Chapter 1: Introduction

I. A Rationale

What used to be a poor man’s

timber, bamboo is becoming a material

of choice for many products across

varying industries due to properties

that rival, if not exceed, most

commonly used material in building

crafts, furniture, and other structure. Bamboo is the tallest perennial

grass that belongs to the family of Gramineae. Due to the long cylindrical

structure of the culm, bamboo is a versatile material for a variety of

economic uses such as for handicraft and furniture, farm implements,

fish pen, fish cages, banana props, musical instruments, pulp and paper,

and house construction. Aside from these uses the young shoots of some

species are edible for human consumption

(Trees and their Management, 1992).

Straws are widely used among people

for drinking beverage, juice or other drinks.

Consumers all over the world use plastic

straws. Nowadays, manufacturers are inclined

towards the introduction of sustainable products which reduces the

 usage of plastic. One such product is bamboo straw, thus preventing

plastics from entering and polluting the environment.

It is in this light that the proponents of this study aim to propagate

the use of bamboos, specifically its species Chinese Bamboo as alternative

material for drinking straws by selling the same to Hotels located in

Bangko Filipino, Paranaque City.

I.B About the Organization

B.1 Name of Business

The

proponents opt to name the business Luntian Bamboo Product Trader

(LBPT). This is so since the main product to be distributed by the

organization are products made of bamboo.

B.2 Type and Form of Business

LBPT is in the form of Partnership

which the law defines as “A contract of two

or more persons who bind themselves to

contribute money, property or industry to

 a common fund, with the intention of dividing the profits among

themselves” (Art. 1767, NCC). The reason for such is that, ts form of

business is generally easier to establish, and requires lesser formalities

as compared to a corporation, because the corporate by-laws must be

considered at any given time. The organization will venture on a trading

industry.

In addition, the company

will fall under the Barangay

Micro Business Enterprise

category under Republic Act 9178 which gives the members the following

benefits, among others:

 Income tax exemption from income arising from the operations of the

enterprise;

 exemption from the coverage of the Minimum Wage Law;

 priority to a special credit window set up specifically for the financing of

BMBEs;

 and technology transfer, production and management training, and

marketing assistance programs for BMBE beneficiaries

Note: Benefits one and two would be capitalized most.

B.3 Company Logo

 The LBPT logo portrays

mother earth. Wherein, by

simply distributing bamboo products to individuals, we can help save

our mother earth.

The round shape is the belief of the organization, i.e. gaining profit

can be accompanied by with an intention to help the planet where we live

as well as its inhabitants. The green bamboos inside the circle represent

main component of the company-products, bamboo. In a word, going-

concern!

B.4 Company Vision and Mission

Vision
Luntian Bamboo Products Trader envisions itself to be the leading

distributor of bamboo products here in

the Philippines, and be an advocate of a

greener environment.

Mission
Driven by the will to serve, Luntian

Bamboo Products Trader commits itself to

distribute to the customers bamboo products of

outstanding quality for the benefit of the users and

for mother earth.

B.5 Proponents

The proponents of this study are Jeremy

Grant Ambe and April Joy Nolasco, both in their

fourth year (4th) of study as BS Accountancy

students. The two are adept to Accounting,

Bookkeeping and knowledgeable in the field of

Taxation and Commercial laws and ultimately,

have a good sense of knowledge with marketing

and running a business.

Chapter 2: Marketing Aspect

2.1 Description of the product

Our pilot product is reusable Bamboo Straw used to savor one’s favorite

beverages! Aside from being capable of being used

repeatedly, our product this particular straw is

hygienic. This is so because it is primarily made

from Bamboo which is considered to be anti-

microbial in nature.

Based on the published article of Journal of

Family Ecology and Consumer Sciences, bamboo

viscose fibers have a unique antibacterial quality

due to an antimicrobial bio-agent called “bamboo kun” which is found

naturally in living bamboo fiber. This “kun” supposedly makes bamboo a

naturally antibacterial, antifungal and odor resistant fiber. This jibes with the

findings of Center for Material and Fiber Innovation, Institute for Technology

Research and Innovation, Geelong Technology

Precint, and Deakin University in Australia.

The species of bamboo used to produce

our bamboo straw is Chinese Bamboo

(Bambusa vulgaris) which is characterized by

its distinguishably golden-yellow color. This

plant grows up to 9.3m high with a diameter

of 5-15 cm. Its slender culm fits for use as

straws. This bamboo normally grows along riverbanks particularly in Tropical

Asia like the Philippines. Straws made from this

material are durable and could last for at least a

year if properly used and cared, according to

Kombucha Kamp, a pioneer in Bamboo straw

industry. Hence, you can use it again and again!

It is to be emphasized that our bamboo straws

don’t have fix diameter or thickness because

each bamboo is unique and it didn’t come out from a product-mold. Its length

however is quantifiable that is ten (10) inches.

2.2 Comparison of the Product with its Competitors

How does it compare in quality and price with its competitors? Luntian

Bamboo Products Trader has identified three competitors that will become its

main competition, to wit:

First are plastic straws companies. These

manufacturers specialize in making and

distributing straws made from thin tube of paper

plastics. The type of straw they manufacture is the

pioneer in the drinking straw industry, worldwide.

In Metro Manila alone, there are at least five (5)

huge companies that produce and distribute plastic

straws; these are, among others, Precision Master Technology Incorporated,

Larone Crafts Incorporated, Sanko Plastics Philippines Incorporated Plastic

Consumer Corporation and Donewell Corporation. They sell their straw

products at a minimum price of Thirty Pesos (P 30.00) per pack, ranging from

80-100 each. Majority of retail stores, cafeterias, restaurants and beverage

shop patronize plastic straws because of its

easy availability in the market.

Second are companies engaging in

manufacturing and selling reusable metal

straws such as: Sip PH, Eco Spot, Gubby

and Hammy, Ritual Trading, Eco Sip, Go

Zero and Recovery PH. Their product

alongside Bamboo Straw was one of the answers to various advocacies to halt

the use of traditional plastic straws due to its adverse impact to environment,

and to the numerous city ordinances regarding plastic bans. Cities in the Metro

Manila such as Makati, Quezon, Pasig, Muntinlupa, Las Pinas and Pasay are

among those who said no to plastics. The said metal straw distributors and

manufactures sell their straws at prices ranging from One Hundred Pesos (P

150.00) to Two Hundred Fifty Pesos (P 250.00) per package, i.e. inclusive of

pouch and cleaner.

Third are other bamboo straw sellers and distributors.

 As regards to Plastic Straws, our Bamboo Straw is superior as to safety

sustainability, and far more eco-friendly!

Plastics straws, when immersed with hot substance, become significant

ingredients of the beverage giving it a bad taste. These also serve as a medium

for toxins to leach since polypropylene and

polystyrene are its main components. Eventually,

these materials could intoxicate a person when

exposed too much. Our Bamboo Straw, on the

other hand, is safer and more hygienic due to

anti-microbial property inherent to it .Using a

natural, organic straw made from bamboo

eliminates the potential for ingesting chemicals

and bacteria without compromising the quality of

experience of having a good sip from one’s drinks.

As to sustainability, Bamboo Straws also

surpass Plastic Straws by a long stretch. Since the former is reusable, it can be

used repeatedly again and again, with proper cleaning, unlike plastic ones.

Straws made from bamboo are also economical since it precludes users from

buying straws every single time. A single bamboo straw could last for at least

six months or up to several years!

From an environmental stance, on the other hand, reusable Bamboo

Straws will begin to compost the moment you decide it’s ready to go back to
nature because of its organic nature hence

reducing pollution and mass in landfills.

Plastic straw, on the other hand, can take

thousands of years to break down into

small pieces and will never completely

disappear!

As regards Metal Straws, our Bamboo Straw

product still surpasses the former in terms of safety and eco-friendliness!

Like Plastic Straws, Metal straws, also

react when immersed with hot substance,

become significant ingredients of the beverage

giving it a nasty taste. Also, since this type of

straw is generally made from metal like nickel

and aluminum, there is the presence of danger

- damage to teeth when accidentally bitten especially by children!

In addition, having metal as its main component, it will still make an

adverse effect to the environment especially in mining and excavating the

metals needed to produce these straws. In a way it defeats the purpose of

alleviating the continuous deterioration and pollution of Mother Earth.

As regards competition with other sellers of Bamboo Straws, while our

products are the same in all material respects, our assurance of quality is our
cutting edge. Each product will be inspected before delivery to ensure that only

the best will go to the vendee’s hands for a cheaper price!

2.3 Location

Our business address is, #8 Grace Street, Remmanville Executive

Subdivision, Betterliving, Brgy., Don Bosco, Parañaque City. This is so because

no manufacturing or processing will be done. Ergo, this is allowed inside the

village. Of the 220 square meters lot area of the address aforementioned, 50
square meters would be devoted for the business with a monthly rental of P

3,000.00. The cheaper rental is given the outmost importance in considering

the space

2.4 Market Area

The target geographic area will be the whole City of

Paranaque.Basing on the data provided by the local

government of the City of Paranaque’s website the

population is in excess of 500,000. (http://paranaquecity.gov.ph)

2.5 Main Customers
The main target customers identified by the proponents are

students of Public High Schools and Elementary Schools within Paranaque

City. As provided by the city website, there are 25 public high schools and 25

public elementary schools.

Secondary markets identified are other residents of Paranaque City not

included in the foregoing.

(https://en.m.wikipedia.org/wiki/List_of_schools_in_Parañaque)

2.6 Selling Price

The price of our Bamboo Straw would be Php 25.00. A very affordable

price!

Costing Php
Bamboo straw 10.00
Packaging 1.00
Shipping & Expense 1.00
Commission 1.00
Unit cost 13.00
 Markup (92%) 12.00
Selling price 25.00

2.7 Sales Forecast

Hereinbelow are the forecasted sales for the years, 2021 through 2023.

This table shows the projected sales annually for the first three years

of operations. In the 1st year of operation the projected sales, came from

one thousand (1,000) units of bamboo straw per month which based on

the quota set multiplied by the selling price of twenty-five pesos (Php 25.00)

per piece of Bamboo which equals to twenty-five thousand (25,000) pesos

per month then multiplied by twelve (12) months.. Hence, for the 20-day

school days of the students, each of the partner is ought to sell 25 units of

bamboo straw. The projected sales are three hundred thousand pesos

(300,000.00) in the 1st year of operation.

In the 2nd year of operation, the projected sales came from the

previous year (2021) sales multiplied by 110%.

In the 3rd year of operation, the projected sales came from the previous

year (2022) sales multiplied again by 110%.

 *Note: The partners assumed a 10% increase in number of sales

after the inception and the years thereafter.

2.10 Promotional/Marketing Measures

2.10.1 Promotional Objectives:

To promote the and create awareness to the product;

To create repeat customers by meeting their standards;

Strengthen communication with the target market;

To attract customers;

To successfully promote the product;

To achieve the forecasted sales;

2.10.2 Marketing Strategy

In order for the flagship product of LBPT to prosper, the partners came

up with the idea of having the business entity as a concessionaire to the target

schools’ cafeteria, i.e. to consign the product on a monthly basis. A ten percent

(10%) consignment fee based on sales was deemed necessary and prudent

hence the company expects net sales of ninety percent only (90%).

As a supplementary measure, the partners would also talk to the

science teachers to consider our product as an accessory project to be given to

their students as this would greatly help the latter appreciate the emerging

need to reduce waste, and become an advocate of reduced-plastic waste among

themselves. This would greatly help induce the trend of using bamboo straws.

A small token of appreciation would be given to the former.

 2.10.3 Promotional tools

In order to make the product known to its target market, the

proponents have identified three several advertising and promotion

activities, to wit;

Tarpaulins. This will be placed in front gate of the village where the business

resides .This will include the following information:

-Price list

- Company address and contact number

- Company Slogan

- Benefit of using bamboo straw

Making use of the Pipe line/Word of Mouth

Intensive use of social media platforms like Facebook, Instagram and

Twitter.

2.11 Marketing Budget

In order to properly execute the foregoing marketing plan, the company

would be appropriating a one-time yearly budget of Five Thousand Pesos (Php

5,000.00) for tarpaulins and sampling.

 Chapter 3: OPERATIONAL PLAN

2.1 Procurement Process

2.1.1 How Bamboo straws are made

Luntian Bamboo Products Trader is a business venturing in

trading operations. Ergo, no production process would be involved . The

only pertinent activity of the business is to purchase inventory from

various suppliers to be use for distribution activities. Even so, to ensure

that the products to be distributed by the organization are of outstanding

quality, the latter opted to know directly to the suppliers how they

manufacture their Bamboo Straws.

As provided by the suppliers, the series of process they follow are as

follows:

Step 1: Our bamboo stalks are harvested when they reach a height of

approximately 3 meters.

Step 2: The bamboo stalks are then dried using drying machines, until

the stalks have hardened into a timber like material.

Step 3: The bamboo stalks are then trimmed to size, before being hand

sanded and cleaned.

Step 4: The final step is to soak the bamboo straws in vinegar, before

being cleaned a final time and the coconut oil polish is applied.
 2.1.2 Materials Procurement

Material Procurement Process

Bamboo straws, pouch & cleaner

Start

Contact Supplier
Contact suppliers and make purchases; to be done every third
Friday of the month to provide allowance for 7-day lead time.

Receive goods
After 7-day lead time, goods would be delivered.

Inspect / Sample Random inspection is to be made to ensure quality of the straws

received/delivered. Any damaged goods would be returned.

Record Record the goods in the inventory records for accounting & related
goods purposes

Store Goods
Store the goods in the warehouse for eventual delivery

End
 2.1.3 Distribution

Operation Process/ Distribution:

Start

Load the straws

Place the bamboo straws inside the delivery vehicle rented.

Deliver to the The goods would be brought to the schools for distribution.
vendees place

Record the
sale &decrease After the transaction, the partner in-charged with finances would
on inventory record the sales and corresponding decrease in inventory

End
2.2 Fixed Capital

The partners have identified several properties, pieces of furniture and

equipment necessary to sustain organizational operations. As agreed, the

partners opted to invest to the company fixed capital amounting sixteen

thousand pesos (Php 16,000.00) to be done as part of the organization’s initial

capital. These investments are estimated to have an average useful life of at

least 5 to 10 years. The purchases that the partners will make are brand new

products to ensure longevity of use and no cost, if minimal, for repairs and

maintenance.

The working capital, after a careful deliberation has been made, the

partners amounted to twenty-four thousand pesos (Php 24,000.00) just enough

to cover pre-operating expenses, initial inventory and expenses. The total

capital of LBPTat its inception will be Php 40,000.00.

Table 3.1 Electronic and other Office Equipment

Equipment Specification Quan Cost/Value Amount

tity
(PHP) (PHP)

Laptops Asus 1 5,000.00 5,000.00

Screen size: 14.5”

*at agreed
CPU:Intel Atom
N2600(1.6 GB) value

Memory: 2GB DDR3

Memory

Battery: 3-Cell li-on

battery

Calculators Standard 1 500.00 500.00

Cellular Phones Vivo Y69 1 5,000.00 5,000.00

*at agreed

value
Electric Fans

Dowell SF STF8-
218B 1 500.00 500.00

16 inches, stand fan

Model: STF-167B

Color: Red

Power
consumption:
60W60W

Material: Durable
and high quality
material

Motor: Powerful

Total 11,000.00

Table 3.2 Furniture and Fixtures

Furniture/Fixtures Specification Quantity Value/Price Amount

(PHP)
(PHP)
 Executive Office
chairs and tables 3,000.00
1 3,000.00
with drawers &
lock

Filing Cabinet

2,000.00

Tailee Furniture 1 2,000.00

ST- 400 BDF 4
Layer Utility
cabinet organizer
with lock and
door.

Size: (L x W x H
cm)

118cm x 41cm x
30cm

Weight: 13Kgs

Total 5,000.00
2.3 Life of Fixed Capital

After a thorough consideration of the foregoing fixed capital investments,

the estimated useful lives are estimated to be at least 5 to 10 years.

Conservatism is one of the considerations employed so as not the make the

estimates unreasonable. The degree and frequency of usage are also noted.

2.4 Sources of Fixed Capital

The partners, prior to the inception of business operations have made

due diligence and effort in making their purchases. A number of stores are

identified for these. Quality, price and proximity are the elements considered.

The sources of Equipment as identified are as follows;

Table 3.4 Sources of Fixed Capital

Merchant/Store Fixed Capital to be Contact / Address

purchased

Home and Office Office Tables, Chairs, Home and Office Furniture
Furniture and Filing Cabinet
Dr Arcadio Santos Ave.,
Paranaque, 1700 Metro
Manila

Telephone: 829 4330

Abenson Electric Fan Jaka Plaza

National Bookstore Calculators SM Bicutan
2.5 Planned Capacity

Table 3.5 Capacity

Purchases Volume

Monthly 1000 Pieces of Bamboo Straw

Annually 12,000 Pieces of Bamboo straw

The above table portrays the planed capacity of LBPTat its first year of

operations. This was deemed necessary in order to sustain the business, i.e. to

cover all cost associated and make profit, if sold.

2.6 Future Capacity

The partners agreed that the future capacity would be increased by 10%

annually relative to the preceding year capacity. By the fifth year, the

warehouse would be expanded in order to accommodate the increase in

capacity. Procurement of additional labor and, security measures will also be

taken consideration for these are incidental yet vital to ensure that the planned

increase in capacity would thrive.

3.7 Office and Storage Layout

Figure 3.1

The above figure shows the possible set-up of the headquarters of the

business.
2.8 Merchandise Inventories and Prices

The following are the merchandise inventories needed in order to

facilitate the business operations:

Table 3.6

Merchandise Specification Prices

Bamboo Straws Length: 10 inches Php 10.00

External Diameters:

11mm-13mm (medium; for

shakes and juices with

herbs, pulps, an sago)

14mm and above (jumbo/

pearl tea straws)

Ribbon (green) 100% Polyester Php 7.00/yard

 Bond Paper Ultra white bondpaper. Php

500.00/ream

2.9 Merchandise Availability

The merchandise can be bought from various suppliers. After exercising

due diligence, the partners identified the suitable vendors for the inventory

needs of the business, to wit:

Table 3.7
 Merchandise Supplier (s)

Bamboo Straw
Misty Bamboo Products

Batac, Palawan City, Palawan

ECO SHOP PH

Reliance St., Mandaluyong, Metro

Manila, Philippines 1550

Contact Number: 0956-058-3010

Contact Number: 0925-887-2880

KAWAY BAMBOO STRAW Sapang

Kawayan, Norzagaray, Bulacan

Contact Number: 0917-836-5023

Tutuban Mall in Divisoria, Manila

Ribbon and Bond Paper
 City

For cost minimization and value- for- money, the partners agreed to buy

in bulk in and will arrange for free delivery of goods in future transactions if

that is feasible.

2.10 Labour

On the outset, the partners are the employees themselves. One of the

partners proposed that since the operation is still manageable, it is prudent

that the task of hauling the merchandises, inspecting, repacking and

marketing of the LBPT Bamboo Straw product will be handled by each of them

according to the agreed given task. There are two (2) partners and all of them

must and be able to deliver the said assignment.

2.11 Cost of Labour

The partners also agreed that they will receive commission based on the

number of Bamboo straws that would be sold. This amount amounts to one

peso per unit (Php 1.00)

2.12 Labour Availability and Labour Productivity

 Since all the partners are committed to the success of the business

organization, the harmonious relationship of the partners must be ensured

alongside productivity.