A FEASIBILITY STUDY ON FLAPPY EGGS IN BARANGAY MESAOY, NEW

CORELLA, DAVAO DEL NORTE

Presented to
The Faculty of the College of Business Administration Education
UM Tagum College
Tagum City

In partial Fulfillment of the

Requirements for the Degree of Bachelor of Science in
Business Administration

LOVELY B. ANG
ELMIR JOHN W. APOG
AIREEN F. BULADACO
RACHEL JANE S. LUNA
JERSON P. PALER
ARMARIE JOY R. PARALLAG
ELSANTO V. SANTOS
October 2014

Chapter 1

INTRODUCTION

Objective of the Study

The objective of this study is to determine the feasibility of egg wholesale
and retail in Mesoy, New Corella, Davao del Norte. It specifically aims to:

know the strengths and weaknesses of the proposed business;

study the competitiveness of the business in the chosen location;

determine the characteristics and the distribution of the product;

identify the possible supply, demand and technical support of the

business;

inquest the proper management position of the business; and

Analyze the financial strength of the business.

Methodology
The proponents used survey and interview methods in conducting the
study. This is to obtain reliable information about the demand and supply of eggs
in the Brgy. Mesaoy, New Corella, Davao del Norte. The question given during
the survey, in which the residents were asked directly to state their opinions and
suggestions, provide conclusive evidence supporting a vast demand of eggs.

Scope and Limitations of the study

This study focused primarily on the four major aspects of business which
includes the marketing, technical/production, organization management and
financial aspect. The proponents consider the data gathered but only to the
limited extent, because the competitor ceases to give the details of the
information. The proposed business deals with marketing that limits competition
regarding in the price of eggs that should be affordable for both middle and lower
income bracket level earners. In terms of technical and production aspect it is not
hard to purchase those eggs and materials because it is available within Tagum
City and Davao City. In an organization it is important to require an employee or
a worker that is capable to run a business. It is also wise to have a flawless
management that contribute successful path of the business. This aspect plays
an important role when it comes to scope and limitations because it occupies the
outflow of the capital. The gaining profit of the business should exceed the
expenses so that the business will continue to operate in a long period of time
and still provide good qualities of eggs to the consumers.

Chapter 2

EXECUTIVE SUMMARY

Brief description of the Project

The proposed business is a sole proprietorship. It offers a quality and
cheapest fresh eggs and hygienic that suite to the needs of the consumers. The
business is accessible to the residents where the market itself is reachable both
for store retail and individual household consumers of Barangay Mesaoy. The
quality of eggs and their stability during storage are highly observed to maintain
the good quality of the eggs.
The plan involving distribution, product positioning, pricing, promotion and
marketing research will be conservatively and judiciously implemented.
.Profile of Proponents
Paler , Jerson

BSBA-Financial Mgt.

Luna, Rachel Jane

BSBA-Financial Mgt.

Buladaco, Aireen

BSBA-Financial Mgt.

Ang, Lovely

BSBA-Marketing Mgt.

Apog, Elmir John

BSBA-Marketing Mgt.

Parallag, Armarie Joy

BSBA-Marketing Mgt.

Santos, Elsanto

BSBA-Marketing Mgt.

Prk.4,Mesaoy, New
Corella, Davao del Note
Prk. Durian Pangi Maco,
Compostela Valley
Prk. 4a Aurora
Compostela, Comval
Province
Prk. Gementiza Brgy.
Visayan Village Tagum
City
Blk. 23 Lot 01 RTU
Village Apokon, Tagum
City
Prk. SantanBrgy. Visayan
Village Tagum City
Prk. Aquarius, Visayan
Village Tagum City

Contribution to the Economy

The proposed business will contribute to local economy by bringing growth
and innovation to the community in which the business will be established. It will
realize distinct benefits such as providing employment opportunities to people
who may not be employed by larger businesses, discretionary income in the
community and tax income to get government as transfer payment for the
neighborhood securities, medications, education and public highways which the
people in the community will be benefited. These are some of the benefits that
the household sector and government sector that obtain from the business.

Chapter 3

MARKETING PLAN

MARKETING ASPECT
Description of the products
Flappy Eggs offers the quality of eggs that are fresh from the farm that has
a multiple sizes; small, medium, large, extra-large and jumbo.

It also offers

affordable prices that suites the budget of the consumers. Flappy Eggs insure
that the eggs preserve its nutrients through their stability during storage period
for three weeks to maintain high quality of the eggs.
Comparison of the Product with its competitors
The proponents can say that services are good enough compared to other
dealer of eggs. Customer service is highly observed by thorough knowledge of
the business, experience with the products, treating customers in a friendly
manner and being able to help customers make the best choices for them.
When it comes to the sizes and the prices of the product there is no
comparison into it because Flappy Eggs gives all the sizes of eggs namely;
small, medium, large, extra-large and jumbo and when it comes to the prices of
the eggs the proponents will make sure that Flappy Eggs give the most
affordable and well preserved eggs to the customer in order to serve and satisfy
their taste and preference.

Location of the Business

The propose site is at Barangay. Mesaoy, New Corella, Davao del Norte. It
is very accessible to the customers of the said barangay because it is the heart
Barangay. Mesaoy, New Corella, Davao del Norte. Figure 1 shows the
proponents location on the business.
Market Area
The market area of the business covers the entire Barangay. Mesaoy,
New Corella, Davao del Norte.
Main Customers
The market area of the business covers those households and sari-sari
store owners who are engage in retailing of eggs particularly the constituents of
Barangay. Mesaoy.

Figure 1
Proposed Business Location

Total Demand
Reflected in the Table 1 is the historical demand of eggs for the past 3
years in Barangay Mesaoy. The proponents conservatively assume 73% of the
target market. Every household consume 2 dozen of eggs per month. In year 1,
the total historical demand is 32,868, in year 2 are 35,320 and in year 3 37,983.
As shown in the table, there is an increasing demand of eggs in the past three
years.
Table 1
Historical Demand of Eggs (In Dozen)

Year

No. of
Households

Expected
Target Market
(73%)

No. of dozen
consume/month

Total
Demand
In Dozen

2011

1,876

1,369

32,868

2012

2,016

1,472

35,320

2013

2,168

1,583

37,983

Projected Demand

Reflected in Table 2 is the projected demand of eggs for the next three
(3) years. The proponents used the moving average method. The demands of
eggs have increased yearly. In the year 1, the total anticipated number of eggs is
37,983 meanwhile in the year 2 is 39,882 and in the year 3 is 41,876 these
figures indicate continued increase thus, it implies potential validity of the
proposed business.
Table 2
Projected Demand of Eggs (In Dozen)
Average
Year

Based year

percentage
increase

Projected Demand
(In dozen)

37,983

2%

38,743

39,882

2%

40,680

41,876

2%

42,714

Historical Supply
As per survey that been gathered, there is no immediate competitor for
the proposed business in Barangay Mesaoy. Thus, Flappy eggs competitors are
outside Barangay Mesaoy, which is the reason that the proponents did not
consider them anymore as competitor.
Projected supply in table 3 shows to compute the projected supply of the
propose business. The proponents consider the projected demand as the basis
of the proposed business production capacity.
It can be gleaned in the table that the proposed business can assume a
market share of 3% at the total projected demand. This 3% share as the propose
business production capacity.
Table 3
Selling Capacity
Selling
Year

Projected

Market share

Demand

Capacity
(In-Dozen)

38,743

7%

2,712

39,518

8%

3,161

40,308

8%

3,224

Selling Price
Reflected in Table 4 is the historical price of the eggs in accordance to its
size in per tray, dozen and pieces in 2014.
Table 4
Selling Price
CHICKEN EGG
Selling Price per

Selling Price per

Selling Price per

Tray

Dozen

Piece

Small

P129.00

P50.00

P4.50

Medium

P135.00

P54.00

P5.00

Large

P157.50

P63.00

P5.25

X-Large

P147.00

P60.00

P5.75

Jumbo

P156.00

P64.00

P6.00

Particulars

Projected Price
Shown in Table 5, 6 and 7 is the price of eggs per tray, per dozen and per
pieces. Furthermore, as the interview and survey conducted, the price of eggs is
assumed to increase by an average amount of P 0.35 per year. The increase of
eggs is not considered because an egg is one of the basic needs of man.

Table 5
Projected Selling Price
Year 1
CHICKEN EGG
Selling Price per

Selling Price per

Selling Price per

Tray

Dozen

Piece

Small

P142.50

P57.00

P4.75

Medium

P157.50

P63.00

P5.25

Large

P165.00

P66.00

P5.50

X-Large

P180.00

P72.00

P6.00

Jumbo

P167.50

P75.00

P6.25

Particulars

Table 6
Projected Selling Price
Year 2
CHICKEN EGG
Selling Price per

Selling Price per

Selling Price per

Tray

Dozen

Piece

Small

P150.00

P60.00

P5.00

Medium

P165.00

P66.00

P5.50

Large

P172.50

P69.00

P5.75

X-Large

P187.50

P75.00

P6.25

Jumbo

P195.00

P78.00

P6.50

Particulars

Table 7
Projected Selling Price
Year 3
CHICKEN EGG
Selling Price per

Selling Price per

Selling Price per

Tray

Dozen

Piece

Small

P157.50

P63.00

P5.25

Medium

P172.50

P69.00

P5.75

Large

P180.00

P72.00

P6.00

X-Large

P187.50

P75.00

P6.25

Jumbo

P195.00

P78.00

P6.50

Particulars

Sales Forecast
Reflected in Table 8 it shows the sales projected forecast in-tray for the
year 1 which the total is P175,122.00. Projected sales in tray has 25% equivalent
share in selling capacity. To get the total quantity of the trays, we multiply
projected demand to equivalent per share of 25% then multiply to 12 since the
selling capacity is in dozen, the result is divided to 30 because in tray it have 30
pieces of eggs.
Table 8
Projected Sales-Year 1
(In-Tray)
Particulars

%per share

Quantity
(per tray)

Selling Price
per tray

Small

5%

54

142.50

7,695.00

Medium

7%

76

157.50

11,970.00

Large
X-Large
Jumbo

6%
4%
3%

65
44
32

165.00
180.00
167.50

10,725.00
7,920.00
5,528.00

Total

25%

271

TOTAL

P 43,838.00

The Table 9 shows the projected sales forecast in dozen for the year 1.
We simply multiply the projected demand to equivalent share which is 44% to
selling capacity per year.
Table 9
Projected Sales -Year 1
(In-Dozen)
Particulars

%per share

Quantity
(per dozen)

Selling Price
(per dozen)

TOTAL

Small

13%

353

57.00

20,121.00

Medium

10%

271

63.00

17,073.00

Large

9%

244

66.00

16,104.00

X-Large

7%

190

72.00

13,680.00

Jumbo

5%

136

75.00

10,200.00

Total

44%

1193

P 77,178.00

Table 10 it shows the projected sales forecast in pieces for the year 1.
The computation in getting the total quantity in pieces, we simply multiply the
equivalent share which is 31% to selling capacity year 1 and multiply it to 12 to
get per pieces of eggs.

Table 10
Projected Sales -Year 1
(In-Piece)
Particulars

%per share

Quantity
(per piece)

Selling Price
(per piece)

TOTAL

Small

8%

2,604

4.75

12,369.00

Medium

9%

2,929

5.25

15,377.00

Large

7%

2,278

5.50

12,529.00

X-Large

5%

1,627

6.00

9,762.00

Jumbo

2%

651

6.25

4,069.00

Total

31%

10,089

P 54,106.00

Table 11 shows the projected sales forecast in tray for the year 2. The
total projected sale was P214,471.00. In calculating the total quantity in-tray it
was the same computation in year 1 but the selling capacity used is in the year 2
is assumed to increase by 5% from year 1.

Table 11
Projected Sales-Year 2
(In-Tray)
Particulars

%per share

Quantity
(per tray)

Selling Price
per tray

Small

5%

63

150.00

9,450.00

Medium

7%

89

165.00

14,685.00

Large

6%

76

172.50

13,110.00

X-Large

4%

51

187.50

9,563.00

Jumbo

3%

38

195.00

7,410.00

Total

25%

317

TOTAL

P 54,218.00

The Table 12 shows the projected sales forecast in dozen for the year 2.
The computation was the same with the previous projected sales in dozen in the
year 1. We simply multiply the projected demand to equivalent share which is
44% to selling capacity per year.

Table 12
Projected Sales-Year 2
(In-Dozen)
Particulars

%per share

Quantity
(per dozen)

Selling Price
per dozen

Small

13%

411

60.00

Medium

10%

316

Large

9%

284

X-Large

7%

221

Jumbo

5%

158

Total

44%

1,390

66.00

69.00
75.00
78.00

TOTAL
24,660.00
20,856.00
19,596.00
16,575.00
12,324.00
P 94,011.00

Table 13 shows the projected sales forecast of eggs in piece for the year
2. The computation in getting the total quantity in pieces, we simply multiply the
equivalent share which is 31% to selling capacity year 1 and multiply it to 12 to
get per pieces of eggs.

Table 13
Projected Sales-Year 2
(In-Piece)
Particulars

%per share

Quantity
(per piece)

Selling Price
per piece

TOTAL

Small

8%

3,035

5.00

15,175.00

Medium

9%

3,414

5.50

18,777.00

Large

7%

2,655

5.75

15,266.00

X-Large

5%

1,897

6.25

11,856.00

Jumbo

2%

759

6.50

5,168.00

Total

31%

11,759

P 66,242.00

Table 14 shows the projected sales forecast in tray for the year 3. The
total projected sale was P 226,908.00. In calculating the total quantity in-tray it
was the same computation in year 2 but the selling capacity used is in the year 2
is assumed to increase by 5% from year 2.

Table 14
Projected Sales-Year 3
(In-Tray)
Particulars

%per share

Quantity
(per tray)

Selling Price
per tray

TOTAL

Small

5%

65

157.50

10,238.00

Medium
Large
X-Large
Jumbo
Total

7%
6%
4%
3%
25%

91
78
52
39
325

172.50
180.00
187.50
195.00

15,698.00
14,040.00
9,750.00
7,605.00
P 57,331.00

The Table 15 shows the projected sales forecast in dozen for the year 3.
The computation was the same with the previous projected sales in dozen in the
year 2. We simply multiply the projected demand to equivalent share which is
44% to selling capacity per year.

Table 15
Projected Sales-Year 3
(In-Dozen)
Particulars

%per share

Quantity
(per dozen)

Selling Price
per dozen

TOTAL

Small

13%

422

63.00

26,586.00

Medium

10%

324

69.00

22,356.00

Large

9%

291

72.00

20,952.00

X-Large

7%

227

75.00

17,025.00

Jumbo

5%

162

78.00

12,636.00

Total

44%

1,426

P 99,555.00

Table 16 shows the projected sales forecast of eggs in piece for the year
3. The computation in getting the total quantity in pieces, we simply multiply the
equivalent share which is 31% to selling capacity year 1 and multiply it to 12 to
get per pieces of eggs.
Table 16
Projected Sales-Year 3
(In-Piece)
Particulars

%per share

Quantity
(per piece)

Selling Price
per piece

TOTAL

Small

8%

3,114

5.25

16,349.00

Medium
Large
X-Large
Jumbo

9%
7%
5%
2%

3,504
2,725
1,946
771

5.75
6.00
6.25
6.50

20,148.00
16,350.00
12,163.00
5,012.00

Total

31%

12,060

P 70,022.00

Summary of Sales
Presented in the Table 17 was the summary of projected sales forecast in
tray, dozen and pieces of eggs were calculated based on the production
capacity in the year 1, 2, and 3.

Table 17
Summary of Sales
Particulars

Year 1

Year 2

Year 3

In-Tray

43,838

54,218

57,331

Dozen

77,178

94,011

99,555

Pieces

54,106

66,242

70,022

Total

P 175,122.00

P 214,471

P 226,908

Marketing Strategy
Promotional Measures and Marketing
Marketing is the primary tool in establishing the business because this will
help your business to be known by the customers. The marketing strategy that
the proponents agreed on is to distribute fliers before the launching in the
opening of the business. For the customers awareness about the business that
were planning to put up in the said locations. And also if the business is open,
the proponents decided to give freebies upon purchasing of the products like: for
every purchase of 4 trays of eggs the customer will receive a plastic tray for free
and for every purchase of 10 trays of eggs the customer can avail a two percent
(2%) discount
Distribution Strategy
The proponents agreed that the strategy is direct distribution because for
us as beginners in this business we want to assure that the product are well
distributed to the customers; since the business starts at small, there is no
middlemen involve and the proponents will directly take the product to the
customer with free delivery charge.
Pricing Strategy
Pricing strategy is one of the major things to consider when it to prices.
Customers will always prefer a cheaper and the assurance that the product are in
good quality. The proponent will makes sure to give the most affordable and the
best quality of eggs and the prices will base according to their sizes.

Marketing Budget
Promotional Expense
The proponents also consider the budget in promoting the business. It will
start at P 1,500.00 and assumed to increase by 5% as the years pass by. The
calculation in getting the increase of the promotional expense yearly is to multiply
P1, 500.00 to 5% and the product is added in the principal amount of the
promotional expense.
Table 18
Promotional Expense
Year
1

Amount
P 1, 575.00

1, 654.00

1, 737.00

Chapter 4

PRODUCTION PLAN

PRODUCTION ASPECT
This chapter identifies the overall aspects of operations involving the
production process of the firm. It is necessary to determine the flow of operations
within a business.
Production Process
A production process generally involves the use of raw materials,
machinery, and manpower to provide a product. It is a process of a product or
services takes in order for it to become ready for the customer in the barangay
Mesaoy. The production process of the proposed business; first is the egg
collections that are purchased into some poultry industry. Second is the quality
control that specifies inspection of those eggs with cracks and damage should be
removed from the customers purchasing lines. Then the delivery of the product
from the supplier to the store. Then the preparation of the eggs by putting cold
water and laundry detergent, then wipe the stain continuously using sanding
sponge or loofah then put the eggs to the bucket with towel and let it dry and
ready for display. Then the customer will select the egg of their choice then pay it
to the cashier then the worker will pack it properly for the convenient and safety
of the product.

Furniture and Fixtures

Table 20 shows the detailed furniture and fixture needed for the
operation and has an estimated life in 3 years. It assumed after 3 years its cost
will increase 5% after full depreciation and another Furniture and Fixtures will be
acquired.
Table 20
Furnitures and Fixtures and Appliance
Particulars

Quantity

Unit Cost

Total Cost

P75,000.00

P75,000.00

Electric Fan

3,000.00

3,000.00

Cellphone

600.00

600.00

P3,600.00

P3,600.00

Delivery
Equipment
Appliances

Sub-Total
Furnitures and
Fixtures
Table

P1,500.00

P1,500.00

Chairs

300.00

1,200.00

Display Table

800.00

800.00

P3,600.00

P5,500.00

P82,200.00

P84,100.00

Sub-total
Grand-Total

Purchase of Products
(from supplier)

Delivery of products
(from supplier to our store)

Preparation of the products

Displaying of the products

Selling of the products

Figure 2
Selling Process

Depreciation
Table 21 shows the schedule of depreciation for the fixed asset. As per
assumption the life of the assets are dependent on its kind of assets. The
proponents use the straight line method of depreciation.

Table 21
Depreciation Schedule of Furniture and Fixtures and Appliances

Particulars

Amount

Estimat
ed Life
of
Assets

Delivery

P75,000.00

P9,375.00

P9,375.00

P9,375.00

Electric Fan

3,000.00

1,000.00

1,000.00

1,000.00

Cell phone

600.00

200.00

200.00

200.00

Sub-Total

P3,600.00

P1,200.00

P1,200.00

P1,200.00

Year 1

Year 2

Year 3

Equipment
Appliances

Furniture
and
Fixtures:
Table

1,500.00

500.00

500.00

500.00

Chairs
Display
Table
Display
Shelves

1,200.00

400.00

400.00

400.00

800.00

267.00

267.00

267.00

2,000.00

400.00

400.00

400.00

Sub-Total

P5,500.00

P1,567.00

P1,567.00

P1,567.00

Total

P84,100.00

P12,142.00

P12,142.00

P12,142.00

Sources of Furniture & Fixtures and Appliances

The supplier these furniture & fixture for the projected business are
available in the locality of Tagum City.
Planned Selling Capacity
Presented in Table 22 is the proposed production capacity of the
business. The proponents assume the production capacity based on the capital
set up of this kind of business.
Table 22
Planned Selling Capacity
Year

Selling Capacity Per

month(Tray)

Month

Total

240

12

2,880

252

12

3,024

265

12

3,175

Terms and Condition of purchase Equipment

The proponents had decided that the purchase equipment will be paid
through cash. The proponents and the owner of the purchased equipment had
agreed that equipment should have a warranty from the day it was acquire.
Store Lay-out
Figure 3 shows the proposed store layout of the proposed business.

Figure 3
Store Layout

Cost of Purchase
Reflected in Table 23 is the cost of purchase from the different suppliers.
The proposed business purchases the eggs by tray to take advantage at the
discount. It is assumed to increase by 5% per year.
Table 23
Purchases (eggs) Distributor Price
Cost per tray (30 eggs/tray)
Year1
Year 2
Year 3
80.00
84.00
88.00

Particulars
Small
Medium

85.00

89.25

93.70

Large

95.00

99.75

104.75

XL

105.00

110.25

115.75

Jumbo

115.00

120.75

127.00

Annual Purchase Cost

Table 24, 25 & 26 shows the projected annual cost of eggs.
Table 24
Annual Purchase cost-Year 1
Particulars

% share

Quantity
(per year)
239

Cost per
Tray
80.00

Small

22%

19,120.00

Medium

30%

325

85.00

27,625.00

Large

25%

271

95.00

25,745.00

XL

13%

141

105.00

14,805.00

Jumbo

10%

109

115.00

12,535.00

100%

931

P480.00

P 99,830.00

Total

Total

Table 25
Annual Purchase Cost- Year 2
Particular

% per share

Quantity
(per year)

Cost per
Tray

Total

Small

22%

278

84.00

P23,352.00

Medium

30%

379

89.25

33,826.00

Large

25%

316

99.75

31,521.00

X.L

13%

164

110.25

18,081.00

Jumbo

10%

126

120.75

15,215.00

Total

100%

1,263

P504.00

P121,995.00

Table 26
Annual Purchase Cost- Year 3
Particular

% per share

Quantity
(per year)

Cost per
Tray

Total

Small

22%

285

P88.00

P25,122.00

Medium

30%

389

93.70

36,476.00

Large

25%

324

104.75

33,981.00

X.L

13%

169

115.75

19,526. 00

Jumbo

10%

130

127.00

16,480.00

Total

100%

996

P529.20

P131,585.00

Inventory
Inventory every year is assumed to have a percentage of 1/8% or
equivalent to 0.00125 of spoilage eggs.
Table 27
Inventory Year 1
Cost of
Ending
Inventory

Particulars

Purchases

Sold

Spoilage

Ending
Inventory

Small

19,120.00

18,929

23

168

P384

Medium

27,625.00

27,349

34

242

589

Large

25,745.00

25,488

32

225

618

XL

14,805.00

14,657

18

130

389

Jumbo

12,535.00

12,410

16

110

410

Cost of
Ending
Inventory

Total
Table 28
Inventory Year 2
Particulars

Purchases

Sold

Spoilage

Ending
Inventory

Small

23,352.00

23,118

29

205

P431.00

Medium

33,826.00

33,488

42

296

665.00

Large

31,521.00

31,206

39

276

689.00

XL

18,081.00

17,900

22

159

438.00

Jumbo

15,215.00

15,063

19

133

404.00

Total

Table 29
Inventory Year 3
Cost of
Ending
Inventory

Particulars

Purchases

Sold

Spoilage

Ending
Inventory

Small

25,122.00

24,871

31

220

481.00

Medium

36,476.00

36,111

45

320

743.00

Large

33,981.00

33,641

42

298

670.00

XL

19,526. 00

19,331

24

171

494.00

Jumbo

16,480.00

16,315

20

145

453.00

Total

Operating Expense
Salaries and Wages
Table 30 represents the manpowers requirements of the business. The
proponents assumed that in every month the employer will receive (a monthly)
their pay (of) in accordance to their assign work. The cashier will receive a
monthly pay of P 3,000.00. The helpers will be receiving P 2,500.00 each or total
of P 5,500.00 equivalent to P 30,000.00.
Table 30
Salaries Expense
Particulars

No. of Workers

Rate per month

Worker

P 2,500.00

Cashier

3,000.00

Total

P 5,500.00

Total Amount
per year
P 30,000.00
36,000.00
P 66,000.00

Projected Salaries Expense

Presented on the Table 31 are the projected salaries and wages. It is to
increase by 5% in the next succeeding year.
Table 31
Projected Salaries and Wages
Year

Total Amount

P 66,000.00

69,300.00

72,765.00

Supplies Expense
Table 32 shows the expense to be incurred. As projected the proposed
business will be spending a total cash of P 22,200.00.
Table 32
Supplies Expense
Particulars

Quantity

Unit Cost

Annual Cost

Broom

P 45.00

P 90.00

Dustpan

45.00

45.00

Trashcan

90.00

90.00

Calculator

300.00

300.00

Record Book

100.00

100.00

Cellophane (Smooth)

100 pack

12.00

1,200.00

Cellophane (Sando bag)

100 pack

45.00

4,500.00

Newspaper

10 bundle

50.00

500.00

Tie box

5 roll

55.00

275.00

Egg tray

3,000

5.00

15,000.00

P 747.00

P22,200.00

Total

Projected Supplies Expense

Table 33 is the projected supplies expense for the next 3 years. It is
assume to be increased by 5%.
Table 33
Projected Supplies Expense
Year

Total Amount

P 22,200.00

23,310.00

24,246.00

Meal Allowance
. Presented on Table 34 is the proposed meal allowance of P30.00 per
day or a total of P 2,700.00 per month or P 32,400.00 per year. If is further
assumed to increase by 5% per year
Table 34
Meal Allowance
Year

Total Amount

P 32,400.00

34,020.00

35,721.00

Utility Expense
Table 35 shows the components of utility expense. Furthermore, the
proponents assume a 5% increase. Table 34 shows the projected utility expense
in the next 3 years of operations.
Table 35
Utility Expense
Utility

Source

Cost per month

Total Cost in
Year 1

Power Supply

Daneco

P400.00

P4,800.00

Water Supply

Water District

200.00

2,400.00

Communication

Sun

350.00

4,200.00

Total

P950.00

P11,400.00

Projected Utility
Table 36 shows the projected utility expense per year increase of 5% from
power supply, water supply and communication system.
Table 36
Projected Utility Expense
Year

Amount

P13,800.00

14,490.00

15,215.00

Repair and Maintenance

The equipment and maintenance must be maintained to be able to
function normally. Repair and maintenance expected to increase by 5% per year.
Table 37
Repair and Maintenance
Year

Amount

P14,400.00

15,120.00

15,876.00

Business Permit
The proponents conducted an interview to the licensing division of New
Corella. As per information the amount to be paid by the proposed business will
be P 3,500.00 in the initial year. However, in the year or two, it is assumed to
increase P300.00 per year.

Table 38
Business Permit
Year

Amount

P3,500.00

3,800.00

4,100.00

Transportation Expense
The estimated transportation expenses of the proponents per month is
P1,800.00 per month or equivalent to P 21,600.00 per year. It is assume that it
will increase by 5% in the next succeeding year.
Table 39
Transportation Expense
Year

Amount

P21,600.00

22,680.00

23,814.00

Rent Expense
The rental expense of the stall is P 3,000.00 per month or an equivalent of
P36,000.00 yearly. The proponents expected that there will be an increase for
the succeeding year by 10%. Table 40 presents the details.
Table 40
Rent Expense
Year

Amount

P36,000.00

39,600.00

43,560.00

Summary of Expense
Reflected in Table 41 is the summary of the operating expense in the
year 1,2 and 3.
Table 41
Summary of Operating Expense
Particulars

Year 1

Year 2

Year 3

Depreciation

P12,142.00

P12,142.00

P12,142.00

Salary and wages

66,000.00

69,300.00

72,765.00

Supplies and Materials

22,200.00

23,310.00

24,476.00

Meal Allowance

32,400.00

34,020.00

35,721.00

Utility Expense

13,800.00

14,490.00

15,215.00

Repair and Maintenance

14,400.00

15,120.00

15,876.00

Business Permit

3,500.00

3,800.00

4,100.00

Transportation Expense

21,600.00

22,680.00

23,814.00

Rent Expense

36,000.00

39,600.00

43,560.00

Promotional Expense

1,500.00

1,575.00

1,654.00

Total

P232,542.00

P236,037.00

P249,323.00

Chapter 5

ORGANIZATION AND MANAGEMENT PLAN

Form of Business Enterprise

The form of the proponent business organization is a sole proprietorship
which is owned by a single person and the proprietor owns all the firms assets
and is personally responsible for its debts. The sole proprietorship is a popular
business form due to its simplicity, ease of setup, and nominal cost. A sole
proprietor need only register his or her name and secure local licenses, and the
sole proprietor is ready for business. This business organization also has the
greatest freedom as compared with any form of business organization.
Management and Organizational Structure
Shown in figure 3 is the organizational framework of the proposed
business is composed of manager/owner, cashier and worker.
The manager/owner is the person responsible for planning and directing
the workers, monitoring their work, and taking corrective action when necessary.
Manager also directly liable for all the liabilities needed to the business. The
manager must be familiar with the work of all the groups supervises, but does not
need to be the best in any or all of the areas. It is more important for the manager
to know how to manage the workers and to know how to do their work well.

The worker is responsible for customer care, assists customers by

carrying items, upon request, to cashier area or to customers vehicle; as well as
provides courteous, efficient and attentive service in a timely manner by
welcoming customers.
The cashier responsibility are as follows; first is to greet the customers
entering into organization, handling all the cash transaction of an organization,
receive payment by cash, checking daily cash accounts, guiding and solving
queries of customer.

MANAGER /OWNER

BOOKEEPER

WORKER

CASHIER

Figure 4
Organizational Structure

Business Experience and Qualifications of the Entrepreneur

Success of the business requires a good idea, consistent hard work and
a bit of luck. The entrepreneur who organized the business marketing and
finance can be taught and learned, but the true entrepreneur understands that
the proof is in the product. A degree in just about anything proves you can stick
to a task, but your ability to sell yourself and your ideas is must.

Chapter 6

Financial Plan

The owner will invest the amount of P200.000 came from the savings.

Major Assumption

1. Market share is assumed to be 5% of the total unsatisfied demand per

year.
2. Salaries and Wages are projected to increase 10% per annum.
3. Utility is assumed to increase by 5% per year.
4. Repair and Maintenance is assumed to increase 5% per year.
5. Supplies expense is assumed to increase by 5% per year.
6. Business Permit is assumed to be P3, 500.00 on the initial year and is
assumed to increase by 10% in the next succeeding year.
7. Transportation expense is assumed to increase by 5% per year.
8. Meal Allowances for the crew is set at P32, 400.00 per year and
assumed to increase 5%.
9. Expected 5% increase per year to the Rent expense
10. Furniture and Fixture have a life span of 3 years.
11. Tools and Equipment have an estimated life of 8 years for the Multicab and 3
years for the other equipment.

12. It is estimated that the purchase price will increase by 5% each year.

13. Drawing is 40% of the net income.

14. It is estimated that the inventory of eggs that are considered spoiled is 1/8%
or 0.00125.

Total Projected Cost

The total project cost is approximately P200,000.00. The cost components
are as follows:
Pre Operating Expenses
Business Permit

P3,500.00

Fixed Capital
Tools and Equipment
Multicab
Electric fan
Cellphone
Furniture and Fixture

P75,000.00
3,000.00
600.00
5,500.00

P84,100.00

Working Capital
Cost of purchases of products

P19,200.00

Operating Expense (one month)

Salary and Wages
Utility Expense

P5,500.00
950.00

Repair and Maintenance

1,200.00

Supplies Expense

1,850.00

Transportation Expense

1,800.00

Meal and allowance

2,700.00

Rent Expense

3,000.00

Total
Cash on Hand
Total Investment Cost

P36,200.00
P 123,800.00
76,200.00
P 200,000.00