4th Quarter Flashcards
a written document which shows the conversion process which takes place in a business – from input to a desirable output.
4M’s of Operation
Usually used by businesses under the manufacturing sector
Production Plan
Used by servicing businesses
Operation Plan
In a full-blown business plan, this chapter includes the manufacturing process, product description, production plant location (vicinity map), production plant layout (floor plan), materials and equipment needed, and labor requirements.
4M’s of Operation
Two classifications of resources
human and nonhuman resources
The process to be followed in effectively manufacturing or delivering a product or service
Method
The right human resource who will handle certain business operations
Manpower
The technology used in efficiently operating the business operations
Machines
To be used in creating a product or performing a service
Materials
set of procedures and instructions which you must follow in order to achieve your goal
methods
the process of commencing and conducting business operations
methods
must always be systematic and people in the enterprise must be well-informed about this
methods
Using a flowchart will help the business visualize the actual method involved.
methods
the conversion of raw materials into finished goods that are acceptable to the customer’s standards
manufacturing of goods
services are intangible, and the only way the customer can appreciate the service is by remembering how pleasant his or her experience was
service delivery process
the process of bringing products or services to customers
distribution of goods and services
the entrepreneur must also establish a seamless payment process
payment process
has inputs, processes, and outputs as its elements.
manufacturing of goods
manufacturing sites
Home-based (the cheapest and highly flexible)
Commercial space for rent (if home is viable anymore)
Commercial space purchase (requires the biggest amount of capital expenditure).
step by step guide of the employees and the manufacturing equipment
manufacturing process flow
service businesses must be more meticulous when it comes to the service delivery process because services are intangible, and the only way the customer can appreciate the service is by remembering how pleasant his or her experience was
service delivery process
a detailed flowchart of the service business
service blueprint
the manufacturer will deliver the products to the distributors, wholesalers, retailers, and to customers.
supply chain/distribution channel
handles the invention, development and production of the product or service.
manufacturer
buy products or services from the manufacturers and sell them at a markup price to either wholesalers or retailers.
distributors
negotiate with buyers as to how much or how many are to be sold, so the manufacturer will be able to deliver the goods directly to the buyer.
agents
agents get the product in advance to demonstrate them to the customers return the merchandise to the manufacturers if unsold.
consignment
Enumerates the duties and responsibilities of the potential employee, including the scope, limitations, and terms and conditions of employment.
Job description
Educational background, work experience, specific skill or knowledge, and work attitude.
Employee qualifications
Screening of resumes, conduct of interviews, qualifying exams, or psychology tests.
Selection of Job Applicants
Job contract offer where the terms and conditions (position, responsibilities, salary and benefits, work schedule, regularization etc.) of employment are discussed
Job offer
Training of people
Employee Development
own products or services
Manufacturing
process of appointing third party manufacturers to do the production process which saves the entrepreneur in buying expensive machineries.
outsourcing
own products or services to a present supplier.
purchasing
The entrepreneur may consider the following:
- Cost
- Quality
- Availability
- Credibility of suppliers
- Waste that the raw materials may produce
storing the finished goods manufactured in a facility until they are distributed to end users.
warehousing
process of efficiently transferring the products to retailers or consumers.
transportation
refers to the products, materials, or supplies stored inside a warehouse before production, shipping, or selling.
inventory
basic tools to convert the input into output
machinery
order taking, internet marketing, reports, etc.
laptop and desktop computers
charging debit/credit card, tracking sales, storing data, and analyzing purchases.
POS Machines
accounting business transactions, profitability sales, inventory, etc.
accounting & inventory software
order taking, 24/7 marketing, online conversations, collecting customer information, etc.
website
Act to regulate the use in business transactions of names other than true names, prescribing the duties of the director of the Bureau of Commerce and Industry in its enforcement, providing penalties for violations, thereof, and for other purposes.
RA 3883 - Business Name Registration
Promotes and regulates business activities by registering and licensing business.
DTI (Department of Trade and Industry)
Issues barangay clearance, mayor’s business permit, certificate of final electrical inspection, and health and sanitary permit.
LGU (Local Government Unit)
Enforces tax, laws, assesses and collects all national revenue taxes, fees and charges.
BIR (Bureau of Internal Revenue)
Enforce social and labor legislation to protect the working class and regulate the relations between workers and employers. Must be secured if you employ 5 workers or more.
DOLE (Department of Labor and Employment)
Agency in charge of development and monitoring cooperatives in the country; autonomous independent organization
CDA (Cooperative Development Authority)
Processes applications and issues a certificate or registration for partnerships and corporations
Securities and Exchange Commission
Aims to protect its members and beneficiaries [14% of an employee’s monthly salary] employer 9.5% [employee: 4.5%]
Social Security System
National savings program and affordable shelter financing for the Filipino worker fixed monthly contribution of P200 (50/50 – employer: employee).
HDMF / PAG-IBIG
Aims to provide Filipinos with financial assistance and access to affordable health services. Employer: 50% of contribution Employee: 50% monthly deducted on salary.
Philippine Health Insurance Corporation
How to Register as Sole Proprietorship
- Register a business name at the Department of Trade and Industry
- Register with LGU
a. Barangay
b. Mayor’s Office - Register with the Bureau of Internal Revenue (BIR)
a. Form 1901 (Application for Registration for Sole Proprietorship)
b. Form 0605 (Payment/Remittance Form)
c. Form 2303 (Certificate of Registration)
is not only the making of sales, that is, effecting ownership transfers; but also identifying prospective consumers, stimulating demands, and providing information and service to buyers.
Selling
Using psychological pressure on the customer by appealing to their fear, greed, and pride to sell a given product or service.
Aggressive Selling
Focuses on one-time sales, with the ultimate goal of making the maximum number of sales from the maximum number of customers.
Transactional Selling
The seller, acting as a trusted advisor, assists the buyer in identifying needs and offering solutions within their relationship.
Consultative Selling
Involves developing a partnership between buyer and seller.
Collaborative Selling
form of electronic commerce which allows sellers to directly sell goods or services to a buyer over the Internet using a web browser.
Online Selling
“It shall be unlawful to offer any consumer product for retail sale to the public without an appropriate price tag, label, or marking publicly displayed to indicate the price of each article, and said products shall not be sold at a price higher than that stated therein and without discrimination to all buyers.”
RA 7394, ARTICLE 81 – PRICE TAG REQUIREMENT
Specifically prohibits the manufacture, importation, exportation, sale, offering for sale, distribution, transfer, non-consumer use, promotion, advertising or sponsorship of health products (including medical devices and supplies) without the proper authorization.
RA 9711, ARTICLE 81 – FOOD AND DRUG ADMINISTRATION ACT OF 2009
Record keeping; accounting part that records transactions and business events in the form of journal entries in the accounting system
bookkeeping
Value of resources owned by a company and is expected to provide future economic benefit.
asset account
Costs a company incurs for conducting business and generating revenue.
Expense Account
Amount a company owes.
Liability Account
Shareholders’ interests in the company’s assets.
Equity Account
Reflects the amount of money generated from operating and non-operating activities.
Revenue Account
Increase in value from activities not related to the core business.
Gain Account
Opposite of a gain account, reflecting a decrease in value from nonprimary-business events.
Loss Account
increases assets and expenses, and lowers income, liabilities, and equities.
Debit
reduces assets and expenses, and increases revenue, liabilities, and equity. Also, it is the money owed to a supplier / vendor by an enterprise.
Credit
process of predicting the future based on the past and present data and analysis of trends.
forecasting
expenses or costs incurred by a business to conduct its operations on a certain time frame
operating costs
expenses that have to be paid even if no production takes place
fixed cost
expenses that depend on the amount of food that is produced
variable cost
the expenses incurred during the process of creating a new business; the amount of money that is needed to buy the facilities and equipment, to register and license the business and get the necessary certificates
start-up costs
include a business plan, research expenses, borrowing costs, and expenses for technology
pre-opening startup costs
include advertising, promotion, and employee expenses
post-opening startup costs
Essential tool for managing a business of any size; month-by-month forecast of the level of sales you expect to achieve; selling price per unit multiplied by the number of units sold.
Sales
Direct cost to producing the goods that your business sells; Cost of Sales if your business is a service provider
Cost of Goods Sold
The net amount of cash and cash equivalents being transferred into and out of a business; Cash received are inflows, and money spent are outflows.
cash flow
Describes money flows involved directly with the production and sale of goods from ordinary operations.
cash flow from operations
Reports how much cash has been generated or spent from various investment-related activities in a specific period.
cash flow from investing
Shows the net flows of cash that are used to fund the company and its capital.
cash flow from financing
A “blueprint”; a written document describing in detail how a business is going to achieve its objectives
business plan
a brief introduction to your business plan; describes your business, the problem that it solves, your target market, and financial highlights; written last but appears first in the business plan
Executive Summary
Furnish relevant information about the company, its legal operation, the principal owners, and key personnel.
mission statement
What you want to accomplish (specific goals that can be measured), as well as how you’d achieve your goals.
objectives & key to success
Start-up cost, marketing, sales, and inventory cost. Funding for the company comes from two major sources: owners’ investments and bank loans.
financial requirements and features
Straight Schedule vs. Preferred Payments
Return on Investment (ROI)
The what and why of your business; This is where you elaborate on what you do (and the product or service you offer), who you serve, and why you’re different (and better) than the competitors
Business Description
One individual who owns and operates the enterprise.
Sole Proprietorship
General Partnership vs. Limited Partnership
Partnership
A blend of sole proprietorship/ partnership and corporation Owners have liability protection like corporations but less paperwork. Member or owner of this is allowed a full participatory role in the business’s operation.
Limited Liability Company (LLC)
A business organization that’s intended to promote educational or charitable purposes.
Nonprofit
The enterprise exists as a legal entity separate from its owners. This type of business structure separates the liabilities and obligations incurred by company operations from being the responsibility of the owners.
Corporation
Designed to provide enough facts to convince an investor, potential partner or other reader that your business has enough customers in a growing industry and can earn sales DESPITE the competition.
Market Analysis
indicates where your products or services fit in the competitive environment.
Competitive Analysis
describes both the strategy and tactics you will use to get customers to buy your products or services.
sales and marketing plan
Best way to expose your services/products/ brand identity to possible customers
Marketing Channel
Logo, business cards, website, etc.
marketing materials
Cost-plus pricing, Demand pricing, Competitive pricing, Price skimming, Penetration Pricing, Value-Based Pricing
pricing strategy
Describes your management team, staff, resources, and how your business ownership is structured.
ownership and management plan
describe just how the business functions continuingly.
operating plan
summary of your funding criteria, your detailed financial statements and an overview of your financial statements.
financial plan
place to include any additional documents that will help to build the legitimacy of your business concept, your product, marketing, services and so on.
appendices and exhibits
