A Feasibility Study of a Putting up a Beauty Salon in General Santos

City

A Research Proposal Presented to the

Faculty of Senior High School Department
Ramon Magsaysay Memorial Colleges
General Santos City

In Partial Fulfilment in the Requirements

For the Accountancy and Business Management
Senior High School

By:
Palconite, Angel D.
Prejoles, Jenevie P.
 Chapter I

INTRODUCTION

Beauty is an establishment opens for all individual who wants to look good

and gorgeous. It offers a variety cosmetics treatment and cosmetics services.

Beauty salons may offer a variety of services including professional hair cutting,

hair styling, hair coloring, manicures and pedicures, Skin care, and often

cosmetics, make-up and make-overs.

At the Beauty parlor, we believe in beauty with a conscience. We have

created a salon that offers the highest quality hair services in a setting that is

healthier for the environment, our guests and our staff.

As a clean air salon, we offer ammonia-free color services with little to no

scent properties or chemical emanation. This healthier alternative to traditional

coloring practices is also safe for expectant mothers and individuals with allergies

or scent sensitivities

Men and Women are beautiful themselves. But a little make up and retouch

does help a lot and it keeps one to make the day better and happier. Everyone

wants to be pretty and handsome whether he/she is young or old so the beauty

salon is the place to go.

Background of the Study

As it turns out, it takes a lot of effort to keep us looking and smelling our

best an absolute army of products and services, in fact. Cosmetics, skin care, hair

styling, hair coloring, hair removal, nail salons, tanning salons, shower and shaving

product, perfumes, colognes. And a whole lot more.

And that’s where it starts to get interesting - within each of these segments

are products for every different skin tone or texture, allergy, age, hair type or color,

sex - even the time of day! It is a level of diversity and nuance that may go unnoticed

to the casual observer. Some of us, in fact, are overwhelmed by all those rows of

shaving cream.

But increasingly we are the minority - most consumers care, are discerning,

and will try a number of different products before finding something that works.

Once they find it, however, brand loyalty - whether for a shampoo or a particular

salon - is extremely strong.

The beauty industry is known to be resistant to economic downturns - even

faring well during the Great Recession of 2008. Though consumers tend to be more

price conscious during those times, they do not stop spending. So in today’s

environment of rising per capital incomes the beauty business is booming.

In 2015 the industry generated $56.2 billion in the United States. Hair care is the

largest segment with 86,000 locations. Skin care is a close second and growing
fast, expected to have revenue of almost $11 billion by 2018. This growth is being

driven in part by a generally increasing awareness of the importance of skin care,

but also specifically due to an increase in the market for men.

Rational of the study

The goal to this study is to make everyone look better and gorgeous. And

we believe in beauty conscience. We choose this study because we are interested

about beauty of men and women so that they will look stunning.

Objective of the Study

To provide quality services with enthusiasm to exceeds costumer

expectation to increase number of customers and to make them more satisfied to

provide and contribute employment and opportunity.

Scope and limitation

The main focus of the study is to make everyone looks good pleasant in

their physical appearance by providing them the best cosmetics treatment and

services. Aside from that we assure that we are using the standard and high quality

technology to make our costumers satisfied and give their expectation. This study

is not is not only for women but also men and children who are capable enough to

take care their selves. The target age for this study was 3 years old above. All

individuals are welcome as long as the salon can cater and provide their needs

and wants. It covers the whole area of General Santos City. Like nearby houses,

subdivisions and other establishments.

Significance of the study

An explanation of the significance of a study may include the meaning

of the research work to you personally and should include how your research

benefits or impacts others in part or whole.

Research Methodology

This section discusses the process used to collect information and data

by research design, Respondents, and locale of the study, data gathering tools

and data gathering procedure.

Research Design

The research design used in the study is descriptive exploratory

method. This method of research is known in forming a better understanding of a

problem.

Respondents

The researcher choose ten (10) respondents. And we choose the staff

of the parlor to answer the question, because they know about beauty parlor,

Beauty products, Cosmetics treatment and cosmetics services.

Locale of the study

This study was conducted at Wilquin’s Beauty Salon in front of KCC Mall

of Gensan. It is strategically located at J. Catolico. The researcher choose Brgy.

Lagao General, Santos, City.

Data Gathering Tool

The researcher used an interview to gather data or information to the

owner of the Beauty salon business located in General Santos City. The

questionnaire was given to ten (10) respondents that are engaged in Beauty salon.

This served as a basis in interpreting and analyzing the given data of the

respondents and was used an evidence in this study.

Data Gathering Procedure

The researcher observed the following procedures in data gathering. First

and foremost the researcher asked permission to conduct the study. She wrote a

letter to the program director of Senior High School Department to allow her to

conduct the study.

After the researcher granted the permission, she identified her ten (10)

respondents.

The researcher prepares and sent the questionnaire to the randomly

chosen 10 person respondent.

As soon as the respondents were finished answering the questionnaire,

she gathered them, analyze and tabulated the raw data and finally, she endorsed

the tabulated data to her statistician.

Definition of terms

For clearer understanding of the study, the following terms are defined

operationally.
A feasibility study of putting up- this refers to the variable by putting up a

business.

Beauty Salon in General Santos City- this refers to the beauty products,

cosmetics treatment and cosmetics services in General Santos City.

 Chapter II

THE INDUSTRY AND BUSINESS DESCRIPTION

This chapter presented the products and services offered by the

business, major players in the industry, market trends and directions, capacity in

the industry, key success factors, general description of the, brand name,

product/service, potential of the venture, business strategic plan, the vision and

mission of the business, objectives of the business, SWOT analysis, location

analysis, vicinity map and location map.

Product and Services

The Beauty Salon focuses on the rendering of the services of the Salon.

The beauty salon offers and a very comfortable seats and a very approachable

crews that perfectly encapsulate your outside beauty and the incomparable

employee’s hospitality. The salon provides a peaceful mind.

Major Players in the Industry

There are 53 Beauty salon in General Santos City (Google Map). The

researcher chose one (1) major player of the industry based on the criteria that

they have been known to the industry to be offering good services and have been

operating and existed for longer years. There is the following:

Wilquin’s Beauty Salon is located at J. Catolico Street Brgy. Lagao

General Santos City, 9500 South Cotabato. The business is now 2 years in the

industry wherein it started in the year of 2015.

Capacity in Industry

The capacity of the industry is the ability to accommodate certain number

customers. In Southern Mindanao, General Santos City is one of the fastest

growing cities. Beauty salon is the one of every woman needed in their lifestyle.

For the reasons given it is acclaimed that this will give a continuous

establishing of the business.

Furthermore, National Statistics Office (NSO) as May 2010, General

Santos City has a population of 538,026 and expected to be doubled in 26 years

ahead with annual growth of 2.71 percent. The increasing population signifies an

increase in potential customers as one of the advantages for new business

ventures.

Key Success Factors

The following are the key success factors of the industry:

Quality Service- gives a reputation to the Beauty Salon industry. This motivates

not only the customer but also to the management itself. By achieving quality

service means guaranteed customer satisfaction and a good demand for the

market. This gives loyalty by the customer to the business.

General Description of the Venture

The proposed business is Beauty Salon named “Wilquin’s Beauty

Salon”. The proposed business in the form of partnership. A partnership is a form

of business organization where two or more members share in the business. The
partners mutually agree on how profits will be shared and how business will be

conducted. Partners also agreed on how disputes will be resolved legally and

how additional partners will be admitted (Zarate, 2016). It will be located at

Lagao, General Santos City. It will have 2 sections, that will be include the

following: The manager’s office, where the manager stay and to manage day-by-

day operations of the business, the re-bonding of hair area, where the customers

were seated and their hair get rebond.

The business will be indulging in service industry and will focus on

meeting up the expectation of the customers. It offers a service that can make

you more beautiful and handsome. And, it has website where you can see what

the promos are and what are the trending nowadays. The customers can

accommodate.

Brand Name

The proposed business will have a name “Wuilquin Beauty Salon“ derived

from the expected beauty salon. This will allow potential costumer to easily

understand the nature of the venture’s name. The words also impose easily

clarified meaning. This can be easily recognize and pronounce by everyone.

This service of the business will be highly in nature and more releasing to

meet the expectation of the costumer.

Service Style
 The service of the business will be highly in nature and nicer to meet the

expectation feedbacks of the customers. The prices of salon will vary to the design

of the hair and all.

BUSINESS LOGO

FIGURE 2

Company Logo

The logo propose in the business is colorful, shows the beauty in the

parlor. The light will bring about life in business.

Uniqueness of the Service

The uniqueness of the proposed business the view lies in the guarantee

that each corner is passionately traditional culture of the Filipino view. And, high

quality products and high standard. I assure you that our beauty salon was

relaxing, so that the customer can relax their mind, body and soul.
Product/Service Labelling

The proposed business will be labeled as becoming one of the prominent

and outstanding beauty parlor in General Santos City by means of providing high

quality products and excellent service.

Potential of the Venture

The proposed business will serve as high quality and affordable prices.

The researcher will do their best to satisfy the customer, so that the business will

progress.

Business Strategic Plan

The proposed business will have business strategic plan to ensure its

success and continuous development. The business will also have total quality

management. This will oversee that all aspect of the management will surely be

functioning well. This is for products for customers satisfaction.

The business will also be established in a location that will be accessible

to real estate, churches, hospital and school to ensue customer’s consumption. It

will be placed where the numbers of customers are gradually escalating: it adds

strength and credibility to the organization and more effective at meeting needs

and concerns.

Vision

Beauty is what you feel about yourself not about what you see in the mirror.
Mission

Wilquin Beauty Salon mission is to have a good well priced, wowing voluminous

changing, color, or cutting hair styles. We want to be able to have our customers

come in and want to come back every other week or opportunity they get. Day to

day we want to complete each task by allowing our mission to be succeeded. The

service we give we accomplish every expectation that our customers comes in our

salon wanting in their hair.

Objectives

1. Allow our service to give in every potential we as employees have to

satisfy our customers.

2. Have more and more customers each day.

3. To be one of or the best salon anyone could possibly walk into, including

celebrities.

4. Satisfy our customers.

5. To have professional hair stylist that can actually do the hairstyles as

asked, and have them trained when we first bring them in even if they

say they are profession.

SWOT Analysis

This part discusses the strength, weaknesses, opportunities and threats

of the business venture.

Strength- is the characteristic of the business that give it advantage over others.

The proposed business will have the following strengths.

Reasonable Prices- The proposed business will have prices that will see to it that

the prices will be given to the customers. Quality service will give reputation to the

business.

Strategic Location- The business establishment will located near from the noisy

place and crowded people.

Good Governance- The proposed business ensure good governance which will

enhance the reputation of the business will make it more appealing to the market.

Weaknesses- are the characteristics that place the business at a disadvantage

relatives to others. Here are some weaknesses of the proposed business.

Loyalty of the Customers-considering that there are already existing beauty

salon in General Santos City near in the heart of the City. It is certain that a large

portion of the market have already their own name. A great number of customers

are already patronizing a certain business in beauty salon industry.

Weak Marketing Structure- Beauty salon, as a new business industry, it will be

difficult for the venture to the have marketing strategies be implemented with high

standards immediately and business and high quality.

Opportunities are the elements that has business could make the most of

the advantage. Here some opportunities that business has.

Increasing number of aged population in General Santos City with the

inflating population of General Santo City it is a certain to have more enhance

relaxation activities for beauty parlor industry. This will give a great advantage to
the population for this will give them the proposed business a sure member of

customers because of the growing demand of the consumers.

Economic Development- General Santos City is seen highly developing its

economy. As the economy grows, the number of establishments is growing and

investors are drawn to the City.

Threats

Threat is the element in the environment that could cause trouble for the

business. Hence, here are some threats in that proposed business has.

New Entrant to the Industry- as the economy of General Santos City grows;

a great number of business establishments are growing. There are numbers

ventures that already exists that is related to the kind of proposed business.

Presence of More Competitors- there are already Beauty Salon in General

Santos City, and as both economy and the population escalate. It is not inevitable

that many more will rise. This is considered a threat to the propose business, for

this will give another set of competitors. This will be dealt in having maintaining a

top position industry.

 Chapter III

MARKETING ASPECT

This Chapter discusses about the marketing aspect of the proposed

business will used the following advertising medium: This chapter discusses about

the marketing aspect of the proposed business. Specifically, it discusses the

market research and analysis including the target market, estimated market share

and intensity of competition. It also discusses the marketing strategy including the

service contribution strategy, inventory control and management. Storage

inventory, pricing strategy, and promotion strategy of proposed business.

Market Research and Analysis

The viability and profitability of any business should be analyzed first before

Establishing it. This will help whether the plans and strategies will be helpful or not.

This includes the knowledge of acquiring the target market, the estimated market

share and intensity of competition.

Target Market

The primary target markets of proposed business are the students,

professionals and household in General Santos City.

The secondary target market are those people who loved to go beauty salon these

are family and group of friends. The costumer can go to beauty salon to have relax

and comfortable experience. That’s why people will go to this kind of venture to

experience a better quality service.

Estimated Market Share

Since the proposed businesses new in the industry, its estimated market

share is only ten percent (10%) because aside as a new entrant. The beauty salon

industry is a common business in the city so that it is expected to gain a limited

market share. The total market share of major players has seventy percent (70%)

in which they already have names in the industry and already proven their service

in the public. The existing competitors are very competitive, each of them has a

different kind of strategies to attract customers. Open market has twenty percent

(20%) for possible new entry to the beauty salon industry that will help them to

compete with the existing competitors.

Legend :

 Existing Players

Figure 5. Estimated Market Share

Intensity of competition

In General Santos City, there are thirty one (31) registered beauty

salons according to City of Licensing office. The degree of competition industry is

very intense because the venture is one of the common businesses here in the

locality and since the competitors already established their names in the minds of

the customer. The existing players have in General Santos are competitive and

came from a strong company. Because of high intensity of competition the pricing

can also affect. The strategy of the proposed business to compete with the existing

players is to give them the best service in which it will offer outstanding service in

every aspect. This kind of strategy will work because it can lure the customer to

avail the service offered.

Marketing Strategy

A marketing strategy is a process or model to allow company or

organization to focus limited resources on the best opportunities to increase sales

and thereby achieve a sustainable competitive advantage. This shows the service

distribution strategy, inventory control and management, storage of inventory,

pricing strategy, inventory control and management, storage of inventory, pricing

strategy, service rate promotion strategy, advertising and sales promotion.

Marketed through independent sales representatives who are sometimes also

referred to as consultants, distributors or other title.

Sales and Distribution Strategy

The distribution strategy of the proposed business will be personal

service. It is a need chain of production given directly to the consumer it is

Marketed through independent sales representatives who are sometimes also

referred to as consultants, distributors or other title.

Order Processing

Order service is work flow associated on how to meet the requirements

needed. The proposed business may make inquiries with regards to the availability

of products through phone call or personally inquiring to the supplier. Then, it will

have an order placement which is customizing the order of the customer. The

proposed business will pay the total cost of the ordered and the supplier will serve

the products and materials ordered.

INQUIRY

ORDER PLACEMENT

PAYMENT

SERVE
Inventory Control and Management

Inventory Control and Management is set of policies and controls that

monitor the levels of inventory and determined what levels should be maintained,

when stock should be replenished and how large orders should be placed. The

research determined what facilities should be replays to be assured that the entire

products serve are new and fresh. The newly purchase products are refer to those

perishable goods such as vegetables to avoid food contaminated and to assure

that the health of the customers re secured.

Order Quantity

The order quantity will be based on the materials ordered from the

suppliers. The proposed business will order a lot of promos like hair rebond and

coloring hair. Also, it will order manicure, pedicure, and foot spa.

Volume of Safety Stock

The remaining stock in the storage room depends on the products that

are being use. Some products that are in demand in the beauty salon will be more

needed to have many stock in the storage room. Beauty products should have

quantity in the storage room.

Storage of Inventory

The storage room will be located within the building of the proposed

business. The storage room should be free from any leakage in terms of roof

construction in order to ensure the safety of the products come from the rain. The
storage room is also well-ventilated so that the products will not be easily damaged

and spoiled.

Pricing strategy

The pricing strategy of the proposed business is cost based pricing. It

is a straight-forward and effective strategy because it ensures that all cost are

cover before profits are calculated. Unlike some pricing methods which hedge

seasonal loses against profitable time-periods, based pricing has the added

advantage of generating steady profit. So, as a new entrant in the business

industry, the proposed business will give the customer a reasonable price.

The Product Prices/Service Rates

This shows the services rates of the service, the capacity and its price.

Product offer Price

Kind of Hair Rebonding

Brazilian Blow-out P1,800

Hair Rebond P1,000

Hair Rebond with color P1,300

Hair Rebond with Cello P1,100

Hair Rebond with color and cello P1,700

 Hair Rebond treatment P1,200

Nail Care

Manicure P60

Pedicure P70

Pedicure with Foot spa P130

Promotion Strategy

Promotion is the advancement of business establishment. It is the

encouragement of the progress or growth of the proposed business. It aims to

recognize the value of the business towards the people. The promotional tools that

will be used are the outdoor advertisement like posting tarpaulins in places where

people can easily see it. The business will also give leaflets or flyers for the

customer to be more aware of the business, it will be shown or given to a public

month before its operation.

Advertising

Advertising is attempting to influence the buying behavior of your

customers or clients by providing a persuasive selling mess

 Flyers- to be given that contained information about the business that

will open soon to the market. It will be distributed where is the target market of

the business pass by along the areas.

Social Media- It will show the services of the proposed business and the

terms and condition. Here, the viewers or customers can also suggest and post

their comments. This publicity will be a great help for feed backing purpose to

improve the services of the proposed business.

Radio- It is used a campaign that talkback/DJ promotes the proposed

business through radio.

Sales promotion

Sales promotion is a way on how to promote products or services to the

customer, it is a factor that the business will recognize if the sales status will be

increasing or decreasing.

Privileges to be offered to valued customers of the proposed venture

Loyalty card- It entitles a holder a ten percent (10%) discount on the total

products he/she buys. This is to maintain good customer relationship, promotes

customer loyalty and at the same time attracts new customers.

Tarpaulin- The proposed business will use a tarpaulin in promoting the

service since tarpaulin is commonly used by the existing business in promoting

their services because of its affordable price.

 Radio- It is used as a campaign that talkback/DJ promotes the proposed

business through radio.

 Chapter IV

TECHNICAL ASPECT

This chapter discusses the technical aspects of the proposed business

specifically, it includes the suppliers, the technical process, production needs,

building/plant lay-out and waste disposal.

The Suppliers

Suppliers have more important role in the proposed venture since it will

provide all the materials needed in the operation of the proposed venture. The

supplier of the proposed business will be wilquin beauty salon that is located in

Silang Cavite, Philippines. The supplier is trusted for more than forty (40) years.

This supplier is well known for their higher reputation and fresh quality of products

in the Philippines because it offers all kinds of beauty products in affordable prices

owned by Enrile family.

Raw Materials

The proposed business will be using the following materials for the

business operation. The materials are specifically for the hair, salon stations,

chairs, mirrors, shampoo bowls and dryers. For the nails are the pedicure chairs,

manicure stations, nail polish racks, sanitation stations and drying lamps. Some of

the equipment needed had to be bought from the suppliers to ensure the quality.

Thus, the manager will always check the raw materials and the substance needed

for the service.

Source of Raw Materials

The raw materials of the proposed venture will be purchased in the

beauty products like nail polish and shampoo but the materials have to be

purchased in the suppliers. The researcher proposed the business will consider

the Watsons as the supplier for the materials or equipment that the venture will

use.

Suppliers Order Flow

The suppliers order flow presents the supplies ordered, the mode of

payments. How the order arrived and how the order fulfilled. The proposed

business may make inquiries with regards to the availability of products through

phone call or personally inquiring to the office of the supplier. The proposed

business will be accommodated by the supplier if the products are available. The

proposed business will have an order placement which is customizing the order of

the customer. Then the proposed business will pay the total cost of the materials

ordered and the supplier will deliver the products and materials to the address of

proposed business.
 INQUIRY

ORDER PLACEMENT

PAYMENT

DELIVERY/PICK-UP

Figure 7. Suppliers Order Flow

Technical Material

The technical process includes the discussion of the service flow or the

process on how the service will be rendered to the customers.

Process Flow

The process flow in the proposed business is that the customer will

inquire about the products offered. Then, it will have an order from the customer.

It will take 3 to 6 hours in every rebond of hair. For rebonding of hair preparation,

the employee will first gather gather the necessary material of rebonding of hair.

After that, it will be serving the customers. Time frame will be monitored by the
production manager and staff to avoid customercomplaints. The business adhere

to “pay as served” policy.

INQUIRY

CALL ORDERS

COOKIN/PREPARATION

SERVE

Figure 8. Process Flow

Service Flow

The service of the proposed business will start at 8:30am until 6:30pm

from Mondays to Saturdays. Figure 6 on the next page shows the service process

of the business. It caters inquiries from the customers about the services offered,

accommodates concerns and suggestion derived from what they experience in the

beauty salon to ensure customer pleasure, accepts payment in a cash to cash

basis from the orders of the customers.

 INQUIRY

ACCOMMODATION

PAYMENT

SERVICE

Figure 9. Service Flow

Production Needs

In order to be efficient and effective in having a quality services;

facilities, equipment, utilities and labor supply should be taken into consideration.

Facilities

Facilities are important aspect of production management and control.

It will help to provide good services to the customers in order for the company to

satisfy them in availing the service offered.

 Manager’s Office. This is the place provided to manager to manage

day-day operations of the business. This place will also be a means connect with

the customers who had concerns about the business and services.

Cashier’s Area. This is the area where the customer is in charge of

keeping and arranging the money to avoid confusion.

Stock Room. This is the room where excess equipment need to be

repaired, and other materials stocks will be kept. This is also the area where utilities

like brooms, dust pan, and mops are to be kept.

Garage Area. The proposed business will provide a garage area for

clients. This area will be used by customers to park their vehicles while processing

their transactions.

Equipment

These are tangible properties that are used in the operation of

business.

Air conditioner. It is used for keeping the air in a proposed business

for the comfort of the customers and also for the employees to the betterment of

the transaction.

Close Circuit Television or CCTV Camera. Is a TV system in which

signals are not publicly distributed but are monitored, primarily for surveillance and

security purposes within the area. It will be used to monitor to the everyday
situation inside and outside the establishment. Two camera will be placed within

the vicinity of the building.

Generator. The proposed Beauty salon will use quality generator to

provide continuous service even if there is no electrical power from the

SOCOTECO II. Generator will convert mechanical energy into electricity to serve

as a power source for other machines.

Water Dispenser. A machine or container that allows the contents to

be removed and used in convenient or prescribed amounts.

Table 2

Equipment

Quantity Particulars

6 Units Service chairs

4 Units Curler for hair

5 Units Dryers

Utilities

These are what the business expects to function without interruption. The

proposed business will use the following.

Electricity. It is used for providing power to the business and giving power

to equipment and running the appliances for everyday transaction of the proposed
business. The South Cotabato Electric Cooperative (SOCOTECO II) will be the

source of light and power of the business.

Water. It is used for cleaning the area and providing basic hygiene for

customers and employees by washing their hands after using the comfort room.

The Water District of General Santos City shall provide the water.

Labor Supply

The proposed business will not find it hard to look for manager and cashier

because there are a lot of business graduates in the city. For security guard, it will

hire from any accredited security guard agency for the safety of everyone. NAA

PA NIY DIGTONG.

Building/Plant Lay-out

Facility layout and design are important components of a business’s

overall operations, both in terms of maximizing the effectiveness of the production

process and meeting the needs of employees. The key to good facility layout and

design is the integration of the needs of people (personnel and customers),

materials in such a way that they create single, well-functioning system.

Figure 9 shows the floor plan of the proposed beauty salon business in

General Santos City.

 Figure 9. Floor Plan

Waste Disposal

The proposed business will be responsible for making sure that the waste

is handled and disposed properly. The proposed business will be using garbage

can inside the establishment and the business also will provide garbage bag

outside the venture to maintain the cleanliness. It is consist of two garbage cans

for is biodegradable and non-biodegradable. The waste of the business will be

collected by the city.

 Chapter V

MANAGEMENT AND ORGANIZATION ASPECT

This chapter presents the form of business organization, the

organizational structure, personnel duties and responsibilities, personnel salary

structure, pre-operating activities and time table of the proposed business.

Form of Business Organization

The proposed business will use sole proprietorship form of business

ownership in which only one individual acquires all the benefits and risk of running

an enterprise. The capitalization of the proposed business is one million seven

hundred thousand pesos (P 1,700,000,00).

The main advantages of starting as a sole proprietorship, the owner is

not required to file a separate business tax report. Instead, they will list business

information and figures within their individual tax return. This can save additional

costs on accounting and tax filling. The business will be taxed at the rates applied

to a personal income, not for corporate tax rates. While, the main disadvantages

of operating a business as a sole proprietorship is the owner’s personal

responsibilities for a business obligations and debts. Business creditors can satisfy

judgments out of the personal assets of the owner, including his house and

personal bank accounts. If the business has high liability exposure a personal

injury judgment can devastate an owner’s personal finances.

Organizational Structure

This kind of structure is a necessary in order for the business to be able

to determine the assigned job of each employee and to determine the number of

employees needed. As organizational structure is a formal system of job duties

and hierarchy. It defines the responsibilities of each position and the relationship

between them. The proposed business uses simple organizational structure

because it centralizes decision making with the owner. It is also necessary to

determine the proper channels of order, which is to be adhered by each employee.

The figure below shows the organizational structure of the proposed

business.

MANAGER

CASHIER CASHIER
(1) (2)

Personnel Qualifications

For effective operation, the management should exercise good sense

in selecting personnel. It requires consideration in their qualities to make sure the

proper filling up of the position in the organizational structure. The following are the

qualification of the employees to be hired by the proposed business.

Manager

 Must be a graduate of any 4 years business course

 Must be at least 23 years old above

 Male or Female

 Single or Married

 At least 2 years’ experience in managing business

 Must have a good moral character

 Hardworking, patient, honest and loyal

Cashier

 Must be graduate in high school or college level with experience

 Must be at least 18 years old above

 Male or Female

 Single or Married

 Must have a good moral character

 Hardworking, honest, and responsibility

Service Crew

 Must be graduated un high school or college level

 Must be at least 18 years old above

 Male or Female
  Single or Married

 Patient, Hardworking and Responsibility

Personnel Duties and Responsibilities

Personnel management is a part of management concerned with people at

work and their relations within a firm. Duties and responsibilities of every employee

should be properly oriented to avoid overlapping of jobs. The following are the

duties and responsibilities of the every employee to be hired in Wilquin Beauty

Salon.

Manager

 Handles all issues and problem associated with organizational personnel.

 Assigns each employee a development plan to help them to improve their

performance and support the organization’s success.

 Have a responsibility to recognize and reinforce strong performance in your

employees, and identify and encourage improvement where needed.

 Provides details on how they accomplished their goals, the milestones they

met and work products they delivered.

 Must constantly review the company’s Financial, Budgetary and production

goals.

Cashier

 Computes and records totals of transaction.

  Receives payment by cash, cheques, and credit cards.

 Issues receipts.

 Handling all the cash transaction.

Service Crew

 NAA NIY SUMPAAAAAAAAAAAAAy

Personnel Salary Structure

Salary is the compensation received by employees as a payment for

the services they rendered in the business. Employees are contracted to work for

a specific hours per day and are expected to work the number of hours sufficient

to do the job to a satisfactory standard. Specifically, the personnel will work eight

(8) hours a day and (6) days a week. An average of 26 working days a month will

be spent by each employee.

The page will shows how much each employee may receive in return

for their services. Salaries may vary according to each position an employee holds

in the establishment.

Table 3

SSS, Philhealth and Pag-ibig Contribution

May sumpay ni siya bes box2

Pre-operating Activities

The proposed business provide a timeline for the schedule and

guidelines for analyzing and planning more projects to plan out the task that need

to be completed as basis for the scheduling of the plan, allocation of resources

needed and to work out the critical path where they must be done at a particular

date.

Conducting the Feasibility Study-This involves the kind of

business to be offered, how it will be promoted, the financial supports and the

organizational structure of personnel which will take one month.

Securing business and License and Permits-This activity will be

accomplished in one (1) month after conducting feasibility study. This serves as

legal requirements when entering into a business for the security of the

environment, resources and people.

Acquisition of Equipment’s-The proposed business will

purchase appropriate equipment, furniture and fixture needed for operation. This

shall be done a month after completing the construction of the building.

 Hiring and Training of Employees-The proposed business

need to hire and train employees to fulfil goals in an organization. Hiring will start

on posting job vacancies. The applicants will be given examination. The passers

will be interviewed and presto qualified applicants will be required to submit

requirements. After given one week of getting requirements, they will be trained.

Start of the Actual Business Operations-The business will

start the actual operation upon the completion of activities, information and

requirements conducted.

Timeline-The timeline or Gantt chart plots the activities under

the pre-operating stage. This will be given a lucid way to understand how the pre-

operating activities should be done as well as the arrangement of it according to

the duration of accomplishments.

Table in the next page shows the timeline of the pre operating

activities of the proposed business.

Table 4

Time Table

Naa niy boxbox friend.

 Chapter VI

FINANCIAL ASPECT

This chapter presented the investment cost of business. Financial forecast

and assumptions, projected financial statement, financial analysis, capital

budgeting decision and financial statement supporting schedules.

Investment Cost

Investment cost is the total amount of money necessary to put a project

into operation (Hasset, 2008). The total capitalization will be PHP 1,700,000,00.
 The table 1 below shows the summary of the total investment cost of the

proposed business:

Table 1

Investment Cost

NAA PA NIY SUMPAY….

Financial Assumptions

The following are the financial assumptions implemented by the

proposed business regarding financial related issues of the entity. This would be

the basis in preparing the projected Financial Statements.

 The proposed business will be established in the form of the sole

proprietorship.

 The capital will be Php 1,700,000,00

 Total revenue will increase annually by 3% except depreciation.

 The depreciation expense will be computed using the straight line

method.

 Salaries and wages will increase by 1,000 every 3 years.

 Prepaid rent will increase by 3% yearly.

 The owner’s withdrawal will be 50% of net income.

 Cost of sales is equal to 70% based on sales.

 Inventory is equal to 10% of Cost of sales.

Financial Statements

The financial statements are the means by which information

accumulated and the processed in financial accounting periodically communicated

to the users (Valix, 2014). It is to provide information about the financial position

which includes income statement, balance sheet and the statement of cash flow.

Projected Income Statement

The income statement measures a company’s financial performance

over a specific accounting period (valix, 2015). It shows the summary of income

and expenses derived from and incurred for a given period of time. Financial

performances is assessed by giving a summary of how the business incurs its

revenues and expenses through both operating and non-operating activities. It also

shows the net profit or loss incurred over a specific period, typically over a fiscal

quarter or year.

Projected Balance Sheet

Balance sheet is the statement which shows the financial position of the

business establishments as of given date (Agamata, 2014). This is a financial

Statement that summarizes a company’s assets, liabilities and shareholders’

equity at a specific point in time.

Projected Statement of Owners’ Equity

 The statement of owners’ capital shows the changes in each partner’s

capital account for the year or period being reported on (Valix, 2014). The

statement starts with the beginning capital balance, followed by the amounts of

investments made, share of net income or loss, and withdrawals made during the

reporting period to determine the capital balance at the end of the period.

Wiquin’s Beauty Salon

Statement of Income Statement

For the year ended December 20A,20B,20C,20D,20E

MAY SUMPAY NI HAAAAAA? SABOT KA?

Wilquin’s Beauty Salon

Statement of Changes in Equity

As of December 20A,20B,20C,20D,20E

MAY SUMPAY JAPON NI Sya.

 Wilquin’s Beauty Salon

Statement of Balance Sheet

As of December 20A,20B,20C,20D,20E

MAY SUMPAY JAPON NI Sya.

Wilquin’s Beauty Salon

Statement of Cash Flow

As of December 20A,20B,20C,20D,20E

MAY SUMPAY JAPON NI Sya.

Financial Analysis

The financial ratio analysis is a useful management tool that will improve

understanding of financial results and trends over time. And provide key indicators

of organizational performance(McGraw-Hill, 2000). It also pin points strengths and

weaknesses from which strategies and initiatives can ba formed.

 Financial ratio can be in the profitability ratio analysis, liquidity ratio

analysis, solvency ratio analysis and the payback period.

Profitability Ratio Analysis

A class of financial metrics that are used to assess a business’s ability to

generate earnings as compared to its expenses and other relevant cost incurred

during a specific period of time (Dr. Eugene Brigham, 2014). The following are the

ratios under profitability ratio analysis period.

Return on Revenue

The return on revenue ratio measures the company’s ability to turn its

sales into net income (Investopedia, 2016). It shows what the percentage of sales

is left over after all the expenses are paid by that business. It is calculated by

dividing net revenue by net sales.

Table 2.

MAY BOX2 NI SIYA

Rate of Return on Assets

Ratio of return on assets is the ratio of annual net income to average

total assets of a business during a financial year(Dr. Eugene Brigham, 2014). It
measures efficiency of the business in using its assets shows that business is more
profitable.
 Table 3 below shows the return on assets ratio of the proposed business
for five (5) consecutive years.
Table 3
MAY SUMPAY NI SIYA.

Rate of Return on Owner’s Equity

The rate on owner’s equity ratio measures the company’s profitability

by revealing how much profit a company generates(Dr. Eugene Brigham, 2014). It

is expressed as a percentage and calculated by dividing the net income by owner’s

equity.

Table 4 below shows the current ratio of the proposed business for

five(5) consecutive years.

Table 4

MAY BOX2 NI SIYA.

Liquidity Ratio Analysis

Liquidity ratio is used to determine a business’ ability to meet its short-

term debt obligations. Investors often take a close look at liquidity ratios when

performing fundamental analysis on the business. The liquidity ratio of the

company will not be identifying since there is no debt, the owner will provide the

capital of the business.

Current Ratio
 Current ratio performance measure used to evaluate the efficiency of

investment. It compares the magnitude and timing on gains from investment

directly to the magnitude and timing of investment costs. It is one of the most

commonly used approaches for evaluating the financial consequences of business

investment, decisions, or actions. It is calculated by dividing current assets by

current liabilities.

Table 5 below shows the current ratio of the proposed business for five

(5) consecutive years.

Naa ni siyay box2 bebebebebebebebebebebe ./.

Solvency Ratio Analysis

Solvency ratio analysis is measurement that will answer how long the

proposed business can survive. The owner wants to be assured of the investments

and the ability of it to pay to pay their long term obligation.

Debt to Asset Ratio

Debt to total assets measures the total provided by creditors. It indicates

the degrees of financial leveraging and it provides indication of the ability of the

entity to survive losses without impairing the interest of its creditors (Baysa and

Lupisan, 2011)

Table 6 below shows the debt to asset ratio of the proposed business for

five (5) consecutive years.

 Table 6

May box2 ni siya

Equity Ratio