DEVELOPMENT OF

BUSINESS PLAN
Purpose for the lesson

 New information is important in

explaining the existence of
entrepreneurial opportunities
(Schumpeter)
Joseph Schumpeter
Austrian economist
Political scientist
Product innovation, marketing and
production methods
“An entrepreneur is an individual with
distinct social characteristics or
attributes”
“Very few can be considered as
entrepreneurs”
Factors to Consider in Starting a
Business

 Entrepreneurial opportunities
 Financial stability
 Self-fulfillment
 Helps the family
 Provide employment to others
Ways to Start a New Venture: Most
Frequently Used Forms

 Start-up
– a company which is recently
formed, where the founder establishes a
completely new business from scratch
 Buying an existing business - acquiring
either the shares of an existing company
or all of the assets of an existing
enterprise.
 Ways to Start a New Venture: Most
Frequently Used Forms
 Franchising – when the “owner  Jollibee
of the company that already  Mang Inasal
has a successful product or
service, licenses its trademark,  Ricky Reyes Salon
trade name and methods of  7-eleven
doing business to others in  Mini Stop
exchange for an initial
 Tapa King
franchise fee and royalty
payments
 Important Factors to Consider Before
an Entrepreneur can Actually Begin
an Enterprise
 Focus and Direction – objective grasp of the business and
where it will be headed many years from the start of
operation. There should be a clear and documented
vision-mission and strategies to begin with. Start right by
“beginning with the end in mind.”
 Sources and Capital – can be from personal funds, family
and friends, retirement account, banks/financial
institutions, government loan and/or stock market
 Important Factors to Consider Before
an Entrepreneur can Actually Begin
an Enterprise
 Good Network – like associations and professional groups,
childhood friends, family members, former classmates can be
drivers to build self-confidence and direction, providers of
information that are not readily accessible to others, suppliers of
raw materials as well as mentors and coaches.
 Legal Requirements – know the laws and regulations that govern
the type of business that will be opened to avoid major problems
that can arise if legal requirements are overlooked like copyright
and patent laws, environment and sanitation regulations as well as
labor codes.
 Important Factors to Consider Before
an Entrepreneur can Actually Begin
an Enterprise
 Degree of Risk – like limited market, stiff competition, high
cost of financing the business and few supply of needed
labor
 Research and Development – the presence of new
technology, science and knowledge transfer from
universities and public research centers to new and
growing businesses, support for the creation of new-
technology based ventures are good indicators to start a
business in the area
 Important Factors to Consider Before
an Entrepreneur can Actually Begin
an Enterprise
 Personal
competencies – like creativity,
opportunity seeking, self-confidence, persistence,
commitment, risk-taking and technical
background as well as related experiences
needed to run a business
 Availability
of Resources – pertaining to raw
materials, human resources and machineries and
equipment
Generalization and Abstraction for the
Lesson
The critical phase in the entrepreneurial
process is actualizing the entrepreneurial
mindset after opportunity recognition, when
the business idea is put into a final form
where the details are worked out and it is
transformed into something of value.