Review Seminar Entrepreneurship Cycle 2

Summary

The seminar reviews entrepreneurship as more than starting a business. It involves identifying opportunities, solving problems, and coordinating the functions needed to operate and grow a business.

Core Business Functions

• Marketing: Promotes and sells products or services, and determines how customers will discover and buy the offering.
• Finance: Manages funding, income, expenses, and profit.
• Production and operations: Delivers products or services efficiently while maintaining quality.
• Human resources: Selects and manages employees, partners, and other contributors.
• Accounting: Records transactions accurately and tracks cash flows.
• Management: Plans, organizes, leads, and controls business activities.

Frameworks and Playbooks

CARL Method for Multiple-Choice Questions

• C — Comprehension: Understand what the question asks, especially words such as “except” or “not.”
• A — Anticipate: Predict the answer before reviewing the options.
• R — Removal: Eliminate clearly incorrect options.
• L — Leverage: Choose the best remaining answer.

Seven Ps of the Marketing Mix

The seven Ps are product, price, promotion, place, people, process, and physical evidence. The seminar recommends addressing these in a business proposal—for example, by defining the product and brand, explaining pricing, selecting promotion channels, and describing how customers access and experience the business.

Pricing Strategies

• Psychological pricing: Prices such as 19.99 may make an item feel cheaper.
• Competition-based pricing: Sets prices in relation to competitors, including pricing slightly below them.
• Demand-oriented pricing: Adjusts prices based on demand, as with seasonal travel or trending products.
• Cost-oriented pricing: Uses production costs and expenses as the basis for setting prices.

Product Lifecycle, Innovation, and Supply

The presenter emphasizes continually improving products and introducing features that keep pace with changing customer preferences.

When demand exceeds available supply, scarcity and upward price pressure may result. When supply exceeds demand, a surplus can push prices down.

Finance and Accounting Concepts

• Taxes: Income tax is described as being based on earnings; sales tax or VAT is charged on purchases; and excise tax applies to specified goods such as tobacco, alcohol, petroleum products, and automobiles. The presenter cites a 12% VAT and an income-tax schedule with a ₱250,000 annual threshold and rates rising from 15% to 35%. These figures should be checked against current Philippine tax rules.
• Owner’s equity: The owner’s investment or share in the business. Net losses reduce equity, while net income can increase it.
• Assets and liabilities: Assets are resources a business owns or uses to operate and earn money; liabilities are obligations it owes.
• Intellectual property: The seminar notes that creations and inventions are protected through intellectual-property law.

Profit Calculation Example

Starting with ₱20,000 in revenue:

1. Subtract ₱8,000 cost of goods sold to get ₱12,000 gross profit.
2. Subtract ₱5,000 operating expenses to get ₱7,000 operating profit.
3. Subtract ₱2,000 in further costs to reach ₱5,000 net profit.

Financial Statements

• A balance sheet summarizes assets, liabilities, and equity at a point in time.
• An income statement shows how revenue is reduced by expenses to arrive at net income.
• A cash-flow statement tracks cash moving into and out of the business over a period.

Customer Service, Operations, and Entrepreneurship

• Customer service: In a scenario about a Manila shop, poor treatment by an indifferent employee is identified as the strongest explanation for customers stopping their purchases. The seminar also links unmet expectations to customer loss and stresses the value of feedback and positive human interaction.
• Productivity: Good lighting and ventilation, as well as compensation for overtime, are presented as supportive conditions. Excessive pressure from employers is presented as counterproductive.
• Advertising and sales: Flyers and social-media posts are examples of promotion intended to increase demand. Magazine articles, newspaper placements, and billboards are also discussed as advertising channels.
• Entrepreneurial competencies: Investing despite uncertainty is associated with risk-taking; generating new ideas and new ways of doing things is associated with innovation.
• Operations and quality: Entrepreneurs are encouraged to consider how to produce or deliver efficiently while maintaining consistent quality.

Metrics and Examples

The seminar is a review session, not a company performance report. It provides no business growth, revenue, margin, CAC, LTV, churn, or operating targets.

Numerical examples include the ₱20,000-to-₱5,000 profit calculation, a hypothetical product price rising from ₱100 to ₱120 after a ₱20 excise charge, and the cited 12% VAT.

Other examples include seasonal demand for Christmas decorations or travel, tomato oversupply lowering prices, and a salon using flyers and social media to attract customers.

Presenter/source: Prof. (channel: Gerald Daguplo)