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Economic Landscape

PHILIPPINE ECONOMIC LANDSCAPE IN THE PRESENT TIME

The Philippine Economic landscape remains to be the springboard of questions when

economic development is the focus of discussion. The leaders of this nation, aim for
greatness for the Filipino people especially during the time of election. Their honest
intention of improving the economic condition is the battle cry that catapulted them
into power, yet in spite of the many promises, Filipinos remain poor. Instead of improving
the living condition of the Filipinos, they amassed wealth as a preparation for the next
election. Politics becomes an investment for power and money and it is not the true
essence of public service. Two important factors hinder Our growth as a nation:

1. Poverty is the making of its people and the kind of leaders that holds the wheels of
economic fortune.

Our country is still dominated by poverty and the unjust distribution of wealth. Income is
in the hands of the few opportunists. Power is in the hands of traditional and family
politicians as they amass wealth through graft and corruption.

2. Population explosion is another factor that contributes to the poverty of our nation.

We cannot increase the size of the land that is cultivated by the farmers, yet his family
size continues in number. Productivity in agriculture remains the same through the years.
Economic activities in the countryside remain in the hands of few entrepreneurs who
take advantage of the marketing of products to the urban center.

FACTORS IN DETERMINING ECONOMIC GROWTH

The following factors are contributory determinants to our slow growth. in economic
development as a nation:

1. The Filipino values and culture.

a. Love for imported products

The country's colonization for centuries has developed in the Filipinos a
culture of dependence and love for foreign products. We still feel that
 imported products are superior in quality and we look upon our own products
as inferior.
We love the taste of imported chocolates, the taste of apples rather than our
local guava, the taste of grapes rather than local berries, and the love for
imported clothing rather made in the Philippines. Buying imported goods
develops the economy of foreign countries and drains the Philippine
economy.

b. Our values of BAHALA NA

A true Filipino entrepreneur will not put his destiny in the hands of the
BATHALA. He must act with strong determination and push for the
development of his ideas. Innovation and the creation of more goods and
services are in the hands of an entrepreneur who has the ability to make new
and innovative products or create a new channel of their distribution.
BAHALA NA is the concept of belief in BATHALA, the gods of the lazy of bones
and undetermined individuals. Faith in GOD could be the driving force of any
entrepreneur to make things happen as he believes that his power to think
and innovate comes from the true GOD that guides the destiny of man.

c. Our Crab Mentality

Crab Mentality is the action of people to pull down others who are about to
get out of the verge of poverty and reach for their success. Enviousness is the
making of people who could not think better for themselves. There are many
of us who destroy others yet when we look at the mirror, we are not better
than them.
This could be a clear example of Pedro opening a SARI-SARI store and JUAN
opening the same kind of business in the next corner. Thinking that someone
on the other corner is making good in selling barbeque or a LITSONG MANOK,
he opens the same outlet not thinking that competition is pulling down both
of their profit. Why can we not think of anything better rather pulling the other
fellow in his entrepreneurial activity?

d. The MANANA HABIT (manyana)

MAMAYA NA or BUKAS NA is a culture that is brought to us by the colonizers
who were fond of SIESTA after lunchtime. We take time in stride wasting time.
The real entrepreneurs do not believe in siesta as they keep working until
things are done according to their plans.
Hard work and dedication are the qualities in the making of successful
entrepreneurs. In all books and records of successful people that developed
economic fortune, we find in their economic dictionary that success carries
with it a love for work and time management. They would not keep any work
 unfinished during the day. Persistence is a value that we have to develop to
make our economy successful.

e. The value of time

Relative to the above discussion is our lack of value to the precious time
given to us, 24 hours a day and 364 days in a year. We are always late at the
start of the program, coming to our classes, attending office work, and even
in important meetings and appointments. We take all the time in our hands,
not thinking that the meaning of progress rest in our value of this precious gift
of time.
The Japanese, our Asian neighbor, are noted for their sense of value for time.
They became successful because they are always on time. Meeting with
them is meeting on the dot or else you will not be able to get important
business with them. Time wasted is an opportunity lost in making a fortune.
Time is gold as the saying goes. Entrepreneurs get the golden opportunity as
they do not lose time to make money and fortune.

f. Our values of HIYA

HIYA could be a positive value in dealing with the business conditions. It
could be a propelling reason for us to create better service and proper
dealings in the business transaction. There are still many of us who take
shortcuts in business dealings. Good in its face value but with hidden agenda
of fraud and deception. Tourism could be a haven for economic
development if our people love to treat our visitors with HIYA of cheating
them with taxi fares and services. Our beautiful country is noted for hospitality,
a value that many people of the world admire, yet many foreigners are
afraid to go to our country because there are still some of us who are acting
WALANG HIYA.
Economic progress in the countryside and even in the urban centers could
have come in if we have developed the basic services in education and
social development. Our political and social systems have not developed the
value of HIYA, as graft and corruption still exist because of our love for
material things, money, and power. Power is in the hands of WALANG HIYA
that amass the wealth of the people's taxes which are supposed to eliminate
poverty and develop and improve education.

g. Fiesta and social occasions

The celebration of Fiestas of Saints that we inherited from the Spanish
colonizers could be another factor in the slow development of our economy.
People especially in the countryside would have all their savings spent in a
 day of the fiesta, entertaining guests, only to find out the next day that there
is no more rice to feed their children.
The fattest pig is slaughtered and the best food is prepared and all the
festivities are shown to the visitors. People will spend on the best clothes and
attend the coronation of the REYNA with all the fanfares of the local
politicians who are attending and preparing for the coming election.
There could be nothing wrong with celebration as it is a part of happy
Filipinos. The negative side is the little money that we could spend on more
important business that would generate more profit in the long run. Spending
money on birthdays, baptisms, and other social occasions is no means for an
alarm but if we need to make loans with high interest rates, then that creates
a problem to our daily budget.
Economic progress and development are the makings of all people but they
must come from the top, the leaders of this nation. We need to harness our
talent and skills toward economic development. We, as a people, are not
lazy. We are made the way we are because we have not changed our
values to a more positive system. Proper education could help us develop
our values towards work and proper dealings with other people. Graft and
corruption should be taken out of the political and social system in the
management of our people. It must start with us if we want this nation to
develop economically.

2. Job Opportunities/Employment

Employment opportunities remain to be elusive among Filipinos. The industries in the

economic zones and other urban centers could not accommodate the growing
employable people. Most still receive minimum wages that barely support the needs of
five members of the family.

a. Employment is one great factor in economic development

The entrepreneur provides the necessary work for people that propel the
economic development of the nation. The money in circulation for wages
and salaries will help local industries to develop new products and services
that generate more small and medium enterprises.
Contractual employment is still the name of the game in most factories as
multinational corporations still take advantage of the low labor cost. Workers
are lured to this opportunity as there exists no better employment. The
national labor laws still favor multinational interest for fear that they will pull
out their investment when better employment terms will be implemented.
There are some multinational corporations operating in the country with great
concern for their employees who give them medical benefits and better
 wages and terms and conditions of employment. The government should
look deeper into these firms and give them tax incentives that would not
necessarily reduce the taxes.
More regular employment also means more income taxes from employees.
Economic factors along this area tor the country could be two-tone factors
for the better services of those employed. Security of tenure will provide
peace of mind among local employees to support their children's education.

b. Income opportunity in the countryside is still subsistence in nature

Most people are still dependent on the old farming and fishing system. We
have not introduced modern farming technology and the proper culture of
our fishery resources. Our corals and fish sanctuary are damaged by
destructive methods of fishing. Our vast shoreline could be developed into a
haven for fishery development if new methods and technologies could have
been put in place to supply the food of the nation.
MANILA is the dream paradise. The bright lights attracted dreamers of wealth
and fortune that could be found at the end of the rainbow. Most ended up
to be squatters or the politically correct term, informal urban Settlers. The
theory that agriculture is an essential key to economic development must be
pursued with vigor by the government and those people in the rural setting.
Agricultural productivity will minimize internal migration to the urban centers.
This could be an entrepreneurial venture in the economic development of
the countryside.
We need to introduce new technology to make farming productive with the
introduction of new technology to improve irrigation, improve working
conditions, and increase the productivity of the farmers. Technology is one
important factor in the development of the economy and entrepreneurial
activity.

3. Availability of Needed Capital

The banks are sources of limited capital for small and medium enterprises. These
resources are available in banking institutions. The poor people are not aware of these
great opportunities and they do not know how to go about it to avail of the funds.
Below is the legality of this topic:

a. Republic Act 6977, known as the Magna Carta for Small Enterprises provided
the necessary funds for the development of entrepreneurs in the countryside.
Under this act, are small and medium enterprises engaged in industry,
agribusiness, and other services. These funds could be availed by single
proprietorship, cooperatives, partnerships, or corporations.
 a small and medium enterprise whether engaged in industry, agribusiness
and/or services, whether single proprietorship, partnership, corporation or
cooperative whose total assets, inclusive of those arising from loans but
exclusive of the land on which the particular business entity's office, plant,
and equipment are situated, must have value falling under the following
categories:

The intention of the law is to provide the promotion, growth and development of SMALL
AND MEDIUM ENTERPRISES by assisting government and RELEVANT AGENCIES (capitalize
for emphasis) in tapping local and foreign capital and the use of existing guarantee
funds.

The Law of SMALL AND MEDIUM ENTERPRISES DEVELOPMENT COUNCIL has some of the
important powers that could develop the countryside and those of the local enterprises
described below:

1. To recommend to the President of the Philippines and Congress on policy matters

affecting small and medium enterprises;

2. To coordinate and integrate various government and private sector activities relating
to small and medium scale enterprises;

3. To monitor and determine the progress of various agencies geared towards the
development of the sector;

4. To provide appropriate policy guidelines and coordinate framework in assisting

relevant government agencies in the tapping of local and foreign funds for small and
medium enterprises;

5. To assist in the establishment of modern industrial estates outside the urban centers.

6. To promote the viability of small and medium enterprises by way of directing or

assisting relevant government agencies in the national, regional and provincial levels
towards the following:
a. Technical training courses and those related to business operation, like simple
accounting and bookkeeping;

b. Labour and management relations and improve working conditions. Product

development and quality assurance and product diversification;

c. Improve production techniques and the use of technology in production and the
utilization of indigenous community resources and raw materials;

d. Provision and assistance in the marketing and distribution of products;

e Provide for concessional interest rates, lower financing fees, and incentive for prompt
credit payments, as well as arrangement tying amortization to business cash flows, the
effective substitution of government guarantee cover on loans for borrowers, lack of
collateral;

f. It provides for the setting of a RELIEF SYSTEM for distress enterprises as preventive
bankruptcy measures and the setting up to insurance against- extraordinary disasters

g. It provided for INTENSIVE INFORMATION CAMPAIGN and ENTREPRENEURIAL

EDUCATION (the intention of which is to give opportunity for all those with
entrepreneurial talent and interest.);

h. The law provides easier access and uses of tax credits and other tax and duty
incentives as provided for in OMNIBUS investment code and other laws,

i. Provision for product research and development and system of experimentation and
access to information on commercial technologies

B. Republic Act No. 6810 is the establishing the Magna Carta for Countryside and
Barangay Business Enterprises, granting exemptions from any and ALL government rules
and regulations and other incentives and benefits and for other purposes. The
important provisions of this ACT are the following:

1. To achieve the development of countryside business enterprises in the BARANGAY

level through the absence of BUREAUCRATIC RESTRICTIONS and granting of incentives
and other benefits;

2 The number of employees should not be more than twenty (20) at any time for the
purpose of undertaking a productive business enterprise that will help the economy in
the area;

3. The productive enterprises shall be principally engaged in the following activities:

a. Professional Service

b. Retailing

c. Wholesaling or Trading of Commodities, Products, or Merchandise.

Based on the above discussions and the important provisions of the laws mentioned,
entrepreneurial activities in the local levels and the countryside have not developed
when all the opportunities were provided by the government for local entrepreneurs.
We remain to be poor and the budding entrepreneurs continue to search for available
funds to finance their enterprises.

Analysis of the prevailing conditions and the business laws that grant these incentives
points to the following failures in the implementation program:

1. An honest political will to implement the program to develop the countryside and the
local entrepreneur. Information dissemination fails to cascade down to all sectors
interested in the program.
2. Vested interest groups take advantage of the program by establishing NON-
GOVERNMENT AGENCIES in the disguise of helping the lowly business sector but it
turned out that it is for their benefit. They established financing agencies with interest
rates that benefited their organization. Some NGOs lost interest after taking advantage
of the government money and now they are nowhere to be found to be persecuted
for their acts of corruption.

3. Banks and lending institutions required so much paper works beyond the
comprehension of small businessmen who don't have formal training as provided for the
law.

The Entrepreneur

Entrepreneur and Socio-Economic Development

The development of the nation's economic activity is the making of small and medium
enterprises mostly located in the countryside. They contribute to the economy of big
corporations as they are als0 consumers of their production, It is the entrepreneur who
develops new products and makes innovation that becomes the backbone of more
economies.

The following are the contributions of the Entrepreneur in our Socio-Economic

Development:

1. The entrepreneur provides employment.

Employment generates income and those employed pay taxes to the government
which in turn gives benefits to the social and educational needs of the greater
population. Those with income through employment become less burdensome to the
government.

2. The entrepreneur pays taxes.

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Entrepreneur pays taxes in the form of the real estate tax, sales tax, import and export
tax, and permits from the local and national government.

Taxes collected from the entrepreneur pump up the development of better

communities in terms of better road facilities, better school buildings for the masses, and
other social services. With the taxes paid the government could maintain better peace
and order situation as police and military personnel could better protect the people.

3. The entrepreneur provides a new lifestyle and pleasures.

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innovation and development is the making of entrepreneurs. Mobile phone is the new
lifestyle tor phone is the newest contribution of the entrepreneur to make a lifestyle for
more Filipinos. Communication between individuals and businesses became so easy
and handy as everyone enjoys new innovation.

New technology like computers and other household conveniences are the results of
entrepreneurial geniuses that turned our life to new lifestyles and pleasures. They
provide life convenience beyond the imagination of man.

Entrepreneurs do not stop searching for better products and services.

4. The entrepreneur improves the capital base of the economy.

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The entrepreneur mobilizes economic activity as the circulation of money which pumps
up the economic development of the community. Capital investment generates profit.
Profit, in return, is growth in investment base that will propel more business activities.

Entrepreneurs do not keep their money in the piggy banks or make this an idle deposit
in banks. The greater money in circulation the greater is the economic activity of the
nation. More investment generates more employment opportunities for the people
5. The entrepreneur creates people empowerment and social mobility.

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Entrepreneurs accumulate financial resources that give them social power in the
community. They can afford to buy some personal luxuries of life. They acquire a new
lifestyle of travel and pleasure. They make new houses and invest in real properties that
make them respected in the community.

It empowers them to make decisions related to the wise use of money.

Their high income differentiates them from those employed as their lifestyle becomes
more diverse and complex. Empowerment makes entrepreneurs the idol of the
community for their innovation and hard work.

6. The entrepreneur provides healthy competition.

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Healthy competition provides people with choices of new products or better services.
Entrepreneur seeks better products and develops new ones that will satisfy their target
customers. Competition develops pride for the entrepreneur that their Product or
service is superior to the other.

The entrepreneurial ego of human superiority in the development of new products or

services drives the entrepreneur to more innovation and development hence, the
greater goods cascade down to the consumer who wants new products and services.

MANAGERIAL SKILLS THAT MAKE A SUCCESSFUL ENTREPRENEUR

Being hardworking and industrious is no guarantee in the making of business activities
while they play an important role in the success of the enterprise. While many successful
entrepreneurs have not gone to business schools to acquire managerial theories in the
management of the enterprise, they have developed managerial skills through share
observation, or an inherent leadership ability and intelligence.

The entrepreneur has the following managerial skills:

1. The ability to plan and conceptualize.

Conceptualization and planning go together. Good concepts need to be put in the

planning table to avoid the risk factor. The entrepreneur is able to forecast the future by
seeing to it that the risk involved is properly controlled.

He must be able to visualize the direction of the business towards successful takeoff. He
must see that the products or services, the pricing strategies, the cost of production,
and the inventory. will generate reasonable profit and return of investment. The take-off
point of any business is the generation of profit based on plans and programs.

2. The ability to organize the resources of the enterprise.

A good business organization is based on people and resources. An entrepreneur

works with others and needs people with the same values and working ability. Efficiency
and effectiveness in the work arena are the working of people with dedication and
talent to do the job properly.

The material and physical resources must be put in place. Waste of time and money
has no place in a good organization. The entrepreneur must be able to give specific
direction and work activities that will redound to the efficient delivery of the necessary
services to customers and clients.

3. The ability to direct and motivate people in his organization.

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People are like machines that need an oil that will make them work smoothly and
efficiently and effectively. Machines will bug down if no oil is put into their chamber
while in operation. The same principles work with people. They need proper
compensation and motivation to deliver the necessary output.

Compensation and benefits are no guarantee for effective performance while they
may serve as important ingredients. The entrepreneur must be able to communicate
ideas and plans to his subordinates with a sense of humility. Good communications and
human relations will drive people to be motivated to perform their task with pride

4. The ability to control.

Controlling the whole operation is a difficult task for the entrepreneur. Safeguards and
control mechanisms could put in place with carefully crafted policies and procedures.
Such policies and procedures must be carefully disseminated and understood by all
who will implement them.

In the implementation stage, check valves through monitoring and feedback

mechanism must be worked out through reports and at times conference with key
people. The progress of operation and other activities related to finance and marketing
must generate the necessary reports as bases for more plans and actions. Controlling
cost and none essential expenses will save important profit that could be invested in
profitable operations.

5. The ability to manage time.

Time management is a very essential ingredient to the success of an entrepreneur.

Because of the numerous activities to attend to the entrepreneur must be able to log
on his time schedule so that important activities could be attended on time.

Meetings and conferences occupy most of the time of entrepreneurs. They must be
scheduled properly that they will not complicate with important paper works in the
office.

Some entrepreneurs who burn themselves out with stress die early and do not see the
fruits of their labor. They must have scheduled for his family, his religion and enjoy some
personal pleasure that will eliminate the stressful task of managing his business.
6. The ability to adapt to the changing environment of business.

Business today is fast changing with the advent of technology and innovation. The new
entrepreneur must be able to adapt to these changes in the business landscape for
him to go with the time of progress and expansion.

Consumers' tastes and preferences are gradually changing to better quality products
and services. Competition is shifting to more affordable quality products and
entrepreneurs must be aware of this changing customer demand. Changes are
applicable adaptability should be given attention to gain continuous customer
patronage.

While the above discussions are the theories and elements of good management, an
entrepreneur without formal training should attend seminars and advance schooling to
get further into the realms of better management theories that will help in the operation
of the enterprise. Learning is not the sole property of those in school. Reading and
attending various management interventions would make a great difference.

The entrepreneur, before launching into the field of business, must look forward to the
challenges of the entrepreneurial life. The decision to go into the business requires not
only investment in money and time but hard work and intelligence in order to succeed.
The positive qualities of the individual are needed to start an investment:

CHARACTERISTICS OF AN ENTREPRENEUR

1. Leadership and management abilities

Managerial Leadership is the ability to plan, organize, direct and control the
organization towards the goals and objective of the organization. it requires
conceptual skills in defining the direction of the business and the development of plans
and programs that will work effectively. The mission and vision of the organization must
be set up based on his investments and interest.

The human skill deals with how the leader will relate himself with the people around him
and those that he will encounter in the course of his business. Managers must treat their
workers with dignity and honor. They are aware of their needs and problems and
workers are treated as partners in the growth of their organization. Leaders motivate
people to excel in their respective fields and pay them commensurately for their
efficiency and performance on the job.

2. Positive risk-takers

The entrepreneur as a positive risk take enjoys the challenges of putting his money and
time to a test. He calculates the various alternatives open to him and careful in the
choice of actions. The entrepreneur gathers complete data and makes careful analysis
before making decisions.

The entrepreneur makes things happen rather than wait for things to happen. They look
at opportunities and make immediate actions before others plunge into the business
venture. They are confident in their intelligence and abilities and optimistic that results
will be positive.

3. Self-confidence and positive outlook

The entrepreneur has a strong belief in his capacity to make a difference in their
chosen field. They believe that achievements are guiding principles in man's success as
faith drives them to do better. The entrepreneur believes in the Lord Almighty and that
his talents are God-given gifts that he must use for the well-being of mankind. His faith in
God drives him to work with great enthusiasm and perseverance to reach his target
goals.

The entrepreneur looks at the bright side of the business. Threats are converted into
opportunities and he thinks of successes rather than failures. A positive outlook
generates profit and money that makes him richer. The poor become poorer because
they do not think of how to make money. They put their destiny to the BATHALA or the
BAHALA NA attitude as tomorrow is another day. The entrepreneur thinks of how to
make money.

4. Innovativeness and forward looking

The blazing path to entrepreneurial success is the courage to make innovations in

products or services. The entrepreneur refuses to stop at his achievements. He looks
forward to creating new things, something different from others. He thinks of new
technology that will create new and better things for the customers. He introduces
innovations that will satisfy human needs and wants. He satisfies new market demand
for new and better products.

5. Natural intelligence and decision-making skills

The entrepreneur's natural intelligence is an important requirement in making effective

decisions. The entrepreneur has to make decisions as he cannot make things happen
without making a wise choice of alternatives. Creativity and innovativeness carry with it
the power to make decisions as he needs to satisfy customer needs for new and better
products and services.

The success of any business venture rests with good decisions. The entrepreneur has to
increase market demand. The customers' wants and needs for better product changes
over time and the entrepreneur has to make decisions that would fit in this market
demand. The entrepreneur has to follow a logical process in making decisions.

The Decision-Making Process:

1. Identify the problem.

The risk involved in the management of the business has to be identified and analyzed
before solutions could be made. Relevant data and information must be organized.
The core objective is to minimize the risk factor involved as the wrong choice f
alternative would result in production or operation losses.

2. Gather the data that brought the problem.

A good and intelligent entrepreneur must be able to get the data that brought about
the problem. The solution to the problem is dependent on the data available at hand.
Correct information would give better solutions. False and irrelevant data would not
give the best solutions.

3. Analyze the data.

Not all information is relevant to the solution of the problem. Some data must be
discarded. The data must focus on the problem at hand. It must be timely gathered
and the information is based on actual situations prevailing in the business environment.
The internal and external sources must be analyzed to find out which are relevant in
formulating alternatives solutions.

4. Formulating alternative solutions.

The entrepreneur makes various alternative solutions to the problem at hand. These
solutions are subject to a series of analyses and he may need outside opinion. He may
subject the alternatives to further study before making decisions until he finds the right
alternative course of action.

5. Selecting the best alternatives course of action.

After all the alternative courses of action had been analyzed, the entrepreneur makes
the decision. The decision has to be implemented with fewer possible risks in terms of
money, time, and effort. It must take into account the available manpower and
material resources, supported with financial logistics.

6. Implementing the best alternative.

The modern entrepreneur utilizes group efforts in solving business problems. Problems
and Solutions best arrive at when people who will be implementing the decisions are
properly consulted and their opinions and ideas are taken into account before the final
decision is implemented. Group effort is required in planning effective strategies for
implementation.

ORGANIZING THE BUSINESS ENTERPRISE

The prospective entrepreneurs before going into the intricate field of the business world
should first go into a deep analysis of their personal and social attitudes. It is not only
material assets but personal values and characteristics. Before venturing into the field of
business, it is wise to develop entrepreneurial studies that will help determine the
feasibility of the project.

Some entrepreneurs failed because they are "plain copycats" in putting the business
because the neighbor Juan makes money going into a Mini-grocery. The entrepreneur
must first evaluate his personal interest, experienced in the chosen field, technical skills
as well as his human skills as these are the vital component in the success of the
business.
Business forecasting and planning skill is another vital component that must be
addressed before making investments. Careful preparation is an essential factor in
setting the enterprise into motion. Investment in money and effort may go to waste
without adequate preparation and careful planning. The loss of money and time must
be prevented.

ENTREPRENEURIAL STUDIES

The entrepreneur must see for himself the kind of management control and how the
business will be able to generate his projected profitable investment. He sees the wide-
open market of opportunities and the possible problems before he plunges into the
intricate operation of the enterprise. Wise investment through a careful analysis of the
business environment would minimize business failures. The following steps in the
business formations have been done by entrepreneurs that applied a more scientific
study of the business conditions. A business project either new or an expansion,
undertake careful planning of the project which will serve as a guide in the
implementation.