FACILITATE

ENTREPRENEURIAL
SKILLS FOR MICRO-
SMALL-MEDIUM
ENTERPRISES (MSMEs)
THIS UNIT COVERS THE OUTCOMES REQUIRED TO
BUILD, OPERATE AND GROW A MICRO/SMALL-SCALE
ENTERPRISE
What is Micro-Small-Medium
Enterprise?
A Micro, Small, and Medium Enterprise (MSME) refers to a business classification based on size,
encompassing micro-enterprises with minimal scale, small enterprises with intermediate size,
and medium enterprises that, while not large corporations, fall within a defined range of
employees and revenue.

•Micro - if they have PHP 3,000,000 or less in assets and 1 to 9 employees

•Small enterprises - if they have PHP 3,000,001 to PHP 15,000,000 in assets and 10 to 99
employees
•Medium enterprises - if they have PHP 15,000,001 to PHP 100,000,000 in assets and 100 to 199
employees
Develop and maintain Micro-Small-Medium
Enterprise (MSMEs) skills in the organization
To develop and maintain skills specific to Micro, Small, and Medium Enterprises (MSMEs)
within the organization, it is crucial to implement targeted training programs, foster a culture of
continuous learning, provide resources for staying updated on industry trends, and encourage
collaboration and knowledge-sharing among employees to ensure adaptability and proficiency in
the dynamic MSME environment.
 1. Appropriate business strategies are determined
and set for the enterprise based on the current and
emerging business environment
Based on the existing and developing business environment, the organization determines
and sets appropriate business strategy.
Why is a business strategy important?
• Planning - A business strategy helps you identify the key steps to take to reach your business goals.
• Strengths and weaknesses - The process of creating a business strategy allows you to identify and evaluate your company's
strengths and weaknesses so you can create a strategy that optimizes your strengths and compensates for or eliminates your
weaknesses.
• Efficiency - A business strategy allows you to effectively allocate resources for your business activities, which automatically
makes you more efficient. It also helps you plan ahead for deadlines, allocate job roles and stay on track for your project
goals.
• Control - Creating a business strategy gives you more control over choosing the kinds of activities that will directly help you
reach your goals, as well as allows you to easily assess whether your activities are getting you closer to your goals.
• Competitive advantage - By identifying a clear plan for how you will reach your goals, you can focus on capitalizing on your
strengths, using them as a competitive advantage that makes your company unique in the marketplace.
 2. Business operations are monitored and
controlled following established procedures
By following established protocols, business processes are monitored and controlled to
guarantee consistency, effectiveness, and compliance to corporate standards.
Here are some types of key business monitoring techniques a company can use:
• Process monitoring - allows you to check whether you're executing procedures required for a business to operate
successfully. This type of business monitoring is typical for companies that share information about policy updates or
procedure implementation. You can also use this business monitoring process to inform all business staff about whether
the implementation steps were successful.
• Progress tracking - focuses on tracking a business' progress toward meeting its goals, allowing executives to stay up-to-
date on departmental operations. Many businesses have objectives and milestones to reach during specific periods of
time, such as meeting sales quotas or hiring a certain number of people. Using progress tracking can help you maintain
efficiency while completing them.
• Performance monitoring - provides you with an opportunity to assess performance progress as it occurs, which gives
you insight into what to improve for future projects or tasks
 3. Quality assurance measures are
implemented consistently
Consistent implementation of quality assurance measures ensures the systematic application of standards
and processes to maintain and enhance the quality of products or services across all aspects of a business
operation
What are the benefits of Quality Assurance?
• Product Consistency - Quality assurance inspections ensure that products meet defined standards consistently, resulting in
uniformity and reliability in the end products or services.
• Customer Satisfaction - By identifying and addressing quality issues before products reach customers, quality assurance
inspections contribute to higher customer satisfaction as customers receive products that meet or exceed their expectations.
• Reduced Costs - Early detection and correction of defects during quality assurance inspections help in avoiding costly rework,
waste, and potential recalls, ultimately leading to cost savings for the organization.
• Compliance Assurance - Quality assurance inspections ensure that products or services adhere to regulatory requirements and
industry standards, reducing the risk of legal and compliance issues.
• Enhanced Reputation - Consistently delivering high-quality products builds a positive reputation for the company, fostering
trust among customers and stakeholders and potentially attracting new business opportunities.
 4. Good relations are maintained
with staff/workers
Establishing and maintaining positive and constructive connections with employees and staff promotes a
collaborative and supportive work environment that improves overall morale and productivity.

How to build working relationships

Communicate often
Be consistent and trustworthy
Avoid gossip
Support fellow team members
Remain positive in interactions
Know company guidelines
Deliver quality work on time
 5. Policies and procedures on occupational
safety and health and environmental
concerns are constantly observed
The company maintains a continuous commitment to the health and welfare of its workers as well as the
preservation of the environment by strictly adhering to rules and procedures referring to environmental
issues and occupational safety and health.
Occupational safety, health, and environmental procedure:
Workplace Safety: Procedures for maintaining a safe working environment, including protocols for handling hazardous
materials, fire safety, and emergency response.
Personal Protective Equipment (PPE): Policies outlining the use of PPE and guidelines for employees to ensure their
safety in various work conditions.
Training Programs: Guidelines for training employees on safety procedures, including regular safety drills and updates
on best practices.
Accident Reporting: Procedures for reporting accidents, incidents, and near misses, including investigation processes
to identify root causes and preventive measures.
Establish and Maintain Client-base/Market
Businesses must concentrate on developing solid relationships, offering great products or
services, putting efficient marketing tactics into practice, and consistently changing to match
changing market trends and consumer wants in order to build and sustain an established customer
base or market presence.
 1. Good customer relations are maintained
Maintaining good customer relations involves consistently providing excellent service, addressing inquiries
promptly, and fostering positive interactions to build trust and loyalty with customers.
How to maintain customer relationships?
Be respectful and trustworthy
Communicate consistently
Get to know your customers
Stay connected
Offer incentives
Ask for feedback
Address any issues promptly
Hire dedicated customer service staff
 2. New customers and markets are
identified, explored and reached out to
To increase its reach and market presence, the company actively looks for and interacts with new clients and
markets by seeing opportunities, looking into unknown areas, and putting outreach plans into action.
How to find customers:
Identify your target audience
Define your budget
Research the industry
Determine unique ways to engage with potential customers
Create original social media content
Use a pay-by-the-click strategy
Sponsor events to increase awareness
Assess your reviews
Asks for brand referrals
 3. Promotions/Incentives are offered
to loyal customers
Promotions and incentives are extended to loyal customers as a gesture of appreciation, fostering customer
loyalty and encouraging continued patronage.
Ways to reward loyal customers:
Offer Discounts to Repeat Customers
Provide Rewards Based on How Much Customers Spend
Encourage Referrals from Friends and Family
Request Reviews About Your Customer Service
Reward Shoppers for Sharing Positive Information on Social Media
Maintain the Human Connection
Work with Loyal Customers on Their Level and Occasionally Make Exceptions
Offer Courtesies and Conveniences
 4. Additional products and services are
evaluated and tried where feasible
To expand its offerings and satisfy changing consumer needs, the company evaluates and tests
new products and services whenever possible.
Why is product testing important?
• Gain insights - This type of testing can help teams gain valuable insights about customers' needs and
preferences, which can provide direction during the development process.
• Improve products - By gathering and reviewing feedback during development, teams can use this input to
improve products to meet customers' expectations and requirements.
• Save time - Product testing can help teams save time during development by identifying potential problems or
risks early in the development process, before launching the product to consumers.
• Achieve business goals - Teams can use product testing to help them understand the priorities of the product
so they can achieve key business goals, such as attracting more customers or increasing revenue.
 5. Promotional/advertising initiatives are
carried out where necessary and feasible
Strategies for promotion and advertising are implemented when necessary and appropriate.
Tips for creating a strong promotional strategy
Keep promotions simple
Bundle products together
Reward customers to boost orders
Re-merchandise your product and homepage
Seed product reviews
Test out different promotions
Stay memorable
Apply Budgeting and Financial Management Skills

To apply budgeting and financial management skills, one must develop detailed budgets aligned
with organizational goals, monitor financial performance regularly, and make informed decisions
to allocate resources efficiently. This process involves strategic planning, forecasting, and risk
assessment, contributing to sound financial practices that enhance overall business stability and
success.
 1. Enterprise is built up and sustained
through judicious control of cash flows
A key component of establishing and maintaining an organization is maintaining effective control over the
inflow and outflow of funds through careful cash flow management. This is necessary to support growth,
maintain operations, and promote financial stability.
How do you sustain cash flow?
Invoice Management - Send out invoices promptly and follow up on overdue payments to ensure a steady inflow of
cash.
Payment Terms Negotiation - Negotiate favorable payment terms with suppliers to align outgoing payments with the
business's cash generation cycle.
Customer Credit Policies - Implement clear credit policies for customers, conducting credit checks and setting
appropriate credit limits to minimize the risk of late payments.
Expense Control - Monitor and control expenses through strategic budgeting, cutting unnecessary costs, and ensuring
that spending aligns with business priorities.
Emergency Fund - Maintain a financial buffer or emergency fund to handle unexpected expenses or disruptions without
affecting daily operations.
Inventory Management - Efficiently manage inventory levels to prevent overstocking or stockouts, optimizing the use of
working capital and reducing holding costs.
 2. Profitability of Enterprise is Ensured
through appropriate Internal Controls
Effective internal controls reduce risks, thoroughly monitor and manage financial operations, and
guarantee the accuracy and reliability of financial reporting, all of which contribute to an organization's
profitability.
What Internal Control measures must be put in place to improve the profitability of the business?
Expense Approval Procedures - Enforce strict protocols for authorizing and monitoring expenses to guarantee that all payments
are in line with the budget and strategic goals, thus decreasing unnecessary expenses.
Inventory Management Controls - Create efficient inventory controls, such as regular audits and real-time tracking, to avoid
overstocking, lower holding costs, and boost overall productivity.
Segregation of Duties - To avoid possible fraud or errors, clearly identify and divide roles within the company and make sure that
important financial operations have a checks-and-balances method in place.
Financial Reporting Accuracy - Establish procedures to ensure the dependability and correctness of financial reporting, such as
frequent settlements, in order to preserve stakeholder trust and facilitate well-informed decision-making.

Budgetary Controls - Create an effective budgeting procedure with strong controls to keep an eye on spending, track
errors, and make sure funds are distributed effectively in line with strategic priorities.
 3. Unnecessary or Lower-priority Expenses
and Purchases are Avoided
A company can optimize its financial resources by avoiding lower-priority or unnecessary costs and purchases. This
allows cash to be allocated toward strategic goals and essential operations, which eventually improves financial
efficiency and profitability.
Practical Advice on Cutting Costs:
Budgeting and Expense Tracking - Create a detailed budget that outlines all expenses and regularly track spending to identify
areas where costs can be trimmed.
Prioritize Spending - Differentiate between essential and non-essential expenses, prioritizing spending on critical activities that
directly contribute to business success.
Negotiate with Suppliers - Negotiate favorable terms with suppliers and explore opportunities for bulk discounts or long-term
contracts to lower the cost of goods and services.
Negotiate with Suppliers - Negotiate favorable terms with suppliers and explore opportunities for bulk discounts or long-term
contracts to lower the cost of goods and services.
Remote Work Policies - When possible, implement remote work arrangements to cut down on overhead relating to
utilities, office space, and other facilities-related expenses.
 END OF DISCUSSION
QUIZ #