THE NATURE OF SMALL

BUSINESS
 LEARNING
OUTCOMES:

• At the end of the discussion the participant should be

able to:
1. Identify the nature and types of small
business,
2. enumerate the characteristics of small
business, and;
3. discuss the advantages and disadvantages of
small business.
 SMALL BUSINESS
Two Approaches
1. Market Share
 small business may be defined as one which
is independently owned and operated and
which is not dominant in its field of
operation.
2. Total Assets
 may be defined under the total assets
approach as one having total assets that falls
within a certain bracket.
Magna Carta for Small Enterprise (R.A.6977)
BU S I N ES S A C C O R D I N G TO S I ZE

Micro
Business
Small
Private Business
Business Enterprises Medium
size Public Business
Enterprises Large
Business
 TYPES OF SMALL
BUSINESS

1. Small Manufacturing Business

2. Small Service Business
3. Wholesaling
4. Retailing
5. General Construction Firms
ARE YOU IN?
 Identify what
types of small
business that the
pictures represents

a. Small Manufacturing Business c. Wholesaling

b. Small Service Business d. Retailing
 Identify what
types of small
business that the
pictures represents

a. Small Manufacturing Business c. Wholesaling

b. Small Service Business d. Retailing
 Identify what
types of small
business that the
pictures represents

a. Small Manufacturing Business c. Wholesaling

b. Small Service Business d. Retailing
 Identify what
types of small
business that the
pictures represents

a. Small Manufacturing Business c. Wholesaling

b. Small Service Business d. Retailing
 1. SMALL MANUFACTURING
BUSINESS

 involved in the conversion of raw

materials into products needed by
society.
Examples:
Bakeries, tricycle sidecar assembly shops,
bagoong manufacturers, restaurants.
 2. SMALL SERVICE BUSINESS

 Business Services- accounting firms,

janitorial services, security services,
manpower agency.
 Personal Services- massage parlor, voice
lessons, tutoring services
 Repair Services- repair shop ( auto, watch,
cellphone/ gadgets, appliances) plumbing
services
 2. SMALL SERVICE BUSINESS
CONT….

 Entertainment and recreation- movie

house/cinema, resorts, salon and spa,
barbershop, games and amusements.
 Hotels and motels- apartments,
boarding house, inn
 Educational Services- schools
 3. WHOLESALE/ING

 it refers to activities of persons or

establishments which sell to retailers
and other merchants, and or to
industrial, institutional and
commercial users, but who do not sell
in large amounts to final consumers.
 4. RETAILING

 covers all activities involved

in the sale of goods and or
services to the final
consumers.
 5. GENERAL CONSTRUCTION
FIRM

 are engaged in construction

of building/establishments,
roads and bridges
 CHARACTERISTICS OF SMALL
BUSINESS

 independent management- owner is

also a manager
 Small capital requirements
 Mostly Local operation
 ECONOMIC IMPORTANCE OF
SMALL BUSINESS

PROVIDE
- Economic opportunities SUPPLIES and
for entrepreneurs DISTRIBUTES
- Products and services to
consumers - Products and
- Support the government
services to and for
i.e. taxes other businesses
-employment
 ADVANTAGES OF OPERATING A
SMALL BUSINESS

OPPORTUNITY

 to gain control over his/her destiny

 to reach his/her own full potential
 to reap unlimited profit
 to make a contribution to society and
receive recognition for his efforts.
DISADVANTAGES OF OPERATING A
SMALL BUSINESS

 uncertainty of income
 risk of losing your entire capital investment
Lower quality of life until the business gets
established
 complete responsibility
 having to serve undesirable customers
 paperwork and other chores
 Long hours and demanding work conditions
ITS YOUR TIME!!!
 PICTURE ANALYSIS

DIRECTION:
Take a look at the different pictures,
identify what types of small business
that the pictures represents.
* Some clues are given below the
pictures.
S _ _ L_ S _ R _ _ _ E B U _ _ I N _ _
S _ _ L_ _ A N _ _ _ C _ _ _I N _
B U _ _ I N _ _
W_ _ L_ _ _ L_
R _T _ _ _ E _
 NAME ME!!!

Examples below are the different services under

small service business, tell what type of services
does this business represents.
1. Movie houses
2. security services
3. Plumbing services
4. schools
5. Salon and spa