro Environmental factors
 Product/Service Offering: Description, Evolution and
justification
 Enterprise Strategy And Enterprise Delivery System
 Financial Forecasts: Expected Returns, Risks and
Contingencies
 Environmental and Regulatory Compliance
 Capital Structure and Financial offering: Returns and
Benefits to Investors, Financiers and Partners
QUESTIONS?