GROUP ACTIVITY 1

Take a look at your city/municipality and the surrounding towns. What are the
notable customer, market, industry, and other sources of opportunities? Now imagine
that an investor gave your group P1,000,000.00 to start a business in response to these
opportunities. What would you do?

To help you out in this project, follow the instructions below:

1. List at least five (5) opportunities that can be found in your surrounding area.
2. Brainstorm on several possible businesses for each opportunity. Your
groupshould have at least two (2) business proposals for each opportunity.
3. Compile the listed opportunities and proposals into a report following the format
below.

OPPORTUNITY BUSINESS PROPOSAL

1. Lack of Internet Access in 1.1 Establish an internet café
most barangays/towns 1.2 Set-up low-cost Wi-Fi hotspots
for restaurants and eateries.

4. Be as creative as you can be! Don’t be afraid to tackle difficult

opportunities or come up with expensive ideas. Assume you have
P1,000,000.00 to invest.
5. Discuss your opportunities and proposals with your teacher and the
rest of the class. He or she should help you decide on the top three
to five (3 to 5) most promising proposals.
OPPORTUNITY SCREENING
Means the narrowing down of your choices.

The Personal Screen

 Do I have the drive to pursue this business to the end?

 Will I spend all my time, effort, and money to make the business work?
 Will I sacrifice my existing lifestyle, endure emotional hardship and forego my usual comforts
to succeed in this business?

The 12 Rs of Opportunity Screening

1. Relevance to Vision, Mission and Objectives of the Entrepreneur

 Is your chosen business relevant or related to your vision or mission as an entrepreneur?

2. Resonance to Values
 The opportunities or business you choose to pursue matches your values and desired
virtues.

3. Reinforcement of Entrepreneurial Interests

 Choose an opportunity that is close to your interest and hobbies.

4. Revenues
 Is it saleable?

5. Responsiveness to Customer Needs and Wants

 Opportunity must fill well with unfulfilled customer desires

6. Reach
 Opportunities that can be expanded by adding similar products or services, branches or
franchise deals and have good prospects for achieving rapid growth

7. Range
 Must have wide range of possible products or service offerings, to attract more
customers

8. Revolutionary Impact
 Opportunity must be “the next big thing” in the market.
 A game changer

9. Returns
 Opportunities that have a low cost of production or servicing but higher prices would
most probably yield the higher return on sales and return on investments.

10. Relative Ease of Implementation

 The best opportunities are ones that are easy for you to implement but very difficult for
others.

11. Resources Required

 Must have resources for launching your business.

12. Risks
 The more risk there are in the opportunity, the less attractive it will be
 GROUP ACTIVITY 2

Screen each opportunities that you chose in Group Activity 1 using

the 12 Rs and the Opportunity Screening Matrix seen below

Instructions:

1. Provide a weight for each R. The most important thing you gave to a
criterion, the higher the weight
2. Rate the quality of each opportunity in relation to the 12 criteria. For
the first ten Rs, 5 is the best score. For the last two Rs, the scoring is
reversed. Very high resource requirements means a score of 1 while
the have low resource requirements means a score of 5. The more
resources needed, the less attractive the opportunity.
3. Multiply the rating for each criterion with the assigned weights to
come up with the score.
4. Total the weighted score
5. Repeat the process for your listed opportunities.

** The opportunities with the highest total scores are likely the best ones
for you

Table 2.1 Opportunity Screening Movie

CRITERIA VERY HIG AVERAG LOW VERY SAMPLE SCOR

HIGH H E LOW WEIGH E
T
Opportunity Screen Grid for Each Opportunity
RATING 5 4 3 2 1 WEIGH SCOR
T E
RELEVANCE 2
RSONANCE 1
REINFORCEMENT OF
1
ENTREPRENEURIAL INTERESTS
REVENUES 2
RESPONSIVENESS 1
REACH 1
RANGE 1
REVOLUTIONARY IMPACT 2
RETURNS 4
RELATIVE EASE OF IMPLEMENTATION 1
RATING 1 2 3 4 5
RESOURCES REQUIRED 1
RISKS 20
TOTAL SCORE
*Rating x Weight = Score
LESSON 3 PREPARING A BUSINESS PLAN

Definition

BUSINESS PLAN is “a formal statement of a set of business goals, the reasons why they are
believed attainable, and the plan for reaching those goals. It may also contain background information
about the organization or team attempting to reach those goals.”

Focus of a Business Plan

Business plans target intermediate goals required to reach the external goals.

Feasibility Study

The preparation of a Business Plan compliments the project Feasibility study. The feasibility study
is a major information source in making a critical decision whether to go or not to go into the business.

The advantages of writing down the results of the feasibility study are as follows:
 The findings can be set out in a clear and logical way, so that potential lenders can understand
the business and its likely risks/advantages. The document helps the entrepreneur to clarify and
focus his/her ideas.
 It is a reference material that can be used to plan long term development of the business.
 The plan can be regularly consulted and updated as a guide to the business development.
 Mistakes can be made on paper rather than in the operation of the business.
 When the plan shows that a successful business is possible, it makes the entrepreneur feel more
confident to succeed.
 It helps the entrepreneur to decide on how much money is needed and if properly prepared, it
gives the loan agency confidence that their money will be repaid.

Comparison between a Feasibility Study and a Business Plan

a. A feasibility study is conducted before a decision to proceed (go/no go)
b. A business plan is prepared after a decision to proceed (go/no go)
c. A feasibility study provides an investigative function
d. A business plan provides a planning function

BUSINESS PLAN OUTLINE

1.0 Executive Summary

2.0 Opportunity
2.1 Problem worth Solving
2.2 Solution
2.3 Mission and Vision Statement
3.0 Market Analysis Summary
3.1 Market Segmentation
3.2 Target Market Segment Strategy
3.2.1 Market Needs
3.2.2 Market Trends
3.2.3 Market Growth
3.3 Key Customers
3.4 Future Markets
3.5 Competition
3.5.1 Competition and Alternatives
3.6 SWOT Analysis

4.0 Execution
4.1 Marketing Plan
4.2 Sales Plan
4.3 Location and Facilities
4.4 Equipment and Tools
5.0 Production Plan
5.1 Product Description
5.2 Production Process
5.3 Tools and Equipment
5.4 Raw Materials and Availability
5.5 Production Cost
6.0 Company and Management Summary Organization Structure
6.1 Organizational Structure
6.2 Company History and Ownership
6.3 Management Team
6.4 Management Team Gaps
6.5 Personnel Plan
6.6 Personnel Policies
7.0 Financial Plan
7.1 Total Project Cost
7.2 Projected Profit and Loss (5 years)
7.3 Projected Balance Sheet ( 5 years)
7.4 Business Ratios
7.4.1 Break-Even Analysis
 7.4.2 Gross Profit Analysis
7.4.3 Cash Payback Period
7.4.4 ROI
8.0 Business Implementation and Timetable

GROUP ACTIVITY NO. 3 (WIDE NOTEBOOK)

FEASIBILITY STUDY

A. MARKET POTENTIAL
1. Target Market (Describe in detail who your targeted customers are)
2. Competition Assessment (Describe who your competitors are. Identify their strengths and
weaknesses)
3. Estimated Market Share and Sales (What portion of the market can your business
attract? Based on this, come up with a monthly sales forecast)

B. TECHNOLOGY ASSESSMENT AND OPERATIONS VIABILITY (Accomplush the Operations

Viability Assessment Table. What outcomes do customers desire? What process and inputs are
necessary to achieve these outcomes?

PRODUCT-
MARKET/
INPUTS THROUGHPUTS OUTPUTS OUTPUT- OUTCOMES
OUTCOME
MATCHING
(right quantity (bring goods and
(right quantity and (high productivity, (desired end
quality and costs, services to
quality) efficiency, economy) results)
time) customers)
 Money  Resource flow Customer’s
quality, delivery
 Fix
 Operating and price
between
systems and expectation
outputs
procedures  Goods
 Manpower and
 Management produced
 Management outcome
 processes,  brendere
 Methods expectatio
supervision, d Sales, volume,
 Materials n
and control market share
 Machinery  Correct
 Quality
marketing
control during
mix
process
Financial results

C. INVESTMENT REQUIREMENTS AND PRODUCTION/SERVICING COST

1. Investment Requirements (Identify the pre-operating costs, facilities investments, and
working capital investments needed to jumpstart your business)
2. Production/Servicing Costs (Identify all operating costs. What is the total monthly
operational cost of running the business?)

D. FINANCIAL PROSPECTS (Create a monthly income statement based on the estimated

operating costs and sales forecasts)

Note:
1. Each part should be backed up with research. For instance, you may want to visit your
municipal/city hall to get data on demographics (age, income, occupation). To get details on the
operation and finance.
2. To make the project easier, you may choose to subdivide the group into three units: marketing,
operations and finance. The marketing unit can focus Part A, operations with Part B, and the
finance on Parts C and D.