PARADA NATIONAL HIGH SCHOOL

SENIOR HIGH SCHOOL DEPARTMENT

THE CHALLENGES AND COPING MECHANISMS OF

SELECTED SOLE PROPRIETORS IN

BUSINESS MANAGEMENT

A Qualitative Research
Presented to the Faculty of the
Senior High School Department
Parada National High School

In Partial Fulfillment
Of the Requirements for the subject
Practical Research 1

by

John Kenneth Lee

Judy Ann Monsanto

Joemari Osea

Christian Valenzuela

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 TABLE OF CONTENTS

I. TITLE PAGE………………………………………………………………………1

II. TABLE OF CONTENTS………………………………………………………...2

III. CHAPTER 1: THE PROBLEM AND LITERATURE REVIEW

Background of the Study…………………………………………...

………….4

Literature Review……………………………………………......…………….5

Synthesis…..……………………………………………………………….….8

Significance of the Study………………………………………………………

Research Problems…………………………………………………………...10

Theoretical Framework……………………………………………………....10

Conceptual Framework……………………………………………………....11

Scope and Delimitation of the Study…………………………………………

12

Definition of terms…………………………………………………………...12

IV. CHAPTER 2: METHODS

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 Qualitative Design and

Methodology………………………………………...13

Research Site………………………………………………............................14

Selection Criteria and Participants………………………………...................14

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 TABLE OF CONTENTS

Data

Collection……………………………………….....................................14

Role of Researcher…………………………………………………………...15

Methods of

Validation………………………………………………………..15

Ethical Consideration……………………………………...............................16

V. Bibliography……………………………………………………………………..16

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BACKGROUND OF THE STUDY

There are types of business organization with different advantages and

disadvantages it includes sole proprietorship. Sole proprietorship refers to a business

owned and operated by an individual person. In a sole proprietorship, the business

and the owner are inseparable (Champlin, et. al., 2019).

On the other hand, Priyanka (2019), described sole proprietorship as

unincorporated business entity with one owner and it is different from state-registered

business entities such as corporation and limited liability companies (LLC) because it

doesn't need to file formation papers with the state.

Moreover, Caitlin (2019), says that Sears, eBay, and JC Penney which are one

of the successful businesses, started as sole proprietorships. However, In terms of its

simplicity and easy to operate, it also associated with risk. In addition, she includes

that sole proprietorship has advantages that benefits the owner and disadvantages that

may consider as a challenge. The advantages of sole proprietorship are easy to

establish, complete control to the business, and it is a stepping stone to the

incorporation, while the disadvantages of sole proprietorship are liability risks, and

difficulty in raising money.

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 Most sole proprietors closed their business in a short period of time due to

failure of coping up the challenges they encounter in business management. The

research entitles "The Challenges of Selected Sole Proprietors in Business

Management". It is important to conduct this study to create new knowledge and

understandings, about the experience of sole proprietors in their challenges they

encounter and coping mechanism they apply in their business to survive and continue.

Moreover, this study is important to establish new conclusions that can help the future

businessmen for their preparation in starting their own sole proprietorship business.

LITERATURE REVIEW

Challenges in Sole Proprietorship

According to Audra Bianca (2016), a sole proprietor faces five challenges. A

challenge of being a sole proprietor is his/her time management as an owner. A sole

proprietor’s time must organize and prioritize tasks. A sole proprietor risk their

personal savings or take out small business loan to start a business and assume the

risk of losing the start-up money. The sole proprietor is the only person who is

responsible for damages. Tight schedule and access to capital is also a challenge that

a sole proprietor can encounter.

While according to Nicole Fallon (2015), the sole proprietor has a complete

control to the business but it limits your time and creativity as an owner. There is no

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built-in support systems because when there is a problem in liability the owner has to

take the responsibility. Fallon added that it is tough to keep up as sole proprietor

because all the challenges that the owner may encounter, the sole proprietor will be

the responsible such as liability, no time off and difficulty in obtaining finance.

Moreover, Chris Joseph (2017), stated that sole proprietorships are popular

because they are easy to start and may require little in the way of an initial

investment. However, operating as a sole proprietor also comes with some potential

risks. first is Personal liability, personal liability has a no legal separation between

personal and business assets, so if the owner defaults on business obligations like

loans, her creditors may have a right to claim personal assets for payment. Difficulty

obtaining financing is also a risks, if your business is struggling and needs an infusion

of capital to keep it afloat, you may have difficulty finding investors. The sole

proprietor makes all the decisions so, if he becomes ill or disabled, there may be

nobody else who can step in and keep the business going, resulting in its possible

collapse. And There is no guaranteed income from a sole proprietorship, so if the

business fails, the owner could lose everything.

Business Management

Chris Seabury (2020), gives a tips for growing a successful business, to succeed

in business today, owners need to be flexible and have good planning and

organizational skills. Many people start a business thinking that making money in a

business is much more difficult. Owners can avoid this in your business ventures by
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taking the time and planning out all the necessary steps that sole proprietors need to

achieve success. (1) To be successful in business, owner need to be organized. (2) All

successful businesses keep detailed record. By keeping detailed records, so that the

owners know where the business stands financially. (3) To be successful, owners

can't be afraid to study and learn from competitors. (4) The key to being successful is

taking calculated risks to help your business grow. (5) Always be looking for ways to

improve the business and to make it stand out from the competition. (6) Stay focused

on achieving short-term goals. (7) Make sacrifices in which many cases, owners have

to put in more time, if owners were working for someone else, which may mean

spending less time with family and friends to be successful. (8) provide better service

for the customers, the customers be more inclined to come to your business (9)

owners have to consistently keep doing what is necessary to be successful day in and

day out.

Furthermore, David McPherson (2017), believed that having a true passion in

managing business is very important for the owner’s success. But passion alone is not

enough. Owners need to understand business planning, strategy, finance, and

marketing. Starting and managing a business takes a great deal of business knowledge

and experience. Look at real-world businesses as owners develop an understanding of

each of these key disciplines. (1) People, Human resources are the owner’s greatest

asset. Learn the key leadership and communication skills that the owners need to be a

successful leader and build a strong organization. (2) In Operations management,

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owners will explore key aspects of business operations including capacity planning,

productivity analysis and improvement, quality assurance and the concept of lean

management. (3) In Accounting for decision-making, learn about different business

organizations and the role of accounting in each. (4) In Strategic management, owners

will learn how to develop a business strategy including analyzing the competition and

identifying ways that business can gain a competitive edge. (5) In Corporate finance,

learn the tools and techniques managers use to manage capital and maximize the

value of a business. (6) In Marketing management, owners will learn core concepts of

marketing including segmentation, targeting, differentiation, product positioning and

much more.

SYNTHESIS

Literature indicated that sole proprietorship is easy to start-up but there are

challenges in handling a sole proprietorship, time and personal savings is at risk. Sole

proprietors sacrifice their time to run their properly. Owner has a complete control to

business so that when there is a problem or liability in business, sole proprietors has

the responsibility to fixed all, so that even his/her personal saving will be at risk

handle everything, in business management owners need to have a good planning and

organizational skills to be successful. Sole proprietors need to understand business

planning, strategy, finance and marketing.

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SIGNIFICANCE OF THE STUDY

The purpose of the study will benefit the following:

Sole Proprietor - This study will help the sole proprietors to their business

management in terms of coping up the challenges they may encounter in their

business. This study may also be a guide for future businessmen.

Future Researchers - This research will be a useful reference for the future research

who would plan to make study under Business most especially in sole proprietorship.

Parents - This study will help the parents to understand more about the challenges

and coping mechanisms of a sole proprietors. This study can be a guide to parents

before starting up a business.

Teacher - This research will help the teacher for their better understanding about

experiences of sole proprietors. This study will also help the teachers on teaching

their students about sole proprietorship business. More especially in challenges and

coping mechanisms of a sole proprietors.

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Students - This study will help the students to learn more about sole proprietorship

business and this study may serve as a guide and reference for the students who will

start a business in future.

RESEARCH PROBLEM

This study will aim to identify the challenges and coping mechanisms of selected

sole proprietors in business management.

Specifically, this study seeks to answer to the following problems:

1. What are the experiences of the sole proprietors in managing their business?

2. What are the challenges do the sole proprietors encounter in managing their

business?

3. How do sole proprietors cope up with the challenges they encounter in the

business?

THEORETICAL FRAMEWORK

This study was based on the study of Villanueva et al. (2019) where they stated

that sole proprietors have eight coping mechanisms in dealing with the challenges

they encounter in starting their business. Based on their findings, sole proprietors

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cope up their challenges by openness, optimism, wise decision making, having a good

customer relationship, perseverance, establishing goodwill, sales promotion and

adaptability. This study will be a guide on how the researchers will explore and find

answers in the challenges of sole proprietors in business management and how they

cope up these challenges they faced. The researchers will seek and explore further on

the experiences of sole proprietors in business management to gain better

understanding and can be served as a guide for future businessmen.

CONCEPTUAL FRAMEWORK

Input Process Output

 The challenges  Analyzing data  Challenges and
of sole from individual coping
proprietors in interview. mechanism of
business  Identifying selected sole
management. challenges in proprietors in
 The coping business business
mechanism of management. management.
sole proprietors  Identifying how
in challenges sole proprietors
they encounter cope up the
in business challenges they
management. encounter.

Figure 2

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 Paradigm of the Study

Figure 2 shows how the researchers will determine the challenges and coping

mechanisms of selected sole proprietors in business management.

SCOPE AND LIMITATION

The scope of this study is to know the experiences, challenges and coping

mechanisms of selected sole proprietors in business management in Barangay Parada,

Valenzuela City. This study will not tackle the experiences, challenges and coping

mechanisms of other forms of business in business management.

DEFINITION OF TERMS

Sole Proprietorship - A sole proprietorship is a type of business that is owned and

run by one person.

Challenges - A difficult task or problem.

Coping Mechanisms - Strategies used by sole proprietors to cope up their challenges

they encounter in business management.

Business Management - Activities associated with running a sole proprietorship

business.

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CHAPTER 2: PROCEDURE

This study entitled the Challenges and Coping Mechanism of Selected Sole

Proprietors in business management. This chapter represents the discussion on the

qualitative design and methodology, research site, selection criteria and participants,

data collection, role of researcher, method of validation and ethical consideration.

QUALITATIVE DESIGN AND METHODOLOGY

This research entitles "The Challenges and Coping Mechanism of Selected Sole

Proprietors in Business Management" will use qualitative research. The researchers

will use phenomenological methods because this study aims to understand the

experience of sole proprietors in their challenges they encounter and coping

mechanism they apply in business management.

Phenomenology is the study of structures of consciousness as experienced from

the first-person point of view. The central structure of an experience is its

intentionality, its being directed toward something, as it is an experience of or about

some object. An experience is directed toward an object by virtue of its content or

meaning (which represents the object) together with appropriate enabling conditions.

Phenomenology as a discipline is distinct from but related to other key

disciplines in philosophy, such as ontology, epistemology, logic, and ethics.

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Phenomenology has been practiced in various guises for centuries, but it came into its

own in the early 20th century in the works of Husserl, Heidegger, Sartre, Merleau-

Ponty and others. Phenomenological issues of intentionality, consciousness, qualia,

and first-person perspective have been prominent in recent philosophy of mind

(Smith, 2003).

RESEARCH SITE

The research site of this study will be in Valenzuela City. Specifically, this

study will be conducted at Barangay Parada.

SELECTION AND PARTICIPANTS

The Participants of this study are the selected sole proprietors in Barangay

Parada, Valenzuela City.

DATA COLLECTION

The researchers will conduct study and collect data through individual

interview. The data that will be gathered will be interpreted by the researchers by

using data analysis.

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 The researcher will ask permission to the sole proprietor by giving them a letter

of permission and wait for their approval. If the sole proprietor approves the

researchers’ permission, the researchers will start to interview the sole proprietor

depending on their schedule and free time agreed with the researchers. On the day of

the interview, the researchers will divide the tasks during the interview: One will do

audio recording, one will observe, one will write down notes, and the other one will

ask the participants all the question from the questionnaire and follow-up question if

there is something need to clarify.

ROLE OF RESEARCHER

The researchers will collect and gathered information about Challenges and

Coping Mechanism of Selected Sole Proprietors in Barangay Parada, Valenzuela

City. The researchers will ask their participants about their experiences in business

management as well as their challenges they encounter and coping mechanisms they

apply. It is the responsibility of the researchers to secure participants and their data

shared with the researchers.

METHODS OF VALIDATION
The researchers gathered necessary information from the internet sources which

is reliable. The researchers ensure that the source has a trusted author, accurate, free

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to access and updated. The data will be collected using individual interview, which

means the selected sole proprietors in Barangay Parada is free to answer by their own

way about their experiences in sole proprietorship.

ETHICAL CONSIDERATION

The researcher will ask permission to the participants who will participate in the

research in a proper way, and any confidential information about the participants

shared with the researcher should not leak. The researcher ensures that the question in

the questionnaire will not offend the participants.

BIBLIOGRAPHY

Bianca, A. (2016, September 29). 5 Challenges of a Sole Proprietorship. Retrieved

from https://yourbusiness.azcentral.com/5-challenges-sole-proprietorship-
1188.html
Bishop, C. (2020, January 28). What are the advantages and disadvantages of sole
proprietorship? Retrieved from https://www.wework.com/ideas/advantages-
of-sole-proprietorship
Champlin, K. (2019, February 15). Sole Proprietorship - Definition, Examples,
Cases, Processes. Retrieved from https://legaldictionary.net/sole-
proprietorship/
Edward A. Haman, E. (2019, May 29). What Are the Main Advantages of a Sole
Proprietorship? Retrieved from https://www.legalzoom.com/articles/what-
are-the-main-advantages-of-a-sole-proprietorship

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Fallon, N. (2015, March 18). 4 Business Challenges Faced by Sole Proprietors.
Retrieved from https://www.businessnewsdaily.com/7853-sole-proprietor-
challenges.html
Joseph, C. (2017, November 21). Risks in Starting a Sole Proprietorship. Retrieved
from https://smallbusiness.chron.com/risks-starting-sole-proprietorship-
4448.html
Mcpherson, D. (2017, August 23). 6 Fundamentals of Business Management.
Retrieved from https://blog.edx.org/6-fundamentals-of-business-management/
Priyanka Prakash, J. (2020, January 29). Sole Proprietorships: What You Need to
Know to Get Started. Retrieved from https://www.fundera.com/blog/sole-
proprietors
Seabuary, C. (2020, January 29). 9 Tips for Growing a Successful Business. Retrieved
from https://www.investopedia.com/articles/pf/08/make-money-in-
business.asp
Smith, D. W. (2013, December 13). Phenomenology. Retrieved from
https://plato.stanford.edu/entries/phenomenology/

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