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A project submitted to the faculty of the College of Business Administration and Accountancy of Eastern Luzon Colleges-Benguet
In partial fulfillment of the course requirements in MM5 (Franchising)
Submitted by: OLAYAN, CATHLEEN KAY A. PABLO, JONALYN N.
MARCH 25, 2010
FEJC MUSHROOM FARM BUSINESS PLAN
*The logo shows the name of the business and the product it offers. It is colored green to show abundance and being environmentally-friendly. It is triangular in shape to show the three P¶s which initially measures a firm¶s success; process, product and personnel.
Note that FEJC mushroom farm owns this project plan. It is confidential and may not be reproduced or transmitted in any form or by any means without the consent of the owners. All rights reserved.
EXECUTIVE SUMMARY NAME OF THE BUSINESS The business shall be named FEJC mushroom farm. FEJC stands for the first name initials of the partners. LOCATION OF THE BUSINESS The business will be established in DBB, Cabarroguis, Quirino. Quirino is a good location because there are potential markets for mushroom products and there is only one supplier. So definitely, the mushroom supply in the province is low. PROJECT¶S LONG-RANGE OBJECTIVES Generally, any business is established to achieve positive cash inflow. But as marketers, our business aims to create more customers. The project aims to produce quality mushrooms and promote mushrooms as a part of our daily diet. By doing so it is expected that mushroom businesses all over the province will achieve market growth by at least 10% and the FEJC mushroom farm eventually capturing 35% market share on the first year of operation, 50% on the second year and 60% on the following years. Once the business has achieved profits greater than 100% of the partner¶s capital contribution, the partners have agreed to expand the business by establishing branches in the nearby provinces which remains a good market for mushroom products due to low number of mushroom suppliers. With this, the business would need to employ more workers thereby helping reduce the unemployment level in the Philippines and promote the country¶s economic growth.
NATURE OF THE PROJECT The business is to be established in DBB, Cabarroguis, Quirino to produce different types of mushroom to supply the demand of mushroom products not only in Quirino province but also in the nearby provinces. The business shall observe and maintain proper cultivation of the different mushroom types. The business will need Php 47,872,341 amount of capital contribution. PROJECT TIME TABLE AND STATUS The FEJC mushroom farm will start to operate upon the approval of the project by the Bureau of Food and drugs and the Department of Trade and Industry. FEJC Mushroom farm is a partnership at will. THE PROJECT PROPONENTS FEJC mushroom farm is formed by the following: NAME OLAYAN, CATHLEEN KAY A. OMWENG, EDILYN L. PABLO, JONALYN N. WALANG, FEBBIE R. RESIDENCE Lower Wangal, La Trinidad, Benguet Camp Dangwa, La Trinidad, Benguet Irisan, Baguio City DBB, Cabarroguis, Quirino
MISSION -To provide quality mushrooms to meet the demand of the market not only in Quirino province but also in the nearby provinces -To encourage teamwork in carrying out every activity regarding the business and continuously improve the operations of the business -To strive harder to improve technologies and techniques employed including facilities used and human resources by attending educational programs, symposiums and seminars regarding mushroom cultivation -To incorporate in its operations the welfare of the society VISION -To be known as one of the mushroom farms which produces quality mushroom products in the whole Philippines
MARKETING ASPECT I. DESCRIPTION OF PRODUCTS/SERVICES The company offers for sale four mushroom types namely Banana mushroom, oyster mushroom, shitake mushroom and button mushroom. 1. STRAW MUSHROOM
Volvariella volvacea (also known as straw mushroom or paddy straw mushroom,Volvaria volvacea, Agaricus volvaceus, Amanita virgata, Vaginata virgata) is a species of edible mushroom cultivated throughout East and Southeast Asia and used extensively in Asian cuisines.
They are often available fresh in Asia, but are more frequently found in canned or dried form outside their nations of cultivation.
Straw mushrooms are grown on rice straw beds and picked immature, before the caps open. They are adaptable and take 4-5 days to mature, and are most successfully grown in subtropical climates with high annual rainfall. There is no record of their cultivation before the 19th century.
They resemble poisonous death caps, but can be distinguished by their pink spore print; the spore print is white for death caps. Nevertheless, people have been poisoned (sometimes fatally) making this mistake.
2. OYSTER MUSHROOM The Oyster mushroom, or Pleurotus ostreatus, is a common edible mushroom. It was first cultivated in Germany as a subsistence measure during the Great War and is now grown commercially around the world for food. It is related to the similarly cultivated "king oyster mushroom". Oyster mushrooms can also be used industrially for mycoremediation purposes. The Oyster mushroom may be considered a medicinal mushroom since it contains statins such as lovastatin which work to reduce cholesterol. The mushroom has a cap spanning 5±25 cm broad, fan or oyster-shaped; Natural specimens range from white to gray or tan to dark-brown; margin inrolled when young, smooth and often somewhat lobed or wavy. Flesh white, firm, varies in thickness due to stipe arrangement. The gills of the mushroom are white to cream, descend stalk if present. If so, stipe off-center with lateral attachment to wood. The spore print of the mushroom is white to lilacgray, best viewed on dark background. The mushroom's stipe is often absent. When present it is short and thick. The taste of the mushroom is described as mild with a mild odor of anise. 3. BUTTON MUSHROOM Agaricus bisporus²known variously as the common mushroom, button mushroom, white mushroom, table mushroom, portobello mushroom, cremini, crimini mushroom, Swiss brown mushrooms, Roman brown mushrooms, Italian brown, Italian mushroom, or cultivated mushroom²is an edible basidiomycete mushroom native to grasslands in Europe and North
America. Agaricus bisporus is cultivated in more than 70 countries and is one of the most commonly and widely consumed mushrooms in the world.
The pileus or cap of the original wild species is a pale grey-brown in color, with broad, flat scales on a paler background and fading toward the margins. It is first hemispherical in shape before flattening out with maturity, and 5-10 cm (2-4 in) in diameter. The narrow, crowded gills are free and initially pink, then red-brown and finally a dark brown with a whitish edge from the cheilocystidia. The cylindrical stipe is up to 6 cm (2 in) tall by 1-2 cm wide and bears a thick and narrow ring, which may be streaked on the upperside. The firm flesh is white though stains a pale pinkish-red on bruising.The spore print is dark brown. The spores are oval to round and measure around 4.5-5.5 x 5-7.5 m, and the basidia usually twospored.Commonly found in fields and grassy areas after rain from late spring through to autumn worldwide, especially in association with manure. It is widely collected and eaten, even by those who would not normally experiment with mushrooming.
4. SHITAKE MUSHROOM The Shiitake (Lentinula edodes) is an edible mushroom native to East Asia, which is cultivated and consumed in many Asian countries, as well as being dried and exported to many countries around the world. It is a feature of many Asian cuisines including Chinese, Japanese, Korean and Thai. In the East, the Shiitake mushroom has long been considered a delicacy as well as a medicinal mushroom. II. TARGET MARKET
The major target market during the first year of operation would be the wholesalers, retailers, restaurants and other food enthusiasts in Quirino province. If the mushroom supply exceeds the demand in Quirino province, the business would be targeting wholesalers and retailers in the nearby provinces. III. PRICING STRATEGY Market prices of different mushroom types are affected by the current supply and demand condition. Therefore, the company cannot dictate market price. Prices for the mushroom products shall now depend on the prevailing current market price within the province of Quirino. IV. ADVERTISEMENT The company will be providing brochures regarding the benefits derived from mushroom products and distribute it to potential customers. This is to create awareness about mushrooms and the existence of the mushroom farm and to eliminate any uncertainties and confusions about mushrooms. Twenty five percent discount will be provided on the first month of operation. V. SUPPLY AND DEMAND SITUATION Mushroom supply in the Philippines is inadequate to meet the demands of the market. Since 1950¶s,the Philippines has been importing processed or canned mushroom from the United States, Taiwan and Hong Kong; spending about Php 750,000 or more annually. Presently, most oyster and banana mushrooms are commercially grown in Manila, Cavite and Laguna. Shitake mushrooms and button mushrooms are cultured and sold in Baguio City and
Benguet province. Button mushrooms are produced only in Baguio city and Benguet because it requires low temperature. Based from DOST findings, mushroom demand in national and local markets has been growing at a rate of ten percent per annum for the past years. This market growth trend is expected to increase as a result of the rapid increase of population and the growing awareness of the consumer about the benefits derived from mushroom. VI. COMPETITORS AND PROJECTED DEMAND The competitors and projected demand of mushroom products will be based on the answers of the questionnaires which will be floated. Respondents would be wholesalers and retailers of mush room products in Quirino. Questions to be asked are: 1. What types of mushroom do you sell? 2. How many kilograms of each mushroom type do you sell every day? 3. How much do you pay for one kilogram of each mushroom type? 4. What is the peak season of each mushroom type? 5. Where do you get your mushroom supply? 6. Are you satisfied with the quality of mushroom provided by your current suppliers? Why or why not? 7. What can you say about the price of the mushroom provided by your suppliers?
8. If we provide you with quality mushrooms at a reasonable price, would you avail of it? Why or why not?
MANAGEMENT ASPECT I. BASIC CONSIDERATION The project aims to meet the demand for mushroom products in which the current supply cannot satisfy.To be able to achieve the purpose, certain labor and supervision policies must be practiced which is to be further elaborated for the rest of the management aspect. II. FORM OF BUSINESS The business is a general partnership at will consisting of four partners. The partnership agreement shall set forth the capital contributions needed and the share of each partner including the profit and loss ratio. III. ORGANIZATIONAL CHART
*Some of the laborers might have to assist the driver in delivering the goods to the customers. This organizational chart is applicable for the first year of operation.
IV. KEY PERSONNEL QUALIFICATIONS 1. GENERAL MANAGER -Must be a graduate of Bachelor of Science in Business Administration -Must possess excellent communication and leadership skills -Must have strong and pleasing personality -Willing to work even in weekends and holidays -Knows how to manage a business and has the potential of enhancing the business -Must have a background knowledge on mushroom cultivation -Must be computer literate 2. FINANCE MANAGER -Must be a graduate of any four years accounting-related course -Must be computer literate -Willing to work overtime, on weekends and holidays -Must be honest
-Must be a partner 3. OPERATIONS MANAGER -Must be a partner -Must have a good written and oral communication skill -Willing to work under pressure -Must have an excellent background knowledge on farming particularly mushroom cultivation 4. SALES SUPERVISOR -Must be a partner -Must have a good written and oral communication skill -Willing to work under pressure -Must be a graduate of Bachelor of Science in Business Administration major in marketing -Must be computer literate Must be friendly and humble 5. BOOKKEEPER -Must be a graduate of any accounting ±related course -Must be computer literate
-Must be honest and trustworthy -Willing to work overtime
6. DRIVER -must be literate -at least finished two years in high school -With at least two years experience -Patient and hardworking -Physically fit -must be a licensed driver 7. LABORERS -must be hardworking -must have a good background in farming -Must be willing to undergo training -Must be literate
ACCOUNTING ASPECT The total initial capital contribution that the partners must contribute is Php 47,872,341.
LAND BUILDING FURNITURE AND FIXTURES OFFICE SUPPLIES DELIVERY EQUIPMENT GAS TANKS, AUTOCLAVE, BURNERS WATER TANK, POWER GENERATOR, SPRAYER, INOCULATION CHAMBER OTHER OFFICE EQUIPMENTS OTHER PLANT EQUIPMENTS TOTAL
45,000,000 2,000,000 25,000
10,000 280,000 165,000
PARTNER¶S CONTRIBUTION PARTNER CAPITAL RATIO OLAYAN, CATHLEEN KAY A. OMAWENG, EDILYN L. PABLO, JONALYN N. WALANG, FEBBIE R. TOTAL 2% 2% 2% 94% 100% 957,447 957,447 957,447 45,000,000 47,872,341 AMOUNT
PROFIT AND LOSS RATIO PARTNER PROFIT AND LOSS RATIO OLAYAN,CATHLEEN KAY A. OMAWENG, EDILYN L. PABLO, JONALYN N. WALANG, FEBBIE R. 25% 25% 25% 25%