FACTORS TO CONSIDER IN STARTING A BUSINESS AND TYPES OF BUSINESS Flashcards
means that there should be a clear and documented vision-mission and strategies to begin with. Start right by “beginning with the end in mind.”
FOCUS AND ATTENTION
different sources of capital that can be used depending on the needs to start the venture. These can be from personal funds, family and friends, a retirement account, banks/financial institutions, a government loan, and/or the stock market.
SOURCE OF CAPITAL
Building good relationships and working with other people could help start the business.
GOOD NETWORK
- It is very important to 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.
LEGAL REQUIREMENTS
- Consider the degree of risk related to a specific business opportunity. A business is said to be risky when the probability or chances of failure is high.
DEGREE OF RISK
- There should be a strong research and development that should be undertaken. The government should provide adequate support to investors, scientists and engineers and their new technologies to commercialize their Research and Development products.
RESEARCH AND DEVELOPMENT
creativity, opportunity seeking, self-confidence, persistence, commitment, and risk-taking, as well as technical background and related experiences needed to run the particular business, are necessary to start running the business.
PERSONAL COMPETENCIES
- Resources pertain to raw materials, human resources, and machineries/equipment. Knowing where and how entrepreneurs get their materials and where they source them is vital.
AVAILABILITY OF RESOURCES
owned as usually managed by one person. They register with the Department of Trade and Industry (DTI)
SINGLE PROPRIETORSHIP
is an association of two or more persons who act as co-owners of a business. Each partner contributes money, property or service to the business. They register with Securities and Exchange Commission (SEC)
PARTNERSHIP
an artificial being created by operation of law, having the right of succession, and the powers, attributes and properties expressly authorized by or incident to its existence.
CORPORATION
a duly registered association of persons, with a common bond of interest, who have voluntarily joined together to achieve a lawful common social or economic end, making equitable contribution to the capital required, and accepting a fair share of the risks and benefits of the undertaking in accordance with the universally accepted principles of the cooperatives.
COOPERATIVE
four (4) forms of business, based on ownership, namely:
SINGLE PROPRIETORSHIP
PARTNERSHIP
CORPORATION
COOPERATIVE
– it has an asset size not exceeding Php 50,000. it is usually a home -based enterprise, operating in makeshift or temporary quarters.
MICRO ENTERPRISE
an asset of Php 250,000 but not exceeding Php 500,000. it is a home-based business which is often managed and operated by the members of the family.
COTTAGE ENTERPRISE
has an asset of Php 500,000 but not exceeding Php 2.5 million. It is owned by an individual or group and has enough resources to continue operating. It employs from 10 to 20 people.
SMALL ENTERPRISE
an asset of Php 5 million to less than Php 20 million and employs 1000 or more workers. It is owned by a single individual, business partners, or a corporation. It employs more than 20 to 100 people.
MEDIUM ENTERPRISE
an asset of Php 20 million or more. It is often owned and managed by a corporation. It is large in scope of operation and number of products or services that it offers to the market.
LARGE ENTERPRISE
There are three (3) forms of business, based on its activities, namely:
SERVICE BUSINESS
MERCHANDISING BUSINESS
MANUFACTURING BUSINESS
commonly known as the “buy and sell” business. Products are bought from manufacturers or other merchandisers and are sold as is at an amount higher than the purchase price.
MERCHANDISING BUSINESS
businesses focus on providing intangible products such as offering professional skills, proposals, and expertise.
SERVICE BUSINESS
a type of business wherein materials are bought to create a new product.
MANUFACTURING BUSINESS
products that are processed from raw materials that are consumable. They are things that people use such as clothes, shoes, tables, books, cosmetics, toys, jewelry, and many more.
GOODS
activities which help are demanded by consumers based on their needs and wants. Examples of these services are medical, dental, banking, transportation, printing, publishing, insurance, education, and wellness programs.
SERVICES
exploitation of vegetal and animal natural resources, harvesting, breeding animals, and etc.
ARCHITECHTURE, FORESTRY, AND FISHING
extraction of minerals occurring naturally as solids (coal and ores), liquids (petroleum), or gases (natural gas).
MINING AND QUARRYING
physical or chemical transformation of materials, substances, or components into new products
MANUFACTURING
activities of providing electric power, natural gas, steam, hot water, and permanent infrastructure (network) of lines, mains and pipes
ELECTRICITY, GAS, STEAM, AND AIR CONDITIONING SUPPLY
activities related to the management of various forms of waste, such as solid or non-solid industrial or household waste.
WATER SUPPLY, SEWERAGE, WASTE MANAGEMENT, AND REMEDIATION ACTIVITIES
general construction and specialized activities for buildings and civil engineering works.
CONSTRUCTION
whole sale and retail sale of any type of goods and the rendering services
WHOLESALE AND RETAIL TRADE
provision of passenger or freight transportation, whether scheduled or not, by rail, pipeline, road, water, or air and associated activities
TRANSPORTAION AND STORAGE
provision of short-stay accommodation for visitors and other travelers and the provision of complete meals and drinks fit for immediate consumption
ACCOMODATION AND FOOD SERVICE ACTIVITIES
financial service activities, including insurance, reinsurance and pension funding and activities to support financial services
INFORMATION AND COMMUNICATION
acting as lessors, agents and/or brokers in one or more of the following: selling or buying, renting real estate or providing other real estate
REAL ESTATE ACTIVITIES
specialized professional, scientific and technical activities
PROFESSIONAL, SCIENTIFIC, AND TECHNICAL ACTIVITIES
variety of activities that support general business operations.
ADMINISTRATIVE AND SUPPORT SERVICE ACTIVITIES
– a wide range of activities to meet varied cultural, entertainment and recreational interests of the general public, including live performance, operation of museums sites, sports, gambling and recreational activities
ARTS, ENTERTAINMENT, AND RECREATION
activities of governmental nature, normally carried out by the public administration
PUBLIC, ADMINISTRATION, AND DEFENSE
education at any level or for any profession, oral or written as well as by radio and television or other means of communication.
EDUCATION
provision of health and social work activities, involving a wide range of activities
HUMAN HEALTH AND SOCIAL WORK ACTIVITIES
activities of membership organization, the repair of computers and personal and household goods
OTHER SERVICE ACTIVITIES(as a residual category)
