Entrepreneurship

1. Viability, Profitability, and Customer
Requirements

2. Lesson Objective:
• Screen the proposed solution/s based on
viability, profitability and customer
requirements.

3. What is Viability of a Business?
• The viability of a business is measured by its
long-term survival and its ability to sustain
profits over a period of time.
• A business is able to survive when it’s viable
because it continues to make a profit year
after year. The longer a company can stay
profitable, the better it’s viability.

4. What is Viability of a Business?
• A business demonstrates its viability by
making a profit every year of its existence.
Some say a viable business is one “with legs,”
and the Cambridge Dictionary says something
with legs can continue to exist and be
successful for a long time.

5. What is Viability of a Business?
• Viability is like trust. When your trsut in
someone is shaken, it’s almost impossible to
get it back. And when a business losses its
profitability, that’s difficult to recover. So
viability is linked to profit, but also to both
solvency and liquidity.

6. • In your community, what types of
products are viable/saleable? How will
you describe?

7. • Group Activity:
Conduct a survey of product viability in
your community. Identify viability problems and
cite possible solutions to answer the viability
problems.

8. What do you mean by profitability?
• is closely related to profit, but it is the metric
used to detremine the scope of a company’s
profit in relation to the size of the business.
• is a measurement of efficiency - and
ultimately its success or failure.

9. What do you mean by profitability?
• Is expressed as a relative, not an absolute,
amount. Profitability can further be defined as
the ability of a business to produce a return
on an investment based on its resources in
comparison with an alternative investment.

10. What do you mean by profitability?
• Although a company can realize a profit,
this does not necessarily mean that the
company is profitable.

11. Example:
Vjandep Pastel
Projected Income Statement
For the month of August 2017
Sales 33,000.00
Less: Cost of Sales 15,000.00
Gross Sale 18,000.00
Less: Operating
Expenses
Salaries 5,000.00
Rent 1,000.00
Utilities (lights & water) 3,000.00
Advertising Expense 500.00
Insurance 300.00
Transportation &
Communication
1,000.00
Total Operating Expenses 10, 800.00

12. Factors that affect Profitability:
• Raw Materials
• Manpower
• Natural Calamity
• Financial Status

13. Group Activity
• Based on the given example, each group will
make projected income statement of the
chosen business.
• is the business profitable or not?

14. What is Customer Requirements?
• Customer Requirements are the certain
specific expectations of product features or
characteristics with expected quality and
value that should be present in a product for
it to be deemed useful and desirable by the
customer. These are evolving expectations
which will never be same and keep evolving
with changing times, generations, technology
and trends.

15. Importance of Customer Requirements
• Customer requirements are the parameters for
which every product or service is designed to
fulfil. These requirements form the basis of
product design and launch. If these
requirements are not met, customer will surely
not buy the product and even if the product was
bought, the repeat business would not happen.
Customer requirements are similar to needs but
more specific, real and achievable.

16. Importance of Customer Requirements
• Customer requirements need to be properly
documented and refined to make sure that the
final product has all the features expected.
customer requirements should be well
prioritized and added to products whenever
possible.

17. Types of Customer Requirements
• There can be two types of customer
requirements:
• Tangible Functional Requirements
- These are mostly the tangible
characteristics, features or specifications that a
consumer expects to be fulfilled in the product. If
a consumer is availing a service as a product, then
various service requirements can take the form of
output requirements.

18. • Intangible Requirements
• Intangible aspects of purchasing a product that a
customer expects to be fulfilled. It consists of
elements like on-time delivery, service with a smile,
easy-payment etc. It encompasses all aspects of how
a customer expects to be treated while purchasing a
product and how smooth his buying process goes. If
a customer buys an AC, he/she expects the
company to support after purchase in installation
and setup seamlessly.

19. Customer Requirements
• Customer-Focused Strategy
Step 1. Develop Customer-Focused Business
Strategy
- It is helpful to segment customers.
Step 2. Listening to the various customer
complaints
Step 3. Learn how to identify customer segments.

20. Step 4. present findings to participants.
- Customer have needs and requirements. A
customer is anyone who requires the output(s)
of your process.

21. Customers want:
1. Cross-channel, cross-lifecycle customers service
2. Support for their common customer scenarios
3. To find answers quickly and easily-anywhere
-Search and navigation
-Premium search
-Adapt to Customer Behaviour

22. 4. Fresh answers, fresh knowledge
5. Forums for “how to” information. “your
involvement is requested...”
6. Timely and Responsive Escalation

23. Customer Requirements
1. Understanding the requirements of the
customers and markets.
2. Comparing them ith the standard operation
rules and performance.
3. Analyzing the feasibility of new requirements
not currently implemented.

24. Customer Requirements
4. Deploying agreed upon requirements.
5. Monitoring trends for upcoming demands
and aligning systems to satisfy them.