Lesson 6

IMPORTANCE OF
ENTREPRENEURSHIP
LEARNING OUTCOME
At the end of this lesson, the learner should be able to
 Explain the importance of entrepreneurship to the Filipino people
 State the significant contributions of entrepreneurship to the local community
 Determine the importance of entrepreneurship to the Philippine economy
Site a business whether ordinary or small business operating in your
community. Assess their importance and contributions to your life
and to other people.

What do you think will happen to people’s lives if these businesses

do not exist?
 The Flow of Entrepreneurial Benefits

Contributions of
entrepreneurship

Filipino People Local Community Philippine Economy

ILLUSTRATE THE DOMINO EFFECTS OF ENTREPRENEURSHIP
Jenny’s Hair Salon
Jenny, upon seeing a promising and brilliant business opportunity in the community, opened
a beauty shop.
She went to the DTI, the City Government of Davao City, and the BIR to process, pay, and
comply with all the documentary requirements and fees in opening the business. Total taxes and
licenses paid by Jenny in opening the business amounting to Php 5,000.
Upon receipt of the business permit, Jenny immediately bought all the needed equipment
and materials for her beauty shop. For all these equipment and fixtures, she paid Php 60,000.
Shen then rented a business space at Php 10,0000 per month.
She hired and employed five beauticians and provided them with salaries above the
minimum salary and all statutory benefits. The total annual compensation and benefits paid by
Jenny to her employees for the year amounted to Php 540,000.
Jenny at the end of the year is enriched by Php 590,000 after paying the annual income tax
of Php 110,000 to the BIR.
THE FLOW OF ENTREPRENEURIAL BENEFITS
1. Jenny as an entrepreneur is enriched by Php 590,000 during the year.
2. The five employees or beauticians are enriched financially at a total amount of
Php 540,000.
3. The owner of the rented building is enriched by Php 10,000 per month or Php
120,000 for the whole year, while the supplier of equipment and fixture was
enriched by Php 60,0000.
4. The local government collected local taxes amounting to Php 5,000 from the
Jenny’s Hair Salon.
5. The national government, through its collecting agency, BIR, collected annual
income tax of Php 110,000.
6. The taxes collected by the local and national government will be returned to the
general public in the form of services like roads, street lights, police security,
and other public services.
IMPORTANCE TO THE
FILIPINO PEOPLE
1. It provides guidelines in their wealth-creating ventures
2. It helps improve their financial and social life
3. It helps broaden their creativity.
4. It helps make their lives happy, fruitful, and successful
IMPORTANCE TO THE LOCAL
COMMUNITY
1. It provides employment in the community
2. It creates new demand in the market
3. It makes substantial contributions to the raising and collection of
taxes
4. It facilitates the movement of the factors of production
5. It creates new business opportunities
6. It promotes a peaceful and loving community
7. It increases constructive competition
IMPORTANCE TO THE PHILIPPINE
ECONOMY
1. It encourages competitiveness and thereby challenges entrepreneurs to keep
improving their products and services
2. It helps find an entrepreneurial niche in the world market
3. It helps hasten the economic recovery process of the Philippines during
financial turmoil or crises
4. It facilitates the smooth flow of money in the market
5. It assists the national government in its desire to have favorable economic
ratings in the world market