Planning is essential for business success. It involves thinking ahead about objectives, strategies, finances, production, marketing, profits and growth. Effective planning must be realistic, based on available resources, and flexible to adjust to changing conditions. Planning also develops over time, from an initial unplanned stage to eventually implementing annual and strategic plans. Proper planning can eliminate risks, minimize costs and improve business operations. Overall, planning is needed to organize resources and activities to accomplish business goals.

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Planning in plain and simple language is
thinking ahead. In business, it is thinking
ahead of objectives, strategies, financing,
production, marketing, profit prospects, and
growth possibilities.
Planning is :
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What to do.
How to do it.
When to do it.
What to expect in the future.

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Planning must be realistic. It must be based
on available sources – human, financial, and
physical resources.
Planning must be based on felt needs. The
objectives of the entrepreneur should fit the
needs of the people in a community.
Planning must be flexible. Resources, needs,
and economic condition change. Planning
should be adjusted to such change to be
effective and relevant.
Planning must start with simple projects.

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Unplanned stage. At the start of the business, the
owner-manager is busy looking for funds,
customers, materials, and equipment.
Budgeting – System stage. Eventually, the ownermanager realizes the need to develop and use a
budgeting system.
Annual planning stage. The owner-manager
drafts an annual plan. He can use either the top
down planning or bottom up planning.
Strategic planning stage. As the business
enterprise becomes bigger, a long range
planning is needed.

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The plan should state clearly its objectives.
The plan should provide measures for
satisfactory accomplishment of the objectives in
terms of quantity, quality, time and cost.
The plan should state the policies which should
guide people in attaining the objectives.
The plan should indicate what department or unit
will be involved in accomplishing the objectives.
The plan should indicate the time which should
be allowed for each activity.
The plan should specify the required resources
and their corresponding costs.
The plan should designate the officers who will
held accountable for the accomplishment of the
objectives.

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SWOT. The chances of a product or service
can be evaluated through the SWOT analysis.
Objectives. These should be specific and
realistic. Such objectives can be daily, weekly,
monthly and yearly.
Strategies. These are ways of accomplishing
the objectives.
Time frame. In business, time is gold. An
entrepreneur must be efficient in time
management.

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Evaluate your personal resources and
interest, and the resources of the community.
Analyze your market.
Choose a proper business location.
Prepare a financial plan.
Prepare a production plan.
Prepare an organizational plan.
Prepare a management plan.

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Planning can eliminate business risk because
it carefully studied the competence, interest
and resources of the entrepreneur against the
needs of consumers, together with the
presence of competitors.
Planning can minimize cost of production.
Planning can detect the weaknesses of the
business operations.

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When one starts to organize a business
enterprise, it is presumed that he has
conducted a feasibility or market study. That
is, he knows his resources, the needs of the
community and strengths of his competitors,
and so forth.
However, what count most is the personal
characteristics of the entrepreneur.
Hardwork, determination, creativity,
enthusiasm, and human relations can make
the difference between success and failure.

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More than one hundred years ago, a young man
from Bavaria went to the United States as an
immigrant. His objectives was to seek his
fortune. Little success at first encouraged him to
return to his country. But he decided to try
prospecting for gold in California. At that time all
roads led to California. Likewise, luck was not for
him as a gold prospector.
However, the young man recognized the needs of
his fellow gold prospectors for sturdy and
durable work pants. Exploiting his talent for
tailoring and using his last money, he put up his
tailoring shop. Over the years, his business
prospered. Until it became transnational in
operations. The name of the young immigrant is
Levi Strauss.

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He did not discover gold in California. But
just the same acquired something worth
more than gold. The Levi Strauss and
Company has become largest apparel
company in the world. Famous chain stores
throughout the world sell Levi’s jeans. Annual
sales have been recorded at $3billion.

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Personal Satisfaction. They enjoy challenges and
risk taking ventures.
Family involvement. They feel it is their
responsibility to continue the business of their
parents, specially if it is profitable.
Independence and power. They want to be the
boss.
Social activities. They are people who are really
born socializers. They love social activities.
Profit expectations. They go to business because
this is the best way for them to become rich.

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An organization is a group of two or more
persons who work together to attain a
common set goals.
Organizing is a process of combining and
coordinating resources and activities in order
to accomplish efficiently and effectively
certain objectives.

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There are three most forms of business
organization in a capitalist economy. These are
the:
Sole or Single Proprietorship. Owned and usually
managed by one person.
Partnership. It is an association of two or more
persons who act as co-owners of a business.
Corporation. It is an artificial being created by
operation of law, having the right of succession,
and the powers, attributes and properties
expressedly authorized by law or incident to its
existence.

16. Advantages
Disadvantages
• Ease & low cost of formation &
dissolution
• Unlimited liability
• Retention of all profits
•Lack of stability
• Independence & flexibility
•Limited access to credit
•Tax advantage & less
government regulation.
• Limited business skills and
knowledge

17. Advantages
Disadvantages
• Easy to organize
• Unlimited liability
• Availability of more capital &
credit.
• Lack of stability
• Retention of profits
• Management disagreement
• Better business skills &
knowledge
• Idle investment

18. Advantages
Disadvantages
• Limited liability
• Difficult to organize
• Easy to raise capital
• Strictly regulated and
supervised by the government
• Perpetual life
• Some corporations are
socially irresponsible
• Specialized management
• Formal and impersonal
employer-employee
relationship

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The Cooperative Code defines a cooperative
as 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 contributions to the capital required
and accepting a fair share of the risk and
benefits of the undertaking in accordance
with the universally accepted principles of
cooperation.

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Credit cooperative
Consumers cooperative
Producers cooperative
Marketing cooperative
Service cooperative
Multipurpose cooperative

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Authority passes from the highest to lowest
level. This is called line of authority.
Staff Authority is not a part of a chain
command. Its job is to provide support,
advice and expertise to line authority.
Both line and staff officers are needed for the
efficient operation of the enterprise. The line
managers make decisions while the staff
managers assist in the making of decisions.

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Financial. The entrepreneur must be
knowledgeable about the financial aspects of
business decisions.
Marketing. The entrepreneur must be well versed
on the 4Ps of marketing: product, pricing, place &
promotion.
Managerial skills. The entrepreneur must be able
to identify the strengths & weaknesses of his
personnel.
Overall personal decision-making process. The
entrepreneur should have a thorough evaluation of
what is to be attained by going into business, and
what human and financial resources are available &
necessary.

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Plan the business
Select the appropriate form of business
organization
Scout for reasonable credit or financing
Choose a good location
Secure licenses/ permits for the business
operation.
Setup records for financial, physical and
personnel resources
Insure the business if necessary.
Promote the business
Manage the business
Do your social responsibility

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All business organizations have resources
and goals. Resources require proper
allocation and efficient use. Goals must be
effectively achieved. These and many more
can made possible through good and just
management.
Without efficient and effective management, a
business organization cannot survive.

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Management is a process by which a
cooperative group directs actions towards
common process by which a cooperative
group directs actions towards common goals.
◦ Joseph Massie – Essentials of Management
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Management is the process of coordinating
the resources of the organization in order to
achieve its primary goals.
◦ Robert Hughes – Business
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Management is both art and science.

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The role of business management should not
only to maximize profits for its stockholders,
but also to help jobless.
It is the social responsibility of management
to employ such resources for the good of the
economy and society.

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Material resources. These are tangible,
physical resources which are used for
production.
Financial resources. These are funds.
Human resources. It is the people who plan
and implement business activities.
Information resources. Correct and complete
information is vital to the success of any
business organization. Without information, it
is impossible to formulate good plans and
programs.

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Establish goals of the enterprise and develop
plans to attain goals.
Organize people and other resources to
achieve goals.
Lead and motivate people towards the goals
of the enterprise.
Maintain sufficient control system to ensure
that the enterprise is moving well towards its
goals.

30. Efficient and effective managers possess
skills that are vital in performing their
functions.
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Technical skills
Conceptual skills
Interpersonal skills
Diagnostic skills
Analytic skills

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Risk is a part of business. It can be both
within the control or beyond the control of
the entrepreneur.
Types of non-criminal business risk:
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Fire
Natural Calamities
Personal Liabilities
Economic problems
Business interruptions
Loss of key personnel

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There are business risk which are criminal in
nature. Such risk are personally planned or
intended. These are:
Burglary
Robbery
Shoplifting
Employee theft