The Problem and Its Background

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Chapter 1
THE PROBLEM AND ITS BACKGROUND
This chapter presents the introduction, statement of the problem, objectives of the
study, significance of the study, and its relevant scope and limitations.
Introduction
The Philippines is a tropical country and it has a wide land to cater the
agricultural need of its inhabitants. One of the important value-added enterprises in food
production industry in the Philippines is goat raising.
Goat raising provides source of livelihood to local farmers and it enables the
utilization of vacant agricultural land. Most importantly, it helps to meet the demand for
high-protein foods in the Filipino diet because it is primarily used for meat that provides
about 18 percent of protein intake (Bureau of Agricultural Research, 2012).
Goat farming is the raising and breeding of domestic goats. It is a branch of
animal husbandry, wherein the goats are raised principally for their meat, milk, fiber and
skin. Goat farming can be very suited to production with other livestock such as sheep
and goat on low-quality grazing land. Goats efficiently convert sub-quality grazing matter
that is less desirable for other livestock into quality lean meat. Furthermore, goats can be
farmed with a relatively small area of pasture and limited resources (Qushim, 2016).
Studies show that Filipinos are looking for other goat meat alternatives due to its
low cost. The demand for goat’s meat increased as supported by the increase in the total
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disposition of goat in 2018 by 0.95 percent. However, based on statistics there is a
continuous decline on the goat supply in the Philippines (Bureau of Agricultural
Research, 2017).
Due to these reasons, the researcher decided to propose the establishment of a
goat raising farm in Amadeo, Cavite to meet the increasing demand for goat that will be
sold to goat butchers and traders. This place is strategically located in an agricultural
municipality in Cavite which is suitable in the establishment of an agricultural farm.
Statement of the Problem

The central problem of this study is the evaluation of the viability of establishing
a Goat Raising Farm in Amadeo, Cavite.
Objectives of the Study
The main objective of this study is to determine the viability and feasibility of
establishing a Goat Raising Fam in Amadeo, Cavite.
Specifically, objectives from the point of view of the different functional areas of
management are as follows:
1. Marketing
a. To describe the nature of the primary and the secondary products.
b. To determine the demand of the proposed business.
c. To ascertain the supply of the projected business venture.
d. To analyze the demand and supply of the business.
e. To compute for the market share of the proposed business.
f. To formulate marketing plan and strategies for a successful business
operation.
2. Technical
a. To determine the processes involved in operating the project in the most
effective and economical way.

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b. To find out the necessary equipment, machinery, furniture and fixtures
needed to start the business.

c. To locate and propose to create a building and its relevant requirements.
d. To strategize an ideal location for the goat farm to be established.
e. To create an effective layout and floor plan in the establishment of the goat
raising farm.
f. To come up with the ideal capacity of the proposed business and establish
the most practical business days for its scheduling.

g. To plan on ways how to dispose any wastes that the proposed business
will produce.
h. To verify the most reasonable costs to be incurred for the utilities and
other expenses of the business.

i. To establish good quality controls in order to be effective and efficient in
the operation process.

3. Organization and Human Resource
a. To decide on the most appropriate form of business ownership.
b. To identify the organizational requirements needed in starting the
business.
c. To draw the desired organizational structure and chart for the proposed
business.
d. To set the personal requirements needed to its corresponding prospective
personnel.
e. To establish a qualification standard needed to the personnel involved in
every facet of the projected business venture.

f. To develop a compensation package that will keep and motivate the people
to work hard for the organization.

g. To identify the necessary steps to be done before the implementation of
the project for its time table.

4. Strategic Management
a. To develop the mission, vision, and objectives, key result areas (KRA),
and performance indicators (PI) for the proposed organization needed for
strategic framework.
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b. To formulate a strategic evaluation to be the benchmark in assessing the
performance of the business.

c. To set contingency plans, alternative plans, and exit strategies just in case
the assumptions do not work as expected.

5. Financial
 To make realistic assumptions that will be the guide in the preparation of
financial statements.
 To agree on the amount of total capital investment required to implement
the project, including its pre-operating expenses, working capital, and
capital expenditures.
 To explore the possible sources of financing that would yield low interest.
 To determine the financial returns of the organization after the preparation
of financial statements.
 To interpret and analyze the results of the financial outcomes of the
proposed business.
6. Socio-Economic Responsibility
a. To provide the customers an overview of the business’ contribution for
their welfare.
b. To pay the right amount of employee’s salaries and benefits for their
personal and professional growth.

c. To be the source of revenues to the prospective suppliers to the business.
d. To give back to the community, society, and church what is due to them.
e. To quantify the contributions to the government by means of taxes.
Significance of the Study
For the researchers, this study will be beneficial in developing time management,
perseverance, social personality and business mindedness. This study will also provide
the researchers with knowledge about putting up a business that might help them in
establishing their own business.

105
Future researchers who are also into goat raising industry can use this study as a
reference. This study can serve as a guide for the progress and betterment of their
research.
Investors who are looking for a potential business which can yield a high return
can benefit from this study. Through the content of this study, investors can have the idea
on where to spend their money.
By this study, farmers can realize that the use of organic fertilizer from goat
manure because it is safer to the environment and is relatively cheaper compared to
commercial fertilizers.
Scope and Limitations
The study is to be conducted in Amadeo, one of the municipalities in the province

of Cavite.
The study will be conducted for a span of six weeks. The limited time may
prohibit the researcher to gather enough information that might be important in the
outcome of the study.
Only limited sources are available. Some data are not very recent which means
that it could have changed in the lapse of time. This probable change in the data used by
the researchers can contribute to different findings of the study.
Other relevant information may not be found by the researchers on the period of
study. Some factors may be overlooked and not taken into consideration.
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Chapter 2
REVIEW OF LITERATURE AND RELATED STUDIES
This chapter presents the literature and the relevant studies to the proposed
business venture, industry profile, success and risk factors, and the definition of terms
used to understand the study.
Literature
Goats are very popular among Filipinos because they require low capital
investment, fit the small farm condition, and multiply fast. Culturally, goats are integral
to every special occasion such as birthdays, baptisms, weddings, and fiestas. Hence, they
command a higher price compared with other meats in the market. Goats require low
maintenance because they eat tree leaves, weeds, grasses, and agricultural by- products.
They are not only a source of protein for Filipinos, but they also provide the much-
needed income. In fact, goats provide livelihood to about 15 million Filipinos across the
country today (Philippine Statistics Authority, 2017).
As goat production requires low initial investment and small risks compared to
other livestock species, it is thus an attractive undertaking among resource- poor families.
Moreover, women and children can raise the species, making it a sound option to
augment the country’s programs on livelihood.
Currently, there is an increase in demand for goats. Although total goat inventory
in the country is steadily increasing at 2% per year, still there is not enough supply to
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meet current demands. It is expected that this incr eased demand will last to 2020, the
year when supply is projected to meet demand. (Philippine Statistics Authority, 2017)
Considering these, goat production is indeed a promising venture, and anyone
interested to go into this business is expected to reap positive rewards.
According to the Bureau of Agricultural Statistics (2015), livestock production –
including goat, contributed a gross value of ₱247.1 billion to the agricultural output of the
Philippines.
Goat production is divided into two aspects namely: dairy production and goat
production. In some European countries (excluding France) they use the same goat as
source of both goat and milk while in other countries like Australia, New Zealand, the
USA, Canada, and Israel, the functions of goat and milk production have been separated
(Balls & Peters, 2004). In the Philippines, most goat are for slaughter while few remain
for dairy.
Related Studies
In the study of the goat industry roadmap for Region XII done on 2008, it has
been assessed that goat raising in the Philippines has an advantage compared to other
animal production ventures. This is because of the increasing demand for goat and the
transform of low-quality and fibrous feed materials, the availability of pastures and
favorable climate for goat production. Thus, the applicable technologies that had been
discovered increased goat productivity (Menandang, 2008).
Because of the increasing demand for goat due to population, changing of food
preferences and import liberalization, commercial feedlot fattening had arisen. A study
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by Menandang (2008) assessed that current trend in livestock industry shows that the
goat sector has the biggest room for growth and productivity. An investigation conducted
by Department of Agriculture last October 2017 shows that there were 22 mortalities out
of 2,309 goats, a mortality rate of 0.009 percent. The researcher did not consider the
mortality rate because it is insignificant.
According to the study of Baliang, P.D. (2012) on goat breeding, although goat
raising is a long-term investment, profits and assets increase more as the business
continues to operate.
Industry Profile
As of 1 January 2019, the total goat inventory was 3.76 million heads. This was
0.83 percent higher compared with the inventory of 3.72 million heads in 1 January 2018.
Inventory of goat in backyard farms increased by 0.87 percent. On the other hand, goat
population in commercial farms went down by 2.36 percent. The top four regions with
the highest inventory of goat were Central Visayas, Western Visayas, Ilocos Region and
Central Luzon. The combined stocks from these regions accounted for 48.36 percent of
the country’s total goat inventory.
In 2017, the gross value of production at current prices amounted to Php 9.70
billion. It increased by 6.34 percent over the Php 9.12 Billion in 2016. The gross value of
production at constant prices decreased by 0.15 percent from its 2016’s value of Php 3.65
Billion.
Despite of the slight increase of supply for the goats, the demand has been
continuously increasing more. This is evidenced by the increase in the number of goats
slaughtered for meat in 2013 (Bureau of Agricultural Statistics, 2013).

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Success Factors
The success of establishing a goat farm is dependent on internal factors like the
kind of management, breed of the goat, resources and organizational capabilities and
competencies; and external factors such the economic status of the place of business,
social factors, ecological and technological factors. These factors should be considered
to provide steps to enhance the success of the business.
Strengths. According to Gomez (2009), The proposed goat farm should have a
strict quarantine program that includes proper disinfection of delivery vehicles,
individuals, and goat; immediate isolation of sick goat, proper disposal of waste, dead
animals and other contaminated materials; and rigid inspection of newly introduced goat
breed to break the cycle of the disease. Proper sanitation will also be considered. By
doing such, the proposed business can produce healthy goats that can be sold to goat
farms and can establish a good relationship with customers through its quality product.
It will also have early diagnosis of disease because there are infections that cannot
be detected in its early stage. The farm people will have a thorough inspection of the
goats once a day to ensure that the goats are in good health. Goat farmers prefer healthy
goats to avoid food safety problems (Gomez, 2009).
Parasite control like lice treatment and anthelminthic treatment will also be
implemented to avoid mortality and morbidity. Being able to avoid mortality and
morbidity will increase the number of goats that can be sold to the customers (Kazutaka,
2012). The farm workers are able to administer injections to minimize the risk of carcass
damage, compromise on animal health and potential food safety problems (Kazutaka,
2012). Hiring appropriate management staff that is capable of anticipating potential

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problems and making contingency plans is favorable for the business. This reduces risks
of probable losses or in worst case scenario, bankruptcy (Kahan, 2008)
Good relationship between the management and the farm personnel can result into
the good image of the business, maximization of the working hours and decrease on the
worker’s negligence. Through this, the farm can be more productive.
Opportunities. Economic growth can give rise to increase on the demand and
increase on sales which is good for the business. As a result of which, the business can
become more profitable (Infotechusa, 2009).
Local events such as the annual patronal fiestas on the target market will increase
the demand for goats year-round. Global celebrations too like Christmas Day and New
Year’s Day celebration triggers the increase in demand for goat. (Sec. 14. SWOT
analysis: strength, weaknesses, opportunities, and threats, 2014). According to the
researcher’s interview with Mr. Joeper Causapin, a logistics manager of DV Boer Farm
International Corporation, during the seasons mentioned goat’s meat demand is very
high.
Technological advances on goat raising is profitable for the business. The
development of technologies that contribute to the well-being and fast reproduction of
goat will increase the supply of goat. (Hersom H., Thrift T., & Yelich, J. , 2015)
Risk Factors
It is a common knowledge that any businesses have weaknesses and threats that
may cause them to fall. It is of great importance to know these weaknesses and threats to
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prepare for the possible outcomes and plan strategies and preventive actions to minimize
the risks.
Weaknesses. Underdeveloped roads and the inconsistent power supply remain a
major challenge for acquiring and supplying good quality goat. (Kahan, 2008).
Bad odors are a problem with livestock raising. People who live nearby often
complain about it. Foul smell can cause respiratory diseases to the people. The residents
might file a lawsuit against the farm. This can be disadvantageous because this entails
additional expense (Kazutaka, 2012).
Threats. The appearance of a new or stronger competitor may threaten the
proposed business. This may lead to decrease in sales and possible loss of clients and
decrease on the business’ market share (SWOT Analysis).
The rise of health awareness can lessen red meat consumption and can be a threat
to the goat business (Peterson, S., Jaret, P., & Schenk B.F).
Economic down turn can also affect the business. The purchasing tendencies of
customers will decrease if this happens (Peterson, S., Jaret, P., & Schenk B.F).
Environmental issues such as the contribution of goat in the global warming, land
degradation, air and water pollution, and loss of biodiversity is a threat. Some people
may stop patronizing the product once they become aware of such.
There are incurable diseases which might fall upon the goats like Caprine Arthritis
Encephalitis (CAE). CAE is incurable, contagious, and devastating to goat herds. It is
similar to the human AIDS virus and compromises goats' immune systems. If humans eat
diseased tissues from the goat, it is possible for those who had eaten to develop a human
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form of CAE. If this happens, people will not be interested in eating goat. As a result of
such, the demand for goat’s meat will decrease and so are the sales of the business.
Human risks such as sudden death, accident, migration and illness of farm personnel who
have special skills can interrupt farm performance (Kahan, 2008).
Definition of Terms
There are terms that are being used by the people who used to work in a goat
industry. The following are some of the words being used for such purpose:
Anestrous Period- The time when the female does not exhibit estrus (heat); the
non-breeding season.
Boer- One of the breeds of meat goats used in the U.S. This breed originated in
South Africa and was imported into the Philippines during the early 1990s.
Bolus- A rounded mass of medicine used in goat, goats and sheep.
Breed- Is a specific group of animals having similar appearance, behavior and
other characteristics that distinguish it from other organisms of the same species and that
were arrived through selective breeding.
Breeding- Is the reproduction that is producing of offspring.
Buck- A sexually mature intact male goat used for breeding.
Butchers- A person who may slaughter animals, dress their flesh, sell their meat or
do any combination of these three tasks.
Castration- Is any action, surgical, chemical, or otherwise, by which a biological
male loses use of the testicles.

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Cross-breed -An animal whose parents are of two different breeds.
Cull- Animals of low-quality hence prevented from breeding.
Feedlot- A lot of large fence where steers or heifers are fattened for slaughter,
connotes, commercial scale.
Gestation- Period of pregnancy, period from conception until birth.
Weaning- The process of gradually introducing a mammal infant to what will be
its adult diet and withdrawing the supply of its mother’s milk.
Chapter 3
RESEARCH METHODOLOGY
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This chapter identifies the sources of data and instrumentation, the research
design, population and sampling techniques, data gathering procedures, and the analysis
of data.
Sources of Data and Instrumentation
The researcher primarily utilized the primary and secondary data sources to
be the basis of assumptions to gather, analyze, and interpret data and translate it into
the study.
Primary Data. The data used in this study are from the survey questionnaires
distributed to the target market: butchers and goat traders. The researcher also conducted
interviews with individuals who have knowledge about the same business, such as the
farm caretakers and agriculturists. Some data came from direct observation of the
competitor’s practices in selling does.
Secondary Data. Other data sources are electronic materials and printed
materials like books, agricultural magazines and feasibility studies of other individuals
from the past years.
Research Design
In doing this study, the researcher used both exploratory research and descriptive
research. The researchers gathered data from customers and competitors to gain
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knowledge of the customs, values and buying practices of the target market in the
particular place. Also, interviews, surveys, and observation were done by the researchers.
Population of the Study
The target market is the butchers and traders all over Amadeo, Cavite. Most of the
butchers and traders in the area buy goats on a weekly basis- every Tuesday.
The method that the researchers used is 100 percent examination. This is because
the total number of traders and butchers is just 17.
The questionnaires were distributed to all butchers and goat traders in the local
market of Amadeo, Cavite. All of the distributed questionnaires were collected.
Table 1
Questionnaires Distributed and Retrieved
Questionnaires Questionnaires
Location Population Sample Size
Distributed Retrieved
Butchers 11 11 11 11
Goat Traders 6 6 6 6
Total 17 17 17 17
Data Gathering Procedures
After gathering initial data, the researcher formulated the questionnaire that will
explain the demand and supply of goats in Amadeo, Cavite. The questionnaire was
validated by five experts and five laymen to make sure that it can be easily understood by
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the respondents. After receiving feedbacks, the researchers finalized it with the
assistance of the adviser.
The questionnaires are distributed to the traders and butchers in Amadeo, Cavite.
No allowance for non-response is given because of the few numbers of respondents. To
make sure that all the questionnaires will be collected, the researcher used the help of Ms.
Joy Arevalo, the Vice-President for Finance of DV Boer Farm, his audit client who
engages in the same line of business.
The researcher conducted interviews with the farm managers, butchers, traders,
caretakers, government agencies like the Department of Agriculture (DAR), municipal
office workers particularly in the Business Permit Department to accumulate first-hand
information about the proposed business (Results of interviews is on Appendix 3).
Observation was also conducted on the local livestock markets to understand
trading practices particularly the pricing method used in the area. Through observation,
the researcher also obtained data on the number and size of goat commonly sold in the
market.
Analysis of Data
Profitability Ratios assess the proposed business’ capacity to earn sufficient
return on sales, total assets and owner’s investment. As the name suggest, profitability
ratios are measure of profitability. These ratios are used to know whether the proposed
business has the ability to make a profit. However, acceptable ratios vary depending on
the nature of the business [CITATION Placeholder1 \l 13321 ]
Return on Sales “is to indicate the performance of the company in achieving the
maximum sales possible, while at the same time keeping costs to a

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minimum”[ CITATION Pen04 \l 13321 ]. In business, the total cost should not exceed
total sales.
Net Profit ( After tax)

Formula:
Sales
Return on investment compares the investment gains directly with cost of
investment. If the business does not have a positive return on investment – which means
that costs is greater than the gain, it is best not to undertake the business. (Ballada, 2015)
(Gain on investment−Costs of investment )

Formula:
Costs of investment
Gross profit ratio shows the gross margin per every peso sales. This ratio is used
to determine whether the business gauged the appropriate mark ups in the selling price of
the product that are more than adequate to cover inventory cost and operating expenses.
The firm’s ability in controlling acquisition costs and inventories is also measured
through this ratio [CITATION Placeholder1 \l 13321 ].
Gross Profit
Formula:
Sales
Liquidity Ratios shows the ability of the firm to pay its debt that matures within
one year or within the operating cycle. It is essential if the firm continue to operate its
business. Liquidity ratios measure the capability of the firm to generate cash when it is
needed [ CITATION Cab12 \l 13321 ].
Current ratio expresses the relationship between current assets and current
liabilities. It shows the ability of the business to pay or meet its current obligations.
Some entity considers 1:1 as a satisfying ratio [CITATION Placeholder1 \l 13321 ].

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Current Assets
Formula:
Current Liabilities
Acid test ratio measures the ability of the company to repay its short-term debts
without relying on the sale of the inventories [ CITATION Cab12 \l 13321 ].
Quick Assets ( Cash+ Marketable Securities+ Accounts Receivable , net )

Formula:
Current Liabilties
Inventory turnover shows how many times the particular asset is turned over
during the year. The turnover directly affects the profit; the higher turnover suggests that
the entity does not hold much in inventory. With a low turnover, the entity might be
holding obsolete goods that are not worth their stated value [ CITATION Bri11 \l 13321 ]
Sales
Formula:
Inventory
Total Return on Capital Investment these are tools to gauge the average return
on initial investment.
Average Rate of Return measures the amount of net income per peso of average
investment. A rate greater than one is deemed encouraging and favorable.
Average Net Income

Formula: Initial−Year CashOutflow
2
Payback period shows how long it will take to recover the initial cash outflows
(the cost) of an investment. Generally, investments with shorter payback periods are
considered better. However, payback period depends on the nature of the business
(McGraw and Hill, Fundamental Managerial Accounting Concepts, 3rd Edition, p.414).
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Initial Investment
Formula: Payback Period=
After−tax cash flow
Capital Budgeting is the process of analyzing whether to accept or reject a
certain capital expenditure and deciding on which to allocate the firm’s resources
(Brigham and Houston, 2011).
Net present value (NPV) shows the sum of all present values of incoming and
outgoing cash flows over a period of time. NPV considers the time value of money and it
can properly account for different level of risks between projects (Ballada, 2015).
Internal rate of return (IRR) is a discount rate that would make NPV equal to
zero. It is also the rate of growth a project is expected to generate. If IRR is greater
thanthe cost of capital, accept the project. If IRR is less than the cost of capital, reject the
project (Ballada, 2015).
bi−Ci
Formula: IRR=NPV = =0 …
( 1+r )n
Benefit/Cost Ratio (B/CR) is a “ratio of the benefits of a project or proposal,
expressed in monetary terms, relative to its costs, also expressed in monetary terms. It
takes into account the amount of monetary gain realized by performing a project versus
the amount it costs to execute the project. The higher the BCR the better the investment.
General rule of thumb is that if the benefit is higher than the cost the project is a good
investment” (Ballada, 2015).
bi
¿
( 1+r )n
Formula: B/C Ratio
Ci
( 1+r )n
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Chapter 4
RESULTS AND DISCUSSION

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This chapter discusses the marketing study, operations and production study,
organization and human resource study, strategic management study, financial study, and
the socio-economic responsibility study to present the results and findings of the
researcher to its proposed business project.
Marketing Study
This study emphasizes all the information needed to provide the management
with enough comprehension to understand the motivations, desires and behavior of the
most important business assets; customers. This includes the product description,
demand, supply, demand supply analysis, market share, and marketing plans. Marketing
plays an important role in the decision making and contributes a lot to the study through
data collection, which are the industry reports and secondary data sources.
Product Description
The proposed business will produce grass-fed goat as its primary product and
organic fertilizer from the goat as its by-product. Both native and hybrid goat –
preferably Boer will be raised by the proposed business. The goat will be fed with grass
and grass to make them not only big and heavy but also healthier compared to those goats
which were conventionally raised. The farm will be the first goat farm that will be
established in Amadeo, Cavite.
The goat that will be sold by the proposed business are aged 1-2 years. From the
results of the survey, butchers and goat traders prefer to buy goat at this age. Normally,
goats of this age are medium sized and is often sold at P15,000.
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Goats will be sold after kidding 7-8 times to goat traders for P250.00/live weight
kilogram. A new batch of does will then replace the goats that are sold. The Boers will
also be replaced after 7-8 years.
The by-product which is the organic fertilizer from the goat’s manure will be
made through composting. It is a low-cost and environment friendly method. No
chemicals will be added for its fermentation. This will be given to the local farmers from
whom grass is bought as part of the community extension program.
Demand
Butchers and goat traders will be the target market of the proposed business. On
the table below is the historical population of butchers and goat traders since 2013 to
2018.
Table 2
Historical Number of Butchers and Goat Traders
Year Number of Butchers Increase Growth

and Goat traders (Decrease) Rate
2013 8
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2014 9 1 12.50%
2015 13 4 44.44%
2016 14 1 7.69%
2017 14 0 0.00%
2018 17 3 21.43%
Total 75 9 86.07%
Source: Department of Agriculture – Provincial Government of Cavite
To determine the projected population for the next five years, the researchers used
the Statistical Straight-Line Method because the gathered population is inconsistently
increasing (Department of Agriculture – Provincial Government of Cavite). Below is the
formula for Statistical Straight-Line Method:
Statistical Straight-Line Formula
Y = a + bx
∑Y - b∑X
Where: a =
n
∑X∑Y
∑XY -
n
Where: b =
∑X2
∑X2 -
n
Table 3
Projected Number of Butchers and Goat Traders
Number of Butchers and Increase Growth

Year
Goat traders (Decrease) Rate
2019 19
2020 20 1 5.26%
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2021 22 2 10.00%
2022 24 2 9.09%
2023 26 2 8.33%
2024 27 1 3.85%
Total 138 8 36.53%
Source: Result of Statistical Straight-Line Method
Based on the survey, the researchers found out that there is a great demand for
goat in Amadeo, Cavite. This is because of the growing number of goat buyers like
butchers and goat traders.
The survey showed that 100 percent of the butchers and goat traders in Amadeo,
Cavite buy goat from the local market once a week with an average total demand of 45
goats per week.
Based on the answers of the respondents, it is evident that demand is greater than
supply. Because of the limited supply, customers buy less goat than they actually wanted
to. Computation of demand is in Appendix 10.
Table 4
Projected Total Demand of Butchers and Traders in Quantity and in Peso
Demand
Increase/ Growth Increase Growth
Year in Demand in Peso
Decrease Rate (Decrease) Rate
Quantity
2019 11,856 177,840,000.00
2020 12,480 624 5.26% 187,200,000.00 9,360,000.00 5.26%

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2021 13,728 1,248 10.00% 205,920,000.00 18,720,000.00 10.00%
2022 14,976 1,248 9.09% 224,640,000.00 18,720,000.00 9.09%
2023 16,224 1,248 8.33% 243,360,000.00 18,720,000.00 8.33%
Total 69,264 4,368 32.69% 1,038,960,000.00 65,520,000.00 32.69%

Source: Appendix 10
Out of the total population, 100 percent are willing to avail of the products of the
proposed Goat Raising Farm in Amadeo, Cavite. This is based on the respondents
answer on the survey questionnaires.
All of the butchers and goat traders buys goat once a week. A mature goat that is
priced not more than P15, 000 is in demand. There is no particular breed for the demand
of goat because breeds are not considered on the pricing of goat in the area. Size is the
determinant of the goat price.
Table 5
Projected Organization’s Demand of Butchers and Traders in Quantity and in Peso
Growth
Demand in Increase/ Growth Demand in Increase
Year Rate
Quantity Decrease Rate Peso (Decrease)
2019 6,384 95,760,000.00

2020 5.26% 5.26%
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6,720 336 100,800,000.00 5,040,000.00
2021 7,392 672 10.00% 110,880,000.00 10,080,000.00 10.00%
2022 8,064 672 9.09% 120,960,000.00 10,080,000.00 9.09%
2023 8,736 672 8.33% 131,040,000.00 10,080,000.00 8.33%
Total 37,296 2,352 32.69% 559,440,000.00 35,280,000.00 32.69%

Source: Appendix 10
Supply
There is only one competitor within the target market which is the livestock
market in Mahogany Market in Tagaytay, which opens every Thursday.
The goat sold in the local livestock market vary in sizes and in breed. Commonly,
the goat that are sold here are Philippine native goat which are relatively smaller
compared to other goat breeds. Pricing does not depend on the weight of the goat, rather
it depends on the size. The price is not fixed that is why customers can bid a higher or
lower price for each goat.
Goat traders and butchers buy from the local livestock market because it is the
only available goat supplier in the area. The goat traders and butchers cannot avail of the
products of the farms in other municipalities in Cavite because it is far.
Through interviews with the butchers and goat traders who buy goat from the
livestock market for almost 15 years, the researcher was able to gather data about the
historical capacity of the local livestock market in Amadeo, Cavite.
Table 6
Historical Capacity of Competitors
Year Inflation Quantity Peso Value Increase

Rate (Decrease) Growth
105
Rate
2014 3.60 2,340 32,516,655.73

-
2015 0.70 2,340 26,998,129.49 5,518,526.23 -17%
2016 1.30 2,340 28,889,071.84 1,890,942.35 7%
2017 2.90 2,340 34,112,972.65 5,223,900.81 18%
2018 5.20 2,340 34,966,643.19 853,670.54 3%
Total 11,700 157,483,472.90 2,449,987.46 11%

Source: Result of Interview of Mahogany Market Supervisor
There is constant quantity because during the interview with the butchers and goat
traders, it is made known that the supply of goat in the local livestock market did not
change over the years.
Table 7
Projected Supply in Quantity and in Peso
Capacity in Capacity
Name of Competitor Location
Quantity in Peso
Mahogany Market Tagaytay City 2,340 ₱ 35,100,000

Total 2,340 ₱ 35,100,000
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Source: Appendix 11
In terms of quantity, the competitors’ capacity is constant but in terms of the peso
value, its capacity is increasing due to the inflation. Figure 1 shows the projected capacity
of the competitors.
Projected Capacity of Competitors

38,000,000.00
37,000,000.00
36,000,000.00
35,000,000.00
34,000,000.00
33,000,000.00
32,000,000.00
2019 2020 2021 2022 2023
Figure 1. Projected Capacity of Competitors
Table 8
Projected Capacity of Competitors
Quantity Projected Increase Growth

Year
Capacity (Decrease) Rate
2019 2,340 34,268,757

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2020 2,340 35,113,503 844,746.28 2.47%
2021 2,340 35,958,250 844,746.28 2.41%
2022 2,340 36,802,996 844,746.28 2.35%
2023 2,340 37,647,742 844,746.28 2.30%
Total 11,700 179,791,248 3,378,958.11 9.52%

Source: Appendix 11
Demand and Supply Analysis
The organization’s total demand is greater than the unmet demand available
for the proposed business. This is possible because all the butchers and goat traders
are willing to patronize the product of the proposed business over the products of
the local livestock market in Tagaytay City.
Table 9
Comparison of Demand and Supply in Peso
Organization's
Year Total Demand Total Supply Unmet Demand Demand
2019 177,840,000.00 34,268,757.09 143,571,242.91 95,760,000.00

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2020 187,200,000.00 35,113,503.37 152,086,496.63 100,800,000.00
2021 205,920,000.00 35,958,249.65 169,961,750.35 110,880,000.00
2022 224,640,000.00 36,802,995.92 187,837,004.08 120,960,000.00
2023 243,360,000.00 37,647,742.20 205,712,257.80 131,040,000.00

559,440,000
Total 1,038,960,000.00 179,791,248 859,168,751.77 .00
Marketing Plan
After analyzing the project in connection with its target market and the probability
of earning a profit, the market plan is devised. This marketing plan considers the 4 P’s of
marketing mix namely: product, promotion, price, and place.
Product. To attract customers and to encourage them to patronize the product,
the proposed business will produce healthy goat. This is done through proper vaccines
which will be administered by the trained farm workers or by a professional veterinarian
in cases which cannot be handled by the farm workers.
The business will have its own delivery truck which will deliver the goat straight
to the agreed place with the buyer as long as it meets the 10 km distance. This service is
free of charge.
To provide healthy goat, seminars on proper vaccination and castrating goat will
be done by the management. It is to train the workers on how to handle goat. This
training includes the right way of vaccinating and castrating goat. Proper grazing of the
goat will be observed to make sure that the goat will grow bigger over the period.
For the product planning ₱10,000.00 will be used for the research of proper
vaccines, injections for antibiotics, substitute supply of the goat’s primary food, prospect
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veterinarian, and farm workers. This will be done by the owners. Twenty-five thousand
pesos (₱25,000) will be allocated for seminars of workers about goat raising.
Promotion. As a newly established business, the farm will conduct promotion
activities within three weeks before its operation. Hired farm workers will do
advertisements in the market to attract future customers. Farmer Cooperatives will also
be visited to promote and introduce the organic fertilizer out of goat manure. Leaflets
containing the name of the farm, location, products offered and contact information will
be distributed to the butchers and goat traders in Amadeo, Cavite. Along the road, there
will be signage indicating that a goat farm is nearby. In front of the farm vicinity, a life-
size replica of a goat will be erected so that those who pass by will notice that a goat farm
is in the area.
The budget for the market and cooperative promotion will be ₱1,500, the leaflets
will be allocated with a ₱500 budget, ₱2,500 will be for the signage, and ₱5,000 for the
life-size replica of a goat.
Price. As practiced in the local market, the farm will sell the goat in a cash-to-
cash basis based on goat size. Credit will not be accepted because goat are high price-
low volume products. The risk of uncollectible accounts can cause loss to the business.
The market-oriented method will be used in pricing the product. This method is
appropriate when the price is based on the interaction of demand and supply. When the
demand for goat is high, the farm will offer the goat at higher price. On the other hand,
when the demand falls; the goat will be sold for a lower price. To be able to use this
pricing method effectively, the managing partner or the head goat keeper should monitor
the price of goat in the market weekly.

105
Place. The goat farm will be located at Amadeo, Cavite. It is accessible because
it is near the road. The farm will receive orders Mondays to Thursdays through text
messages and telephone calls. The expected delivery is every Thursday but delivery on
other days except Saturday will be accepted. The goat will be delivered at the agreed
place with the customer as long as it does not exceed the 10 km allotted distance. The
payment and the transfer of registration papers of the goat will also take place in the area.
Fuel cost of ₱1,000 is expected to be consumed every week of delivery.
Table 10
Marketing Plan
Programs Resources Needed
Tools
Strategies Activities Duration Cost People
Product Computer,
Research 2 months ₱10,000 Owners
Planning Books
Hiring of
3 days ₱2,500 Management Computer
workers
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Department
Seminars 1 week ₱25,000 of N/A
Agriculture
Promotion in the
market and Farm
Promotion 1 week ₱1,500 N/A
Promotion in workers
cooperatives
Printing
Signage 1 day ₱2,500 N/A
Press
Distribution of
Farm
flyers and 1 week ₱500 N/A
workers
leaflets
Erecting a
3 days ₱5,000 Carpenters N/A
replica of a goat
Survey of recent Manager and
Pricing 1 week - N/A
market price Farm workers
Determining
Manager and
demand and 1 week - N/A
Farm workers
supply
Contact with Phone,
Place 3 days ₱500 Management
customers Computer
Delivery 1 day ₱1,000 Farm Driver Truck
________________________________________________________________________
Operations/ Production Study
This study is comprised of the operation processes of the business with its related
cost. This part also enumerates the production process and flow process of the proposed
business. It also deals with the acquisition of the necessary equipment, machineries and
furniture and fixtures that will be used in running the business. It also takes into
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consideration other relevant factors such as the building, proper place or location of the
business, the lay-out and floor plan of the proposed building, the budgeted capacity and
scheduling of the business, waste disposal and costs such as utilities and production costs.
Quality control which is very important for a business is also tackled in this chapter.
Production Process
The proposed business will raise goat on a farm. It will require acquisition of 100
Philippine native doe of at least one year of age and five Boer goats which were already
used for breeding from DV Boer Farm in Lian, Batangas. For every 25 does, one Boer
will be assigned for breeding. Boers have a big body structure and long floppy ears, and
it is relatively bigger than the Philippine native goat. Philippine native goats are
relatively smaller than Boer.
The native goat will be permitted to graze around the farm after they are brought
while the Boer will be kept in a ventilated barn with broken pens for a month before they
will be allowed to graze on the field. This is because hybrid goat need time to adjust on
the place. The barn will be ventilated to avoid ammonia fume build up and to provide
fresh air. Corn stalks will be used as bedding in the pens so that there will always be a
dry layer on top. To prevent goat from walking outside the farm, fences should be
maintained in good repair.
The goat that will be used for breeding will be Boer so that it will be possible to
cross-breed. It only takes eight months for a native goat. Artificial insemination will not
be practiced by the business because it is costly and it is not very applicable in Amadeo,
Cavite because of the unavailability of a professional veterinarian.

105
According to the researcher’s interview with Ms. Krizza Joy Perache, the Vice
President for Operations of DV Boer Farm, the gestation period of a goat is 240-245
days. On the scheduled birthing date, the farm workers will assist on the goat.
Veterinarians will just be called when the situation cannot be handled by the farm.
On the age of 1.5 months, the young goats will be castrated. Castration is the
removal or destruction of the testes or testicles and is done to stop the production of male
hormones. Castration eliminates unwanted breeding. Surgical castration is allowed even
without pain relievers when goats are two-months old [ CITATION Ani09 \l 13321 ].
New-born does are allowed to suck the milk from the goat for 6-10 months.
After this period, the does are weaned and are transferred to a separate pen for
immunization, deworming, and fattening. When the weaned doe had adjusted from being
away from the goat, they are released in the pasture. In rotational grazing system will be
practiced by the farm. It means that the farm grazing area will be subdivided into four
parts namely: west, north, east1, east2 pasture. The purpose of this is to allow the grass
to grow up to 15-20 centimeter on the vacant pasture to avoid grass shortage. Goat will
be moved to a different pasture once the grass are grazed down to 6-8 cm.
The goats are given immunizing shots of 2cc/ml once they are weaned and are
bathed to remove lice quarterly. Deworming solution is fed on the goat every day. The
immunizer which is 5 ml. --Hemorrhagic Septicemia Vaccine costs ₱500.00 [ CITATION
Ros11 \l 13321 ] and an organic deworming solution called Diatomaceous Earth is
₱200.00/25kg. Five to six oz. a day of this organic deworming solution is good for 1
goat (Agribusiness Digest, 2013).

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At the end of the fattening period of 6-12 months, the goat will be disposed. The
price will depend on the goat’s size because it is the common pricing method used in the
market. Normally, goat of this age is sold for a price of ₱35,000.
The technical processes on the process flow chart that will be done on the
proposed business is shown on the Figure 2 below.
Figure 2. Technical Process Flowchart

38
Table 11
Technical Process
Process Time Cost
1. Breeding 3 days -
2. Gestation 9 months -
3. Kidding 1 day -
4. Branding 1 day -
6. Castration 1 day -
7. Weaning 6-10 months -
8. Fattening, deworming, immunizing 6-12 months P2,016.00
9.Disposal 1 day P100.00
Total P3,016.00
Equipment, Machinery, Furniture and Fixtures
Manual labor will be used by the proposed business in handling goat. Artificial
insemination will not be practiced by the business because it is costly and there is no
readily available veterinarian in Amadeo, Cavite. Veterinarians will just be contacted
during emergencies like prolonged labor of a doe and unusual disease of goat.
The business will capitalize equipment, furniture, fixture and equipment costing at
least ₱10, 000. Other items below this range will be recorded as expense under the
account title Small Equipment, Furniture and Equipment. In depreciating capitalized
furniture, equipment, fixtures, the straight-line method will be used because. The
equipment, furniture and fixture are as follows:
Delivery Truck - is a boxcar that is used for the transportation and faster shipping
of the goat from one place to another.
500 watts Generator 2 GE jet pump motor wheel - a device used two pump-out
water from the main source for constant water supply.

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Movable Weighing Scale - measures the mass of goat that will help the farm care
takers in determining their health condition especially if a doe is already pregnant or if
the goat lacks weight. The depreciation method that will be used is the straight-line
method.
Feeding Manger -usually made of carved stones, woods or sometimes in metal
that is used in feeding the goat.
7500 Portable Generator - used to generate electricity in times of black outs.
Horse - native horse that will be used as means of transportation by the goat
keeper.
The pictures of the equipment, machineries and fixtures is shown on Appendix 13
and 14.
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Table 12
List of Equipment, Furniture and Fixtures
Unit Total Estimated Annual

Description Quantity
Cost Cost Life Depreciation
Barn ₱ 1,000,000 1 ₱ 1,000,000 15 ₱ 66,666.67

Woven Wire Fence 240,000 1 240,000 20 12,000.00
500watts Generator
2 GE jet pump 39,000 1 39,000 10 3,900.00
motor
Laptop 16,000 1 16,000 3 5,333.33
Movable Weighing
15,705 1 15,705 5 3,141.00
Scale
5000 watts
12,500 1 12,500 10 1,250.00
Generator
Delivery Truck 245, 905 1 245,905 10 24,590.50
Total ₱1,569,110 ₱1,569,110 ₱ 116,881.5
The small equipment, machineries, furniture and fixtures that will be used by the
proposed business are as follows:
Weather Proof or Dust Proof LED - used to light the entire farm at night or
even in daylight.
Exhaust Fan – help in the circulation of air which results in cooling of room
temperature inside the barn. Suitable temperature is needed to produce quality goat.
Reduce ammonia fume build up.
Castration Ring – used to castrate male goat.
Branding Iron – Used to mark the goat as its basis of identity.
Table 13
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List of Small Equipment, Furniture and Fixtures
Description Unit Cost Quantity Total Cost
Exhaust Fan ₱ 5,490 5 27,450

Branding Iron 4,860 1 4,860
Ear tagging clamp 3,150 3 9,450
Table 2,500 1 2,500
Castration Ring 1,215 3 3,645
Calculator 600 1 600
Weather Proof or Dust 550 20 10,990
Proof LED
Feeding Manger 513 20 10,260
Total ₱19,427 ₱ 69,665
Building
The proposed business will construct a building that will be used as an office for
the business transactions, supply room and barn. The researchers decided to construct a
building rather than leasing a commercial building because it is more economically
practical in this kind of business.
Table 14 shows the rough estimate of the goat building which costs ₱1,000,000.
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Table 14
Building Construction Cost
Particulars Percentage Cost
Lay-out: Excavation 1% 8,333

Masonry 28% 233,333
Hardware 40% 333,333
Lumber 26% 216,667
Electrical 5% 41,667
Total 833,333
Total Material Cost 833,333
Labor (20% of Material cost) 166,667

Total Construction Cost 1,000,000
Source: Engr. Catalino Valdez
Appendix 18 shows the picture of the proposed barn.
Location
The proposed location will be located in Barangay Talon, Amadeo, Cavite. The
size of the lot is 9 hectares. It is one kilometer away from the national road which makes
it accessible to customers and other prospect investors. The road is concrete that is why
transporting of goat to the agreed distance with the customers is easier.
Because the area is purely agricultural, there are just few families who live nearby
the place and most of them are farmers. The other lands beside the target location of the
proposed business are used as agricultural farm. This is beneficial because grass can be
used as food for goat especially during drought.

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The livestock market in Tagaytay City which is the only competitor of the
proposed business is also located in this area. The distance between the livestock market
and the proposed business is 10 kilometers.
Communication will not be a problem because various mobile networks is already
operating in the municipality like Sun Cellular, Smart, Talk ‘n Text, Globe and Touch
Mobile. Internet connection is also available.
Through riding a tricycle from nearby municipalities of Silang, Tagaytay, and
Mendez which is the place of majority of the target customers to Talon, Amadeo, Cavite
is just P30.00. Customers can just commute to the farm without spending much.
Layout and Floor Plan
Prior to constructing a barn, proper layout must be observed to provide sufficient
ventilation for the goat. Good ventilation implies a enough flow of fresh air. Effective
ventilation contributes to faster drying of floors and a healthy barn climate which is very
important to the goat’s well-being. Proper arrangement of equipment, furniture and
fixtures will be observed for smooth movements of goat and goat keepers.
At the left side of the entrance, the pens for mature goat are located. The Boers,
goats and does are to be kept in this area. Suckling or those does which are still drinking
milk from its mother will also be kept here.
Those weaned does that will be separated from the goats and are to be kept in
pens opposite to the broken pens of the matured goat.
The office will be located at the left side of the entrance, kidding pen on the right
side. The main portion of the barn will be occupied by the mature goat that will serve as
feeding and bedding area. The remaining part will be the space for young goat.
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Appendix 20 shows the lay-out of the barn.
Capacity and Scheduling
The proposed business will begin raising 1,000 goat that will be supervised by the
managing partner. One driver and three goat keepers including the head goat keeper will
be hired. To be able to sell the desired number of goats for its operations, the workers
will work 6 days a week from Sunday to Friday.
Table 15 shows the daily activities of workers in the farm.
A mortality of 2% per year is expected. Most of these deaths will be on the
weaning stage because according to the DAR, there is a rare case of death during
delivery. The most delicate time is the weaning stage. Assumptions were derived from the
interview with the VP Operations of DV Boer Farm.

82
Table 15
Goat keeper Daily Activity
Time Activity Time Involved

07:00 – 8:00 Turning out the goat for grazing. 60 minutes
Observe and isolate goat.
08:00 – 8:30 Feed the nursing female and the fattening 30 minutes
doe.
Watering of the animals on the grazing lands.
08:30 -10:00 Cleaning of the barn and disposal of the 90 minutes
manure.
10:00 – 12:00 Special activities like record keeping, 120 minutes
weighing, vaccination and preventive health
care, sorting, storage and etc.
12:00 – 13:00 LUNCH BREAK 60 minutes
13:00 – 16:00 Continuation of record keeping, weighing, 180 minutes
vaccination and preventive health care,
sorting, storage and etc.
16:00 – 17:00 Return of the goat to the barn. 60 minutes
Feed the nursing female and the fattening
doe.
Waste Disposal
Goat manure is the only waste that will be produced by the proposed business.
The farm workers will collect the manure every day. The manure will be dried and will
be mixed with dust or grass. This is called composting. After the manure is fermented,
an organic fertilizer is produced.
The organic fertilizer from the goat manure will be given to the local farmers
from whom grass is bought. The giving of composted goat manure is a part of the
community extension program of the business.
Utilities and Other Operating Costs
The proposed business will incur utilities and operating costs that are necessary in
carrying out the business operations.

105
Table 16 shows the utilities that will be used in the business such as electricity,
water, fuel, office supplies, delivery vehicle’s registration and repairs and salaries and
benefits of workers.
Table 16
Utilities Expense
Monthly Annual Allocated to Allocated to
Utilities
Cost Cost Production Operations
Electricity ₱ 5,000 ₱ 60,000 ₱ 51,000 ₱ 9,000
Repairs and
5,000 60,000 51,000 ₱ 9,000
maintenance
Fuel 4,000 48,000 - ₱ 48,000
Post Paid Plan 1,300 15,600 13,260 ₱ 2,340
Office Supplies 500 6,000 - 6,000
Vehicle Registration - 8,000 - 8,000
Total ₱ 15,800 ₱ 197,600 ₱115,260 ₱82,340
Table 17
Other Operating Cost
Monthly Annual Allocated to Allocated to

Salaries
Cost Cost Production Operations
105
Driver ₱ 6,847.52 ₱ 88,306.24 - ₱ 88,306.24

Head Goat keeper 8,347.52 106,306.24 106,306.24 -
Goat keepers 16,695.04 176,612.48 176,612.48 -
Agency Cost 12,908.71 154,904.52 131,668.84 23,235.68
Goat Insurance 6,125.00 73,500.00 73,500.00 -
Total ₱ 50,923.79 ₱ 599,629.48 ₱ 488,087.56 ₱111,541.92
Production Cost
Incurring of production cost of goat begins from the gestation period until it is
sold. The cost includes cost of grass, deworming solution, immunizing shots and labor.
A goat will be priced according to its size. The buyer and the seller will negotiate on the
appropriate price for the goat.
Direct materials will include deworming solutions and immunization vaccines.
During summer and drought, grass will be fed to the goat.
In the first year of operations, in order to produce the first batch of does; the
workers will have to work eight hours a day for six days in a week. Herding, feeding,
and watering the goat will be their job. Weight monitoring as well as data recording will
be done by them. The minimum wage of workers of agricultural businesses in Region IV
– CALABARZON for agriculture ranges from P226.00 to P246.00 per day. Due to this,
the researcher used the average of the possible wage, which is P236.00/day.
Factory overhead will be computed by multiplying the sum of indirect materials,
indirect labor and other utilities necessary for production by the 85% predetermined
overhead rate.
Table 18
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Production Cost (First Year)
Monthly Quarterly Annually
Materials:
1. Grass ₱ 6,273 ₱ 18,820 ₱ 75,281
2. Immunizing Vaccine 7,000 21,000 84,000
3. Deworming solution 3,467 10,400 43,460
Total Materials ₱ 16,407 ₱ 49,220 ₱ 196,881
Direct Labor:
1. Head Goat keeper’s
₱ 7,636 ₱ 22,908 ₱ 91,632
salary
2. Goat keeper’s Salary 12,272 36,816 147,264
Total Direct Labor ₱ 19,908 ₱ 59,724 ₱ 238,896
Factory Overhead (85%)
1. Guard Agency Fee ₱ 10,972 ₱ 32,917 ₱ 131,669
2. Utilities 9,605 28,815 115,260
3. Depreciation-PPE 8,279 24,837 99,349
4. Insurance – livestock 7,350 22,050 88,200
Total Factory Overhead ₱ 36,206 ₱ 108,619 ₱ 434,478
Total Production Cost ₱ 75,521 ₱ 217,563 ₱ 870,255
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Table 19
Production Cost (Second Year)

Materials:
1. Grass ₱ 9,735 ₱ 29,204 ₱ 116,818
4. Anesthetic 155 466 1,862
Total Materials ₱ 29,648 ₱ 88,945 ₱ 355,777
Direct Labor:
1. Head Goat keeper’ salary ₱ 7,919 ₱ 23,757 ₱ 95,028
5. Guard Agency Fee ₱ 11,351 ₱ 34,053 ₱ 136,212
6. Utilities 9,936 29,809 119,236
Total Production Cost ₱ 87,711 ₱ 263,133 ₱ 1,052,529
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Table 20
Production Cost (Third Year)

Materials:
1. Grass ₱ 16,225 ₱ 48,674 ₱ 194,696
4. Anesthetic 155 466 1,862
Total Materials ₱ 46,782 ₱ 140,345 ₱ 561,374
Direct Labor:
1. Head Goat keeper’ salary 8,206 24,618 98,472
1. Guard Agency Fee ₱ 11,743 ₱ 35,228 ₱ 140,911
2. Utilities 10,279 30,837 123,350
Total Production Cost ₱ 106,840 ₱ 320,519 ₱ 1,282,069
Quality Control
Each time a new goat is brought and each time that a doe is born, the proposed
business will appropriately make a record for each goat. The information will include
breed, age, initial live weight of goat and identification number. Quarterly, each goat will
be checked-up to know the possible threats on health and growth. After which, the goat
105
will be dewormed, vaccinated, and weighed by the farm workers. The records for the
quarterly check-up, de-worming, weight monitoring, and vaccinating will be kept by the
manager to monitor the health of each goat.
Other Forms of Internal Control
The owner of the proposed business will be hands-on in managing the business, it
means that the records will be checked regularly to monitor the progress and detect
possible frauds.
Utilities and supplies will have to be approved by the owners before it will be
authorized for payment. Proper documentation such as bills, and receipts should be
passed to the bookkeeper for the recording.
In cash management, imprest system will be used to safeguard cash. The
managing partner will be the custodian who will manage petty cash fund for all operating
expenses up to the amount of P50, 000.00. The petty cash will be replenished every
week. No credit policy will be implemented to all sale transactions to avoid the risk of
uncollectible from customers, it is also to follow the existing practice in the target market.
The management will hire a guard to secure that no thief can enter the premises
of the farm to avoid loss. Each goat will have an ear tag and partnership seal as to
confirm its identity and registration.
Organization and Human Resource Study
In order to achieve the good foundation in designing a business organization, the
business should undergo through careful planning and organizing to attain the efficiency
of the business. This chapter discusses the form of ownership of the proposed business,
organization requirements, organizational structure and chart, the number of personnel

105
needed, their qualifications, their compensation package, and projected time-table project
implemented.
Form of Ownership
The proposed business will be operated in the form of a partnership. This is
because the capital needed for the business is very big for a single individual to
materialize it. Each partner should be a capitalist partner with at least one of acting as the
managing partner.
Partnership is more suitable in this kind of business because of the following
advantages:
1. The business requires a big capital investment that’s why it is preferable that
two or more persons will contribute money and property for it to be realized.
2. Aside from the big capital investment, it is better that two or more brains will
combine on the major decisions of the business. Each partner has experiences
and knowledge different with each other.

3. Partners especially the managing partner will be more personal in dealing with
the business.
4. If the business does not seem to be profitable, the partnership can just be
dissolved without the intervention of law.
However, having a partnership form of organization also have disadvantages like
the following:
1. Because of the mutual agency, the partners may incur unlimited liability
which can be paid or settled using their personal assets.

2. Compared to a corporation, partnership can just raise a limited amount of
capital.
105
3. The managing partner can have all the authority to decide but all the partners
bears the risks.
Organizational Requirements
Below are the necessary requirements that the proposed business needed to
comply and to submit at the Permits and Licenses Section in Municipal office of Amadeo,
Cavite:
Community Tax Certificate - It is a legal identity document in the Philippines,
also known as community tax certificate that is prepared, issued, and paid in barangay,
city or municipality office. It is a requirement when filling an income tax return,
registering a new business.
Barangay Clearance - It is one of the Philippine-government issued
identification documents needed for many important business, job, or personal
transactions.
Police Clearance - It is issued by the Philippine National Police Headquarters. It
is to prove that someone is cleared from any bad record in the police department and its
affiliates.
Sanitary Permit - It is the official document issued by the Department of Public
Health and Social Services that authorizes a health-regulated establishment to operate,
after it has been determined to have met the requirements for the sanitary operation.
Health Certificate – Issued by the rural health unit of the municipality to
ascertain that the owners and personnel are physically healthy and are free from any
communicable diseases.
105
Fire Safety Inspection Certificate - It is a requirement of the business permit
and licensing system of local governments to ensure the compliance with the regulatory
requirements for safety and general public welfare.
Social Security System (SSS) Clearance - It is the clearance certificate issued by
the SSS in order to observe the compliance with the existing SSS regulations in order to
protect the interest of the employees whose salaries are being deducted from the payment
of SSS contributions and to make sure and certain that the employee’s contributions are
remitted to SSS.
Department of Trade and Industry (DTI) Certificate of Registration of
Business Name – It is issued by the DTI to certify that the proposed name of the business
is legally registered to DTI and that the proposed business name is not similar to any
exiting business.
Organizational Structure/Chart
Managing Partner
Head Goat keeper
Goat keepers (2) Driver Guard
Figure 3. Organizational Chart

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Figure 3 shows that there will be one managing partner who will be in-charge in
managing and approving the business transactions as well as the regulation of the daily
operations of the farm. The driver and guards will report directly to the manager. The
goat keeper who are facilitated by the head goat keeper will be in-charge in taking care of
the goat.
Personnel Requirement
The proposed business requires 5 personnel to be able to start its actual operation.
The employees must perform their task according to their respective responsibilities.
The number of employees required in each position will be determined from the time of
the business commenced operation up to fifth year.
Table 21 shows the personnel requirements of the proposed business for five years
of operation. The numbers of employees are constant under each position
Table 21
Personnel Requirement
Position 2020 2021 2022 2023 2024

Goat keepers 3 3 3 3 3
Driver 1 1 1 1 1
Guard 1 1 1 1 1
Total 5 5 5 5 5
Qualification Standards
Most managers agree that the most important resource within an organization is
people. It focuses on the management of personnel which is the shared responsibility of
managers and personnel.

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The qualifications of workers to be hired will be based on the personal qualities,
educational attainment and working experience. The table below shows the summary of
qualification standard of employees to be hired.
Table 22
Qualification Standards
Job Position Personal Experience Academic
Managing 1. Responsible 1. Had engaged in 1. College

Partner 2. Honest goat raising and graduate and is
3. Has Management goat selling prior physically and
Skills to the mentally
4. Patient establishment of capable.
5. Hardworking the business.
6. Approachable
Head Goat 7. Responsible 1. At least 2 years of Able to read and

keeper 8. Honest work experience write and is
9. Knowledgeable in other goat physically and
in handling goat farms. mentally capable.
10. Patient 2. Has background in
11. Hardworking livestock raising
Goatkeeper 1. Responsible No requirement Able to read and
2. Has sufficient needed write and is
knowledge in physically and
handling goat mentally healthy
3. Hardworking
4. Patient
5. Honest
Driver 1. Patient At least 2 years Licensed driver
2. Reliable working experience with mechanical
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3. Honest background
Guard 1. Honest At least 1 year Licensed guard
2. Responsible working experience who is physically
3. Trustworthy fit and has
4. Physically and sufficient training
mentally alert in guarding private
properties.
Job Descriptions
The managing partner, being one of the owners of the business has the authority
to decide on business matters such as the acceptance or rejection of orders, approval of
the minimum selling price of one goat, and the daily monitoring of the price of the goat
every week.
. The head goat keeper will be in-charge of managing the work and performance
of the goat keepers. It is expected that the head goat keeper is more knowledgeable and
more experienced than the rest of the goat keeper. Communication to the managing
partner on what order will be approved will be his job.
The goat keeper will take in-charge for the daily feeding of the goat, maintenance
of the barn and collection of goat manure.
The guard will provide the security of the goat as well as the personnel of the
business.
The driver must be well experienced in transporting materials, feeds and animals
and has further knowledge in mechanical matters.

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Compensation Package
The compensation package is composed of employees’ salary and benefits. The
salary will depend on the job position of an employee. All the employees shall be
entitled to benefits required by the government such SSS, Philhealth, Pag-ibig and 13th
month pay. In some cases that the employees were required to render services during
holidays, separate overtime fee will be given. The monthly salary of the employee is
based on Department of Labor and Employment specifically required for Region IV
under Agriculture-Farming type of business.
The table below shows the basic salary of each employee added by the employer’s
contribution in SSS, Philhealth and Pag-Ibig to arrive with the gross monthly
compensation.
Table 23
Gross Compensation
Positio Basic SSS Pag- Phil Allowance 13th Gross Annual
n Salary ibig month Monthl Gross
Health
pay y Salary Salary
Driver 6,136 488.8 122.72 100 0 6,136 6,847.52 88,306.24
HH 6,136 488.8 122.72 100 1,500 6,136 8,347.52 106,306.24
H1 6,136 488.8 122.72 100 0 6,136 6,847.52 88,306.24
H2 6,136 488.8 122.72 100 0 6,136 6,847.52 88,306.24
* HH-Head Goat keeper

*H1-Herman 1
*H2-Goat keeper 2
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Table 24 below presents the monthly compensation of each employee computed
by deducting the employee’s contribution in SSS, Philhealth and Pag-Ibig. These are the
actual amounts that will be received by the employees.
Table 24
Net Compensation
Position Gross SSS Pag- Phil Net Monthly Annual Net
Salary ibig Salary Salary
health
Driver 6,847.52 236.2 122.72 100 6,388.60 76,663.32
HH 8,347.52 236.2 122.72 100 7,888.60 94,663.20
H1 6,847.52 236.2 122.72 100 6,388.60 76,663.32

H2 6,847.52 236.2 122.72 100 6,388.60 76,663.32
* HH-Head Goat keeper

*H1-Herman 1
*H2-Goat keeper 2
Projected Time Table

The projected timetable shows the estimated span of time that will be spent in
preparation, organization and before the actual operation of the proposed business.
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The Gantt chart that visualizes the proposed business schedule is shown on next
page.
Table 25
Projected Time Table
Activities
April May June July Aug Sept Oct Nov Dec DecYr2
Preparation of
the feasibility
study.
Formal
organization.
Preparation of
the place
Acquisition of
the PPE
Recruitment
of employees
Marketing and
promotion.
Start of
operations
Acquisition of
goat
Strategic
Evaluation
Preparation of the feasibility study

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The researcher conducted a study to gather all the necessary information to
evaluate whether the proposed business is viable or not. This will take up to two months
and will probably cost up to Php10, 000.
Formal Organization
After determining the viability of the proposed business, it may now register to
the Department of Trade and Industry (DTI) to acquire legal personality so as to carry the
name Goat Raising Farm in Amadeo, Cavite. The application of necessary permits will
also take place on this step. All permits needed in the operation of the proposed business
will cost a total of Php 3,705.00.
Table 26
Permits and Licenses
Particulars Amount
Mayor’s Permit 400.00
Business Permit 1,500.00
Community Tax Certificate 50.00
Barangay Clearance Fee 25.00
Police Clearance Fee 100.00
Sanitary Permit 100.00
Health Certificate 30.00
Fire Safety Clearance Fee 1,500.00
SSS Clearance Fee 0.00
Philhealth Clearance Fee 0.00
Pag-ibig Clearance Fee 0.00
Total 3,705.00
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Preparation of the place

The preparation of the place will take place on this step that will take three
months. The preparation of the pasture, construction of the barn and installation of the
water source will be included in this step.
Labor costs for the clearing of the land is P150 a day for one person (Interview
with Ms. Joy Arevalo, VP for Finance, DV Boer Farm). Thirty people will be requested
to clean the whole area for one day. This will entail a total cost of P4,500. The clean
area will be left untouched to allow grass to grow.
Acquisition of Equipment, Furniture and Fixture and Construction of Building and
Land improvements
The canvassing, ordering as well as purchasing of equipment, furniture and
fixtures will take place on this place. The proposed business will purchase equipment
and furniture and fixtures like laptop, generator, jet pump motor and delivery truck ensure
the smooth operation of the proposed business. Farm fences will be constructed to
provide security for the goat. A barn will also be constructed to provide shelter for the
goat during evening.
Recruitment of Employees
The hiring of qualified employees will take place on this step. The training and
seminars of the chosen employees will also be included in this step. This will take one
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month, it is to make sure that the hired employees will be competent to their assigned
position.
Marketing and Promotion
Introduction of the proposed business is the essential part of the pre-operating
process because the proposed business is newly established and will be the first goat farm
in the place. Familiarity must take place between the neighbors, target market and the
business in order to create rapport.
Start of the Operation
After all the steps were completed, the proposed business is ready to operate.
Acquisition of goat to be used for breeding will be done first right after commencement
of operations.
Strategic Management
This study shows the analysis of strategic framework starting from the mission,
vision and objectives and how these are met through qualitative and quantitative terms
through various programs, activities and tasks. The method on how to strategically
evaluate the progress of the business is undertook in this study. Important strategies such
as contingency plans, alternative plans and exit strategies are also discussed.
Strategic Framework
In the areas of management, strategic management encompasses the formulation
and application of the major goals and initiatives taken by an organization's top
management on behalf of owners, based on thought of resources and valuation of the
internal and external milieus in which the organization functions. Strategic management
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provides overall path to an inventiveness and comprises specifying the organization's
objectives, emerging policies and plans to accomplish those objectives.
Mission
The proposed business exists to provide high quality and healthy organic goat to
butchers and goat traders for the safe consumption and satisfaction of the people in
Amadeo, Cavite.
Vision
By the year 2025, the proposed business has already put up another organic goat
goat raising farm in Brgy. Minantok, Amadeo, Cavite.
Objectives
The short-term targets of the proposed business are:
1. Marketing:
A. To maintain the level of sales all throughout the 8 years of operation.
2. Production:
A. To maintain a full capacity of goats within the years of operation.
B. To sell big and healthy goat over the years of operation
3. Human Resource:
A. To sustain work force over the 8 years of operation.
Key Result Areas
1. Marketing
 The sales will increase by 10% in every year.

2. Production:
 The number of goats ready for sale will increase.
 Low mortality rates.
 Health and size of goat
3. Human Resource:
 Employee Turnover
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 Certificates and Licenses
Performance Indicators
1. Marketing:
 Five thousand goats are sold every year.
2. Production:
 All does kid each year.
 Record of mortality of goat is zero
 All goats are big and are free from diseases
3. Human Resource:
 There is zero employee turnover every year.
 One hundred percent of the employees acquired license and certification to
administer vaccines from the Department of Agriculture.
Strategies:
1. Marketing:
 Increase awareness of customers

 Obtain customer loyalty
2. Production:
 Assure 100 percent pregnancy of does
 Decrease mortality rate
 Prevent goat diseases
 Maximize growth of goat
3. Human Resource:
 Reduce employee turnover
 Make employees more equipped
Programs:
1. Marketing:
 Distribute leaflets
 Construct a landmark
 Gather contact information of existing customers
 Offer free delivery
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2. Production
 Timely breeding
 Successful kidding of does
 Timely vaccination
 Goat deworming
 Proper goat grazing
3. Human Resource:
 Proper employee benefits
 Employee trainings and seminars
Activities:
1. Marketing:
Distribution of leaflets
 Printing of leaflets
 Distribution.
Constructing a landmark
 Sculpture outsourcing
Gathering of contact information
 Personal inquiry to customers

 Keeping of customer information record.
2. Production:
Timely breeding
 Determine the goats ready for breeding.
 Facilitate breeding
Successful kidding of does
 Determine the kidding date of the goat

 Assisting goat during delivery
Timely vaccination
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 Set dates for quarterly vaccination

 Vaccination
Goat deworming
 Feed goat with deworming solution daily
Proper goat grazing
 Schedule the timely rotation of grazing area.

3. Human Resource:
Proper employee benefits
 Register employees to SSS, Pag-ibig, and PhilHealth.

 Give salary from the approved minimum wage of DOLE – Region IV.
Employee Trainings and Seminars
 Set an appointment with the Department of Agriculture in the area

 Enroll the goat keeper to the seminars and trainings.
 Acquire certification and license.
Tasks:
1. Marketing:
Printing of leaflets
 The design and printing of leaflets will be done through outsourcing. The
chosen printing press will design and print the leaflets for a cost of
P500.00
Distribution of leaflets
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 The manager will determine the target customers through inquiry in the
municipal office of Amadeo, Cavite.

 Farm workers will be tasked to go to the local livestock market on
Thursday.
 Farm workers will distribute the leaflets to the butchers and goat traders.
Sculpture outsourcing
 The managing partner will choose a design for the landmark.

 Pay P5,000.00 for the landmark.
Personal Inquiry to customers
 The managing partner will ask existing customers to give their contact
numbers and addresses or any contact information.
Keeping of customer information record
 The managing partner and the head goat keeper will save telephone or cell
phone numbers of customers

 The managing partner will encode contact information of customers in the
laptop
 Print encoded information for a cost of P100.00
 Keep on a separate folder in the office
2. Production:
Determine does ready for breeding
 Goat keepers will observe the behavior of does.
 After observing the behavior of does, the goat keeper will evaluate if the
does are ready for breeding.
Facilitate Breeding
 The goat keeper will guide the Boer to the area where the does are.
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 The goat keeper will isolate the goat and after 20 minutes, they will
separate the does from the Boer.
Determine the kidding date of goats
 To determine the kidding date of does, the goat keeper will keep track of
the date of breeding.

 The goat keeper will count 279-281 days from the date of breeding.
Assisting does during delivery
 The goat keeper will observe the does to know if it is ready for kidding.
 The goat keeper will monitor goat for 24 hours
 When labor exceed 24 hours, the goat keeper will assist in the goat
delivery.
Set dates for quarterly vaccination
 To determine the date of the next vaccination, the goat keeper will keep
track the date of the last vaccination

 After three months from the date of last vaccination, the goat keeper will
again vaccinate the goat
Vaccination
 Each quarter, the goat keeper will inject goat with proper vaccines
Feeding goat with deworming solution

105
 Every day, the goat keeper will mix the deworming solution to the grass or
grass.
3. Human Resource
Register employees to SSS, Pag-ibig, and PhilHealth.
 The farm workers will fill-up the registration form

 The managing partner will pass forms to the office
Give salary from the approved minimum wage of DOLE – Region IV
 The managing partner will determine the minimum wage applicable in the
area.
Set an appointment with the Department of Agriculture in the area
 The managing partner will call the office of Department of Agriculture to
set the appointment date and will pay the amount of P25,000.00 for the
seminars and trainings
Enroll the goat keeper to the seminars and training
 After setting an appointment, the managing partner will list the names of
all goat keeper that will attend the training and seminars
Acquire certification and license
 The goat keeper will wait for the delivery of certificates and licenses.
Strategic Evaluation
105
In order to evaluate the progress of the business, evaluation, review and follow-up
will be conducted. The managing partner will compare the actual performance of the
business to the standard set-up in the performance indicators. In case of difference
between the actual results compared to the expected results; the managing partner will
determine the root-cause of the problem to plan corrective actions. Once the corrective
actions are planned, it will be implemented and monitored.
The table below enumerates the steps that the business will undertake to evaluate
the progress of the business.
Table 27
Strategic Management
KRA Frequency In - charge Description

Sales Monthly Managing Partner Expected sales for the month
is reached
Number of goat Monthly Head goat keeper Number of goat available for
available for sale is equal with the
sale organization’s target number
of goat disposal
Mortality Yearly Goat keepers Zero mortality of goat
Health and size Monthly Goat keepers Goat are fully grown and
of goat healthy
Employee Yearly Managing Partner No employee turnover for the
turnover year
Licenses and Yearly Managing Partner All goat keeper acquired
certificates licenses and certificates

Other Strategies and Plans
105
To adhere to the growing demands of the strategic management, an enterprise
should make necessary strategies and plans to execute the direction of management.
These includes the contingency plans, alternative plans, and exit strategies.
Contingency Plans
Although business processes are studied keenly before it’s actual operations, it is
still be of the best interest to the owners, investors, creditors and workers to have a back-
up plan in case of unforeseen instances wherein there are sudden emergencies or
interruptions in the business operations. Below are the contingency plans of the
proposed business:
1. In case of brownouts, a stand-by-generator will be used to supply energy
throughout the whole farm especially in the barn. Proper ventilation cannot
be interrupted because it is very important for the goat. The place cannot be
dim especially during evenings because thieves can go inside without being
detected when it is dark.

2. In times of drought and when there is scarcity of grass in the pasture, the
proposed business is going to buy grass which will be additional food for the
goat from the rice fields nearby the area.

3. If a goat has difficulty in delivering her doe even with the assistance of the
farm workers, a veterinarian will then be called.

4. An insurance will be purchased to minimize the loss in case of unfavorable
circumstances such as goat pestilence and fire.

5. The proposed business will hire physically and mentally abled individuals
when one or some of the farm workers gets sick.

6. If the goat used in breeding does not kid anymore, it will be sold to the goat
traders who buys in a live weight basis to generate cash that will be used in
buying new breeding goat.

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7. When there is a threat for possible bankruptcy, the proposed business will
liquidate all its assets to pay off debt.
Alternative Plans
If the major assumptions of the business changes, the farm will do the following:
1. In case the goat farm will not be successful, the proposed business will be
converted into a goat meat dealer in the local wet market of Amadeo, Cavite.
2. If the meat dealers in Amadeo, Cavite have a high competition, the proposed
business can venture into a goat trader which sells goat on other places other
than Cavite.
Exit Strategies
If the proposed business will not earn a profit and continues to generate a loss,
then the goat farm will sell its goat inventory to other farms nearby Amadeo, Cavite. The
land will be sold to the people who are interested on buying agricultural lands. The farm
will also take charge in arranging the hiring of its present workers. Adora’s Hardware
Shop will be the prospect buyer of the delivery truck, generator and other small
equipment.
The money that will be gathered through these strategies will be used to pay off
debts and the salaries and benefits of the workers. Partners will divide the remaining
amount on the date of settlement on the basis of their original capital contribution.
Financial Study
This study presents the major assumptions used to carry out the financial aspect of
the proposed business. The capital investment, including the pre-operating expenses,
working capital, capital expenditure is also considered. The proposed venture’s source of
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funds is also discussed. The projected financial statements are also disclosed to ascertain
the profitability, liquidity, and solvency of the project. This includes the projected
statement of comprehensive income, projected cash flow statement, projected statement
of statement of financial position, and the financial analysis underlying in it.
Major Assumptions
The major assumptions of the researchers in making the financial statements are
the following:
Assets
 Starting from the third year of operation cash should not be less than P1,000,000
to finance the operations of the business for the next eight months. It is
because, sales are assumed to be on the last quarter of each year.

 The biological assets account is increasing yearly due to the price and physical
change.
 The depreciation of fixed assets is computed using the straight-line method.
 Farm supplies balance is assumed to be the safety stock good for 3 months.
The price of the farm supplies increases every year due to the inflation rate.
 Land is accounted for using the cost-method.
Liabilities
 Telephone payable is assumed to be paid every end of the month. A telephone
payable is reflected on the statement of financial position to show the accrued
telephone payable for one month because it is expected that establishments are
close during December 31.

 Security agency payable for one month is accrued every December 31 because
of the assumption that establishments are close during year-end. It increases
every year due to the inflation rate.

105
 Income Tax payable is 30% of the net income before tax. It is accrued because
income tax return is remitted on the first quarter of the next year.
 Withholding tax increases because of the increase in the compensation of the
workers. It is computed in accordance with the Bureau of Internal Revenue
(BIR) withholding tax table and is paid every end of the year. It is shown in
the statement of financial position because it is assumed that offices are closed
on year-end.
 SSS, Pag-ibig and Philhealth contributions are paid every end of the month.
The payment for December is accrued because it is assumed that offices are
close during December 31. Contributions vary because it changes according to
the salary bracket.

 The salaries are paid every last Friday of the month. Increases in the amount
of the salaries reflected in the financial statement is due to the P8.00 increase
per day of the salaries of the workers as stated in the Wage Order no. IVA-14
of Department of Labor and Employment (DOLE) – CALABARZON.
Owners’ Equity
 The partners divide profit/loss ratio using their beginning capital balances.
 Withdrawals are estimated in connection with their capital balances.
Income Statement
 The sales are assumed to be increasing even if the proposed business will sell
desired number of goats each year because the price of goat increases in
consideration of the inflation rate.

 0.05 percent of the gross sales are assumed to be the cost of the business permit
plus the P3, 705 for other certificates. This is in accordance with the local code
and municipal tax ordinance of Amadeo, Cavite.

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 The proposed business will only have Advertising/Promotion expense for two
years.
 Utilities expense increases every year due to the inflation.
 Insurance is fully expensed each year because it is assumed that the insurance
is purchased on the first day of January.

105
Capital Investment
The initial capital investment needed for the business to operate includes the pre-
operating expenses, operating expenses as well as the capital expenditures or fixed assets.
Overall, the needed capital for the business is P11,820,779.00. The researcher ascertains
the need of a partnership type of business organization due to the great demand of capital
that the proposed enterprise is needing. With this type of business organization, the pool
of capital funds could be easily attained.
Pre-operating expenses
Before starting the operations of the business, pre-operating expenses are incurred
to ensure that operation will commence smoothly. For 2 months, a feasibility study
costing P10,000 is made to verify whether the venture is feasible and viable. Acquisition
of permits and licenses are next which cost 3,705. The preparation of the place will have
a total cost of P4,500. Marketing and promotions as well as the hiring of employees will
cost P47,000.
Working Capital
Working capital is a financial measurement or tool which represents operating
liquidity accessible to a business, organization or other entity, including administrative
entities. Along with fixed assets such as plant and equipment, working capital is
measured a part of operating capital. Gross working capital is equal to current assets.
Working capital is considered as current assets minus current liabilities.

105
For the first two years, the only income will be from the fair value gain due to
physical and price change. Therefore, to finance the operations of the business for the two
years, the capital needed are the following:
 A cash of P2,100,000 is needed to acquire biological assets and P197,600 for
the payment of utilities which includes the electricity, fuel, office supplies,
repairs and maintenance, vehicle registration and post-paid plan.

 The farm supplies which includes vaccines, deworming solutions and grass
costs P206,505 for the first year.

 Prepaid expenses include insurance which costs P88,200 annually.
 Salaries of workers amounts to P324,653.16 subject to an P8.00 increase per
day for their salaries the following year. Guard agency costs is P154,904.52
each year.
 Advertising will be done for two years. It costs 9,500 for 1 year.
 Transportation cost of goat is P48,000 per year.
Capital Expenditures
The business will capitalize equipment costing P10,000 and above and will
depreciate it using the straight-line method over their useful life. This includes the
following: barn with a cost of P1,000,000 that will be depreciated using straight line
method over its useful life of 15 years; fence or land improvement costing P240,000
which will be depreciated for 20 years, delivery truck costing P245,905 will also be
capitalized; jet pump motor costing P39,000; weighing scale costing P15,705; generator
costing P35,500; feeding manger costing P29,000; and the laptop with a cost of P16,000.
Land is recorded using the cost-model method. Other equipment lower than P10,000 cost
will be included in account Small Equipment and will be treated as an expense.
Sources of funds
105
The business decided to use equity financing which means that the funds will
come and from the investors. One partner will contribute nine hectares of land and his
expertise to manage the proposed business. Three partners will contribute money to
finance the acquisition of equipment, machineries and furniture and fixtures as well as the
pre-operating and operating costs for the two-year breeding period.
Financial Statements
Projected Statement of Comprehensive Income
For the two years of operation, there is no sales. The income reflected on these
years is from the price and physical change of biological assets. On the third year, the
income shown in the income statement is from the fair value gain on the sale of
biological asset and from the fair value gain from the price and physical change of the
remaining biological asset. Income is increasing every year. Although the yearly increase
in the net income is not that high, the capital continuously increases as a result of the
increase in the number of goat as well as the increase in its fair value.
The income for the years 2020-2025 is shown on next page.

82
Table 28
Yearly Income
Year Income
1 (89,611)
2 (210,245)
3 9,988,371
4 9,889,375
5 9,797,020
Projected Statement of Financial Position
The total assets of the business are rapidly increasing each year brought by the
increase in the value of the biological assets due to the price and physical change. Also,
the realized gain from the sale of biological assets added cash to the entity. On the other
hand, the increase in the total liabilities is only minimal. This is because there are just
few payables. As a result, over the years of operations; the capital balances of the
partners increase.
The table showing the balance of the assets, liabilities and owners’ equity is
shown on the next page.

105
Table 29
Assets, Liabilities and Owners Equity
Year Assets Liabilities Owner’s Equity
2020 11,947,625 37,235.20 11,910,389.90

2021 9,752,501.13 - 9,752,501.13
2022 21,138,863.89 4,362,274.47 16,776,589.42
2023 26,967,898.11 4,321,691.72 22,646,206.39
2024 31,725,424.68 4,345,718.93 27,379,705.76
Projected Cash Flow Statement
For the first two years, the cash outflows are greater compared to the following
years. It is because on year 1 and year 2, the business is still not generating cash through
sales -there is no cash inflow yet. However, on the 3rd year of operations up to the 5th
year; cash inflow is greater than the cash outflow as a result of the disposal of goat. As a
result of which, partners withdrew cash from the business.
The withdrawals of the partners for year 3 up to year 5 is shown on next page.
Table 30
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Withdrawals
Year Withdrawals
2020 -
2021 -
2022 1,000,000
2023 2,000,000
2024 3,000,000
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Table 31
Statement of Financial Position
105
Table 32
Statement of Comprehensive Income
105
Table 33
Statement of Cash Flows
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Financial Analysis
The information from the financial statements are analyzed to know the financial
condition of the proposed business.
Profitability Ratios
Profitability ratios assesses the capacity of the business to earn sufficient profit.
For every kind of business, acceptable ratios are different.
Below are the profitability ratios that are applicable for the business.
Table 34
Return on sales
Net Income FV Gain in

Biological Profit
Year Assets Margin
2020 (89,611) 2,000,000 1,129,745

2021 (210,245) 2,043,333 988,804
2022 9,988,371 2,087,606 15,805,537
2023 9,889,375 2,132,837 15,831,546
2024 9,797,020 2,179,048 15,682,936
The result of the return on sales of the proposed business is increasing every year.
It indicates that the profit produced per peso of sales are increasing. As a matter of fact,
from the third year of operation, the proposed business is. Thus, it can be concluded that
the business is achieving its maximum sales while keeping the cost at minimum.
Table 35
105
Return on Investment
Year Net Income Total Investment ROI
2020 (89,611) 11,820,778.60 -0.76%

2021 (210,245) 11,820,778.60 -1.78%
2022 9,988,371 11,820,778.60 84.50%
2023 9,889,375 11,820,778.60 83.66%
2024 9,797,020 11,820,778.60 82.88%
Return on investment showed that the proposed business is increasing. The
continuous increase of ROI implies a good effect in the profitability of the business.
Positive ROI’s over the years means that the gain is greater than the cost and it is best to
undertake the business.
Return on Capital Investment
The ratios in the table are used to gauge the return on initial investment of the
proposed business. The list is shown on next page.
Table 36
Payback Period
105
Year Cash Inflow Unrecovered Investment

0 - 11,820,778.60
2020 (3,598,230.00) 15,419,008.60
2021 (2,225,352.20) 17,644,360.80
2022 11,335,265.20 6,309,095.60
2023 5,811,741.59 497,354.01
2024 4,753,609.90
Payback period = 4.104626 years or 4 years, 1 month, and 8 days
Based on the data gathered from the financial statements, it will take 4.10 years
for the partners to recover the initial cost of their investment. It is not discouraging
because on the first two years of operations, there is no cash inflow yet. This is good
because the expected payback period for this kind of business is approximately 5 years,
according to the Vice President for Finance of a same line of business.
Capital Budgeting
To analyze whether to accept or reject a certain capital expenditure, the following
ratios below were used to ascertain the capital budgeting of the proposed business
venture. It is shown on next page.
Table 37
105
Net Present Value
Year Cash Inflow
2020 -
2021
2022 11,335,265.20
2023 5,811,741.59
2024 4,753,609.80
Total 21,900,616.59
Cash Outflow 11,820,778,60
NPV P35,122,348.02
The present value of all cash inflows of the business for the years 2020-2024 is
P35,122,348.02 is greater than the present value of the initial cash outflow of Php
11,820,778.60. A positive net present value means that the present value of all cash flows
is greater than the present value of the initial investment.
Table 38
Benefit cost ratio
Year Cost Benefit B/CR
2020 879,879 963,633 1.10

2021 1,054,941 1,919,485 1.82
2022 1,304,531 3,501,854 2.68
2023 1,345,760 3,656,398 2.72
2024 1,388,179 3,843,515 2.77
105
The benefit-cost ratio of the business is 2.218 in average which reflects that the
benefit from the operation of the business is greater than the expenditures incurred by the
business. Since the ratio is greater than 1, it indicates that the project is a viable.
Table 39
Current Ratio
Year Current Assets Current Liabilities Current Ratio
2020 4,453,396.00 37,235.20 119.60

2021 2,266,821.80 - 179.31
2022 13,659,386.00 4,362,274.47 3.13
2023 19,476,223.59 4,321,691.72 4.51
2024 24,235,104.49 4,345,718.93 5.58
The
average current ratio of 4.91 is a good indicator that the business will be able to cover its
own obligation for the next five years of operation. Thus, the result shows that the
business has a good performance within its operating period.
Socio-Economic Responsibility
This study enumerates the desirability of the proposed business on customers,
employees, suppliers, partners, community, church and the government considering the
benefits that they will get from it.

105
Customers
The study shows that establishing this proposed business will lend a hand to the
butchers and goat traders to purchase good quality and affordable goat. By this, the
consumers will have additional supply of goat to decrease their unmet demand. Since the
goat is raised in an organic process the buyers –goat traders and butchers will be assured
that the goat that they will buy is healthy.
Employees
The success of the business operation depends on the skills of the workers. The
study proposed that having great employed persons deserve incentives like right amount
of salary, SSS for their safety, PhilHealth to ensure their physical condition and Pag-ibig
for financial loans.
Five employees and their families will benefit from the proposed business.
Suppliers
Since the proposed business will raise goat through natural gathering method,
farmers will serve as the suppliers of grass. Suppliers of animal vaccines, anesthetics, and
deworming solutions can also benefit by the increase in their sales brought by the demand
of the proposed goat raising farm. The five-year projected benefits of suppliers from the
proposed business is shown on next page.

105
Table 40
Customers/Suppliers benefits
Year Benefits
1 870,255
2 1,054,529
3 16,282,069
4 16,951,290.24
5 17,810,195.71
Total 52,968,338.95
Partners
Although the initial investment requires a large sum of money, the partners can be
assured that they will receive higher returns. On the third year of operations, partners can
already receive cash from the business. Non-monetary benefits can also be derived such
as increase in their credited capital due to the increase of the number of goats in the farm.
The projected benefits that the partners can derive from the partnership for 5 years is
shown on next page.

105
Table 41
Partner’s Net Income
Year Net Income Cash Returns
1 (89,611) -
2 (210,245) -
3 9,988,371 1,000,000
4 9,889,375 2,000,000
5 9,797,020 3,000,000
Total 29,374,910 6,000,000
Community /Society/ Church
The proposed business aims to extend its help to the community, to the society
and to the church. As one of its charity works, the proposed business will give out free
organic fertilizer from composted goat manure to the local farmers in Amadeo, Cavite.
Yearly, farm workers will help in the Brigada Eskwela of the schools near the area. Also,
the farm will be open for schools who wish to have their field trip in the farm. Because
the business is earning, it can also contribute to the betterment of the church through its
tithes and offerings.
The 5-year projection of benefits that the proposed business will give to the
community, to the society and to the church as a whole is shown on next page.
Table 42
105
Community/ Society/ Church Benefits

Year Benefits
1 -
2 -
3 998,837
4 988,938
5 979,702
Total 2,967,477
Government
The proposed business will contribute to the economy by reducing the number of
unemployed workers in the area and by paying the appropriate income tax. As stated on
the previous paragraphs, the business is going to provide work to four people. Even
though the business will not pay income tax because it’s a general partnership, the
individual partners will include the partnerships revenue and expenses in their income tax
returns. Thus, the proposed business contributes income to the government. It is shown
on next page.
Table 43
Government benefits
Year Benefits
105
1 (38,405)
2 (90,105)
3 4,280,730
4 4,238,304
5 4,198,723
Total 12,589,247
105
Chapter 5
SUMMARY OF FINDINGS, CONCLUSION, AND RECOMMENDATION
This chapter summarizes and concludes the feasibility and viability of
establishing a Goat Farm in Amadeo, Cavite. The findings presented in the foregoing
chapters are briefly explained to support the conclusion of the researchers. This includes
the summary of finding in marketing, technical/operation, organization and human
resource, strategic management, financial, and socio-economic responsibilities. This
chapter aims to state a conclusion and to present a recommendation on the study.
Findings
To be able to make a conclusion about the study, the findings about the attained
and un-attained objectives in different aspects of management is briefly discussed in this
chapter.
Marketing. From the formulated marketing plan and strategies, the business will
be established in Amadeo, Cavite which is also the location of the competitor. It will sell
in cash to cash basis big and healthy goats which are fed with grass and hay and complete
with vaccines that will be administered by the farm workers. The pricing method to be
used is the market-oriented method which means that the price depends on the interaction
of demand and supply. Seminars and trainings will be done by the management to equip
the workers with necessary skills needed in the business operation.

105
As gathered from the study conducted by the researchers in Amadeo, Cavite, the
demand for goat is higher than the supply available in the livestock market. It is also
known that 100 percent of the butchers and goat traders are willing to patronize the
product of the proposed business. The unmet demand available for the proposed business
for the five-year projection period totals to ₱859,168,751.77. The fertilizer from goat
manure is the determined by-product of the business. It will be given to the local farmers
in the area.
Technical/Operation. The proposed business will raise 1,000 Philippine native
goats and 10 boers which are all one-year old in land located at Amadeo, Cavite. The
goats will be bought from a supplier in Australia. For every 100 Philippine native goats,
1 boer will be assigned to make cross-breeding possible.
The first two years of operations will be for breeding. On the interview with the
head of Department of Agriculture in Provincial Government of Cavite, 240-245 days are
the normal gestation period of a goat. One to one and half years after the birth of the goat,
dehorning and castration will be performed. Newborns will be allowed to suck milk from
their mothers until 8 months and they are weaned afterwards. Quarterly, goats are
vaccinated and weighed to keep track of its health. The goat will be sold after the
fattening period of 12 months. Every year, 1,000 goats will be sold to butchers and goat
traders.
The equipment, machinery, furniture and fixtures needed by the business are:
delivery truck, jet-pump motor will, movable weighing scale, feeding manger and
generator. Barn will be constructed to provide shelter for the goat at night. The land will
be fenced to avoid goat from grazing out of the area.

105
To avoid employee fraud, internal control is devised. Utilities and other supplies
need to be approved by the managing partner before it is paid. Proper documentations
like bills and receipts should be passed for record keeping. The imprest system will be
used to safeguard cash. Sales will be in cash to cash basis to avoid the risk of
uncollectible accounts. A guard will be hired to avoid thieves in entering the farm
premises.
Organization and Human Resource. Because the business needs a large amount
of capital, it is decided that a partnership form of business is more appropriate. This is
because two or more people can contribute properties to reach the desired amount of
capital.
Prior to starting the business, the business should be able to acquire a community
tax certificate, barangay clearance, police clearance, sanitary permit, health certificate,
fire safety inspection certificate, Social Security System (SSS) Clearance, and
Department of Trade and Industry (DTI) Certificate of Registration of Business Name.

The compensation of the workers is based on the minimum wage approved by the
Department of Labor and Employment (DOLE) specifically required for Region IV-A
under Agriculture-Farming type of business. Each employee will also be registered to
SSS, Pag-ibig and Philhealth.

Strategic Management. The mission of the proposed business is to provide high
quality and healthy organic goats to butchers and goat traders for the safe consumption
and satisfaction of the people in Amadeo, Cavite. Its vision is to expand its operations by
putting up organic goat raising farms in nearby municipalities by the year 2025.
Financial. For the two years of operation, there is no sales. The income reflected
on these years is from the price and physical change of biological assets. On the third
105
year, the income shown in the income statement is from the fair value gain on the sale of
biological asset and from the fair value gain from the price and physical change of the
remaining biological asset. Income is increasing every year. Although the yearly increase
in the net income is not that high, the capital continuously increases as a result of the
increase in the number of goat as well as the increase in its fair value.
The payback period of the business is over four (4) years. It is normal to have a
long payback period in this kind of business because the capital requirement is big.
Socio- Economic Responsibility. The proposed business will generate benefits
not only to the partners but also to the farm employees, to the suppliers, to the
community, to the church, to the economy and to the government.
Farm employees benefit through their salaries which increases every year in
accordance with the increase of P8.00/day as approved by the DOLE. The total benefits
of employees for five years is P7,475,017.
The demand of farm supplies generates income to the suppliers. Every year, the
amount of supplies that the proposed business needs increases as a result of the increase
in the number of goat and also because of the inflation rate. For five years, the total
amount of benefit that suppliers can get from the proposed business is P52,968,338.95.
The community, society and church can benefit from the business through the free
organic fertilizer from goat manure, free man-labor during Brigada-Eskwela, Free field
trip inside the farm and through tithes. For five years, the total benefit that the
community, society and church get from the business is P2,967,477.

105
The government can benefit from the business through income tax. The total
income tax for the business for the five-year period is P12,589,247.
The partners can benefit from the business not only with the cash withdrawals but
also with the share in the price and physical change of the biological assets. The total
benefits that partners get from the business in five years is P6,000,000.
Conclusion
The marketing study shows that the proposed business will be profitable and
successful if ever it is established. It is because 100 percent of the butchers and goat
traders in Amadeo, Cavite is willing to patronize the product of the business. The result of
the marketing study depicts that the business will have a big market share.
The technical study or the production and operations study give assurance that the
propose business can produce healthy organic goat goat that the target market needs. This
is because the processes involved in the production of goat is monitored.

The organizational and human resource study shows the hierarchy of capable
employees who will run the business. In this study, it can be concluded that there is a
stable work force because the workers will be hired with qualifications and standards.
The financial study shows that from years 1 – 5, the profitability of the business is
increasing although the number of goats sold is constant. This is due to the fact that goat
price changes each year.
In five years, the proposed business contributes to the employees P7,475,017; to
the suppliers, P52,968,338.95; to the community, society and church P2,967,477; to the
economy and to the government, P12,589,247, and to the partners P6,000,000 in total of
cash and non-monetary assets.

105
Recommendation
From the findings gathered from the study and conclusions stated above, the
researchers recommend the proposed business for implementation by 2020.

105
References
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management. Sampaloc, Manila: Rex Bookstore Inc. (RBSI)
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Environmental Protection Agency: http://www.epa.gov
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U.S.A.: South-Western Cengage Learning
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http://www.bas.gov.ph
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http://rosethorn-whatmakesherhappy.blogspot.com
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105

THE PROBLEM AND ITS BACKGROUND

production industry in the Philippines is goat raising.

about 18 percent of protein intake (Bureau of Agricultural Research, 2012).

Goat farming is the raising and breeding of domestic goats. It is a branch of

disposition of goat in 2018 by 0.95 percent. However, based on statistics there is a

continuous decline on the goat supply in the Philippines (Bureau of Agricultural

Due to these reasons, the researcher decided to propose the establishment of a

municipality in Cavite which is suitable in the establishment of an agricultural farm.

Statement of the Problem

a Goat Raising Farm in Amadeo, Cavite.

Objectives of the Study

establishing a Goat Raising Fam in Amadeo, Cavite.

management are as follows:

effective and economical way.

b. To find out the necessary equipment, machinery, furniture and fixtures

needed to start the business.

the most practical business days for its scheduling.

other expenses of the business.

the operation process.

every facet of the projected business venture.

to work hard for the organization.

the project for its time table.

b. To formulate a strategic evaluation to be the benchmark in assessing the

performance of the business.

the assumptions do not work as expected.

the project, including its pre-operating expenses, working capital, and

personal and professional growth.

Significance of the Study

establishing their own business.

on where to spend their money.

manure because it is safer to the environment and is relatively cheaper compared to

Scope and Limitations

The study is to be conducted in Amadeo, one of the municipalities in the province

outcome of the study.

the researchers can contribute to different findings of the study.

REVIEW OF LITERATURE AND RELATED STUDIES

used to understand the study.

country today (Philippine Statistics Authority, 2017).

augment the country’s programs on livelihood.

Considering these, goat production is indeed a promising venture, and anyone

interested to go into this business is expected to reap positive rewards.

According to the Bureau of Agricultural Statistics (2015), livestock production –

discovered increased goat productivity (Menandang, 2008).

mortality rate because it is insignificant.

the country’s total goat inventory.

slaughtered for meat in 2013 (Bureau of Agricultural Statistics, 2013).

to provide steps to enhance the success of the business.

strict quarantine program that includes proper disinfection of delivery vehicles,

goats to avoid food safety problems (Gomez, 2009).

2012). Hiring appropriate management staff that is capable of anticipating potential

of probable losses or in worst case scenario, bankruptcy (Kahan, 2008)

worker’s negligence. Through this, the farm can be more productive.

become more profitable (Infotechusa, 2009).

analysis: strength, weaknesses, opportunities, and threats, 2014). According to the

Technological advances on goat raising is profitable for the business. The

development of technologies that contribute to the well-being and fast reproduction of

Weaknesses. Underdeveloped roads and the inconsistent power supply remain a

additional expense (Kazutaka, 2012).

Threats. The appearance of a new or stronger competitor may threaten the

decrease on the business’ market share (SWOT Analysis).

Encephalitis (CAE). CAE is incurable, contagious, and devastating to goat herds. It is

have special skills can interrupt farm performance (Kahan, 2008).