Applied Economics

Quarter 4- Module 3:
Application of Business
Principles, Tools, and
Techniques in Participating
Various Types of Industries in
the Locality
Applied Economics – Grade 12
Quarter 4 – Module 3: Applying Business Principles, Tools, and Techniques in
Participating in Various Types of Industries in the Locality
First Edition, 2021

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Editors: Tito Ompoy Jr., Ricardito F. Gadiane
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Applied Economics
Quarter 4- Module 3:
Application of Business
Principles, Tools, and
Techniques in Participating
Various Types of Industries in
the Locality
Introductory Message
For the facilitator:
As a facilitator, you are expected to orient the learners on how to
use this module. You also need to keep track of the learners' progress
while allowing them to manage their learning at home. Furthermore,
you are expected to encourage and assist the learners as they do the
tasks included in the module.

For the learner:

As a learner, you must learn to become responsible for your
learning. Take time to read, understand, and perform the different
activities in the module.
As you go through the different activities of this module be
reminded of the following:
1. Use the module with care. Do not put unnecessary mark/s on any
part of the module. Use a separate sheet of paper in answering the
exercises.
2. Don’t forget to answer Let Us Try before moving on to the other
activities.
3. Read the instructions carefully before doing each task.
4. Observe honesty and integrity in doing the tasks and checking your
answers.
5. Finish the task at hand before proceeding to the next.
6. Return this module to your teacher/facilitator once you are done.
If you encounter any difficulty in answering the tasks in this
module, do not hesitate to consult your teacher or facilitator. Always
bear in mind that you are not alone. We hope that through this
material, you will experience meaningful learning and gain a deep
understanding of the relevant competencies. You can do it!

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 Let Us Learn

This module was designed and written with you in mind. It is here to help you
apply business principles, tools and techniques in participating in various types of
industries in the locality. The scope of this module permits it to be used in many
different learning situations. The language used recognizes the diverse vocabulary
level of students. The lessons are arranged to follow the standard sequence of the
course. But the order in which you read them can be changed to correspond with
the textbook you are now using.

The module is divided into two lessons, namely:

Lesson 1: Types of Industries

Lesson 2: Apply SWOT Analysis as a Tool in Evaluating a Business
Opportunity

Learning Competencies:

1. Business Principles, Tools, and Techniques in Participating in Various Types

of Industries in the locality

After this lesson you are expected to:

1. Identify the different types of industries; and

2. Distinguish the different products and services of the business industries
ABM_AE2II-a-d-10
3. Discuss industry and environmental analysis as a tool in evaluating
business opportunities;
4. Apply SWOT analysis as a tool in evaluating a business opportunity.
5. Select business opportunities appropriate in your locality.

Let Us Try
Multiple Choice

Choose the letter of the best answer. On a separate sheet of paper, write your answer.

1. Which of the following statement that environmental analysis is false?

A. It identifies strengths and weaknesses of the business.
B. It helps identifies opportunities, plans and will not take into action
C. It is a careful study of various factors influencing the business outlook.
D. It is a process by which organization monitor their relevant environment.

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2. What is the purpose of environmental analysis emphasizing the importance of
current business climate and changes in various environmental factors such
as political, economic, socio-cultural, technological, legal, and environmental?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable changes in environment.

3. It refers to the availability of alternatives in environmental analysis?

A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

4. What is the ultimate goal of environmental analysis of which to determine

environmental opportunities and risks?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

5. Which of the environmental analysis goal, emphasizes the most efficient use
of a company's resources to achieve business success?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

6. Who is the author of the phrase "Environmental analysis surveys market

landscapes to assess how external factors can influence its decision-making."?
A. Adam Smith C. John Maynard Keynes
B. Alfred Marshall D. Robert Grant

7. Who was the author of SWOT analysis who organized a convention using data
from Fortune 500 companies at the Stanford Research Institute (now SRI
International) in 1960s and 1970s?
A. Adam Smith C. John Maynard Keynes
C. Albert Humphrey D. Robert Grant

8. What is the acronym of SWOT?

A. Staff, Workers, Operation, Time
B. Suppliers, Workers, Overtime, Tool
C. Supreme, Weaknesses, Opportunity, Threats
D. Strengths, Weaknesses, Opportunity, Threats

9. Aling Nena’s lechon manok, business located in Toril, Davao City have many
competitors in that locality that sells grilled chicken like Mang Inasal, Chooks
to Go, and Super Yonip signifies to ____________________?
A. Opportunity C. Threat
B. Strength D. Weakness

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 10. What is an indication on environmental analysis, if the companies have a high
turnover of workers?
A. Opportunity C. Threat
B. Strength D. Weakness

11. Which of the following can be registered as an opportunity in the bookstore

business?
A. Customer is supportive
B. Difficulty in hiring due to low salary
C. E-books eliminates need for physical books
D. The idea of using price bundling to increase sales.

12. Among the choices, which of the following can be classified as a strength in
the bookstore business?
A. Customers are supportive
B. Difficulty in hiring due to low salary
C. E-books eliminates need for physical books
D. The idea of using Price Bundling to increase sales.

13. In a bookstore business, which of the following can be classified as threats?

A. Customer is supportive
B. Difficulty in hiring due to low salary
C. E-books eliminates need for physical books
D. The idea of using Price Bundling to increase sales

14. It pertains to the characteristics of the business or project that gives

advantage over others denotes to?
A. Opportunity C. Threat
B. Strength D. Weakness
15. What element of the environment analysis that can cause a problem in
business?
A. Opportunity C. Threat
B. Strength D. Weakness

Let Us Study
A business requires to conduct a study on factors that influence operations.
To recognize market opportunities and risks, both internal and external factors must
be taken into account. You will learn about market and environmental analysis as
you progress through the lessons, and you will apply one of the most commonly used
for industry analyses, the SWOT Analysis as a method for assessing a business
opportunity.
You heard about various business sectors in your community and the types
of goods and services they produced in the previous lessons. Now read the operation
and respond to the questions.

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Activity 1:
Choose at least three (3) local businesses and conduct an online interview with
the owners to learn more on business operations includes the opportunities and
challenges encountered when the business starts. Please follow the format
outlined below.
Industry and Environmental Analysis

Industry Analysis Porter’s Five Forces

Porter's Five Forces is a market analysis model that explains why different
industries maintain varying levels of profitability.
1. COMPETITION in the Industry- industry competition between rivalry in the
same or similar industries is an unavoidable part of every business's
environment.
2. Potential Industry “NEW ENTRANTS”- established businesses in a market
with high entry barriers would be able to charge higher prices and negotiate a
terms and conditions if they were able to charge higher prices and negotiate
with the best terms.
3. CUSTOMERS- interested in owning or using goods and services and they are
critical to the success of your business.
4. SUPPLIERS- provides an input that the industry's used to produce a final
goods that will be offer to the customers.
5. SUBSTITUTES- products can partially fulfills the needs and wants of a
consumer and allows the consumers to substitute for a similar product.

In short, Industry Analysis is a tool that facilitates a company's understanding of

its position in the market. Relative to other companies that produce similar products
or services. Understanding the forces in the overall industry, is important component
of effective strategic planning. Industry analysis, enables small business enterprises
(SME’s) owners to identify the threats and opportunities facing a particular business.
Focus business resources on developing unique capabilities leads to a competitive
advantage in the market.

Lesson

2 Apply SWOT Analysis

Strengths, Weaknesses, Opportunities, and Threats are terminologies that

represent the acronyms for SWOT. SWOT Analysis, is an effective strategy that helps
business sectors to understand the strengths, limitations, opportunities, and risks
that a company or project faces.
A SWOT analysis can be performed on a commodity, place, industry, or
person. It entails defining the goal of the business ventures or projects. Determines
the internal and external factors are beneficial and unfavourable to achieving that
goal.
Some authors attribute SWOT to Albert Humphrey (2005), who organized a
convention using the data from Fortune 500 companies at the Stanford Research

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Institute (now SRI International) in the 1960s and 1970s. However, Humphrey will
not claim to have invented SWOT, its roots are unknown.
1. Strengths – refers to the characteristics of a company’s or initiative that
gives an edge over competitors. The most common method for determining a
company's strengths is to assess which operations generate revenue.
2. Weaknesses – a quality that puts a company or project at a disadvantage in
comparison to others. Find areas of your service that are costing a money to
identify weaknesses.
3. Opportunities – pertains to an aspect that the company or project might use
to its benefits. Finding markets, alliances, goods, or services that can
potentially follow its part of the strategy for recognizing opportunities.
4. Threats – environmental factors that may wreak havoc on the company or
project. Owning a company entails taking risks that have a direct effect on the
company’s right that appear to have the potential impact of the business in
the next five years.

Internal and External Factors of SWOT

Internal influences examine strengths, having disadvantages depending on

the effect on the organizational goals. Strengths for one company’s goal may be
considered weaknesses (distractions, competition) for another. The 4Ps in marketing
particularly the price, product, promotion, and place will be considered in which
includes the staff, finance, manufacturing capabilities, and so on.

Macroeconomic issues, technological change, regulation, and socio-cultural

shifts, as well as changes in the market place or competitive position are examples
of external influences. The outcomes are often presented as a matrix. SWOT analysis
employs for pre-crisis preparation and crisis prevention. A feasibility study and
SWOT analysis used to make an effective recommendation.

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 Let Us Practice
Activity 1:

Identify the STRENGTHS, WEAKNESSES, OPPORTUNITIES and THREATS.

Apply SWOT Analysis by using the SWOT Template Bookstore. Use the
following listed words in the box. Write it in a separate sheet of paper.

a. Employees are well-behaved and knowledgeable about books.

b. Place is irrelevant
c. E-books and e-readers have rendered paper books obsolete.
d. The manager lacks leadership abilities.
e. Customers can shop online via their website, which is also visible
on social media.
f. One-stop shop for office and school supplies
g. Pandayan and Orchids Bookstore are competitors
h. Competitors give student and teacher rewards points and discounts
i. Collaboration with a global publishing house
j. Supported by bookworms and students

Let Us Practice More

Instructions: Unscrambled letters should be finding the right expression. Make use
of the clue's context. Write your answer in a separate sheet of paper.
__________________1. TSOW AANSISLY- a technique used to understand
the strengths, weaknesses, opportunities, and threats
involved in a business or project.
__________________2. ERTORP HAELCIM- introduced Competitive Forces model
__________________3. NGTHREST- an internal factor of SWOT Analysis.
__________________4. SREATTH- obstacle face by the business.
_________________ 5. OTROPPUNIESTI- an external factor of SWOT Analysis that
can increase the profitability.

Let Us Remember

In this part of the module, the teacher would like to know what you have learned in
the lesson.
1.Identify at least five
principles and tools in ______________________________
creating business ______________________________
______________________________
______________________________
______________________________

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2. Why is it important to
know your consumers,
competitors and suppliers
in creating business?
http://clipart-library.com/cartoon-business-cliparts.html
______________________________
______________________________
______________________________
______________________________
______________________________
______________________________
_____________

Let Us Assess
Choose the letter correspond to the best answer. Write your answer on a separate
sheet of paper.

1. Who is the economist stated that environmental analysis surveys in business

landscapes determine how external variables will affect its decision making?
A. Adam Smith C. John Maynard Keynes
B. Alfred Marshall D. Robert Grant

2. Which of the choices of the following statement is NOT true about environmental
analysis?
A. It identifies strengths and weaknesses of the business.
B. It will not study various factors affecting the business.
C. It helps identifies opportunities, plans and take into action.
D. It is a process by which organization monitor its relevant in the
environment.
3. What objectives of environmental analysis puts relevance that one company will
be aware of existing environmental analysis specifically, factors such as changes
in economic, technological political, socio-cultural, and environmental?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

4. It refers to the availability of alternatives in environmental analysis in the market?

A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

5. What kind of objective that environmental analysis examines opportunities and

threats in the environment?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

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6. What objective in the following choices of environmental analysis that puts
outmost importance in the proper use of the company’s resources to make the
business successful?
A. To provide input for decision-making.
B. To ensure optimum utilization of resources
C. To identify the threats and opportunities of environment.
D. To understand current and probable change in environment.

7. Who is the proponent of SWOT Analysis who led a convention at the Stanford
Research Institute (now SRI International) in the 1960s and 1970s using data
from Fortune 500 companies?
A. Adam Smith C. John Maynard Keynes
B. Albert Humphrey D. Robert Grant

8. SWOT analysis is an effective technique to evaluate business or project. The

acronym for SWOT is _____________________________________?
A. Staff, Workers, Operation, Time
B. Suppliers, Workers, Overtime, Tool
C. Supreme, Weaknesses, Opportunity, Threats
D. Strengths, Weaknesses, Opportunity, Threats

9. If a company has a strong support in the market denotes to have a __________?

A. Opportunity C. Threat
B. Strength D. Weakness

10. When you received a proposal for a new investor, then your business has
_______?
A. Opportunity C. Threat
B. Strengths D. Weakness

11. In an online business, which of the following can be classified as an opportunity?

A. Customers are supportive
B. Well known blogger patronizes your products.
C. Difficulty in distributing products to rural areas
D. Discover a new level of marketing that can increase your sales

12. Who was the proponent of Forces Competitive Model?

A. Adam Smith C. John Maynard Keynes
B. Albert Humphrey D. Michael Porter

13.In an online business, which of the following can be classified as threats in the
business?
A. Financial difficulties
B. Customers have freebies
C. Free shipping fee to your valued clients
D. Competitors have well known bloggers that patronize products

14.Which characteristics of the business or project that could endanger the

profitability of the business?
A. Opportunity C. Threat
B. Strength D. Weakness

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 15. In an online business, when your online site has thousand followers then
your business has _________?
A. Opportunity C. Threat
B. Strength D. Weakness

Let Us Enhance

Performance Task. Choose a e-business or online business that you might like to
do in the future and make a SWOT Analysis to help you decide if your business is
feasible.

RUBRICS (50 pts.)

Excellent Good Fair Poor Very Poor

Introduction/purpose/company
background (20 pts.)

SWOT Analysis (20 pts.)

Presentation (10 pts.)

Brief Introduction of the Business:

Brief introduction of the business and company’s background. State the purpose of
the business

Strengths:
1. Is your business can compete to the market in this time of pandemic?
2. Your business proposal has strong in the market position? (Do research and
support with evidence)
3. Why your business has a strong sense of purpose and the culture to support?
Weaknesses:
1. Is your business do poorly in the market?
2. Are problems could be avoided?
3. Potential financial difficulties will be encountered?
Opportunities:
1. Are the industry trends moving upward? (support with evidence, provide
sources)
2. New markets exist for your products or services? (do research, support with
evidence, provide sources)
3. Are there any new technologies you can utilize?
Threats:
1. Who are your competitors?
2. Are competitors doing well?
3. What obstacles that you are possible to encounter?
4. Are there any problems lead to change in your business environment such as
technologies, laws, and regulations? (do research, support with evidence, provide
sources)

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 Let Us Reflect

Entrance and Exit Slip. Fill in the table below.

ENTRANCE SLIP
What is SWOT Analysis is all
about?
_______________________________
_______________________________
_______________________________
How can I apply SWOT Analysis
in business?
_______________________________
EXIT SLIP
What I have learned about
SWOT Analysis?
_____________________________
_____________________________
_____________________________
_____________________________

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Let Us Assess Let Us Practice More Let Us Practice Let Us Try
1. D 1. SWOT Analysis A. Strength 1. B
2. B 2. Michale Porter B. Weakness 2. D
3. C 3. Strength C. Threat 3. A
4. A 4. Threats D. Weakness 4. C
5. C 5. Opportunities E. Strength 5. B
6. B F. Strength 6. D
7. B G. Threat 7. B
8. D H. Threat 8. D
9. B I. Opportunity
9. C
10. A J. Strength
10. D
11. B
12. D 11. D
13. D 12. A
14. C 13. C
15. B 14. A
15. C
Answer Key
 References

Competency Based Curriculum and CBLM 2019.Entrepreneurship

Corporate Finance Institute. Industry Analysis, Understanding the
competitiveness of an Industry. Retrieved on April 15, 2021 at
https://corporatefinanceinstitute.com/resources/knowledge/strategy
/industry-analysis-methods
Dinio and Villasis (2017). Applied Economics. Rex Bookstore, First Edition.
Friesner, Tim (2011). History of SWOT Analysis. Retrieved on April 15, 2021
https://www.researchgate.net/publication/288958760_History_of_sw
ot_analysis
Leano, Roman D. (2016). Applied Economics for Senior High School.
Mindshapers Co., Inc.
Ronquillo, Cindy (2020). Applied Economics. Department of Education,
Region III, Division of Pampanga
Sperling, Mike (2015). Evaluating Business using S.W.O.T. Analysis.
Retrieved on April 15, 2021 at
https://enterprisectr.org/blog/evaluating-your-business-using-s-w-o-
t-analysis

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For inquiries or feedback, please write or call:

Department of Education – Region XI Davao City Division

DepEd Davao City, Elpidio Quirino Ave., Davao City

Telefax: 224-3274

Email Address: davaocity.division@deped.gov.ph