HENTREPLAN

1. HENTREPLAN
Chapter 3 - Entrepreneurship: Starting and Operating A
Small Business 4th
Ed.
Presented by: Mervyn Maico Aldana, Faculty SHTM

2.  Entrepreneurs find and take advantage
of opportunities that others don’t
recognize or cannot access the
resources to exploit.

3. Business Definition
 Before you can start a business, you
should define it along several
dimensions.
 Business definition includes the offer;
target market, and the product and
delivery capability – answering
questions of who, what, and how.

4. Elements of a Solid Business
Definition:
 The Offer
What will you sell to your customers? That is
called your offer and includes the complete
bundle of products and services you will be
bringing to the marketplace.
This should address not only the tangible
product or intangible services but its
benefits.
Ex. “We will offer quality food that will
promote good health among our customers.”

5. Elements of a Solid Business
Definition:
 Target Market
Which segment of the market are you
aiming to serve?
Defining your target market in a way that will
help you identify qualified potential
customers is an important factor in achieving
success.
This definition must be precise enough so
that you can identify a viable market for the
business and focus your marketing efforts.

6. Elements of a Solid Business
Definition:
 Production and delivery capability
How will you provide your offer to your targeted
customers? This includes how to perform the
key activities required to produce the product or
service, deliver it to your customers, and ensure
they are satisfied.
○ Includes the primary activities of:
Buying, developing, or manufacturing the product;
Identifying its potential qualified customers and selling
the product to them;
Producing and delivering the product or service; and
Receiving payment

7. What Sort of Organization Do You
Want?
 Each organization has the opportunity to
create a unique mission, vision, and
culture that will be supported by its
core values.

8. Company’s Core Values
 When you start your company, what
beliefs will you use to guide it? These
are the core values of your business.
 Core values include the fundamental
ethical and moral philosophy and
beliefs that form the foundation of the
organization and provide guidance
for all decision making.

9. Coca-Cola’s Core Values
 Leadership: The courage to
shape a better future
Collaboration: Leverage
collective genius
Integrity: Be real
Accountability: If it is to be,
it’s up to me
Passion: Committed in heart
and mind
Diversity: As inclusive as our
brands
Quality: What we do, we do
well

11. Company’s Mission Statement
 The mission of your business, expressed in
the mission statement, is a concise
communication of your purpose, business
definition, and values.
 The function of the mission statement is to
clarify what the business is trying to do in
the present, but it can provide direction and
motivation for future action through a clear
and compelling message.

12. Company’s Mission Statement
 A well-crafted mission statement will not
only tell your customers and employees
what your business is about, but can be
a guide for every decision you make.
 It should capture your passion for the
business and your commitment to
satisfying your customers.

13. Starbuck’s Mission Statement
 "Our mission: to inspire and nurture
the human spirit – one person, one
cup and one neighborhood at a time."

15. Company’s Vision
 The vision for your business is broader
and more comprehensive than its
mission, painting a picture of the overall
view of what you want your organization
to become in the future, not what it is at
the moment.

16. Company’s Vision
 The vision is built on the core values of
the organization.
 It should energize your people, and they
should embrace it with enthusiasm and
passion.
 The vision should be compelling across
the organization. It has to matter.
 Employees need to be empowered to
fulfill the vision.

17. McDonald’s Vision Statement
 “To be the best quick service restaurant
experience. Being the best means
providing outstanding quality, service,
cleanliness, and value, so that we make
every customer in every restaurant
smile.”

18. Company’s Culture
 The culture of an organization is largely
shaped by its leadership.
 Culture is composed of the core values
in action.
 Leaders of a company build a particular
culture by making the beliefs, values,
and behavioral norms explicit and
intentional.

19. Company’s Culture
 Culture includes factors such as risk
tolerance and innovation, orientation
with respect to people, teams, and
outcomes; attention to detail; and
communication norms.
 Organizational culture is learned by
members of the team in a number of
ways, including anecdotes, ceremonies
and events, material symbols, and
particular use of language.

21. Your Competitive Advantage
 For your business to be successful and
to fulfill your mission and vision, you will
need a strategy for beating the
competition. This will be your
competitive advantage, or core
competency.

22. Your Competitive Advantage
 Your competitive advantage is whatever
you can do better than the competition
that will attract a sufficient number of
customers to your business so it can
succeed.
 The competitive advantage must be
sustainable in order to create a long-
term viability.

23. Types of Competition
 Direct – selling the same or similar
products to the same market
 Indirect – selling different products that
compete for the same share of customer
spending

24. Find Your Competitive Advantage by Determining
What Customers Need and Want
 When you know your customers’ wants
and needs and your competitor’s
capabilities, you should be able to find a
competitive advantage.
 As you identify environmental trends
and search for product- or service-
opportunity gaps, there will be outside
forces at work: economic and social
forces, technological advances, and
political regulatory changes.

25. 6 Factors of Competitive
Advantage
1. Quality – can you provide higher quality
than competing businesses?
2. Price – can you offer a lower price on a
sustained basis than your competition,
or does your higher price reflect quality
and/or uniqueness?
3. Location – can you find a more
convenient location for customers?

26. 6 Factors of Competitive
Advantage
4. Selection – can you provide a wider
range of choices than your competitors
can?
5. Service – can you provide better, more
personalized customer service?
6. Speed/turnaround – can you deliver
your products/service more quickly than
the competition?

27. Is Your Competitive Advantage
Strong Enough?
 A successful company needs to do one of
the following:
Sell to a market that is large and growing
Sell to a market where the competition is able to
make a profit
Sell to a market where the competition is
succeeding but is not so powerful as to make it
impossible for a new entrepreneur to enter.
Sell a product or service that solves problems
consumers may have with the competition
Sell a product or service at a competitive price
that will attract customers

28. Is Your Competitive Advantage
Strong Enough?
 Also,
Understand the needs of your customers;
Have a sustainable competitive advantage
or multiple, evolving advantages; and
Deliver a product or service that meets your
customers’ needs at the right price.

29. Checking Out the Competition
 One useful exercise is to learn
everything you can about particular
competitors, especially those that have
earned the respect of the marketplace.
 Examine websites, track their
advertising and promotion, including
print, broadcast, internet, and
sponsorships.

30. Checking Out the Competition
 To determine whether you have a
competitive advantage that will enable
you to outperform your closest and
strongest competitors, ask these
questions:
Competitive offers: how does your offer
compare with those of your leading
competitors? What are the key features of
each?

31. Checking Out the Competition
 To determine whether you have a
competitive advantage that will enable
you to outperform your closest and
strongest competitors, ask these
questions:
Unique Selling Proposition (USP) – Based
on the comparison, what is your USP? USP
is the distinctive feature and benefit that sets
you apart from your competition. What is it
about your offer that your competitors
cannot or will not match?

32. Checking Out the Competition
 To determine whether you have a
competitive advantage that will enable
you to outperform your closest and
strongest competitors, ask these
questions:
Cost structure – what is different about your
business activities and the cost of doing
business, compared to your competition?
Overall, are you at a cost advantage or
disadvantage?