Republic of the Philippines

Department of Education
National Capital Region
DIVISION OF CITY SCHOOLS – MANILA
Manila Education Center Arroceros Forest Park
Antonio J. Villegas St. Ermita, Manila

ENTREPRENEURSHIP

https://fastpayltd.co.uk/blog/writing-a-gym-business-plan-10-step-guide-
to-gym-business-strategy/

Quarter 1 Week 5 Module 5

Learning Competency:
Screen the proposed solution/s
based on viability, profitability,
and customer requirements.
(CS_EP11/12ENTREP-0b-c-5)
Learning Module for Entrepreneurship

HOW TO USE THE MODULE?

As you start studying the module, I want you to set aside other task/s
that may disturb you while enjoying the lessons. Read the
instructions below to successfully enjoy the objectives of this kit. Have
fun!

Follow carefully all the contents and instructions

indicated in every page of the module.
Write in your notebook the concepts about the lessons.
Writing enhances learning, which is important to develop
and keep in mind.
Perform all the provided activities in the module.
Let your facilitator/guardian assess your answers using the
answer key card.
Analyze conceptually the post-test and apply what you have
learned.
Enjoy studying!

PARTS OF THE MODULE

 Expectations - This will give you an idea of the skills or
competencies you are expected to learn in the module.
 Pre-test - This will measure your prior knowledge and the concepts
you are to master all throughout the module.
 Looking back to your Lesson - This section will measure what
competencies and skills you have learned from the previous lesson.
 Brief introduction- This section will give you an overview of the
module.
 Activities - These are sets of activities you will perform with a
partner.
 Remember - This section summarizes the concepts and applications
of the module.
 Check your understanding - It will verify the concepts and
competencies you learned from the lesson.
 Post-test - This will measure how much you have learned from the
entire module

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Learning Module for Entrepreneurship

The possible product/s or service/s

Lesson
based on viability, profitability and
5
customer requirements

EXPECTATIONS
After going through the module, you are expected to:
 define viability, profitability and customer requirements
 analyze the viability, profitability and customer requirements of the
possible product/s or services offered

You may start your journey in learning how to screen the

proposed solution/s based on viability, profitability and
customer requirements. Are you excited to answer the Pre-test?
Smile and Enjoy!

PRE-TEST

DIRECTIONS: To check your prior knowledge about the topic, please analyze the
statements below. Write the letter of the correct answer in the space provided.

_________1. Which is referred to as the ability to survive as a business enterprise?

A. Challenge B. Viability
C. Survival Test D. Record Management
_________2. Which of the following is the correct acronym of SKU?
A. safe keeping unit B. stock keeping unit
C. standard keeping unit D. small keeping unit
_________3. At which point cost and income are equal and/or neither profit nor loss?
A. Increase on Sales B. Net Loss
C. Break-even D. Even Profit
_________4. Which of the following are considered perishable goods?
A. canned goods B. vegetables and fruits
C. RTWs D. dried fish
_________5. Which is referred to as cost of transporting goods in bulk by truck, train,
ship, or aircraft?
A. freight cost B. operation cost
C. production cost D. average cost

You have finished answering the pre-test. You may request your
facilitator/guardian to check your work. Congratulations and keep on
learning!

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Learning Module for Entrepreneurship

LOOKING BACK TO YOUR LESSON

As we go further, let us try to recall our lesson about determining the possible
product/s or service/s that will meet the need.

 Entrepreneurs must have a full knowledge as to what products are needed

in the society. The product will be for the satisfaction of the group of the
target market. It must be specific, identified from others, and easily be
recognized. An entrepreneur must conduct market research to determine
better the needs and wants of the target market.

 A product can be tangible or intangible in nature that can be offered for

satisfaction of the recipients and it may be an idea, a physical entity (a
good), service or any combination of the three. Product is the bundle of
satisfaction which the buyer receives as the result of a lease of purchase. It
includes the physical good or service itself. (Agustin-Acierto, M., 2017)

P Please answer the questions below. Good Luck!

DIRECTIONS: Read and analyze the statements below. Determine whether the
statement is TRUE OR FALSE. Write TRUE if the statement is correct and write
FALSE if otherwise. Write your answer in the space provided.
_____________1. Innovation comes from identifying customers’ needs and providing
solutions that meet those needs.
_____________2. Customer needs are the named and unnamed needs of customers
when they come in contact with the different business establishments or when they
search for the solutions which businesses provide.
_____________3. A product can be defined as anything that we can offer to a market for
attention, acquisition, use or consumption that could satisfy a need or want.
_____________4. Services are special form of product which consists of activities,
benefits or satisfactions offered for sale that are intangible and do not result in the
ownership of anything.
_____________5. Education in school is an example of a product.
_____________6. Anti-droplet face shield is an example of a service.
_____________7. Customers have the same needs.
_____________8. Customer feedback helps to evaluate customer satisfaction.
_____________9. Identifying clients’ needs creates satisfied customers.
_____________10. Brand name and trade mark are important in the marketing of
services.

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Learning Module for Entrepreneurship

BRIEF INTRODUCTION

The entrepreneur’s desire to establish his business is a

visible idea yet it must come into a test whether it is a viable
business option. It needs a careful analysis of opportunity
evaluation. The entrepreneur who fails to evaluate his noble idea
because of his eagerness to plunge into the business world often
discovers later that he has more problems to solve and at times
abandons the idea after spending his time and money (Agustin-
Acierto, M., 2017).

Definition of terms:

 Viability – refers to the ability to survive or persist. In a business sense,

that ability to survive is ultimately linked to financial performance and
position. A business is viable if (http://www.managementguru.net/
business-viability-checklist/, 2014):
 it is gaining a profit that is sufficient to provide a return to the
business owner while also meeting its commitments to business
creditors.
 it has sufficient cash resources to sustain itself through a period
when it is not returning a profit.

 Profitability – determines whether a business stays in business

(https://study.com/academy/lesson/what-is-profitability-definition-
analysis-quiz.html). It also refers to the ability of a company to use its
resources to generate revenues in excess of its expenses. It is a company’s
capability of generating profits from its operations
(https://www.myaccountingcourse.com/accounting-ictionary/profitability).

 Profit – refers to the revenue a business generates after it pays all

expenses directly related to the generation of the revenue, such as
producing a product, and other expenses related to the conduct of the
business activities (https://study.com/academy/lesson/what-is-
profitability-definition-analysis-quiz.html).

 Customer requirements - are those characteristics that determine whether

or not the customer is happy (https://www.sixsigmadaily.com/customer-
needs-and-requirements/).
Example: a requirement is that the iPad is user-friendly, has to be fast in
data storage and retrieval, etc (https://www.sixsigmadaily.com/customer-
needs-and-requirements/).

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Learning Module for Entrepreneurship

Starting Point of Conceiving the Idea of the Type of Business (Agustin-Acierto, M.,
2017):

1. Conceiving a new product is a process of innovation and when this comes into a
reality, the product must be different from an existing product.

2. New product needs customer evaluation and this process needs exposure to the
target market as to its economic value.

3. The entrepreneur must find a new approach to win customer on his side if the
product or service is similar to what is existing in the community.

4. He must know the strengths and weakness of his competitor and thereby devise
a new system of promotion and advertising such as product discounts, cash
discounts, raffles and other package of prizes. (Agustin-Acierto, M., 2017)

Things to Consider During a Product Viability Analysis

(https://www.bigcommerce.com/blog/evaluate-product-
market-viability/#undefined)

 Some serious strategic questions about the

product’s viability:

 Is the product idea practical?

 What obstacles or challenges lie ahead?
 Will it need support services of some kind to ensure customer
satisfaction?

 Tactical aspects of a product and its impact to business model:

1. Product Size and Weight

 If the product is large or heavy it may have high shipping costs.

 If customers are provided with free and fast shipping, it will
significantly increase the chances of winning their loyalty.
 If the product is small or light, it can minimize shipping costs and
satisfy customers’ desire for quick and easy delivery.

2. Product Fragility

 Fragile products are products that can be easily broken or damaged.

It needs extra attention when shipping to ensure they arrive in perfect

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Learning Module for Entrepreneurship
condition. Fragile goods will increase costs for shipping, inventory
and customer service.

3. Stock Keeping Unit Consider

 SKU refers to color, size and other variations of a single product. The
more SKUs, the more attention, time and money it will need to spend
in tracking and maintaining inventory, adding a level of complexity,
and to manage and distribute the product.

4. Product Lifespan

 Product lifespan is the time interval from when a product is sold to

when it is discarded. Having a consumable or disposable product is
often perceived as a great choice from a business perspective because
it improves customers’ loyalty and, ultimately, builds repeat sales.
 The challenge of selling perishable products like ice cream, frozen
yogurt, fruits, etc. are storages, shipping and production.

5. Seasonality

 Seasonality means that there are different levels of demand for a

product throughout the year.
 Consider the location of your target customers (if you’re selling
internationally or locally)
 In managing a seasonal product, there is a need to determine the
business downtime, and work to off-set expectations and costs during
those periods.

6. Price Point

 Selling a product with a higher price tag doesn’t prevent firms from
finding success. Example, firms offering fashion brands or luxury
items are able to find success through their product quality and
service to their customers.
 Make sure that prices are still attainable for the target customer.
 To determine the market viability, maintain functionality at the
forefront of quality and luxury.

7. Competition

 The more niche products are, the lesser the competition, thus, the
more leverage a firm has to win a large share of the market.
 Competition can be a good thing—just be sure to continue market
viability research.

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Learning Module for Entrepreneurship
8. Yourself

 On top of choosing a product that’s viable in the market,

entrepreneurs should select one that they actually enjoy or one that
solves a problem they have personally experienced.

Profitability analysis (https://www.ecommerceceo.com/product-profitability-

analysis).

 Revenue without profit is pointless.

 Gross sales are all smoke and mirrors.
 Profit is what matters.
 Profit is what’s left in your pocket after you break-
even.
 Break-even is a point at which cost and income are
equal and there is neither profit nor loss.

4 Keys to Analyze the Profitability of your Product

(https://www.ecommerceceo.com/product-profitability-analysis)

1. Determine the true cost of production

 It involves the cost in getting the product into the hands of the customer.
 How much does it cost to bring a product into existence?

Running a business comes with many potential costs, including, but not limited to:
 Property and equipment leases
 Loan repayments
 Utilities
 Salaries/wages/commissions of employees
 The inventory itself
 Freight costs—it is the amount you pay to transport goods from one place
to another, whether by land, sea, or air. Shipping of the product from Point
A to Point B (Point A is the place or places at which the product was
manufactured or assembled; Point B is the place of business—or, depending
on the scenario, the customer).

2. Test the market

 It might begin as simply as drawing upon your own experience as a customer,

putting yourself in the shoes of someone who might be interested in the product
you intends to sell. Consulting with family, friends and acquaintances who have
prior familiarity with the product is also a good course of action
 Testing the market by conducting research on a wider scale.

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Learning Module for Entrepreneurship
 Visit stores that sell the same product in the locality. Take note of what is being
stocked on the shelves and the associated prices. Compare with online prices
for the same or similar products in via internet research.

3. Find the „Sweet Spot‟

 It is about striking an attitude that will make customers whonwant to choose

you over their other options.
 Offer relevant business insights in the form of blogs or social media posts that
analyze trends or aggregate data from other sources.
 The right prices, the right attitude, the right understanding of customer
psychology—all inform each other and cohere into a profitable whole.

4. Understand margins

 Margin is the difference between total sales and the cost of those sales.
 Reducing business expenses can increase earnings, key to higher margin.
 Figure out new or improved ways to reduce costs in areas like labor and
shipping.
 Turn to the services of “Sourcify” and other similar tools, which connect
budding entrepreneurs with the manufacturers that are right for them.

What is Customer Requirements?

Determining the specific requirements of the

customers will contribute to the success of the
proposed desired products.

Customer Requirements are characteristics or

specifications that should be present in a
product for it to be deemed desirable by the
consumer.

Two Types of Customer Requirements:

1. Service Requirements: Intangible aspects of purchasing a product that a

customer expects to be fulfilled.
Examples: on-time delivery, service with a smile, easy-payment etc.

2. Output Requirements: 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.
Examples: on-time arrival of a grab taxi, loudness and clarity of a pair of
speakers, etc.

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Learning Module for Entrepreneurship
3 Levels of Customer Requirements (https://www.mbaskool.com/business-
concepts/marketing-and-strategy-terms/11884-customer-requirements.html):

1. Must Haves: These are the bare minimum requirements expected by the
customers; if fulfilled, customers will not be showing any exceptional
appreciation but if not fulfilled, the customer will show dissatisfaction.
Example: A clean and decent washroom provided by the restaurant as part of
their facility.

2. Satisfiers: These are the requirements that customers can express their desire
for, explicitly. If you offer better or more of these satisfiers, then the customers
will appreciate it more and will be more satisfied.
Example: the assortment of desserts in a buffet; the customers might feel that
they’re entitled to at least two as they’ve paid heavily for the buffet and will be
happier if they get four.

3. Delighters: These are the extras or the add-ons. Absence of these will not leave
the customer dissatisfied; but adding these would increase the customer’s
satisfaction greatly and will leave them delighted.
Example: you order a-la-carte in a restaurant and get complimentary wine

ACTIVITIES

Activity 1. Fill up the chart below to determine the viability of your possible
product/services to be offered in the market.

Product Name:

Tactical Aspects of a Product Product Description Based On Viability:

A. Size & Weight

B. Fragility

C. SKU

D. Product Life Span

E. Seasonality

F. Competitors

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Learning Module for Entrepreneurship

Activity 2. Interview at least 2 members of your family. Ask them questions that will
help you find out their Service and Output Requirements
as the future Customers of your product.

Product Name:
Product Description:
Service Requirements: 1.

2.

3.

Output Requirements: 1.

2.

3.

REMEMBER
 There are a handful of things you must take into account before
launching your business.
 Know the costs of doing business.
 Obtain accurate pricing for the production, shipping and other costs
involved in manufacturing a product. Keep tabs on the competition and
gain a feel for the market.
 The process is ongoing, which is to say that it begins before a business is
created and never really stops so long as the business continues to
function.

CHECK YOUR UNDERSTANDING

DIRECTIONS: Read and analyze the statements below. Determine whether the
statement is TRUE OR FALSE. Write TRUE if the statement is correct and write
FALSE if otherwise. Write your answer in the space provided.

____________1. Freight cost is the amount you pay to transport goods from one place to
another, whether by land, sea, or air.

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Learning Module for Entrepreneurship
____________2. Break-even is a point at which cost and income are equal.
___________ 3. Seasonality means that there are same levels of demands for a product
all throughout the year.
____________4. Black Friday shopping holiday results in highest sales in Philippines.
____________5. Product lifespan is the time interval from when a product is sold to
when it is discarded.
____________6. Fragile products can’t be easily broken or damage.
____________7. Customer requirements are characteristics or specifications that should
be present in a product for it to be deemed desirable by customers.
____________9. Customer service requirements are intangible aspects of purchasing a
product that a customer expects to deliver.
____________10. Must-have customer requirements are the minimum requirements
expected by the customers.

POST-TEST
DIRECTIONS: Read and analyze the statements below and determine which ―Level of
Customer Requirements” is referred to. Write the letter of your choice in the space
provided.

A. MUST HAVE B. SATISFIERS C. DELIGHTERS

Answer Statement
1. Kuya J Restaurant at Quezon Ave. branch is a non-smoking
restaurant.
2. Grab accepts cashless transactions.
3. SM Department store provides comfort room for PWDs.
4. Italian Restorante gives complimentary wines to couples.
5. Shoppee gives coupon with 100 free points once you buy on their
Shoppee Big Day.
6. Casa Escolta gives complimentary breakfast to families every
Christmas season.
7. Changji’s Videoke Bar gives free extension of 1 hour for using the
Exclusive music lounge with package A.
8. Clean and decent wash room at Hamerson Hotel.
9. Free cake for every purchase of P1,000 bakery products.
10. Clean glasses and plates at Romeo’s Eatery.

REFLECTIVE LEARNING
SHEET Lalamove operates mobile and web apps that helps connect users
with delivery drivers. The mobile apps are free to download on the iOS App
Store and Google Play for Android users.

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Learning Module for Entrepreneurship
A separate Lalamove Driver app is used by delivery drivers wanting to manage
and accept deliveries. Users can choose from an array of delivery vehicles which vary
from city to city.
Generally, users in most cities can select from lorries, trucks, vans and cars for
deliveries of larger and bulky goods. Fleets of two-wheel vehicles are also available for
courier services.
Lalamove also offers API integration for businesses that wish to integrate the
delivery booking platform into their own systems to create a more seamless service for
large numbers of orders.
Based on the above selection about Lalamove, Please answer the questions below:

1. Give 3 customer service requirements of Lalamove.

a.
b.
c.
2. Give 3 reasons why Lalamove delivery is in-demand nowadays.
a.
b.
c.
3. Give 3 instances why venturing into a courier delivery like Lalamove is a good
idea especially this time of COVID-19 pandemic.
a.
b.
c.

Congratulations! You are done in this module. Please explore the sites
below.

E-SITES

To further explore the concept learned today; please watch the video following the
links:

https://www.youtube.com/watch?v=BmMH2WcKX0A
https://www.youtube.com/watch?v=lXyTO0cUAsU

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Learning Module for Entrepreneurship

REFERENCES
Websites

1. Agustin-Acierto, Marife (2017). The starting point of conceiving the idea of the
type of business.

2. Business Viability Checklist (2014). Retrieved from:

http://www.managementguru.net/business-viability-checklist/

3. Customer Needs and Requirements. Retrieved from:

https://www.sixsigmadaily.com/customer-needs-and-requirements/

4. Customer Requiements. Retrieved from: https://www.mbaskool.com/

business-concepts/marketing-and-strategy-terms/11884-customer-
requirements.html

5. Keys to Analyze the Profitability of your Product. Retrieved from:

https://www.ecommerceceo.com/product-profitability-analysis

6. Things to Consider During a Product Viability Analysis. Retrieved from:

https://www.bigcommerce.com/blog/evaluate-product-market-
viability/#undefined

7. What Is Profitability? - Definition & Analysis. Retrieved from:

https://study.com/academy/lesson/what-is-profitability-definition-analysis-
quiz.html

Acknowledgement
Writers: Farida F. Tallud, DBM
Catherine S.Guanzon, MBA
Clarabelle V. Dalimit, DEM

Editor: Isabel A. Gumaru, DBA

Evaluator: Ellaine I. Dela Cruz, DBA

Validators & Reviewers: Remylinda T. Soriano, EPS, Math

Angelita Z. Modesto, PSDS
George G. Borromeo, PSDS

Management Team: Maria Magdalena M. Lim-Schools Division

Superintendent-Manila, Aida H. Rondilla-Chief Education Supervisor
Lucky S. Carpio-EPS and Lady Hannah C Gillo, Librarian II-LRMDS
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Learning Module for Entrepreneurship

ANSWER KEY
PRE-TEST
1. B 2. B 3. C 4. B 5.A

LOOKING BACK TO YOUR LESSON

True or False
1. True 6. False
2. True 7. False
3. True 8. True
4. True 9. True
5. False 10. True

ACTIVITIES

Activity 1. Fill in the Chart & Activity 2. Interview

Use the below Rubrics

CRITERIA 5 4 3 2 1
Outstanding Very Satisfactory Unsatisfactory Poor
Satisfactory
Clarity
Correct usage
of Grammar
Organization
of Ideas
Achievement
of Required
task

CHECK YOUR UNDERSTANDING

True or False

1. T 6. F
2. T 7. T
3. F 8. T
4. T 9. T
5. T 10. T

POST – TEST
Classification
1. A 6. C
2. A 7. B
3. C 8. A
4. C 9. B
5. B 10. A

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