Chapter 1

INTRODUCTION

Objective of the Study

The objective of the study is to know how feasible the proposed project in the

market. Its objective also is to know how competitive the proposed project in the market.

In other words, the objective of this study is to know whether or not the project is worth

doing. Its objective also is to encourage buyers to buy and to ensure the feasibility of

the said business especially on the management set up and state of its supply and

demand situation in the market. Its significance to be studied in order to come up with

reliable data and with the right form of business organization since the management

aspect of the business has something to do with the success of the operation of the

business.

Methodology

To know better about the proposed business, the proponents followed the steps

in order to have the concrete information of this study. The proponents conducted or

gathered data through survey, interview and questionnaires.

Scope and limitations of the study

The study of the proposed business focused on the marketing, production,

management and financial aspect. The data gathered were limited due to the

confidentiality of the proposed business.

 Chapter 2

EXECUTIVE SUMMARY

Brief Description of the Project

The products of the proposed business are Vegetable Empanada and Buko

Shake, the name of the proposed business is “Nutri Food” which is derived from the

word “Nutritious Foods”. The proponents choose this kind of business, since nowadays

the need for healthy and affordable food is in demand. The target market of the

proposed business is of all age and religion and everyone can eat for it is safe and of

good taste. The proposed business is located in Prk. Maalam Arellano Street Tagum

City. The legal form of business is sole proprietorship kind of business. The proposed

business will surely contribute to the development of economy since it will generate

employment and will pay taxes.

Brief Profile of the Proponents

NAME EDUCATIONAL BACKGROUND ADDRESS

Boyles, Ronald c. BSAT Prk. Bayanihan Visayan

Village, Tagum City

Project’s contribution to the economy (Socio Economic Aspect)

The main aspect in putting up a business is also the contribution of the proposed

business project to the economy. The proposed will somehow increase the employment

rate in Tagum City. The proposed project will contribute to the community by paying

taxes for the increase of government’s revenues for the development of the community.

The contribution of the project to the society is for the benefits of the individual workers

and families of the businessman and to the employees. The proposed project will

generate income and employment to the people.

 Chapter 3

MARKETING PLAN

Description of the Products/Services

Nutri Food offers a delightful and nutritious food like vegetable empanada with

main ingredients flour, oil and water filled with carrots, potato, jicama, and raisins. It also

offers Buko Shake, a mixture of ice, evaporated milk, white sugar, and coconut meat.

Comparison of the product with its competitor’s

The comparisons of the proposed business with its competitors are the services

offered which is take-out. Other than that, the Nutri Food offers fresh Buko shake. In

terms of packaging, the proponents used cellophane for vegetable Empanada while in

Buko shake, they used recyclable plastic bottle to make sure that it can help other

people after being used. The price is much affordable and in terms of the quality, the

proponents make sure that the ingredients of Empanada and Buko shake are always

new. In terms of the taste, it will assure that it is not only for good health but also, it will

capture the taste of the people so it can give satisfaction. The volumes of the product

produce proper mixtures. Since the ingredients of empanada are vegetables, the factors

are the following: Health Benefits, Appealing, and Inexpensive.

Location

The proposed business will be located at Arellano Street, Magugpo South,

Tagum City. There are two establishments offering bread and burger in near the

location but the proposed business is offering unique kind of bread that is new to the

taste of people. The proponents already knew that there are many bakeries and Buko

shake in Tagum City but the people will be attracted because of its offering new kind of

bread. Nowadays, the people will tend to be attracted in new product, so the project will

took advantage of it. Figure 1 shows the vicinity map of the propose business

Market Area

The proponents decided to put the proposed business at Purok Maalam, Arellano

Street, Tagum City because there are many students passing and there are also big

marketing establishments in the said location.

Main Customer

The main target of the proposed business are residents of Purok Maalam,

Arellano street, students of University of Mindanao, Tagum City and employees of the

near establishments like LYR, Motor R, J-Marketing, etc.

Historical Demand

Table 1 shows the historical demand of Empanada in University of Mindanao

Tagum City. The proponents conducted a survey on a month and day of April 4, 2016,

at close to start the second semester and summer class, from morning, afternoon and

evening session to determine the target market and the average number of pieces

consumed in a month. The proponents derived the target market which is 83.33% for

the reason that the total computation for those students who would willing to buy and

eat empanada. The number of students who would like to buy and eat empanada is 50,

divided by 60 which is the total questionnaire that proponents provided in all sessions.

Table 1

Historical Demand of Empanada (UMTC – Students)

Year Population % Target Average Average No. Annual

Market Consumption of per Month Demand in

(83.33%) Pieces

2013 11,814 9,845 3 7 206,745

2014 12,820 10,683 3 7 224,343

2015 14,835 12,362 3 7 259,602

Total 690,690
In Table 2, it presents the historical demand of empanada in Purok Maalam, Arellano

Street and the employees of the establishments near in the location. The proponents

considered 60% as the target market, while the average number of pieces per month is

5. The basis of this computation is come from the survey conducted by the proponents.

Table 2

Historical Demand of Empanada (Prk. Maalam)

Year Population % Target Average No. of Annual

Market No. of Months per Demand in

(60%) Pieces per Year Pieces

Month

2013 69 41 5 12 2,460

2014 92 55 5 12 3,300

2015 115 69 5 12 4,140

Total 9,900
Reflected in table 3 are the details of historical demand of Empanada in the past 3

years. Table 3 also presents the summary of the historical demand in UMTC, Purok

Maalam, Arellano St. and the employees of the establishment near the location of the

proposed business. In the year 1, the total historical demand is 211,069; in year 2 is

229,873 and 266,226 in year 3. The demand is historically increasing.

Table 3

Total Historical Demand of Empanada

Year Total No. of Total No. of Total No. of Total

empanada per empanada per empanada per Historical

year (UMTC) year year Demand

(Prk.Maalam) (Employees)

2013 206,737 2,460 1,872 211,069

2014 224,341 3,300 2,232 229,873

2015 259,602 4,140 2,484 266,226

Table 4 shows that the projected demand in year 1 is 35,163 and continues to increase

in the year 2 which are 40,170 and 45,890 in the year 3. The proponents used moving

average method. The figure reveals the potential viability of the proposed business

since the demand in the next three years continues to increase.

Table 4

Projected Demand of Empanada

Year Based Year Average % Average No. of

Increase Empanada

2013 266,226 12.35% 299,105

2014 299,105 12.35% 336,044

2015 336,044 12.35% 377,545

Table 5 shows the historical demand of Buko Shake in University of Mindanao

Tagum City. The proponents conducted a survey on a month and day of April 4, 2016 at

close to start the second semester and summer class, from morning, afternoon and

evening session to determine the target market and the average number of pieces

consumed in a month. The proponents derived the target market which is 76.66% for

the reason that the total computation for those students who would willing to buy and

eat empanada. The number of students who would like to buy and eat empanada is 46,

divided by 60 which is the total questionnaire that proponents provided in all sessions.
 Table 5

Historical Demand of Buko Shake (UMTC – Students)

Year Population % Target Average Average No. Annual

Market Consumption of Bottle per Demand in

(76.66%) Month Bottle

2013 11,814 9,057 2 7 126,798

2014 12,820 9,828 2 7 137,592

2015 14,835 11,373 2 7 159,222

Total 423,612

In Table 7, it presents the historical demand of empanada in Purok Maalam, Arellano

Street and the employees of the establishments near in the location. The proponents

considered 95% as the target market, while the average number of pieces per month is

2. The basis of this computation is come from the survey conducted by the proponents.
 Table 6

Historical Demand of Buko Shake (Prk. Maalam)

Year Population % Target Average No. of Annual

Market No. of Months per Demand in

(95%) Bottle per Year Bottle

Month

2013 69 62 2 12 1,488

2014 92 83 2 12 1,992

2015 115 104 2 12 2,496

Total 5,976
Reflected in table 7 are the details of historical demand of Buko Shake in the past 3

years. Table 4 also presents the summary of the historical demand in UMTC, Purok

Maalam, Arellano St. and the employees of the establishment near the location of the

proposed business. In the year 1, the total historical demand is 14,454; in year 2 is

16,180 and 18,843 in year 3. The demand is historically increasing.

Table 7

Total Historical Demand of Buko Shake

Year Total No. of Total No. of Total No. of Total

Buko Shake Buko Shake Buko Shake Historical

per year per year per year Demand

(UMTC) (Prk.Maalam) (Employees)

2013 11,814 1,488 1,152 14,454

2014 12,820 1,992 1,368 16,180

2015 14,835 2,496 1,512 18,843

Table 8 shows that the projected demand in year 1 is 21,517 and continues to increase

in the year 2 which are 24,632 and 28,127 in the year 3. The proponents used moving

average method. The figure reveals the potential viability of the proposed business

since the demand in the next three years continues to increase.

Table 8

Projected Demand of Buko Shake

Year Based Year Average % Average No. of

Increase Empanada

2013 18,843 14.19% 21,517

2014 21,517 14.19% 24,632

2015 24,632 14.19% 28,127

Total Supply
 The proponents observed that there are no existing competitors with the same

product in the particular area that proponents would sell the product, which is why the

proponents would consider that the proposed business has a great advantage in selling

the products. But not totally the customers would always prefer to buy the product due

to the fact that there are other considered competitors like burger, “pandesal”, etc.

Demand and Supply Analysis

The demand and supply analysis is no longer considered in this study since the

proposed area has no existing competitors in selling empanada and buko shake.

Production Capacity

In Table 9 and Table 10 shows the planned production capacity of the proposed

business for both empanada and buko shake. The computation is based on the capacity

to produce in a day multiplied by the operating days and 12 months in a year. The

proponents considered 10% increase for both empanada and buko shake in the

production for year 2 and year 3 since the increase in cost of materials is only 5%.

Table 9
 Planned Production Capacity of Empanada

Year Production Capacity per year

1 87,120

2 95,832

3 105,415

Table 10

Planned Production Capacity of Buko Shake

Year Production Capacity per year

1 28,080

2 30,888

3 33,977

Selling Price

The selling of the products is based on cost plus mark-up scheme; specifically,

the proposed business adds a mark-up of their selling price by about 15% for both

empanada and buko shake.

Projected Selling Price

 Table 11 and Table 12 presents the details of projected selling price per year.

The selling price is set based on cost plus mark-up of 15% based on cost of production.

Moreover, an increase in price is due to the increase of direct materials.

Table 11

Projected Selling Price of Empanada

Particulars Year 1 Year 2 Year 3

Empanada P5.00 P6.00 P7.00

Table 12

Projected Selling Price of Buko Shake

Particulars Year 1 Year 2 Year 3

Buko Shake P10.00 P12.00 P14.00

Sales

Table 13, 14 and 15 shows the projected sales within 3 years. The proponents

measured that there is an increase of sales in every year; it is because the product is

already known in the market.

Table 13
 Projected Sales – Year 1

Particulars Production Capacity Selling Price Total Sales

Empanada 87,120 P5.00 435,600

Buko Shake 28,080 10.00 280,800

Total 716,400

Table 14

Projected Sales- Year 2

Particulars Production Capacity Selling Price Total Sales

Empanada 95,832 P6.00 574,992

Buko Shake 30,888 12.00 370,656

Total 945,648

Table 15

Projected Sales – Year 3

Particulars Production Capacity Selling Price Total Sales

Empanada 105,415 P7.00 737,905

Buko Shake 33,977 14.00 475,678

Total 1,213,583

MARKETING STRATEGY
Promotional Measure and marketing

The customer itself is the best promotional measures that the business has

ensuring the best product to the customers plus the affordability and nutritious food to

make it more attractive. Also they will know better about the product by providing our

prospective target market all they want to know.

Distribution Strategy

Vegetable Empanada and Buko Shake will be distributed in UMTC students,

PurokMaalam, Arellano Street, employees of the near establishments and also walk-in

customers. It will be sold in take-out service.

Pricing Strategy

The proponents decided to use the most common method of computing the

product by adding the cost and the mark-up. The proponents ensure that the mark-up

added is minimal but they ensure that the profitability of the proposed business is not

being sacrificed.

Chapter 4
 PRODUCTION PLAN

Production Process of Empanada

The process of making Vegetable Empanada first is to create the dough through

mixing of water, flour, black pepper, salt and oil. Second process is to knead until it

forms soft and smooth dough. Third is to prepare the filling, heat the oil and cook the

carrots and jicama for about 3 minutes and wait until the carrots and jicama are tender,

then put about 1 teaspoon of filling in the middle of the dough including the raisins.

Fourth is to fold the dough to make the edges meet and form a half circle. Lastly is to

seal it by pressing the edges with thumb then fry them and constantly flip them to avoid

burning and serve it immediately while it’s hot. In making a vegetable empanada you

can create any design.Figure 2 shows the details of production process.

Production Process of Buko Shake

The process of the production of buko shake is easy. First, is to open up the

coconut and separate the coconut meat. Second is to put the coconut meat into a

blender together. Third is to put crushed ice, milk and sugar in the blender together with

coconut meat. Lastly is to blend until it smooth and pour it in a bottle then serve

immediately. Figure 3 shows the details of production process.

For the dough, mix water, flour,

black pepper, salt and oil. Knead
until it forms soft and smooth dough.
To prepare the filling, heat the oil
and cook the carrots and jicama for
about 3minutes. Wait until the
carrots and jicama are tender.

Put about 1 teaspoon of filling in the

middle of the dough including the
raisins. Fold the dough to make the
edges meet and form a half circle.
Seal it by pressing the edges with
thumb.

Fry them and constantly flip them

to avoid burning. Then serve
immediately while it’s hot.

Figure 2

Process Flow Chart of Empanada

Open up the Coconut and separate

the coconut meat.
 Place coconut meat into a blender
together with crushed ice, milk and
sugar.

Blend until it smooth.

Pour it in the bottle then serve.

Figure 3

Process Flow chart of Buko Shake

Equipment and Utensils

 The equipment and utensils can be purchase in Mall and different markets in

Tagum City. The total budget of machineries and equipment amounted P16, 096.00.

The proponents used straight line method depreciation.

Table 16

Equipment and Utensils

Equipment & Utensils Quantity Unit Cost Amount

Gas stove Burner 1 P709.00 P709.00

Refrigerator (Small) 1 5,000.00 5,000.00

Blender 1 879.00 879.00

Frying Pan 2 325.00 650.00

Kitchen Scale 2 379.00 758.00

Gas Tank 1 600.00 600.00

Total P8,596.00

Depreciation of Equipment and Utensils

The Table 17 presents the depreciation of equipment and utensils, its

corresponding depreciation for the next 3 years.

Table 17
 Depreciation of Equipment and Utensils

Particulars Total Estimated Year 1 Year 2 Year 3

Amount Life in

Years

Gas stove P709.00 3 P236.00 P236.00 P237.00

Burner

Refrigerator 5,000.00 5 1,000.00 1,000.00 1,000.00

(Small)

Blender 879.00 3 293.00 293.00 293.00

Frying Pan 650.00 3 217.00 217.00 216.00

Kitchen Scale 758.00 2 379.00 379.00 -

Gas Tank 600.00 3 200.00 200.00 200.00

Total P8,596.00 P2,325.00 P2,325.00 P1,946.00

Furniture and Fixtures

The furniture and fixtures will be used in daily operation of the proposed

business. All furniture and fixtures can be purchased in leading supermarkets in Tagum

City.

Table 18
 Furniture and Fixtures

Particulars Quantity Unit Cost Amount

Working Table 1 P500.00 P500.00

Chair 1 500.00 500.00

Total P1,000.00

Depreciation of Furniture and Fixtures

Table 19 shows the depreciation of furniture and fixtures. It shows that the total

depreciation for year 1 is P417.00, P417.00 for year 2 and P166.00 in year 3.

Table 19

Depreciation of Furniture and Fixtures

Particulars Total Estimated Year 1 Year 2 Year 3

Amount Life in

Years

Working Table 500.00 3 167.00 167.00 166.00

Chair 500.00 2 250.00 250.00 -

Total 1,000.00 417.00 417.00 166.00

Outright Expense
 In Table 20 presents the kitchen utensils expense which amounted to P564.00

and assumed to increase 10% per year as shown in table 21.

Table 20

Kitchen Utensils Expense

Particulars Quantity Unit Cost Amount

Oil Strainer 2 79.00 158.00

Roasting Tong 2 55.00 110.00

(12inches)

Dough Mixer 1 46.00 46.00

Knives 2 25.00 50.00

Plastic Tray 4 50.00 200.00

Total P564.00

Table 21

Projected Kitchen Utensils Expense

Year Total Amount

1 P564.00

2 620.40

3 682.44

Planned Production Capacity

 Table 22 and 23 shows the planned production capacity of the proposed

business, there is an increase on both empanada and buko shake per year. The

computation is based on the capacity to produce in a day multiplied by the operating

days and 12 months in a year. The proponents considered 10% increase for both

empanada and buko shake in the production for year 2 and year 3 since the increase in

cost of materials is only 5%.

Table 22

Planned Production Capacity of Empanada

Year Production Capacity per year

1 87,120

2 95,832

3 105,415

Table 23
 Planned Production Capacity of Buko Shake

Year Production Capacity per year

1 28,080

2 30,888

3 33,977

Terms and Condition of Purchase Equipment

The equipment and the office supplies will be acquired and will be purchased on

cash basis since the required equipment is affordable.

Business Location

Presented in Figure 4 is the location map of Nutri Food located at Purok Maalam,

Arellano St., Tagum City in between Sobrecary Street and Bonifacio Street.

------------ BONIFACIO STREET ---------

A
R
E
L
L
 _______________ ______________ ________

SIBLINGSSOLUTION

NUTRI
Laundry House
FOOD
LYR

------- -------- SOBRECAREY STREET ------- --------

___________________________ __________________________
Furniture
Resident 2
Resident 1
Resident 3
Resident 4
Resident 5

Resident 6

UMTC Arellano gate

University of Mindanao Tagum City

Figure 4

Business Location
 WORKING TABLE GAS STOVE

REFRI-
GERATOR

Ordering and Receiving

Area

CASHIER
DISPLAY AREA

Figure 5

Store Layout

Cost of Raw Materials

 Table 24 presents the raw materials for empanada. It shows the needed

ingredients as well as the quantity and the cost.

Table 24

Cost of Raw Materials-Empanada

Ingredients Quantity Cost of Actual Cost

Ingredients/unit

Carrots 1kilo P40.00/kilo P40.00

Jicama 8kilos 40.00/kilo 320.00

Oil 2kilos 55.00/kilo 110.00

Raisins 100grams 51.00/pack 51.00

Salt 1/8grams 6.50/kilo 1.00

White Sugar 3/4grams 52.00/kilo 39.00

Flour 3kilos 36.00/kilo 108.00

Total P669.00

Divided by 330 pieces

Cost per P2.03

Empanada

Presented in Table 25 is the raw materials needed in making Buko Shake, where

it shows how much actual cost of the needed ingredients.

 Table 25

Cost of Raw Materials-Buko Shake

Ingredients Quantity Cost of Actual Cost

Ingredients/unit

Coconut Meat 2 P100.00/kilo P200.00

White Sugar 1 52.00/kilo 52.00

Crushed Ice ¼ 40.00/bag 10.00

Evap. Milk 6 30.00/can 180.00

Total P442.00

Divided by 30 cup

Cost of Raw P14.73

Materials per bottle

Disposable Plastic 3 47.00/bundle 1.57

Cup

Straw 1 pack 25.00/pack 0.25

Cost per Buko P6.73

Shake

Raw Materials Availability

 The availability of the raw materials will be acquired in Tagum City public market

and other supermarkets in Tagum City.

Average Annual Project Cost of Raw Materials

Table 26 and 27 shows the average annual project cost of raw materials in

empanada and buko shake. The proponents considered that the average cost increase

is 10% for both empanada and buko shake, since the communal minimum increase of

cost of materials is 5%.

Table 26

Average Annual Project Cost of Raw Materials (Empanada)

Particulars Year 1 Year 2 Year 3

No. of Empanada to 87,120 95,832 105,415

be produced per year

Average cost per P2.03 P2.13 P2.24

piece

Average total cost 176,854 204,122 236,130

Table 27
 Average Annual Project Cost of Raw Materials (Buko Shake)

Particulars Year 1 Year 2 Year 3

No. of Buko Shake to 28,080 30,888 33,977

be produced per year

Average cost per P6.73 P7.07 P7.42

piece

Average total cost 188,978.4 218,378 252,109

Direct Labor

In Table 28, it shows how much is allocated to the worker of the proposed

business of which, the salary of the worker is assumed to increase up to 5% per year.

Table 28

Cost of Labor

Particulars No. of Worker Rate month Total amount per year

Baker 1 P6,500.00 P78,000.00

Total P78,000.00

Labor Productivity
 The manpower is not a problem since the baker lives in Tagum City so it will be

available in the entire year of operation.

Salaries Expense

Table 29 shows the salary expense of cashier amounted to P78, 000.00 per year

and Table 30 presents the projected salary which is assumed to increase 5% every

year.

Table 29

Salaries Expense

Particulars No. of Worker Rate Month Total Amount per year

Cashier 1 P6,500.00 P78,000.00

Total P78,000.00

Table 30

Projected Salaries Expense

Year Total Amount

1 P78,000.00

2 81,900.00

3 85,995.00

Utility Expense
 Table 31 shows the utility expense of Nutri Food and Table 31 shows the

increase of 5% per year in total utility expense.

Table 31

Utility Expense

Utility Source Basis Rate per Quantity Total Amount

Month

Gas tank Per tank P600.00 12 P7,200.00

refill

Electricity Daneco P9.00/kph. P1,008.00 112kph 12,096.00

Consumption

Water TWD P20/cum. 140.00 7cum 1,680.00

Total P20,976.00

Table 32

Projected Utility Expense

Year Amount

1 P20,976.00

2 22,025.00

3 23,126.00

Repair and Maintenance

 Table 33 shows the increase of 5% per year in repair and maintenance.

Preventing from delays is one of the essential in the proposed business.

Table 33

Repair and Maintenance

Year Amount

1 P1,000.00

2 1,050.00

3 1,103.00

Store Supplies Expense

Table 34 presents the expense of supplies that can be used in the Nutri Food. In

table 35, the proponents assumed 5% increase on supplies expense.

Table 34
 Store Supplies Expense

Particulars Unit Cost Quantity/month Annual Cost

Calculator P125.00 1 P1,500.00

Record Book 20.00 2 480.00

Ball pen 4.00 5 240.00

Dishwashing Detergent 49.00 5 2,940.00

(250ml)

Apron 100.00 2 2,400.00

Cellophane (3x10) 13.00 4bags 624.00

Cellophane (8x14) 31.00 2bags 744.00

Total P8,928.00

Table 35

Projected Store Supplies Expense

Year Total Amount

1 P8,928.00

2 9,374.40

3 9,843.12

Business Permit
 Reflected in Table 36 is the cost of business permit. The estimated cost for the

business permit in year 1 is P6, 360.00 and is assumed to increase up to 5% per year.

Table 36

Business Permit

Year Amount

1 P6,360.00

2 6,678.00

3 7,012.00

Transportation Expense

Presented in Table 37 is the cost of transportation expense and the proponents

presumed an increase of 10% per year.

Table 37

Transportation Expense

Year Total Amount

1 P4,000.00

2 4,400.00

3 4,840.00

Rent Expense
 Table 38 shows the rent expense which is assumed to increase 5% every year.

In year 1 is P60, 000.00, P63, 000.00 in year 2 and P66, 150.00 in year 3.

Table 38

Rent Expense

Year Amount

1 P60,000.00

2 63,000.00

3 66,150.00

The proponents decided to give free meal allowance per day to each employee.

The cashier and the owner will eat two times a day which is breakfast and lunch while

the baker it will eat only during breakfast for the reason that it will work only in the

morning to prepare the dough.

Table 39
 Meal Allowance

Position No. of Meal Total Meal Annual Cost

Employee Allowance Per Allowance Per

Day Month

Owner 1 40 1,040 12,480

Baker 1 40 1,040 12,480

Cashier 1 40 1,040 12,480

Total 37,440.00

According to the given data in Table 40 the projected meal allowance is to have

an increase of 4% annually.

Table 40

Projected Meal Allowance

Year Total Projected Meal Allowance

1 P37,440.00

2 38.937.60

3 40,495.10

Honorarium
 Table 41 the proponents considered that the bookkeeper will have a P500.00

monthly honorarium or a total of P6, 000.00 in the year 1. This will be assumed to

increase by 10% for the next two years.

Table 42

Honorarium

Year Total Amount

1 P6,000.00

2 6,600.00

3 7,260.00

Summary of Operating Expenses

Table 44 shows the list of total operating expenses. On the first year, operating

expense is P69, 561.00. In year 2 is P67, 261.00 and P69, 558.00 in year 3.In operating

expense, 25% was allotted for utility expense and transportation expense .

Table 43
 Summary of Operating Expense

Particulars Year 1 Year 2 Year 3

Depreciation P2,742.00 P2,742.00 P2,112.00

Kitchen Utensils 564.00 620.40 682.44

Expense

Salaries 78,000.00 81,900.00 85,995.00

Expense

Utility Expense 20,976.00 22,025.00 23,126.00

Repair and 1,000.00 1,050.00 1,103.00

Maintenance

Store Supplies 8,928.00 9,374.00 9,843.12

Business Permit 6,360.00 6,678.00 7,012.00

Transportation 4,000.00 4,400.00 4,840.00

Expense

Rent Expense 60,000.00 63,000.00 66,150.00

Meal Allowance 37,440.00 38,937.60 40,495.00

Expense

Honorarium 6,000.00 6,600.00 7,260.00

Total P226,010.00 P237,327.00 P248,618.56

Chapter 5
 ORGANIZATION AND MANAGEMENT PLAN

Organization and Management Aspect

Form of Business

Nutri Food is a sole proprietorship. It is being proposed since it is new and

considering that this form of business is unique and easy to handle. It is unique and

simple since they don’t have anybody to consider in terms of making decision because

the owner himself is one of the responsible and the one who manage.

Management and Organizational Structure

In this proposed business, the proprietor is the one who is considered as the

manager. The owner will monitor all the operation of the proposed business and to be

followed by the bookkeeper who will check and lastly, the cashier who will monitor the

inflow and outflow of the cash of the proposed business and a baker who is responsible

for the production and process of the proposed business.

 OWNER

BOOKKEEPER
- - - - - - - -- -

BAKER CASHIER

Figure6.Organizational Chart

Management Qualification and Function

Table 45displays the personnel as well as the job specification and their individual task.

Table 45

Management Qualification and Function

Position Job Description Job Specification

Manager  Supervise daily

business operation.

 Implement policies

rules and guidelines

in the organization.

 Responsible for

planning, decision

making and other

administrative

affairs.

Cashier Provide information to the  High School/

 customers in response to a College Graduate

wide variety of inquiries and  With working

complaints to ensure that experience and

they receive full information pleasing personality

of cash transaction.  Female

 18-35 years old

Baker They are responsible of  High

making and cooking the School/College

empanada Graduate

 With working

experience in the

baking or cooking

 20-45 years old

Total Project Cost

 The proposed business needs a total capital requirement of P90, 000.00 to start
the business operations.

Pre-operating Expense
Business Permit 6,360.00
Initial Fixed Capital Cost
Machinery and Equipment 8,596.00
Furniture and Fixtures 1,000.00 9,596.00
Initial Working Capital (1st month Operation)
Direct Raw Materials 27,924.67
Direct Labor 3,500.00 31,424.67
Operating Expense
Kitchen Utensils Expense 564.00
Salaries Expense 13,000.00
Utilities Expense 1,748.00
Repair and Maintenance 83.33
Supplies Expense 849.00
Transportation Expense 333.33
Rent Expense 5,000.00
SSS/Pag-ibig/Philhealth 698.80
Honorarium 500.00 12,776.46
Total 60,157.13
Add: Cash on Hand 9,842.87
Total Investment Cost P70,000.00
 ANNEX A

Historical demand of empanada in UMTC students

2013 Population % Target Consumptions Num. of Annual

Market Months Demand

in Pieces

1st 8,615 83.33% 3 5 107,683

semester

2nd 7,953 83.33% 3 5 99,408

semester

Summer 3,861 83.33% 3 2 19,304

Total 226,395

2014 Population % Target Consumptions Num. of Annual

Market Months Demand

in Pieces

1st 9,761 83.33% 3 5 122,007

semester

2nd 8,770 83.33% 3 5 109,620

semester

Summer 4,050 83.33% 3 2 20,249

Total 251,876
 2015 Population % Target Consumptions Num. of Annual

Market Months Demand

in Pieces

1st 10,712 83.33% 3 5 133,894

semester

2nd 10,004 83.33% 3 5 125,494

semester

Summer 4,831 83.33% 3 2 24,154

Total 283,542

ANNEX B
 Historical demand of Buko Shake in UMTC students

2013 Populatio % Target Consumptions Num. of Annual

n Market Months Demand

in Bottle

1st 8,615 76.66% 2 5 66,042

semester

2nd 7,953 76.66% 2 5 60,976

semester

Summer 3,861 76.66% 2 2 11,839

Total 138,857

2014 Populatio % Target Consumptions Num. of Annual

n Market Months Demand

in Bottle

1st 9,761 76.66% 2 5 74,827

semester

2nd 8,770 76.66% 2 5 67,230

semester

Summer 4,050 76.66% 2 2 12,418

Total 154,475

2015 Population % Target Consumptions Num. of Annual

 Market Months Demand

in Bottle

1st 10,712 76.66% 2 5 82,118

semester

2nd 10,004 76.66% 2 5 77,004

semester

Summer 4,831 76.66% 2 2 14,813

Total 173,935

ANNEX C
 Production Capacity for Empanada

Production Capacity = Capacity to produce in a day X Days of Operation in a

month X 12 months

Year 1 = 330 X 22 = 7,260 X 12 = 87,120

Year 2 = 87,120 X 10% = 8,712 + 87,120 = 95,832

Year 3 = 95,832 X 10% = 9,583.2 + 95,832 = 105,415

ANNEX D

Computation of Production Capacity for Buko Shake

Production Capacity = Capacity to produce in a day X Days of Operation in a
month X 12 months

Year 1 = 30 X 22 = 660 X 12 = 7,920

Year 2 = 7,920 X 10% = 792 + 7,920 = 8,712

Year 3 = 8,712 X 10% = 871.2 + 8,712 = 9,583

Financial Analysis Ratio

Gross Profit Ratio

Gross Profit Ratio = Gross Profit / Sales

Gross profit ratio shows the relationship between sales and the cost of the product

sold. It determines whether the proposed business is efficient in utilizing its raw

materials. As shown in the computation, the results are the following:

Year 1 = Gross Profit / Sales

= 256,504 / 633,600

= 40.48%

Year 2 = Gross Profit / Sales

= 396,640 /827,640

= 47.92%

Year 3 = Gross Profit / Sales

= 560,569 / 1,054,144

= 53.18%

Net Profit Ratio

Net Profit Ratio = Net Income / Sales

Net profit ratio determines whether the proposed business is running profitably after

considering all revenue and expenses. Nutri Food net profit margin shows an increase

in each succeeding year.

Year 1 = Net Sales / Sales

= 100,288.40 / 633,600

= 15.83%

Year 2 = Net Sales / Sales

=232,222.72 / 827,640

=28.06%

Year 3 = Net Sales / Sales

= 388,143.47 / 1,054,144

= 36.82%

Nutri Food
 Nutri Food
Projected Income Statement
For The Year Ended December 31, Year 1-3

Year 1 Year 2 Year 3

Sales 795,600.00 1,050,192.00 1,054,144.00

Less: Production Cost

Direct Raw Materials (Ingredients) 397,987.00 459,826.00 531,173.00
Labor Cost 42,000.00 44,100.00 46,305.00
Total 439,987.00 503,926.00 577,478.00
Gross Income 355,613.00 546,266.00 476,666.00

Operating Expense
Depreciation Expense 2,742.00 2,742.00 2,112.00
620.4
Kitchen Utensils Expense 564.00 0 682.44
Salaries Expense 156,000.00 163,800.00 171,990.00
Utility Expense 20,976.00 22,025.00 23,126.00
Repair and Mantenance 1,000.00 1,050.00 1,103.00
Store Suplies Expense 8,928.00 9,374.00 9,843.12
Business Permit 6,360.00 6,678.00 7,012.00
Transportation Expense 4,000.00 4,400.00 4,840.00
Rent Expense 60,000.00 63,000.00 66,150.00
SSS/Pag-ibig/Philhealth Contribution 8,385.60 8,804.88 9,245.09
Honorarium 6,000.00 6,600.00 7,260.00
Meal Allowance 37,440.00 38,937.60 40,495.00
Total Operating Expense 312,395.60 328,031.88 343,858.65
Net Income 43,217.40 218,234.12 132,807.35
 Nutri Food
Projected Cash Flows
For The Year Ended December 31, Year 1-3

Year 1 Year 2 Year 3

Cash Inflow
Sales Revenue 795,600.00 1,050,192.00 1,054,144.00

Cash Outflow
Acquisition of Fixed Assets:
Equipments and Utensils 8,596.00 - -
Furniture and Fixtures 1,000.00 - -
Production Cost
Direct Materials 397,987.00 459,826.00 531,173.00
Labor Cost 42,000.00 44,100.00 46,305.00
Operating Expense
620.4
Kitchen Utensils Expense 564.00 0 682.44
Salaries Expense 156,000.00 163,800.00 171,990.00
Utility Expense 20,976.00 22,025.00 23,126.00
Repair and Maintenance 1,000.00 1,050.00 1,103.00
Store Supplies Expense 8,928.00 9,374.00 9,843.12
Business Permit 6,360.00 6,678.00 7,012.00
Transportation Expense 4,000.00 4,400.00 4,840.00
Rent Expense 60,000.00 63,000.00 66,150.00
SSS/Pag-ibig/Phillhealth 8,385.60 8,804.88 9,245.09
Honorarium 6,000.00 6,600.00 7,260.00
Meal Allowance 37,440.00 38,937.60 40,495.00
Drawing (30%) 40,919.10 94,826.62 70,671.32
Total Cash Out Flows 800,155.70 # 924,042.50 # 989,895.97

(4,555.70
Net Increase (Decrease) ) 126,149.50 64,248.03
Add: Cash Balance, Beginning 100,000.00 95,444.30 221,593.80
Cash Balance Ending 95,444.30 221,593.80 285,841.83
 Nutri Food
Projected Balance Sheet
As of December 31, Year 1-3

Year 1 Year 2 Year 3

ASSET
Current Asset:
Cash 95,444.30 221,593.80 285,841.83

Non-Current Asset
Equipments and Utensils 8,596.00 8,596.00 8,596.00
Furniture and Fixtures 1,000.00 1,000.00 1,000.00
Total 9,596.00 9,596.00 9,596.00
(2,742.00 (5,484.00 (7,596.00
Less: Accumulated Depreciation ) ) )
Net Book Value 6,854.00 4,112.00 2,000.00

TOTAL ASSETS 102,298.30 225,705.80 287,841.83

OWNER'S EQUITY
Capital Beginning 100,000.00 102,298.30 225,705.80
Add: Net Income 43,217.40 218,234.12 132,807.35
Total 143,217.40 320,532.42 358,513.15
(94,826.62 (70,671.32
Less: Withdrawal (40,919.10) ) )
Capital Ending 102,298.30 225,705.80 287,841.83

TOTAL OWNER'S EQUITY 102,298.30   225,705.80   287,841.83