Professional Documents
Culture Documents
Our pocket tees aim is to give its consumers creative novelty designs for them to have
an avenue of their personal expression. Due to financial limitations, we would only have an
initial set of 5 designs, the theme will be pop culture phenomena or trending fads that will
invoke humor to the public. It aims to be a statement for the consumers that they are in the
know with regards to pop culture while at the same time have a quality pocket tee that is
fashionable. The production of this product does not require a considerably high capital,
hence can be shouldered by the six group members. The revenue of the company would come
from both retail/enterprise product sales and bulk sales.
The value proposition of the companys quality novelty shirts comes as a form of self-
expression. This product aims to target class B and C in Metro Manila, particularly students
and the young adults, from ages 16 to 30. The companys revenue will come from both
retail/enterprise product sales and bulk sales. In addition, competitors are comprised of local
shirt producers and designers, as well as small scale shirt manufacturing businesses. The
companys vision is to be a well-known fashion brand that helps spread positivity and
happiness in every wear. While Peek A Tees competitive edge is variety through adding
designs every season, and affordability through the reduction of overall cost while retaining
high quality.
Peek A Tee has encountered some challenges and has made certain deviations and
revisions from the original business plan to contain these problems. Firstly, revamping the
design concept of the shirts pushed back the start of manufacturing process by a week. As
part of Peek A Tees contingency plan, the company agreed on outsourcing the shirts instead.
The company also decided to increase the selling price of the shirts to have a faster return on
investment. From PHP 300 per shirt, the selling price is increased to PHP 349. In December,
the company finished revamping the design concept and the production of the shirts. Due to
the delay in the production of shirts, the group was only able to start selling in the first few
weeks of January.
Costs of the goods such as for raw materials as well as labor was higher than the
estimated cost of Peek A Tee. Some deadlines were not made during the first month of
operations. In the first month of implementation, reaching the targeted sales per month was
also a challenge. Peek A Tee once ran out of stock for two of the designs namely the finger
corgi and the muscle corgi. Peek A Tee then asked its manufacturer to produce the
regards to the internal strategic position of Peek-A-Tee. The company stuck with its unique
value proposition of creating unique yet humorous designs and this remains to be its key
strength. In addition, there was no change in the external environment as well. For
opportunities, market access is still a top priority due to the following of the unique product.
While the threats of established brands are unavoidable, the company can be more
aggressive with its marketing campaign. The people behind Peek-A-Tee realized that creating
a plan for promotions is a lot easier than implementing it. Furthermore, they also saw that
being present in social media is not enough to acquire a decent following. The owners also
saw how difficult it is to compete in the apparel industry given that competition is heavy.
The plan for expansion will include exposures to bazaars and the like, though the
company would largely be in digital and online. In terms for the groups competitive strategy,
focusing on differentiation will be the most effective way to attain competitive advantage
among different competitors. Given that the company is a newcomer, it may opt to use
advertising to attract customers, but only as much as resources are able to.
The sources of the paid-up capital (PHP 240,000) by the various incorporators of the
company would either be coming from minimal loans, from either parents or friends or both,
or from the incorporators own savings. Each incorporator would be responsible in acquiring
their share of the total initial investment required for by the company.
In Year 2017, 2018, and 2019, the companys vision and mission statement, as well as
objectives, will not change. In terms of its competitive strategies, the company plans to
maximize social media through aggressive promotional efforts. The financial and non-
objectives for these years is to increase its share in the market. Lastly, the company aims to
have recovered a minimum of 80% of its total initial investments. If the profit allows,
physical retailing would be one of the biggest factors for the companys success.
Table of Contents
Executive Summary .............................................................................................................. 2
I. Business Plan .................................................................................................................... 5
A. Highlights of the Business Plan ..................................................................................... 5
B. Deviations / Plan Revisions ........................................................................................... 7
C. Key Milestones/ Timetable ............................................................................................ 9
D. Key Result Areas ........................................................................................................ 10
2. Business Implementation ................................................................................................ 10
A. Actual vs. Projected Key Results/ Accomplishments ................................................... 10
B. Variance Analysis........................................................................................................ 10
C. Major Challenges / Problems Encountered and Management Response .................... 11
D. Actual Financial Statements ........................................................................................ 15
3. Strategy Evaluation ......................................................................................................... 15
A. Fred Davids Strategy Evaluation Framework with Recommended Corrective Actions 15
B. Rumelt's Criteria .......................................................................................................... 16
C. Lessons Learned ........................................................................................................ 18
4. Prospects ........................................................................................................................ 20
A. Growing the Business ................................................................................................. 20
B. Funding Plan ............................................................................................................... 22
C. Improved Business Plan ............................................................................................. 23
D. Projected Financial Statements................................................................................... 26
Appendices..26
I. Business Plan
Business Concept
The value proposition of the companys quality novelty shirts comes as a form of self-
expression. This product aims to target class B and C in Metro Manila, particularly students
and the young adults, from ages 16 to 30. The companys revenue will come from both
retail/enterprise product sales and bulk sales. In addition, competitors are comprised of local
shirt producers and designers, as well as small scale shirt manufacturing businesses, in the
Philippines.
Vision-Mission Statement
Our vision is to be a well-known fashion brand that helps spread positivity and
happiness in every wear. It is the companys mission to strive to be one of the leading apparel
companies by providing quality novelty shirts with designs reflective of current trends and
The company aims to increase its overall market share, put up physical
stores/infrastructures, and venture into new opportunities. Within three years of operations,
the company aims to have recovered a minimum of 80% of its total initial investments.
The total value of the Apparel and Footwear Industry in the Philippines was PHP
597.4 million in 2015. Current value sales are increasing by 7% because of increased
awareness of young consumers with regards to fashion. Moreover, the companys main
competitors are namely Bench, Penshoppe, Team Manila, and Tee Culture. The company
plans to utilize social media such as Facebook, Twitter, and Instagram for online retailing
while renting bazaar booths for physical retailing. Peek A Tees competitive edge is variety
through adding designs every season, and affordability through the reduction of overall cost
while retaining high quality. As for the personnel requirements, aside from the six group
members of the company, additional help would not be hired unless the need arises. As the
production of the company would be mainly outsourced, the tasks required would mostly be
The role of Chief Executive Officer will be filled by Shereen Salvatierra, and Chief
Operating Officer will be filled by Jerome Manaois. In addition to these, the role of VP for
Production will be filled by Ryan de Jesus, VP for Finance and Accounting by Charlon
Ortega, VP for Marketing and Sales by Seanne Cheung, and VP for HR and PR by Neil Tan.
Thirty percent (30%) from the total capital of PHP 220,000 will be used for the
acquisition of supplies, twenty percent (20%) for the outsourcing of sewing facility, twenty
percent (20%) will be used for printing, and thirty percent (30%) will be used for the other
operating expenses such as transportation, advertising, rent, utilities, and supplies costing
PHP 40,000 annually. To kick start the company's processes, resources from the six group
members, and if need be, a reasonable loan, would be required. Since the apparel industry has
Sales projection for the first year was computed by determining the number of BC
males and Females aged 16-30 in NCR, those willing to try a new clothing brand, and those
willing to purchase at computed SRP; at 2.67% apparel industrys annual growth rate. At
sales volume of 1000, 1232, and 1,581 for the first 3 years of operations, sold at 300 with
COGS at 180/unit, and annual operating expenses of 40,000, the net incomes are 44,000;
63,491,36; and 87,505,50 respectively. Cash flows are 256,500.00; 319,991.36; and
407,496.86 for the 3 years. Both assets, and liabilities and equity, equals 264,000;
327,491.36; and 414,996.86. Finally, the breakeven point remains 334 in units or PHP
During the course of the business operations, Peek A Tee has encountered some
challenges and has made certain deviations and revisions from the original business plan in
order to contain these problems and to continue fulfilling Peek A Tees vision of being a
brand that promotes positivity and happiness in every wear. These deviations were derived
from the contingency plans that the company has put together before the start or operations.
The initial design concept of Peek A Tee is by having four original designs and two
limited edition designs, for Christmas and Valentines Day. However, the problem that was
raised by the panelists is that it would ruin the element of surprise, one of the unique selling
propositions of the product, if customers would see the same design on other people and
would already know what is inside the pocket. Upon the suggestion of the panelists, instead
of having four designs with the same designs inside the pocket, tt would create a better
element of surprise, if there were different designs inside the pocket with the same design
outside the pocket. Peek A Tee was able to make revisions by reducing the outside designs
into two designs instead. In addition, more designs for the inside pockets were created per
outside design, meaning each outside design had three different inside designs.
In addition to the four original designs, Peek A Tee included two limited designs in
the original business plan. However, a few problems were faced during the manufacturing
process. Firstly, revamping the design concept of the shirts pushed back the start of
manufacturing process by a week. By then, Christmas was already one week away, therefore
the company decided not to push through with the Christmas design anymore. Secondly, the
company encountered problems with the shirt manufacturers. Initially, the company planned
to manufacture the shirts instead of outsourcing ready-made shirts. However, by the third
week of December, the company that the company chose to produce the shirts and print the
designs backed out because they had received a big order from SM, their contract company
and therefore not being able to accommodate Peek A Tee anymore. This, then, cause a big
delay to the manufacturing process, since the company could not find a company to produce
the shirts. The company decided after doing a cost-benefit analysis that it would not be ideal
to have limited edition designs too early in the operation since the manufacturing process is
manufacturer, which resulted to a delay in the production of the shirts. As part of Peek A
Tees contingency plan, the company agreed on that if manufacturing the shirts does not
work out, the company will decide to outsource the shirts instead. The company, then, looked
for suppliers of shirts that offers the best quality. Since as mentioned in the companys core
value, Peek A Tee aims to offer shirts that are of the best quality, and the company does not
want to compromise the quality of the shirt because of this setback. Moreover, the group also
decided that it will be less costly to buy regular shirts, have the design printed on, and then
buy cloth for the pockets and have it sewn on; instead of buying pocket shirts, have the stitch
of the pocket taken out, then have the design printed and have the pocket sewn back on. The
company partnered up with Sun Joy shirts for the supply of ready-made shirts, because only
Sun Joy was able to provide with top notch quality out of all the shirt suppliers, however it
also the brand with the higher prices compared to other shirt brands. Moreover, since Sun
Joys shirts are relatively bigger in size compared to other shirts, the company decided to
group intended to have silkscreen printing, the same printing that was used in the prototype.
However, upon further research, silkscreen printing will be costlier for our changing designs
and the print cracks after a few washes. The company decided to switch to heat press printing
Despite having a major change in the manufacturing process, the actual cost of
producing a shirt sums up to be PHP 5 cheaper than the projected cost of PHP 180 per shirt.
This is because the labor costs of having the shirts sewn was taken out. The company also
decided to increase the selling price of the shirts to have a faster return on investment. From
PHP 300 per shirt, the selling price is increased to PHP 349.
(Refer to Figure 1) In December, the company finished revamping the design concept
and the production of the shirts. Due to the delay in the production of shirts, the group was
only able to start selling in the first few weeks of January. Due to the lack promotional
materials, the company only started selling to family and friends. In the second week of
January, the company started to work on promotional materials. In the same week, the
company opened its first pop-up stall for a duration of three days in Sto. Domingo St, Quezon
City. After finalizing the promotional materials, Peek A Tee was able to launch its Facebook
page in the last week of January. In February, Peek A Tee decided to expand its reach online
and launches its Instagram account. In the same month, Peek A Tee started selling in Ateneo
Trade and University Trade, offering options of meetups and shipping for non-Ateneans. As
part of the companys expansion stage, Peek A Tee aims to join bazaars in order to increase
sales and boost its reputation; hence in March, Peek A Tee joined two bazaars: AMA Piazza
bazaar, which happened last March 13 to 17, and MECO SOSS bazaar, which happened last
March 27 to 31.
D. Key Result Areas
Peek A Tee has identified four key results areas in order to fulfill its company goals
that are found in Peek A Tees vision, mission and value statements. These key result areas
2. Business Implementation
(Refer to Figure 3)
B. Variance Analysis
The sales price variance (refer to Figure 4) resulted to a positive favorable amount
mainly because of high demand due to product differentiation and uniqueness. Moreover, it is
agreed upon by the company to increase the markup of the price in order to speed up the
markup could potentially decrease demand and sales, the company decided that the main
In terms of procuring the direct materials, which constitutes to the Cost of Goods
Sold, the variance depicts a favorable result which arises from efficient cost control, planning
error, and untimely use of contingency plan. The cost per production and packaging of shirt
ended up significantly lower, from 180/shirt to 161/shirt, mainly because of a more efficient
procurement method, wherein members buy and haggle each material to reduce its overall
advertising, and rent expense, mainly due to planning error and making use of more cost-
efficient avenues to conduct sales (i.e. free bazaars, garage sales, online order forms)
This amounted to an unfavorable amount mainly due to the lack of actual units
produced and sold in comparison with initial plans. The huge deviation was mainly caused by
unable to sell at the planned month of December due to the last minute shift towards
contingency plans regarding production, resulting to lesser time period to conduct sales.
Supply Chain
The first challenge encountered by Peek A Tee during the implementation of the
business plan was with regards to the supply chain. During the first production planning, the
initial supplier, who was supposed to provide the final products based on the designs backed
out on the last minute due to previous obligations. Therefore, the whole supply chain needed
to be reconsidered. Renewing the supply chain, canvassing and accruing all the supplies at a
low-price posed as a major challenge in terms of time coordination. This also caused delay in
the whole production process which was carried over to the selling process.
In light with this, the task was distributed to specific people to accomplish within a
time period instead of the system that was set before where all should be present. Certain
people were instead asked to acquire the supplies from another supplier while others looked
for a printing place that would provide the best value. After the extensive process of
contacting all suppliers and corresponding with each supplier, the product was produced.
Also, instead of finding another supplier for the packaging, it was made by people of the
company. This was also more cost-efficient than that of asking for suppliers to complete the
last process.
Costing
Another challenge that Peek A Tee encountered in the implementation was with
regards with the costing. Costs of the goods such as for raw materials as well as labor was
higher than the estimated cost of Peek A Tee. Aside from this, the printing of the logos and
designs on the shirts costed twice than what was previously estimated. This prompted Peek A
Tee to bargain with the suppliers to the minimum that they would be able to give. In the
process of this, there was also emphasis given that Peek A Tee is managed by student who
have limited resources especially with respect to financial resources. Costs for packaging
were lessened due to the initiative of members of Peek A Tee to create a more cost effective
and more efficient method for packaging without asking suppliers to produce for Peek A Tee.
Taking all this into account, Peek A Tee was able to produce the pocket tees at a cost less
Administrative
With respect to administrative affairs, Peek A Tee encountered some conflicts within
themselves. Some deadlines were not made during the first month of operations which was
last December. Some of the members of Peek A Tee were assigned to canvas for the best
value cloth were not able to find it in the specific time that was settled. Due to this, some
conflicts arose. Compromises were made in order to finish the production of the pocket tees
The decision for the designs of the pocket tee also caused a conflict. A unanimous
decision could not be made for the designs of the pocket tees. In the end, Peek A Tee came
up with entirely new designs that compromised the disagreeing parties and complied with the
challenge. This was also an effect of the delay in the production process. Due to this, Peek A
Tee added some promotional avenues to boost its sales. Firstly, Peek A Tee ask the help of
some well-known models within the Ateneo community to model for the product at the same
namely, AMA Piazza Bazaar (in the month of March) and MECO SOSS Bazaar (in the
month of March), the company used a more non-traditional promotional avenue like setting
up its first pop-up stall or a modified garage sale in the month of February outside the
house of one member of the company in Sto. Domingo, Quezon City near Sienna College to
boost the sales of the month. This broadened the market reached of Peek A Tee to not only
the online community within Ateneo at the same time increasing the awareness of the brand.
Peek A Tee reached out through its Facebook and Instagram page two contests where
customers can actively participate in. One was a design contest where contestants can design
a product of their own using the concept of Peek A Tee. The best design chosen has a chance
to have their design printed by Peek A Tee. Another was Choose your Peek where a GIF of
a model opening to pocket to show a full uncovered design was spread online through its
Facebook and Instagram pages. The contestant that was able to pause the GIF at the time
where the full uncovered design was shown has a chance to win a Peek A Tee shirt by
posting the screenshot photo and tagging Peek A Tee in either Facebook or Instagram.
Push marketing was also implemented to increase sales. While participating in both
bazaars within Ateneo, designated people within the group would each take turn to promote
the product in more crowded areas within the Ateneo such as Gonzaga Hall, SEC Walk,
MVP Lobby, and JSEC. This method increased the brand awareness and the sales followed
through.
Lastly, some changes in the pricing strategy were implemented to further promote the
product as well as its sales. Peek A Tee capitalized on the cliquish nature of some customers.
For those who want to buy five or more Peek A Tee products for themselves or for their
family members or wanted to collaborate with their friends can purchase the product at 50
pesos less. Instead of purchasing the product at 349 pesos, they can acquire it at 299 pesos as
These additional promotional avenues increased the sales of Peek A Tee from January
to February and finally reaching the projected sales per month of 83 pocket tees with 85
Stocks
Peek A Tee once ran out of stock for two of the designs namely the finger corgi and
the muscle corgi during the third week of February. To contain this, Peek A Tee asked its
manufacturer on the least amount of shirts that can be produced with the same price given
before. Twelve units of shirts were needed to be given the same price. Peek A Tee decided
that if there were eight customers that preordered the pocket tees of the specific designs, Peek
A Tee would reproduce the pocket tees. Finally, additional 12 units per design were produced
Aside from this, forecasted demand for each size was slightly off. Peek A Tee
forecasted that the demand for medium sized pocket tees would be the highest. The size of
extra large was also taken out due to the fact that the sizes of the pocket tees was larger than
normal shirts. However, more people ordered the size of large than what was produced while
there were also some that ordered extra-large. In the process of reproducing the pocket tees,
Peek A Tee took that into consideration and reproduced the preordered sizes along with
extras for the large and extra-large size to meet the demands of customers.
D. Actual Financial Statements
3. Strategy Evaluation
Throughout the implementation of the business plan, there was no change with
regards to the internal strategic position of Peek-A-Tee. The company sticked with its unique
value proposition of creating unique yet humorous designs and this remains to be its key
strength. Since its just a starting company, it is able to address specific needs of customers
whether this be a sudden influx in demand or new designs. The company is able to acquire its
raw product at a relatively cheap price which allows it to be competitive in its pricing. Aside
from this, the company also streamlines its value chain in order for them to offer quality
novelty pocket shirts that does not break the bank. However, a weakness of the company is in
the area of technology development. Since Peek-A-Tee is just a startup, it doesnt have access
to cheap financial products which can be used for capital expenditures. Buying equipment
may be expensive, but its long-term effect can make the company have a lower cost in
producing the pocket shirts. In line with limited capitalization, the company is not able to
reach all of its target consumer which limits its potential sales. Also, given that the company
is just a startup, the roles of business partners arent clearly established and it results to
Throughout the implementation of the business plan, there was no change in the
external environment. For opportunities, market access remains to be a top priority since its
unique product has a following. Being able to raise awareness to a bigger crowd can make
Peek-A-Tee have scalable growth in the years to come. Online commerce remains to be a
convenient avenue for customers to place orders. This allows the company to have better
information on what shirt designs and sizes are ordered more frequently. Creating a website
that is comprehensive and have more information about Peek-A-Tee may ignite brand interest
and loyalty. Given the growth of the BPO Industry in the Philippines and increased
remittances from abroad, the Philippines GDP is expected to grow for the following years. In
line with this, higher income allows for people to have an increase in buying power.
Partnerships with other companies are also avenues of potential growth. However, Peek-A-
Tee is threatened by the presence of established retail stores. They can offer a similar design
concept to that of Peek-A-Tee which may severely affect its growth and sales. Furthermore,
the apparel industry remains to be very aggressive with the entry of international brands
which spends a lot in their marketing campaign. Also, certain designs may only be a fad
The goal of Peek-A-Tee has satisfactorily achieved its objective of acquiring market
share. Through participating in different bazaars, Peek-A-Tee was able to expand its
customer segment. The owner's initial investment which shows that the product sells well.
Also by streamlining its value chain, Peek-A-Tee was able to accomplish the goal of having
B. Rumelt's Criteria
Consistency
Peek-A-Tee has the mission of providing quality novelty shirts with designs that
reflect current trends and pop culture. Its long term goal is to increase total market share. The
company has been consistent in achieving these goals which can be seen in the
implementation of their business plan. Participating in bazaars, creating timely designs, and
having an online order form helped the company to be recognized in the market. They also
try to maximize exposure in social media, specifically through Facebook, in order for the
consumers to be aware of their product. The company didnt incur any loss in the bazaars
they joined which shows that they are able to fulfill its mission of humorous trendy designs,
Consonance
The company continuously monitors the trend in pop culture in the Philippines to
produce new designs. This allows them to be adaptive to the external environment and see
new opportunities that may suddenly arise. This is evident in Peek-A-Tees decision to create
new designs instead of going with the initial designs they thought of in the strategy formation
phase. The company was able to determine that the design was already outdated and it
wouldnt be well received in the market. It can be seen that the company not only look at
trends at a whole, but also at individual trends, such as specific designs, and this allows it to
Feasibility
The company is able to acquire its inventory of shirts at a low cost while at the same
time looking for the most cost-efficient way to produce the final product. Peek-A-Tee is
closely involved with its value chain. The company buys shirts in bulk in order to get it a
cheap price. Afterwards, they select the most cost effective company which prints designs to
bulk shirts. To finalize the product, Peek-A-Tee also looks for a bargain in the cloth for their
shirts pockets as well as the sewing facility. The operations of the company is sustainable
Advantage
Peek-A-Tee focuses on designs that are humorous yet fashionable. Their competitive
advantage is being a niche novelty product. It positions itself not only as mere novelty, but
that which offers the benefit of being fashionable. This advantage of the company in line with
the its cost effective approach in handling its resources allows it to be distinct from the
competition, while maintaining a relatively low price. The company is also adept at creating
designs that capture its target market. This allows for Peek-A-Tee to stand on its own against
other competitors.
Corrective Actions
For corrective actions, the company can consider issuance of debt. This can allow the
marketing ability. This in turn may result to increased sales. The company can also consider
organizational structuring in order for people to have defined roles which can make processes
more efficient. The company can also consider creating its own website in order to capitalize
on the opportunity of Online Commerce. Given that more people are having access and using
the internet for their convenience, the company might be able to reach to more people and
increase its sales. The company can also decide to partner up with other companies in order
to reach a wider audience. While the threats of established brands are unavoidable, the
company can be more aggressive with its marketing campaign. This can make people have
brand awareness with Peek-A-Tee. Given that Peek-A-Tee designs may be cyclical in nature,
the company is encouraged to bring out more designs so that people will always have the
option to buy a shirt with timely design. This may include conducting more marketing
research, focused group discussions, which can allow the company to address the various
C. Lessons Learned
The people behind Peek-A-Tee realized that creating a plan for promotions is a lot
easier than implementing it. Furthermore, they also saw that being present in social media is
not enough to acquire a decent following. It is not enough to have a good product, what
matters just as much is the ability to bring the said product in front of the customer and
competition is very heavy. This is a challenge for products to be truly differentiated in order
to have a value that cannot be easily acquired in other products. The owners also realized
how difficult it can get to have a fully functional online platform for orders. Customers may
suddenly cancel on their orders and that there is no certainty that they will buy even if they
have filled up the form. This was a challenge for the company to be more flexible in meeting
the demands of the customers. Furthermore, we also saw that forecasting shirt sizes for
various designs is very difficult since theres no particular pattern to it. This in turns may lead
Peek-A-Tee also saw the significance of having various contingency plans because
not having one may greatly delay the operations of the company. Since the inventory was
only received at the latter part of December, it resulted to the company having no sales
which could have been an opportunity to have profit. The company also learned that having a
logistics and production plan is just as important as having a marketing and sales plan. Peek-
A-Tee had difficulties at the beginning in transferring raw materials, and in making it to the
final product ready for sale. Having a production plan can be very tedious and it may lead to
companies looking for a second and third option in order to make sure that there will always
Peek-A-Tee learned that the actual costs of production can be very different from that
of the forecasted price. There are different factors that are hard to account for in a theoretical
level which only gets its specific figure once negotiations are being made with different
costs results to unfeasible business plans which may need some serious revisions.
Lastly, Peek-A-Tee learned that money was just a reward for the job well done and
for one to gain money, one must first spend and lose money in the first place. Owners having
to invest their own money created an incentive for them to be better in handling money and
bargaining well with suppliers. The company also realized that even if a person can have
higher profit by working alone, working as a team allows for the group to contribute their
expertise in an organized manner which allows for scalable growth since they are able to
4. Prospects
The plan for expansion will include exposures to bazaars and the like. Though the
company would largely be in digital and online, the primary goal of its physical presence at
bazaars is to boost sales and expose the product to a larger public. The group will retain this
type of strategy for the short-term because of the limited initial investment. Moreover,
attaining a strong product position in an online environment may be the most cost-effective
for the group as a startup, but at the same time very difficult due to the ease of entry of
different groups that could potentially create an external risk of increasing competitor
presence.
making necessary changes based on their suggestions can positively affect and maintain the
sustaining the business. Customer trust depicts an important role for ensuring sustainability
In terms for the groups competitive strategy, focusing on differentiation will be the
most effective way to attain competitive advantage among different competitors. In order to
product is key. However, in order to keep the styles up to date, trend research and customer
feedback will ultimately be the guide. For instance, since the companys designs are largely
based on pop culture and current trends, the company plans to create new designs every
season, about every three months, to accommodate the changing consumer preferences. In
addition, the company would also increase the range of sizes of shirts it offers because during
the initial stage of operations, the company had only produced small, medium, and large. The
demand for extra small and extra-large sized was unfortunately not accounted for. Hence, the
company would be producing extra-large and extra small sizes for the upcoming designs.
Moreover, the company would also conduct a next stage for market research in order to
gauge whether the expansion to polo shirts and long sleeves from merely t-shirts is a viable
option. As of the moment, the manufacturing process is still relatively unstable due to the
startup nature of the company, therefore limited edition designs are still not being
implemented due to the negative results derived from the cost-benefit analysis. However,
once the companys production processes has stabilized, then the way for the production of
Every month, top management shall hold meetings amongst themselves in order to formulate
additional strategies to be able meet the companys overall objectives and in order to evaluate
Given that the company is a newcomer in the industry, and is likely unheard of yet,
the company may opt to use advertising in order to attract customers, but only as much as
resources are able to. The form of media in which the company would advertise in would
financially possible, radio. Given that social media sites, such as Facebook, Twitter, and
others are virtually free, it would be wise for the company to utilize these sites, as much as
possible. The company also plans to participate in a couple of local fashion/apparel events
and apply for participation in the aforementioned events and represent the company in
more frequently than large tarpaulins and banners. However, the distribution of such
promotional items will be highly subjected to the limited funds of the startup company.
Hence, online platforms such as Facebook, Twitter, and Instagram shall be the main
promotional tools the company will utilize. Not only are they cost-efficient, but also highly
If sales and revenue allows it, the company may also opt to establish physical stores in order
to attract more consumers. This, however, will be not a major priority of the company as it is
highly costly and in this digital age, online stores as a distribution platform have proven to be
highly effective.
B. Funding Plan
The production process of the companys products is all outsourced, therefore there
are virtually neither machines nor employees required to operate. But the company is in
charge of acquiring all the raw materials to ensure optimum quality for all outputs. As
aforementioned, the company has plans to build physical infrastructures, if and only if, the
sales and net income proves it to be a viable option as it is not a main concern as of the
moment.
Moreover, promotions and advertising will encompass all promotional materials such
as flyers small posters, stickers, tarpaulins and banners as well as paid advertising in online
platforms such as Facebook. Also, another distribution avenue the company will utilize is
bazaars which will incur rent expenses. Lastly, the company would need funding for
transportation expenses in order to be able to transport its products from raw materials
*Figures are based on actual monthly expenses incurred during the initial run of the
company.
Uses of Funds (Refer to Figure 11)
The sources of the paid-up capital by the various incorporators of the company would either
be coming from minimal loans, from either parents or friends or both, or from the
incorporators own savings. Each incorporator would be responsible in acquiring their share
of the total initial investment required for by the company. If for instance an incorporator has
acquired a loan, he/she will be solely accountable for said amount. Since the company has a
relatively low barrier to entry, the amount required to kickstart, or in this case, continue
and/or expand the production process, is relatively small. Therefore, issues regarding the
The computation of the paid-up capital required for each incorporator would be on a one-year
basis. This basis positively assumes that the net profit for the first year would be able to
sustain the production processes of the company for the next year, then the profit for the
second year would sustain the third, and so on for the years to come.
Year 1
Vision-Mission Statement
In Year 2017, the companys vision and mission statement will not change as not to
make the consumers confuse about what the company is especially that it is relatively new in
the market.
The objectives of the financial and non-financial objectives of the company would be
the same. The company will still aim to increase its overall share in market in the end of Year
2017 by having more physical stores and venturing into new operations.
such as Facebook, Twitter and Instagram through aggressive promotional efforts. This will
not only increase the awareness of the consumers but also an avenue for online retailing. The
company will still continue to join bazaars to introduce its product physically to potential
customers.
Sales projection for the Year 2017 will be determined by the apparel industrys annual
growth rate of 2.67% and the forecast of the people who are willing to try a new clothing
brand and willing to purchase at computed SRP. It will also be based on the past actual
demands during the first year. At sales volume of 584 units for the first year of operations,
sold at Php 349 with COGS at 180 per unit, and annual operating expenses of Php 30,500, the
net income for the company is Php 79,357.39. Cash flows for this year will be Php 79,357.39.
Finally, both assets, and liabilities and equity equal Php 112,997.39.
Year 2
Vision-Mission Statement
In Year 2018, the company will still retain its vision and mission statement. The main
reason for doing this is to maintain the companys values, culture and goals that have been
established already.
The financial and non-objectives for this year is to increase its share in the market by
having permanent stores either in malls or in other establishments. By this year also, the
company aims to have recovered a minimum of 80% of its total initial investments.
If the profit allows, physical retailing such as permanent store inside a mall would be
one of the biggest factors for the companys success. Continuous benchmarking with the
competitors in order to penetrate the market is also necessary and crucial during the year.
Sales projection for the Year 2018 will be determined by the apparel industrys annual
growth rate of 2.67% and the forecast of the people who are willing to try a new clothing
brand and willing to purchase at computed SRP. It will also be based on the past actual
demands during the first year. At sales volume of 720 units for the second year of operations,
each unit sold at Php 349 with COGS at 180 per unit, and annual operating expenses of Php
30,500, the net income for the company for this year is Php 104,848.70. Cash flows for this
year will be Php 184,206.09. Finally, both assets, and liabilities and equity equal Php
217,846.09.
Year 3
Vision-Mission Statement
Lastly, for the Year 2019, the vision statement of the company would slightly change.
The vision statement would not just be a well-known company but rather to be an established
fashion brand. The statement fashion brand that helps spread positivity and happiness in
every wear will be retained. For the mission statement, it will not change because the
For its financial and non-financial objectives, its market share should increase
If physical stores inside malls will be successful, the company will add more branches
in different malls in different places in Metro Manila. Online retailing will be push further to
Sales projection for the Year 2019 will still be determined by the apparel industrys
annual growth rate of 2.67% and the forecast of the people who are willing to try a new
clothing brand and willing to purchase at computed SRP. It will also be based on the past
actual demands during the first year. At sales volume of 887 units for third year of operations,
each unit sold at Php 349 with COGS at 180 per unit, and annual operating expenses of Php
30,500, the net income for the company for this year is Php 136,255.01. Cash flows for this
year will be Php 320,461.10. Finally, both assets, and liabilities and equity equal Php
354,101.01.
Appendices
Figure 1
Month
Key Milestones
December January February March
Production of shirts
Start of selling
Promotional preparations
Product delivery
Tracking of inventory
Quality control
Generate capital
Figure 3
Product delivery Meet-ups for online selling Meet-ups for online selling
and bazaar selling and bazaar selling
Generate capital Capital of 1,750 pesos per Capital of 2803.33 pesos per
month month
Figure 4
Figure 6
Figure 7
Figure 8
BreakEven Analysis
Variance CF CM CP KT KR KD
Units Produced 46 45 33 34 33 33
Product Mix Percentage 20.5% 20.1% 14.7% 15.2% 14.7% 14.7%
Net Unit Selling Price 349 349 349 349 349 349
Net Unit Variable Cost 171.2 171.2 171.2 150.8 150.8 150.8
Contribution Margin 177.8 177.8 177.8 198.2 198.2 198.2
Weighted Ave CM/unit 36.5 35.7 26.2 30.1 29.2 29.2
Total Fixed Cost w/ Investment 21,199.26
Total Break Even Units 113
BreakEven units per Variance 23 23 17 17 17 17
BreakEven in pesos 8,128.87 7,952.15 5,831.58 6,008.29 5,831.58 5,831.58
Figure 9
Strengths
Weaknesses
TOTAL 1 - 2.85
Figure 10
Opportunities
Threats
TOTAL 1 - 2.35
Figure 11
Figure 12
Figure 13
Operating Expenses
Transportation
Expenses 15,000.00 15,000.00 15,000.00
Figure 14
Figure 15
ASSETS
LIABILITIES
EQUITY