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Malunggay Tea Feasibility Study

This document discusses conducting a feasibility study for producing and selling Malunggay Tea in Cantilan, Surigao del Sur, Philippines. It provides background information on Malunggay/Moringa leaves and their nutritional benefits. The study aims to determine if a Malunggay Tea business would be viable by examining its marketing, management, technical, and financial aspects. It defines key terms and reviews related foreign and local literature on herbal teas and the growing milk tea trend in the Philippines.
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0% found this document useful (0 votes)
513 views57 pages

Malunggay Tea Feasibility Study

This document discusses conducting a feasibility study for producing and selling Malunggay Tea in Cantilan, Surigao del Sur, Philippines. It provides background information on Malunggay/Moringa leaves and their nutritional benefits. The study aims to determine if a Malunggay Tea business would be viable by examining its marketing, management, technical, and financial aspects. It defines key terms and reviews related foreign and local literature on herbal teas and the growing milk tea trend in the Philippines.
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Republic of the Philippines

SURIGAO DEL SUR STATE UNIVERSITY


Cantilan Campus
Cantilan, Surigao del Sur

CHAPTER 1

INTRODUCTION

Background of the Study

Malunggay or Moringa Oleifera is commonly known as horse-radish tree in

the Western world. This miracle tree is known as a fast-growing and drought-

resistant tree which mostly grows in tropical countries. More recent appreciation

of horseradish is believed to have originated in central Europe, the area also

work to the most widely held theory of how radish was named. Malunggay Tree

is a popular plant known for nutritional value as well as herbal medicine. Thus,

the perception of the abundance of Malunggay Tree is an excellent contribution

to making a new product such as teas. Malunggay Tea is a herbal tea made by

steeping dried moringa leaves in hot water for several minutes. This refreshing

tea is thought to increase wellness and vitality. The moringa leaves contain a

high concentration of nutrients, and also can retain these when dried.

(Staughton, 2019)

According to Jillian Levy (2018), moringa contains “two times the amount

of protein of yogurt, three times the amount of potassium as bananas, four times

the amount of Vitamin A as carrots as well as the amount of calcium as coco’s

milk, and seven times the amount of Vitamin C as oranges.”


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Though researchers have published numerous studies in Malunggay Tea

concerns, it has not been well-known that the Malunggay Tree can be produced

into a healthy beverage here in Cantilan. Many Cantilangnons have not fully

utilized Malunggay Tree for it is just used as one of the ingredients in cooking

"tinola".

This study was designed to evaluate the feasibility of establishing

Malunggay Tea in the Municipality of Cantilan, including the motivations to start-

up and sustain the business. The study extracts information on the probable

performance of Malunggay Tea in terms of the four (4) aspects of business

viabilities. In terms of marketing, the researchers need to examine the product or

services to work out how it should be marketed. The focus of the marketing

strategy should be making sure that the products and services meet customer

needs thereby developing long-term and profitable relationship with those

customers in the future.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Statement of the Problem

This study aims to utilize Malunggay leaves and produce it into a new

product as tea in Cantilan.

Specifically, this study seeks to answer the following questions:

1. What is the profile of the respondents in terms of:

1.1 Age;

1.2 Sex;

1.3 Occupation; and

1.4 Monthly Income?

2. Market testing in terms of:

2.1 Taste;

2.2 Aroma;

2.3 Appearance/Packaging; and

2.4 Price?

3. What is the business viability in terms of:

3.1 Marketing Aspect;

3.2 Management Aspect;

3.3 Technical Aspect;

3.4 Financial Aspect; and

3.5 Socio-economic desirability?

4. Based on the results, will the proposed business be feasible?


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Significance of the Study

This study was conducted to evaluate the probability of putting up

Malunggay Tea. Hence, it will therefore, equally be of immense help to:

Proponents. This study will help to determine if the proposed research or

business will be feasible and will be viable to the community.

Community. Through this study, it will serve the people to have a variety of tea

choice that are very affordable than the commercial one which is now the fast-

emerging business in the community.

Future Researchers. It will also be of use to the researchers for the further

research study, the existing and prospective entrepreneur as well as any

interested party.

Scope and Limitations of the Study

This study focused on conducting a feasibility study of Malunggay Tea in

Cantilan. The participants were the people living in Cantilan area. This study

covered the whole first semester of the school year 2019-2020. The

questionnaire was distributed to the respondents in Cantilan area, where the

proposed business will be established.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Definitions of Terms

The different terms used in this study are operatively defined in order to

give a better light of understanding. The terms used are:

Extract. A substance that is in a liquid state. Moringa leaf extract has great

promise to treat and manage a number of common diseases like arthritis,

hypertension, diabetes, and even cancer.

Herb. Plants with savory or aromatic properties that are used for flavoring and

garnishing the food, medicinal purposes, or fragrances; excluding vegetables and

other plants consumed for macronutrients.

Malunggay. A fast-growing, drought-resistant tree, they proliferate even in poor

soil and bloom eight months after planting.

Medicine. Substance use in the treatment of disease.

Tea. An aromatic beverage commonly prepared by pouring hot or boiling water

over cured leaves of the Malunggay. Tea is the second most consumed drink in

the world, surpassed only by water. An often-surprising fact to tea novices is that

all teas (Black, Green, Oolong, White, and Pu'erh) come from the same plant.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

CHAPTER 2

REVIEW OF RELATED LITERATURE AND STUDIES

This chapter presents the foreign and local related literature and studies after

the thorough and most in-depth research of the proponents. This will also give

the proponents an idea to fully understand the feasibility study to be done. The

traditions to use horseradish plant for medical purpose are still applied in many

countries. Recent studies have shown that crude plant extracts have a complex

profile or naturally occurring GLS’s , with particular regards to sprouts. The

increasing interest in these studies, associated to the long and diffuse tradition of

using horseradish in food presentation and as condiments in many parts of this

plants of the world, is generating new application of this plans in several

industrial and pharmaceutical sector and is encouraging the use of its roots and

leaves in functional food and medicine for human health.

Related Literature

Foreign

In an essay of Awantika Singh (2018), Oh ! ''A Cup Of Tea'', according to me

a cup of means a lot, it's not just a cup of tea, it will l recall all the related

memories and what not ''A Cup Of Tea'' can do for us. That's why it is not just a

cup of tea. As I write above it will recall all the related memories, ''A Cup Of Tea''
Republic of the Philippines
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Cantilan, Surigao del Sur

is a medium for this present generation to get close to our families, friends and

relatives. It's a nice and healthy medium by which we can able to maintain the

harmony of our relationships. We can get together and recall all over sweet

memories and also make sweet memories for the future.

Tea acts as an instant energy source for us. You can examine it as when we

are feeling lazy or whenever we have a cold or cough, a cup of tea will definitely

help you, it will increase your energy and relax your throat. A cup of tea

increases our energy, as tea is hot, and after drinking a hot drink, our neck and

nose becomes clear, that's why our voice becomes clear and effective. Hence, in

such ways ''A Cup Of Tea'' is very much useful and helpful for us.

Local

The milk tea craze has completely invaded the metro. People are walking on

the streets holding their cups filled with tapioca pearls and sipping from large

colorful straws. Although popular milk tea chains have been around for many

years such as Serenitea, Chatime, and Happy Lemon, local milk tea shops are

emerging everywhere, taking advantage of the craze and catering to the taste of

teenagers and young adults. It has become a staple drink for the young

generation, overshadowing other thirst quenchers sold in the market.

Milk tea is not necessarily new to the Dabawenyos palate since most of us

grew up drinking sago’t gulaman and taho, which are both milky and creamy in
Republic of the Philippines
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Cantilan, Surigao del Sur

texture, having either the sago or tapioca pearls. Milk tea is most likely an

evolution of these traditional Filipino drinks. (Daphni Ma Delo, 2019)

As Dabawenyos' cravings for milk tea become palpable, the number of milk

tea shops in the city has vastly grown as well. Business people do not only

compete with their distinct drink selection but also the ambiance and level of

comfort of their milk tea shops. Gratifying milk tea and its aesthetically pleasing

interior design will surely land in people's Instagram and Facebook feed. Coming

up with creative names for the milk tea shops is also an advantage for it to be

easily noticed by the public (e.g. Christianitea, Worth Tea, Tealoca, and

Infinitea). (Intern, 2019)

Related Studies

Foreign

According to the study of Ladohiya et al. (2015), tea is the most common

beverage consumed after water. It is brewed from the leaves of Camellia

sinensis (family: Theaceae). Different types of tea manufactured are oolong,

green, black and Ilex tea depending on the post-harvest treatment and

palatability of a particular region. Being rich in natural antioxidants, tea is

reported to be effective against colon, oesophageal, and lung cancers, as well as

urinary stone, dental caries, etc. Tea found to be anti-cariogenic, anti-microbial,

anti-inflammatory, anti-carcinogenic, anti-oxidant can be used as an effective

preventive agent. Healthy Foods’ containing active scavengers of free radicals


Republic of the Philippines
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are very popular nowadays. The chiefly chemical components of green tea

include polyphenols, caffeine and amino acids. Tea also contains flavonoids

compounds reported to have anti-oxidant properties having many beneficial

effects. It is widely accepted that phenolic compounds of certain foods have

potential health benefits. Tea is linked to the beneficial impacts on human health

with the polyphenols as the responsible constituents. India is one of the largest

tea-producing, exporting and consuming country. The present review focuses on

the production, composition and the beneficial effects of tea consumption on

human health.

Local

According to the study of (Jay M. Pascual 2019) Malunggay is a widely

cultivated plant in the Philippines. It is also known as Moringa, West Indian tree,

horseradish tree, ben oil tree, drumstick tree, la mu (Mandarin), arzan taiga

(Burkina Faso), windi bundu (Niger), etc.

Malunggay is a very nutritious plant and its benefits have been

acknowledged by nutritionist, dietitians, and nutrition researchers. Considered a

miracle plant, the tea derived from the leaves of this tree has high levels of

flavanoids or polyphenols. These are antioxidants that can help detoxify your

body and strengthen the immune system. If you are lucky enough to have a

Malunggay or Moringa tree in your backyard, then you will be able to easily make

tea with the plant’s leaves and reap its full nutritional benefits.
Republic of the Philippines
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CHAPTER 3

RESEARCH METHODOLOGY

This chapter presents the research design, respondents of the study,

research instrument, research locale, data gathering procedure and statistical

treatment that were utilized in order to come up with the best outcome of the

study.

Research Design

This study used a descriptive method to come up with Malunggay Tea

operational performance profile in terms of marketing, management, technical

and financial aspects. The data collection used a questionnaire to determine the

demand from the respondents in Cantilan. This design is concerned with the

description of data and characteristics of a population. The goal is the acquisition

of factual, accurate, and systematic data that can be used in averages,

frequencies and similar statistical calculations.

Respondents of the Study

The respondents of the study were the people who live in Magosilom,

Pag-antayan, and Calagdaan area. They were chosen to provide more

information about the feasibility study by answering the questionnaire provided

by the researcher.

Table 1. Distribution of Respondent

Barangay Population Sample size


Magosilom 4,820 98
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SURIGAO DEL SUR STATE UNIVERSITY
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Cantilan, Surigao del Sur

Pag-antayan 2,205 96
Calagdaan 1,980 95
Total 9,005 289
Research Instrument

The researcher used a self-made questionnaire as the primary tool of this

study. This instrument was presented to the researcher's adviser for comments

and improvements and was validated by the experts who are known to have the

know-how in the field of study and research. The second questionnaire has two

parts. The first part is the demographic profile of the respondents. The second

part tackles on business viability which include the marketing, management,

technical and financial aspects.

Research Locale

The researcher conducted a survey in the following identified barangays:

Magosilom, Pag-antayan, and Calagdaan. These barangays were determined by

the given information gathered about Malunggay tea preference and demand.

Data Gathering Procedure

To be able to come up with productive result, the following procedures

were done: the researchers sought approval from the Dean of the College of

Education Business and Management, Program chair and Campus director;

Second, they sent a letter request signed by the instructor and the adviser,

asking permission from the participant; Third, they personally administered the

questionnaire to the respondents; and lastly, they tallied, analyzed and


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Cantilan, Surigao del Sur

interpreted the data and information to come up with a conclusion and

recommendation.

Statistical Treatment

For the analysis of the data of the study, the researcher employed

numbers of population and margin of error mean as the statistical tool in

interpreting the data obtained from the respondents.

The following statistical tool was used to facilitate the interpretation of the

collected data.

Slovin’s Formula. This is used to determine the total number of respondents in

each barangay.

N
n=
1+Ne2

Where:

n= no. of samples

N= total population

e= margin of error

Frequency Count and Percentage Distribution. These were used to describe

the profile of the participants. A particularly useful method of expressing the

relative frequency of survey responses and other data.


Republic of the Philippines
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Cantilan, Surigao del Sur

REFERENCE

Levy, J. (2018). Moringa Benefits Hormonal Balance, Digestion, Mood & More.
Retrieved from https://draxe.com/nutrition/herbs/moringa-
benefits/?fbclid=IwAR19lwo9QRWhaBujlKOfnXq2osVkbyCsFlOjN8ZAn_g
geGurDKciYK_QIfY

Staughton, J. (2019). Moringa Tea: Health Benefits, How To Make, & Side Effect.
Retrieved from https://www.organicfacts.net/health-benefits/herbs-and-
spices/moringa-
tea.html?fbclid=IwAR1wwizOR8A720L2ULdKuHxcIvt_shFzTcnhgawSKCI
kTewmdJCc3i_53NM
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Conceptual Framework

The input consists of the profile of the respondents in terms of age,

gender, occupation, monthly income, and frequency of tea consumption. It also

includes market testing in terms of taste, aroma, appearance/packaging, and

price. Likewise, it is indicated there the business viabilities in terms of marketing,

management, technical and financial aspects based on the result of the survey

as to the idea of how the proposed business will be feasible. The framework of

the study is illustrated in the schematic diagram in figure 1.

Through the questionnaires, the researchers were able to determine the

demand of the respondents, and how to supply their specific needs. Based on

the result of the survey, it will be deemed that the proposed business is feasible.

The output of this study is a proposal for the establishment of

"MALUNGGAY TEA" as a delightful product that could be offered to the customer

specifically in the municipality of Cantilan.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Input Process Output

Respondents Profile Business Viability Proposed

1. What is the profile 2.1 Marketing Aspect Malunggay Tea


respondents in term of;
2.2 Management Aspect
1.1 Age
2.3 Technical Aspect
1.2 Sex
2.4 Financial Aspect
1.3 Occupation
2.5 Socioeconomic
1.4 Monthly income Desirability

Figure1. Schematic Diagram of the Study


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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

CHAPTER 4

PROJECT SUMMARY

This chapter contains essential concepts pertaining to the proposed


business.

Business name

The name of our business ventures is the same as our product name

which is “MALUNGGAY TEA.” Malunggay is a plant that has been praised for its

health benefits for thousands of years. It is very rich in healthy antioxidants and

bio-active plant compounds. So far, scientists have only investigated a fraction of

the many reputed health benefits. So, other researcher makes some studies of

moringa, one of these is Malunggay tea.

Type of business

The type of our business is a partnership; it is two or more person binding

themselves to contribute money to a common fund by dividing profit among

themselves.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Location

MALUNGGAY TEA will be situated at Brgy. Magosilom, Cantilan, Surigao

del Sur. The researcher chose Cantilan as the location for conducting this study

because the area is perfect for the visibility of the business. The site of the

business will easily catch the attention of the public since it is near the road along

Cantilan town plaza, where there is an influx of people from the town and other

neighboring municipalities.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

CHAPTER 5

PROPONENTS AND MANAGEMENT ASPECTS

Proponent

The proponents of the study are Sienna Rose A. Vallejo, Janice G.

Sabejon, Donnabelle C. Cortes, Ray Clem P. Duero, Business Administration

students major in Financial Management at Surigao Del Sur State University-

Cantilan Campus as a requirement for the subject feasibility study. The

proponents assumed that partners A, B, C, and D will contribute Php100,000.00

each with total investments of Php400,000.00 and agreed to divide profits

equally. It is also assumed that the business will secure bank borrowing

amounting to Php400,000.00 with 10% per annum. Diminishing balance will be

used. Principal and interest will be paid annually.

Management

The management is the one responsible to actively propose as to how the

business will be managed. The owners are trying to work the better ways of

managing it since it is challenging to run a business. That's why the management

requires accurate personnel to take inside the firm that has a capacity to handle

the business.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Organizational structure

Manager/Cashier

Tea maker

Sales lady

Figure 2. Organizational Structure of the business

The proponents used to have a line type of organization because they

have a small-scale business where it only needs a simple plan decision. It only

consists of 2 types of employees.

The organizational structure of Malunggay Tea shows the flow of work

information that start for the manager/cashier of the shop which is responsible for

the distribution of works information and responsible for collection of sales, Tea

maker/sales lady who will be the one to make a tea and access the customers.
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Qualification of the Personnel

Manager/Cashier

 College graduate of business course

 At least 25-40 years old

 Have expertise in managing a business for at least two years

 Has an excellent interpersonal skill in dealing with people

 Ability to handle transactions accurately and responsibly

 He/she must be proven with the ability to operate and manage the cash

register

Tea maker

 At least high school graduate

 At least 20 yrs old and above

 At least one year experience in related business

Saleslady

 At least high school graduate

 18 years and above


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Job Description

Manager/Cashier

A manager is the one responsible in ensuring the daily functioning of the

department of employees, articulates both short and long-term goals to ensure

business longevity. Also, he/she is responsible for managing both the revenue

and cost elements of a business income statement, known as profit & loss

responsibility. It is also the included in his/her responsibility the cash collection,

recording the business transaction and in-charge of making daily collection

reports, inventory and other processes which is related to the accounting. He/she

can also help the sales lady managing other customer's needs.

Tea maker

Someone specialized in tea. A tea maker is someone who is educated in

tea history and making tea, categories or types of tea and the method of tea

production or/and processing. He/she provides customers with information on

available products and their prices and discount options.

Saleslady

She is responsible for ensuring that the customers are satisfied, that they

come back for further business.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Table 2. The Personnel Plan

Personnel No. Of Personnel Monthly Salary Annually Salary

Needed

Manager/Cashier 1 8,000.00 96,000.00

Tea maker 1 5,000.00 60,000.00

Saleslady 1 5,000.00 60,000.00

Total 3 216,000.00

Table 2 indicates the manpower needed for the proposed business,

including the number required, their monthly salary, and expected annual salary.

Their jobs qualifications and descriptions are indicated above.


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Table 3. Project Time Table

Schedule of Aprl May Jun Jul Aug Sept Oct Nov Dec Jan
activities
Making the
business plan
Preparation of
capital
Filling of
business permit
and Partnership
registration
Preparation of
Equipment
needed in store
Purchasing of
raw materials
Hiring &
selection
personnel
Starting of
Operation

Table 3 presents the project table of the production of Malunggay tea.

During the month of April and May, the proponents will be making and

conceptualizing the business plan. During the month of June and July the

preparation of capital, the filling of business permit and partnership registration

will be filed in the municipal office of Cantilan. The preparation of equipment

needed on the other hand will be work out in the month of September and

October and the raw materials needed in the production will be purchased during

the month of November. In following month, hiring and selecting of personnel will
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be done and lastly, January will be the month wherein the business operation will

start.

CHAPTER 6

TECHNICAL ASPECTS

This chapter contains the plan location, Machinery, equipment, furniture

and fixture, building feasibility, raw materials requirement, product process and

waste disposal.

Plan location

MALUNGGAY TEA will be situated at Brgy. Magosilom, Cantilan, Surigao

del Sur. The researcher chose Cantilan as the location for conducting this study

because the area is perfect for the visibility of the business. The site of the

business will easily catch the attention of the public since it is near the road along

Cantilan town plaza, where there is an influx of people from the town and other

neighboring municipalities.
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Table 4. Machinery and Equipment

Machinery and Source Unit Cost Quantity Total

Equipment

Vegetable grinder Local 1,589.00 1 1,589.00

Strainer Local 160.00 1 160.00

Fire extinguisher Local 1,500.00 1 1,500.00

stove Local 1,109.00 1 1,109.00

Frying fan Local 145.00 2 290.00

4,648.00

Table 4 shows the machinery and equipment needed in the business

operation, which will be purchased locally. The first machine and equipment

required for the production of Malunggay tea is the strainer used to strained the

Malunggay. Fire extinguisher as a primary requirement in every business

establishment to serve emergency cases of fire is included in the purchase. Also,

stove and frying fan to dry the Malunggay. All the machinery and equipment will

cost P4,680.00.
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Table 5. Furniture and Fixture

Description Source Unit cost Quantity Total

Tables/Chairs Local 2,065.00 1set 2,065.00

Ceiling fan Local 1,399.00 1 1,399.00

Water dispenser Local 2,490.00 1 2,490.00

Total 5,954.00

Table 5 shows the equipment that will be used to make the costumers

comfortable.

Building Feasibility

The building is feasible because of its perfect locations which is near the

Cantilan town plaza where people could access easily the business.
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Table 6. Raw Materials

Quantity Amount Annually

Malunggay 30kl 25 9,000

Tea Bag 20,622 400

Cardboard 30,993 9

Total

The raw materials of the business are Malunggay leaves, tea-bag and tea

box. The malunggay leaves will be bought in the market with a cost of P25 per

kilo and can produce 5 sachet of finished product of malunggay tea, with the

quantity of 30kl. The tea-bag will be bought locally with the unit cost of P400 per

box (100pcs in a box) or P4 each with the unit of 207box and can create 20,622

tea sachet, for a total of P82,488. We will also purchase cardboard for packaging

with the cost of P9 and unit of 30,933 for a total of P278,397 annually.

Product process

The process of making malunggay tea involves the following. First, (a)

buying the horseradish on the public market while at the same time ensuring to

remove those that have signs of yellowing. (b) Sorting and placing the

malunggay leaves in a clean dry pan. Shaking the leaves follows to remove dust

or cobwebs. (c ) Air-drying, after sorting transfer the leaves into a larger flat
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container for air drying. It takes about three days. (d) Crushing, it involves getting

a fine wire mesh and place the wilted malunggay leaves on top of it. Afterwards,

the start of crushing process follows by vigorously shaking the leaves on the wire

mesh. (e ) Pan drying, pan drying removes moisture to make the leaves brittle. (f)

Packaging, this step includes placing 10grams of dried horseradish in the tea

bag.

Waste Disposal

The management will provide the proper way of waste disposal and

proper segregation of waste materials. We will segregate it to Non-

biodegradable, biodegradable and recycled materials in order to maintain the

cleanliness.

It is important for any business firm to be compliant to Section 37, 40, 41,

and 42 of Republic Act 9003, otherwise known as the Ecological Solid Waste

Management Act of 2000 and DENR Administrative Order No. 2001-34 to evade

untoward consequences that the business may suffer.


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CHAPTER 7

MARKETING ASPECTS

This aspect presents the demand analysis, supply analysis, factors

affecting the market, competition, market distribution, proposed channel of

distribution and promotional activities.

Market description

It is about communicating the value of a product and services or to

promote. It should be given time which consumers convey their experiences of a

product that's why the Malunggay tea consumers satisfaction must be the top of

priority of the business while providing tea that is affordable to the customers. It

needs a competitive marketing strategy to attract customers that are satisfied

with our product. Malunggay tea primary objective is to supply the drinking needs

of the people of Cantilan and its neighboring places.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Table 6. Social-demographic Profile of Respondent

Demographic Profile of the Respondent


Frequency Percentage (%)
Age
18-30 93 32.18
31-50 106 36.68
51- above 90 31.14
Total 289 100.00
Sex
Male 115 39.79
Female 174 60.21
Total 289 100.00
Occupation
Government
Employee 25 8.65
Self-employed 156 53.89
Students 52 17.99
Private employee 17 5.88
Others 39 13.49
Total 289 100.00
Monthly Income
None 52 17.99
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

5,000 below 183 63.32


7,001-8,000 17 5.88
9,001-10,000 17 5.88
10,001 and above 20 6.92
Total 289 100.00

Table 6 shows the profile of the respondents in terms of age in which 31-

50 years old has the highest percentage rate of 36.68% while the 51 years old

and above has the lowest percentage rate of 31.14%. In terms of their gender, it

shows that the female has a higher percentage rate of 60.21% while the male is

39.79%. In terms of their monthly income, most of the respondents receive 5,000

pesos below which has a higher percentage rate of 63.32% while the range

7,001-8,000 and 9,001-10,000 got the lowest percentage rate of 5.88%


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Demand Analysis

The demand analysis for Malunggay tea is great because there is no

problem since this is new to a particular place. This is a project where the

customers will surely patronize our product because it has an affordable price

and has accessible location. As the population increases, the demand for

domestic product will also increase because tea is one of the trendy product

nowadays.

Table 8. Level of Demand of the Respondent

Will you buy this tea?


Yes 225 77.85
No 64 22.15
Total 289 100.00
Which do you prefer?
per sachet (10.00) 207 71.63
per box (120.00) 18 6.23
Total (64)289 (22.15)100.00
How many sachets will you buy?
5 below 174 60.21
6-10 40 13.84
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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

11 above 11 3.81
Total (64)289 (22.15)100.00
How many box(dozen) will you buy?
5 below 194 67.13
6-10 15 5.19
11 above 16 5.54
Total (64)289 (22.15)100.00
Table 8 shows that most of the respondents would like to try this product,

there are 77.85% who said yes and 22.15% who said no and prefer to buy

sachet rather than per boxes, with the higher percentage of 71.63%. It also

shows that the respondent can consume up to 5 below sachet with the higher

percentage of 60.21% and for the box is 5 below with the percentage of 67.13%.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Table 7. Business Viability in terms of market Testing.

Frequency Percentage (%)


Taste
Poor 0 0
Very Poor 0 0
Good 70 24.22
Very Good 159 55.08
Total (60) 289 (20.76)100.00
Aroma
Poor 0 0
Very Poor 0 0
Good 98 33.91
Very Good 131 45.33
Total (60)289 (20.76)100.00
Appearance/Packaging
Poor 31 10.73
6 2.07
Very Poor
Good 141 48.79
Very Good 51 17.65
Total (60)289 (20.76)100.00
Color
Poor 1 0.35
Very Poor 1 0.35
Good 115 39.79
Very Good 112 38.75
Total (60)289 (20.76)100.00
Quality
Poor 3 1.04
Very Poor 0 0
Good 110 38.06
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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Very Good 116 40.14


Total (60)289 (20.76)100.00
This chapter shows that out of 289 respondents based on our survey,

there are 55.08 or 55% who like the taste of our product and 45% like the smell

of Malunggay tea. While in the appearance and packaging, there are 48% who

commented Good, and on the quality of the product, 40% from the respondents

said very good.

Supply Analysis

For the sufficiency of the raw materials needed in the production, the

proponents will be acquiring Malunggay leaves as the main ingredient. During

the planning process of the business, we will plant Malunggay leaves that can be

used in the operation of the business. While other materials like tea bag will be

bought locally. According to (Trees for life) the Malunggay will bloom 8months

after planting, so we assumed that in the first operation of the business, we can

use the Malunggay we planted. The business might experience difficulty yet

proper management could still make everything possible for the business to

succeed.

Factors Affecting the Market

The proponents believed that the following factors will affect the total

demand of the establishment of Malunggay tea.


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Cantilan Campus
Cantilan, Surigao del Sur

Uncontrolled Factors

Calamities- factors that can affect the operation of the business.

Calamities are the natural and unpreventable phenomenon. This factor can be a

hindrance for they can destroy the production of the business.

Controlled Factors

Purchasing of tea-bag is one of the controllable factors that can affect the

production because purchasing of tea bag is difficult.

Pricing – the price of the product is one the controllable aspect that affects

the market since people prefer to buy the cheaper product regardless of its

quality and taste.

Competition

In the field of business, competition is always present. This business will

definitely compete with the other business establishment selling the same

product to survive in the field. So, we offer wholesale and retails to the buyer,

and we assure that the Malunggay tea we sell is very affordable and there is the

quality that the customers won't have any regret whenever they choose our

product to purchase.

Market Distribution

As tea grows in the Philippines, the distribution of Malunggay tea product

is expanding and becoming more efficient. The major part of the entire
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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

distribution is the wholesaler that provides value-added products and services to

the tea offering. Like food products, tea is distributed through retail and

wholesale distributors.

Proposed Channel Distribution

The business can offer customers quality and affordable product. The

proponents use the channel distribution because we are selling our product

directly to the people of Cantilan.

Manufacturer Retailer Walk-in customers

Figure 3. The flow of Distribution of Malunggay Tea

Figure 3 shows the flow of distribution of malunggay tea. We offer retailers and

the walk in customers who are directly buying product in our store.
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Product

The proponents identified Malunggay tea as a replacement for other

coffee and tea products. The business offers affordable Malunggay tea which

can satisfy the needs of the consumers.

Place

MALUNGGAY TEA is situated at Brgy. Magosilom, Cantilan, Surigao del

Sur. The researcher chose Cantilan as the location in conducting this study

because the area is perfect for the visibility of the business. The site of the

business will easily catch the attention of the public since it is near the road along

Cantilan town plaza, where people always have their leisure.

Promotion
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The proponents used advertising to promote the product through

television, tarpaulin, social media and fliers. With this, they were able to motivate

and attract customers to try the product and encourage them to buy it frequently.

Table 9. Price

Sachet 25
Boxes 2,500

The proponents used low price to somehow generate profit at the aim of

targeting marketability at the outset. They managed to keep the price affordable

due to cheap raw materials, while still ensuring quality product for customer

satisfaction. They decided to have just one product at the selling price of P25

per sachet and P2,500 per box.

Proposed Promotion Activities

Promotion is essential in any business, hence the proponents agreed to

use different marketing strategies in order to attract customers and make their
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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

product known in various locations near Cantilan. They utilized local television

advertisement, social media posting, and fliers distribution.

CHAPTER 8

FINANCIAL ASPECT

Financial aspect refers to the projected sale forecast, property, plant and

equipment, overhead expenses, administrative expenses and production cost of

the company or business. There are also projected income balance, statement of

changes in the owner’s equity and projected owner sheet to be made in order to

know if the said business studied is profitable or not.

Financial Assumptions

Income Statement Accounts


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Cantilan Campus
Cantilan, Surigao del Sur

 Sales. The proponent assumed that the sales output will increase at 10%

for the succeeding year for a fact that malunggay tea is a perfect

condiment that consumers prefer to buy. And as the population increases

in the said location, sales will also increase. It is assumed also by the

proponents that for every 1 kilo of malunggay, they can produce 5 sachets

of tea. In addition, sales mix is assumed to be 40% sachets of tea while

60% boxes (100 sachets/box) of tea. As the sales increase, the

proponents believe that the number of demands in our product will also

increase at 10%, however, price will stay the same.

 Cost of Sales. It is composed of direct materials, direct labor, and

overhead. Direct materials are malunggay, teabag, and cardboards (can

create two boxes). Direct labor is only for tea maker. Overheads are

indirect materials, indirect labor, & factory overhead and assumed to be

10% of prime cost.

 Depreciation Expense. Straight line method will be used.

 Advertising Expense. The proponent assumed that advertising expense

will be used only for the first year. Tarpaulins and posters will be used

upon the opening and the rest until it last.

 Taxes and Licenses. Assumed to remain the same for 5 years.

 Salaries expense. It is composed of manager/cashiers and sales lady

salaries and is assumed to remain the same for 5 years.


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Cantilan Campus
Cantilan, Surigao del Sur

 Utilities and Miscellaneous. It is expected to increase by 2% every year.

 Supplies Expense. Assumed to use 80% of supplies purchased

every month.

 Rent Expense. It is assumed to remain the same for 5 years.

 Interest Expense. It is an interest from bank loan with principal amount of

Php400,000.00 and 10% interest p.a. payable annually.

Balance Sheet Accounts

 Cash and cash equivalents. Composed of petty cash, cash on hand,

cash in bank, and cash equivalents.

 Raw materials. It is part of inventory and assumed to be 10% of total raw

materials available for use.

 Work in process. Assumed that all production will be complete.

 Finished goods ending. It is part of inventory and assumed to be 10% of

total goods available for sale.

 Supplies. It is expected to increase purchase by 2% every year.

 Security deposit. Assumed to have 1 month as security deposit as lease

agreement.
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Cantilan, Surigao del Sur

 Mandatory Contributions. SSS, Philhealth, and Pagibig contributions are

assumed to be paid month after accrual.

 Loan Payable. The proponents assumed the business will secure bank

borrowing amounting to Php400,000.00 with 10% per annum. Diminishing

balance will be used. Principal and interest will be paid annually.

 Capital Contribution. The proponents assumed that partners A, B, C,

and D will contribute Php100,000.00 each with total investments of

Php400,000.00 and agreed to divide profits equally. In addition, each

partner is assumed to withdraw Php1,500.00 monthly.

Table 10. Projected Sales Forecast

Revenue Schedule

15mins/sachet to
produce 3mins 3mins 3mins 3mins 3mins

8hrs/day (1 tea maker) 480mins 480mins 480mins 480mins 480mins

261 days/year 261days 261days 261days 261days 261days

Output (sachets) 41,760 41,760 41,760 41,760 41,760

10% increase/annum 4,176 4,594 4,635 4,640

Expected Output
(sachets) 41,760.00 45,936.00 46,354.00 46,395.00 46,400.00

Sales mix
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Cantilan Campus
Cantilan, Surigao del Sur

Tea in sachets - 40% 16,704.00 18,374.00 18,542.00 18,558.00 18,560.00

Tea in box - 60% 25,056.00 27,562.00 27,812.00 27,837.00 27,840.00

Price/sachet 45.00 45.00 45.00 45.00 45.00

Price/box (100sachets) 430.00 430.00 430.00 430.00 430.00

Service revenue 859,420.80 945,346.60 953,981.60 954,809.10 954,912.00

Table 11. Cost of Sales

Cost of Goods Sold Schedule


In Units
Raw materials -
beginning - 2,062.00 2,062.00 2,062.00 2,062.00
+Purchases - tea
bag 20,622.00 18,560.00 18,560.00 18,560.00 18,560.00
Total raw materials
available for use 20,622.00 20,622.00 20,622.00 20,622.00 20,622.00
-Raw materians -
ending 2,062.00 2,062.00 2,062.00 2,062.00 2,062.00
Direct raw materials
used 18,560.00 18,560.00 18,560.00 18,560.00 18,560.00

Raw materials -
beginning - 3,093.00 3,093.00 3,093.00 3,093.00
+Purchases - card 30,933.00 27,840.00 27,840.00 27,840.00 27,841.00
Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

board
Total raw materials
available for use 30,933.00 30,933.00 30,933.00 30,933.00 30,934.00
-Raw materians -
ending 3,093.00 3,093.00 3,093.00 3,093.00 3,093.00
Direct raw materials
used 27,840.00 27,840.00 27,840.00 27,840.00 27,841.00

Finished goods -
beginning - 4,640.00 5,104.00 5,150.00 5,155.00
+Total cost of goods
manufactured 46,400.00 46,400.00 46,400.00 46,400.00 46,401.00
Total goods
available for sale 46,400.00 51,040.00 51,504.00 51,550.00 51,556.00

-Finished goods -
ending 4,640.00 5,104.00 5,150.00 5,155.00 5,156.00

Cost of goods sold 41,760.00 45,936.00 46,354.00 46,395.00 46,400.00

In Pesos
Raw materials -
beginning - 36,085.00 36,085.00 36,085.00 36,085.00
+Purchases - tea
bag (Php4) 82,488.00 74,240.00 74,240.00 74,240.00 74,240.00
+Purchases - card
board (Php9) 278,397.00 250,560.00 250,560.00 250,560.00 250,569.00
Total raw materials
available for use 360,885.00 360,885.00 360,885.00 360,885.00 360,894.00
-Raw materians -
ending 36,085.00 36,085.00 36,085.00 36,085.00 36,085.00
Direct raw materials
used 324,800.00 324,800.00 324,800.00 324,800.00 324,809.00

Direct Labor 67,764.00 67,764.00 67,764.00 67,764.00 67,764.00


Overhead 39,256.40 39,256.40 39,256.40 39,256.40 39,257.30
Total cost of goods
manufactured 431,820.40 431,820.40 431,820.40 431,820.40 431,830.30

Finished goods - - 43,182.04 47,500.24 47,928.34 47,974.87


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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

beginning
+Total cost of goods
manufactured 431,820.40 431,820.40 431,820.40 431,820.40 431,830.30
Total goods
available for sale 431,820.40 475,002.44 479,320.64 479,748.74 479,805.17
-Finished goods -
ending 43,182.04 47,500.24 47,928.34 47,974.87 47,984.25

Cost of goods sold 388,638.36 427,502.20 431,392.30 431,773.87 431,820.93

Table 12. Depreciation Machinery and Equipment

Machinery and Quantity Total Life Span Annual


Equipment Depreciation
Vegetable grinder 1 3,178.00 2 1,589.00
Strainer 1 160.00 2 80.00
Fire extinguisher 1 1,299.00 2 649.5
stove 1 908.00 2 454
Frying fan 2 290.00 2 145.00
Total 2,917.5

Table 12 shows the yearly depreciation of the Machineries and equipment

used in the business. The estimated life for the overall Machinery and equipment

is two (2) years divided by the corresponding book value of each equipment,

considerably, the total depreciation expense for office equipment is P2,917.5.


Republic of the Philippines
SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Table 13. Depreciation Furniture and Fixtures

Furniture and Quantity Total Life Span Annual


Fixtures Depreciation
Tables/Chairs 2 2,065.00 3 688.33
Ceiling fan 2 3,078 3 1,026
Water dispenser 1 2,490 3 830.00
Total 2,544.33

Table 13 shows the yearly depreciation of the furniture and fixture used in

the business. The estimated life for the overall furniture and fixtures is three (3)

years divided by the corresponding amount of each equipment. Hence, the total

depreciation expense is equal to P2,544.00.

Table 14. Advertisement Expense

Description Source Monthly Annually


Television Advertisement Campco 1,000 12,000.00
Tarpaulin and posters KCL cyber link 900.00
Total 12,900.00

Table 14 presents the advertising expenses for the Television

advertisement monthly. Tarpaulins and posters will be used for the first year of

the business for lesser cost. Television advertisement will have P1,000.00

monthly and will eventually arrive at P12,000 annually while tarpaulins and

posters will be at P900.00. The total cost for advertising expense will be

P12,900.00.

Table 15. Taxes and Licenses


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SURIGAO DEL SUR STATE UNIVERSITY
Cantilan Campus
Cantilan, Surigao del Sur

Permit & license Amount


BIR Annual Registration P500.00
Documentary Stamp 15.00
Brgy. Clearance 150.00
Mayor’s Permit 5,000.00
Total P5,665.00

Table 15 shows the pre-operating expense which is the permit and

licenses. It consists of BIR annual registration with the amount of P500.00,

documentary stamp worth P15.00, barangay clearance P150.00 and mayor’s

permit worth P5,000.00. The total amount of permit and licenses is P5,665.00

annually.

Administrative expense

Table 16. Salaries Expense

Personnel No. Of Personnel Monthly Salary Annually Salary


Needed

Manager/Cashier 1 8,000.00 96,000.00


Saleslady 1 5,000.00 60,000.00
Total 2 156,000.00

Table 16 indicates the manpower needed for the proposed business

including the number required and their monthly and annual salary.
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Cantilan, Surigao del Sur

Table Direct Labor

Tea Maker 1 5,000.00 60,000.00

Table 17 indicate manpower needed for direct labor including their

monthly and annual salry.

Table 17. Utility Expense

Description Minimum(Commercial) Annually


Electric bill 2,000.00 24,000.00
Water bill 400.00 2,400
Total 28,800

The table presents the utility expense, which includes the electric bill and

water bill. The overall total for the utility expense will be P28,800 annually.

Table 18. Miscellaneous Expense

Description Unit cost Quantity Amount


Trash can 60.00 2 120.00
Mop 200.00 1 200.00
Broom 50.00 1 50.00
Plastic (small) 25.00 10 250.00
Plastic(medium) 35.00 10 350.00
Total 970.00

Table 18 presents the miscellaneous expense which includes the Trash

can, mop, broom, and plastic. The overall total for the utility expense will be

P970.00.
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Table 19. Supplies Expense

Description Unit cost Quantity Amount


Record book 75.00 2 150.00
Calculator 750.00 1 750.00
Ball-pen 10.00 6 60.00
Total 960.00

Table 19 reflects the supplies used, such as record book, calculator, ball-pen.

The total cost for supplies will be P960.00 yearly.

Table 20. SSS Premium Expense

Personnel No Monthly Monthly contribution Annual Contribution


Salary
ER EE ER EE
Manager 1 8,000.00 650 320 7,800 3,840
/Cashier
Tea maker 1 5,000.00 410 200 4,920 2,400
Saleslady 1 5,000.00 410 200 4,920 2,400
Total 3 17,640 8,640

Table 21. Phil-health Expense


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Cantilan, Surigao del Sur

Personnel No. Monthly Monthly contribution Annual Contribution


Salary
ER EE ER EE
Manager 1 8,000.00 137 137.50 1,644 1,650
/Cashier
Tea maker 1 5,000.00 137 137.50 1,644 1,650
Saleslady 1 5,000.00 137 137.50 1,644 1,650
Total 3 4,932 4,950

Table 22. Pag-ibig contribution

Personnel No. Monthly Monthly contribution Annual Contribution


Salary
ER EE ER EE
Manager 1 8,000.00 100 100 1,200 1,200
/Cashier
Tea maker 1 5,000.00 100 100 1,200 1,200
Saleslady 1 5,000.00 100 100 1,200 1,200
Total 3 3,600 3,600

Table 23. Rent Expense

Description Monthly Annually

Rental space 8,000.00 96,000.00


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CHAPTER 10

SOCIAL ECONOMIC ASPECT

The primary objectives of this study is to determine the feasibility and

viability of a proposed plan to establish a production of Malunggay tea business

in Cantilan, Surigao del Sur. Part of this study is to be able to shed light to the

proponent of this project as to what risks, cost expenditures, benefits,

marketability and profitability of the product are lurking for this business venture.
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Data collected were interpreted and analyzed to reach to the conclusion whether

the business plan is feasible.

Moreover, this project does not only give a great deal of benefits to the

proposing parties but the society as well. With the establishment of a new line of

business -the production of malunggay tea- our product can contribute to the

improvement of the economy specifically, locally by somehow increasing the

number of employed people in the society. But the proposed tea productions as

already have shown its profitability is expected to have favorable and profitable

production and operations. This implies that more and more personnel and

workers will be needed thus, giving avenue for people to get employed and earn

a living. If there are people earning, this means that taxes to be returned to

government would also increase. If there is an increase in production, there are

more products to sell, more income is generated. This means that the business is

contributing to the local economy.

Local farmers will be encouraged to cultivate malunggay trees which have

been neglected for years. The study estimated that there would be income

generated with their products. Wastes generated during production are mostly

organic, so this may not give a problem to the environment, the community and

the health of the residents near the site of production. This malunggay tea

production will be the first manufacturing business not just in Cantilan but in

Surigao del Sur as a whole.


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CHAPTER 11

CONCLUSION AND RECOMMENDATION

In the “Production of Malunggay Tea” it offers good quality of products and

will serve satisfying services to the customers intended to offer the most

memorable malunggay powder experience for the customers. This kind of

malunggay powder to be produced throughout the municipality of Cantilan and


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also from neighboring municipalities is the original and naturally made

Malunggay tea that can satisfy the desires of customers. The production of

malunggay tea is located at barangay Malosilom near the town plaza of Cantilan,

Surigao del Sur. It was chosen as our market because it is easy to locate by the

customers.

The demand for the Malunggay Tea took its primary source of data from

the surveys. The demand of Malunggay Tea is very high based on the

questionnaires answered by the respected respondents. Based on the study

conducted by the proponents of Malunggay Tea, it has been proven that it is

feasible to put a business offering Malunggay tea in Cantilan, Surigao del Sur.

Derived from the results of the survey questionnaire, majority of the respondents

will most likely buy Malunggay Tea making it possible enough to achieve our

business endeavor the success.

Based on the study, the proponents want to recommend after the findings

gathered, to make Malunggay Tea in variety that their customer can choose. In

the first year of the operation, the proponents want to recommend that instead

buying a land, they prefer to rent for the location of the business. From the

management level, it’s a preference to lessen personnel while the manager


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facilitates proper communications between the lower level and higher level of

management. Continuous evaluation from the lower to the higher levels will be

constantly done in order to maintain the safety of the company.

The proponents also want to recommend that after 3 or 4 years of

operation, they will conduct training to those farmers to encourage them to plant

more malunggay trees while the waste of the malunggay leaves will be sold as

animal feeds. Those who are racing animals would have local access to

suppliers of feeds that are very affordable price which will eventually add extra

income from the company and to the people.

CHAPTER 9

ENVIRONMENT IMPACT ASSESMENT

The Malunggay trees has an extraordinary concentration of vitamins,

dietary minerals and proteins; its processed leaves produce a strong fertilizer and

its roots help fight soil erosion. In short, the malunggay is a magic tree whose
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properties find different application in development programs. The firm roots of

malunggay are drought-resistant and counteract the phenomenon of erosion,

while the juice extracted from its fresh leaves is a powerful fertilizer that can be

used in agriculture. Malunggay is also traditionally used to treat disorders and

illness.

The promotion and use of malunggay, which is the common denominator

of all activities, will;

 Improve the fertility of soil and increase its productivity, which in turn will

improve the quality and quantity of tea available to families.

 Make it possible to prepare dishes aimed at fighting malnutrition, thus

improving the population’s nutrition and health.

 Fight soil erosion and increase its biodiversity.

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