1

EXECUTIVE SUMMARY

This section guides the readers and investors on the overall feasibility of the

project at a glance. It summarizes the major highlights and findings of each major aspect

of the study.

Brief Description of the Project

Foodlum is a company wherein it is a locally-owned food outlet founded by

entrepreneur students that will be positioned as an international franchise through a

creative approach of the company‟s image and detailed presentation. Lumpia King is a

new product offered by Foodlum that is made up of meat-stuffed rolled into a thin

cylindrical shape, cut into bite-size lengths and deep-fried to golden perfection that

allows the mouth to devour deliciously wanting more of it. The company provided a

combination of excellent product at a value price and ought to deliver the best customer

service. Foodlum plans to attain and maintain the interest of its customers by

continuously innovate products depending on the necessity and demand of the market

population.

Vision

We at Foodlum Company envision being the market leader setting exceptional

standard and provide quality products and services that consistently exceed customer‟s

satisfaction through the spirit of teamwork.

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Mission

The Foodlum Company aims; to provide a quality product that meets the desires

and need in the market, to be an international company with a total commitment to

quality product and customer service, and to develop a company structure with a design

to maximize economic efficiencies.

Tagline

“Come hungry leave happy”

Slogan

“Crispiness at its best”

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Brief Profile of the Entrepreneur

The following are the brilliant founders of Foodlum Company:

A. LJ Trisha B. Ala

LJ Trisha is the daughter of Mr. Jimmy A. Ala and Mrs. Ednafe B. Ala and only

the girl among her 2 siblings. She started to go to school at the age of three years old,

finished her preschool years at Mindanao Institute. She pursues her elementary school

years at North Cabadbaran Elementary School but eventually moved to Butuan Central

Elementary School of the last year of school year meaning she transferred when she was

in Grade 6 due to personal reasons. Surprisingly, she passed in Science Technology and

Engineering curriculum at Agusan National High School. LJ Trisha graduated in ANHS

with a medal that says with honors. Due to her loyalty, she enrolled at ANHS under the

academic strand Accountancy, Business, and Management and planning to become an

accountant in the near future.

Risk taker, aiming for high, goal-oriented, determine, adventurous, caring, and

lovable are the right description that perfectly fits to her personality and characteristics.

LJ Trisha's goal in life is to become the next Bill Gates.

B. Diane Rose B. Caiňa

Diane is the youngest daughter of Mr. Edgar O. Caiňa and Mrs. Rosalina B.

Caiňa. She is 18 years old and was born on November 18, 2001. She graduated her

elementary years in Butuan Central Elementary School and completed her Junior High
 4

School in Agusan Naional High School. She is currently taking up Accountancy,

Business and Management in Agusan National High School – Senior High Department.

Diane is a simple, adventurous and positive thinker person. She likes to try out

new things and travelling. She loves to read watt pad stories and watching movies. Also,

she enjoys spending her time with her family and friends. She wanted to become a

Certified Public Accountant in the near future.

C. Kharyll Kae A. Tuyor

Kharyll is the first daughter of Mr. Joseph E. Tuyor and Mrs. Joselyn A. Tuyor.

She is 17 years old and was born on December 17, 2001. During her childhood days she

likes to play a volleyball and softball. She graduated her elementary years in Tag-anahan

Elementary School. In her freshmen year, she studied in Esperanza National High

School. In grade 9, she transferred in Agusan National High School and graduated. She is

currently taking up Accountancy, Business and Management in Agusan National High

School – Senior High Department.

Kharyll is a unique person, God fearing, and independent. She brings happiness to

her friends. She likes to hang – out with goats. She also loves to watch movies. She

wanted to become an Accountant and Teacher in the near future.

D. Roel Dexter B. Quilaton

Roel Dexter B. Quilaton is the eldest son of Mr. Roel R. Quilaton and Mrs. Riza

B. Quilaton. He is 18 years old and was born on January 2, 2002. He finished his

elementary years in Butuan Central Elementary School and completed his junior high
 5

school in Agusan National High School. He is currently taking up ABM in Agusan

National High School-Senior High School Department.

Roel Dexter is faithful and a responsible person. He loves playing sports

specially basketball and he also loves playing video games. He wanted to become an civil

engineer someday.

E. Legune B. Saludo Jr.

Legune is the eldest son of Mr. Legune S. Saludo and Mrs. Marylyn B. Saludo.

He is 18 years old and was born on April 27, 2001. During his childhood days he likes to

play football and basketball, his favorite teams are L.A Lakers and F.C Barcelona. He

graduated his elementary years in F.T Magro Elementary School and completed his

Junior High School in Agusan National High School. He is currently taking up

Accountancy, Business and Management in Agusan National High School – Senior High

Department.

Legune is lovable and God fearing. He brings happiness to his friends. He likes to

hang-out with his dogs. He also loves to watch war movies. He wanted to become a

military officer and architect someday.

F. Xyrel Marie A. Patombon

Xyrel Marie A. Patombon is the first daughter of Mr. Newlert C. Patombon and

Mrs. Methusillah A. Patombon. She is 18 years old and was born on December 29, 2001.

She graduated her elementary years in San Vicente Elementary School and spends her

junior year in Agusan National High School. She is currently taking up academic strand
 6

under the Accountancy, Business and Management at Agusan National High School –

Senior High Department.

Xyrel is a kind and cheerful person. She loves watching movies, playing softball

and travelling. She wanted to build her own café.

G. Czaira Mikhaela B. Butcon

Czaira is the first born of Czarel Joe and Michelle Butcon. She is 19 years old

born on October 18, 2000. She graduated her elementary years at Butuan Central

Elementary School and completed junior high at Father Saturnino Urios University-Basic

Education Department, during her first year in senior high, she studied at University of

Mindanao in Davao City and currently finishing 12th grade for almost two-consecutive-

years at Agusan National High School-Senior High Department; taking up Accountancy,

Business and Management.

Czaira is a very simple, kind and a shy type person. She likes traveling and going

out on some adventures. During her free time, she devoted herself in watching movies,

anime series, k-drama, reading novels and wattpad stories and also, she loves pampering

her mom on food trips whenever she got her savings. She wanted to have her own

restaurant and dreams of becoming a Clinical Psychologist and a Lawyer.

H. Ericka Las Piňas

Ericka Las Piňas is the only daughter of Mr. Jimmy Las Piňas and Mrs. Josie Las

Piňas. She is 18 years old and was born in August 19, 2001. During her elementary days,

she loves joining school scouting such as camping‟s and physically active in sports. She
 7

is consistently excelling in her academics. She graduated in Lemon Elementary School.

In her Junior High School, she studied in Butuan City School of Arts and Trades. She

used to focus on her academics and learning cookery which serve as Technical

Vocational Education (TLE). She is currently studying in Agusan National High School-

Senior High Department as a Grade 12 student taking up Accountancy Business and

Management Strand. Ericka is hoping her good future. She tries everything to reach up

her goals in life.

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Project’s Contribution to the Economy

Economic growth is important because it is the means by which the residents on

the nation can improve the quality standard of living and enables to cater for any

increases in population without having to lower the standard of living. One factor that

affects the economic growth is the business establishments. Businesses play a vital role in

the country‟s economy since it provides the needs and wants of the consumer.

Foodlum‟s contribution to the economy is that the company gives the essential

needs of the market population which is in line with food services. The company ensures

the safety and cleanliness of the products being served to the consumers. After the

Foodlum established their food outlet in the market, it will provide opportunities such as

availability of a job wherein they hire people to produce and sell the products to the

consumers. The company drives economic stability and growth by providing valuable

services, products, and pay taxes that directly contribute to the health of the community.
 9

SECTION I

MARKETING PLAN

This section tackles about the product of the business and narrates the project

conceptualization. It also pinpoints the project‟s general to specific market feasibility

topics. It presents the different marketing strategies and summary of sales projections of

the project study‟s entire duration and the project‟s marketing system and forms design.

1.1 Description of the Product

Figure 1
Close-up Shot of the Product

Lumpia King is a Filipino-style spring roll delicacy that is made up of ground

pork, chicken, and beef filling wrapped in thin crepes called lumpia wrappers. The meat-

stuffed lumpia is rolled into a thin cylindrical shape, cut into bite-size lengths and deep-

fried to golden perfection and then dipped into sweet and sour sauce. The crispiness of
 10

Lumpia King is very much evident on the outside. Tasty and savory are the right

descriptions to describe the flavor of Lumpia King wanting you more to indulge.

Lumpia King is perfect for breakfast, lunch, dinner and as well as midday snacks.

It is a finger food which is very easy to consume. The word „King‟ from its name shows

the outcome of the product since it has a large and wide length. The ingredients were

matched perfectly resulting to a great taste.

1.2 Comparison of the Product with Its Competitors

Table 1
SWOT Analysis

STRENGTHS WEAKNESSES

Highly experience owners Limited start-up cost

Limited competition Limited flexibility in pricing
Quick service Competitor has strong promotional
Limited start up risk activities
Affordable Customers are offered better alternative
by competition

OPPORTUNITIES THREATS

Ability to develop additional stores Changes in regulations can impact the

Continued expansion for online sales business
Development of wholesale distribution Products are already sold by major
relationship competitors
Acquisition of additional funds of capital Increases in price inputs can cause
Ability to sell products online upward pricing
Competitors can offer similar products
quickly
 11

In the market population, competition cannot be avoided among business

establishments. The business establishment can be so called competitor if that certain

establishment sells out similar products and services.

The Foodlum‟s competitor is the “carinderia” that is widely scattered in the streets

and corners usually placed near schools and offices. A “carinderia” is a Filipino term for

local eatery selling and serving meals. Consumers tend to prefer eating in “carinderia”

since it is much cheaper than the commercial ones like Jollibee Company Inc. and it

offers homemade meals. However, the Foodlum‟s edge among the competitor is that the

products offered to the consumers ensures best service quality such as the safety of the

product, cleanliness, best food quality, friendly atmosphere, and facilities like the hygiene

of the vendors and the interior facility of the establishment. The Foodlum provides best

quality products yet very affordable to the budget of the consumers.

1.3 Location

Finding the perfect place for the business to start is very crucial since it affects the

roll and profit of the establishments. Foodlum‟s initial area is located at San Jose St.,

Butuan City, Agusan del Norte in between the establishment of Puregold and Little

Wonders. The founders of the company decided to rent the place between the two

establishments because it is located in the heart of Butuan City meaning majority of the

population goes in and out.

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Figure 2
Proposed Location for the Business

1.4 Market Area

Foodlum is marketed through local food outlet located in the area of Butuan City.

So far, the Foodlum has not been distributed through regional and national store. The

plan of the company is to focus 100% of the efforts on the local area market. By focusing

all the efforts and energy in the particular area, the company expects to quickly develop

and maintain leadership position. Being smaller, owner-operated company, Foodlum

intend to use as an advantage to be absolutely certain every consumer receives excellent

service.
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Figure 3
Satellite View of Location

1.5 Main Customers

The target markets of Foodlum Company are the employees and the people who

live within the parameters of the establishment. These active consumers represent the

basis of demographic characteristics and targeting the lower, middle and upper level of

people. Regardless of age, anyone can afford the Lumpia King. Currently, Foodlum‟s

customers tend to live around the city of Butuan.

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1.6 Total Demand

The interaction between supply and demand to determine the market price and

corresponding quantity bought and sold. This is also a relationship between the total

quantity of a good demanded and its price.

Table 2
Market Demand

Parameters Percentage Population

Employees eat lunch and dinner at home 30% 706

Employees eat lunch and dinner at workplace 70% 1, 649

Employees who brings lunch and dinner at workplace 40% 660

Employees who buys lunch/snacks/dinner 60% 989

Prospect consumers 25% 247

People buying lunch/snack/dinner near the establishment 75% 2, 650

Prospect consumers 40% 1, 060

Total population of employees near the establishment of 40% 2, 355

Foodlum

Total population living near the establishment 60% 3, 520

Total population around the parameters of the outlet 100% 5, 875

Total Demand 22% 1, 307

Based on the table above, there are about 1, 307 employees and people who lived

near the establishment or about 22% of the total population who will patronize the

services and products of the establishment. Out of 2, 355 employees near the
 15

establishment 30% of them will take their lunch and dinner at their respective homes

while under the 70% of the population 40% of the employees will bring their lunch in the

workplace to save more money and 60% of them but their lunch, dinner and snacks.

There are about 75% or 2, 650 of the residents who will buy their lunch, dinner, and

snacks in the local stores. An estimated of 40% of the population buying their products

near the establishment will be demand since not all resident will engage to the product.

1.7 Market Share

A company‟s market share is its portion of total sales in relation to the market or

industry in which it operates. In accordance to the high demand of Lumpia King, an

estimated of forty-two percent (42%) would be the market share of the overall sales of

the food sector.

1.8 Selling Price

Price is important to marketers because it represents marketers‟ assessment of the

value customers see in the product. Lumpia King‟s selling price is P7.00 per piece

enough to gain profit and continuously operate the business.

1.9 Sales Forecast

For the first year of the company, Foodlum will generate an estimated 258, 500

pieces of Lumpia King that will have a net sales of P1, 809, 500.00. There will be a 220

monthly production which will total to 264, 000 pieces of Lumpia King since not all of

the pieces will be sold, the Foodlum estimated to have an estimated 18, 205 for the
 16

merchandise inventory. The projected sales growth rate for the years would stack-up to

the following percentages:

2021 (10%)
2022 (20%)
2023 (30%)
2024 (40%)

1.10 Promotional Measures

Foodlum introduces Lumpia King through new media advertisement. The

investors decided to use new media advertisement since it has various advantages given

to the company; it is not costly, efficient, consumers rely to social media, and it is very

accessible. For the store, Foodlum creates flyers, brochures, and tarpaulin another way to

promote the product.

1.11 Marketing Strategy

The following discussion outlines some of the details of the proposed marketing

strategy for Foodlum product:

Product Strategy

Foodlum offers the newly introduce product namely Lumpia King with highly

quality ingredients. The company researched the most demand recipes of lumpia and

named the product that the consumers can enjoy. Over the next years, Foodlum plans to

expand the product line which includes rice toppings and drinks. The second way in

which Foodlum plans to expand its product line is to create and offer products such as
 17

different food menus. In addition, Lumpia King would bear Foodlum‟s logo, poster, and

brochure to ensure that the product entails in the mind of the consumers.

Distribution Strategy

Foodlum is distributed through local food outlet located in Butuan City. Over the

next five years, Foodlum seeks to expand distribution by opening new stores throughout

the region focusing next on the national and eventually to international. In addition,

Foodlum plans to expand by offering and selling the product via internet. The company

fully intends to monitor and maintain strong relationship with the supplier.

Promotion Strategy

Foodlum communicates with consumers and retailers about its products in a

variety of ways. Information about Foodlum – the company as well as its products – is

available via social media. The company‟s promotional efforts also seek to differentiate

its products from those of its competitors. The company relies on personal contact with

suppliers to pick up ingredients to produce the products. This contact, whether in person

or by phones helps convey the Foodlum message demonstrate the product‟s unique

qualities and build relationships. As distribution expands, Foodlum will adjust to meet

greater demand by increasing the production to make sure that the needs and wants of the

customers are satisfied.

Sales promotion and public relations currently make up the bulk of Foodlum‟s

promotional strategy. Foodlum‟s founder creates creative ideas to promote the products

and build good customer relationships. Non-traditional marketing methods that require
 18

little cash and creatively also lend themselves perfectly to Foodlum because the

establishment is a small, flexible organization, the company can easily implement ideas.

Pricing Strategy

Foodlum‟s products are priced with competition in mind. The company is not

concerned with setting high prices to signal luxury on prestige, nor attempts to achieve

the goals of offsetting how prices by selling large quantities of products. Instead, value

pricing is practiced so customers feel comfortable purchasing the product. Foodlum uses

economy pricing the margins are wafer thin, which targets the mass market and market

share. Lumpia King offers a budget price for only P7.00 which shows a value pricing

where the consumers tend to be satisfied by the product.

1.12 Marketing Budget

Marketing budget is an estimated amount of cost that will be required to promote

products or services. The table below shows the Foodlum‟s marketing budget for a year.

Table 3
Marketing Budget of Foodlum

Materials Amount
Flyers P400.00
Brochures 500.00
Tarpaulin 300.00
Calling card 300.00
Total P1, 500.00
 19

SECTION II

PRODUCTION PLAN

This section represents the planning of production and manufacturing modules in

the company. It utilizes the resources of allocation of activities of employees, materials,

production size (capacity) and lay-outs. Thus, production planning enables the company

to fulfil customers demand and achieve other goals efficiently and with high quality.

2.1 Production Process

Raw Finished
Materials Processing Product

Prepare the
Lumpia Wrappers ingredients
Carrots
Ground Pork
Chayote Mix all the
Ketchup ingredients
Oil
Onion Garlic

Wrapped the
stuffed-meat with
lumpia wrappers

Fry the lumpia in

medium heat

Serve the lumpia

Figure 4
Production Process
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The processes in making Lumpia King are as follows:

1) In a bowl, combine ground pork, garlic, onion, seasoning, and salt until well

distributed.

2) Separate lumpia wrappers into individual sheets.

3) Spoon about 1 tablespoon of meat of mixture on the lower end of the wrapper

4) Fold the bottom of wrapper over filling and continue to roll tightly into a thin log

about 3-4 inches thick.

5) Wet the remaining edge of the wrapper with a dab of water to seal completely.

6) In a pan over medium heat, heat about 2 inch deep of oil.

7) Add lumpia in batches and cook turning on sides as needed for about 3 to 4 mins

or until golden brown.

8) Remove lumpia from the oil and drain on a wire rack then set over.

9) Serve immediately witch sauce.

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2.2 Fixed Capital

Fixed capital is invested in the fixed or long-run assets. The amount of fixed

capital need, therefore, varies directly with the amount of fixed assets owned by the

business. The table below shows the Foodlum‟s fixed assets.

Table 4
Fixed Assets of Foodlum

Equipment Brand Unit Price Quantity Price

Office Supplies P1, 500.00
Bond paper Paper One 70 GSM Bond 200.00 2
Paper 500 Sheets
Ball pen Faber-Castell 1419 Ballpen 500.00 1
0.5 Box
Paper clips/Clips HBW Office Vinyl Coated 40.00 3
Paper Clips 50mm
Official Receipts Acknowledgment Receipt 20.00 24
Kitchen Utensils 8, 391.00
Casserole and Non- Peace (13 pcs) Cookware 543.00 6
stick Pan Set Non-stick pan and
casserole
Plate Vintage Natural Coconut 173.36 25
Shell Bowl Eco-friendly
Fork Wooden Fork 14cm by 50.00 8
25pcs per pack
Spoon Wooden spoon 14cm by 50.00 8
25pcs per pack
Fixtures and Furniture 9, 400.00
Dining Table Dining Table Set (24x38 2, 350.00 4
Rectangle Table and 4pcs
chair)
Store Equipment 31, 745.00
Refrigerator Samsung 9.1 cu.ft. Two 21, 245.00 1
Door
LPG Tank Petron Gasul 11-kg Pol 1, 400.00 1
Valve LPG Cylinder
Gas stove Hanabishi Gas Stove GGS 2, 100.00 1
300
Aircon Mx-Kc1509.6 HP Window 7, 000.00 1
Type Aircon (Non-inverter)
Total P51, 036.00
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2.3 Life of Fixed Capital

The lifespan of the fixed capital refers to the investment made by the business for

acquiring long term assets. This includes the machineries and equipment installation that

would last for about five (5) years where it is continuously maintain and repair.

Table 5
List of Fixed Capital

Equipment Depreciation
Fixtures and Furniture P1, 880.00
Store Equipment 6, 349.00
Total P8, 229.00

2.4 Maintenance and Repairs

Regular maintenance of equipment is important and a necessary activity to

continue the production of the products. This will be done through systematic care in

order to keep them in a safe, usable condition, limit downtime, and extend productivity.

This is to ensure that all equipment required for production is operating perfectly at all

times. In addition to term maintenance, to equipment are done through inspection,

cleaning, lubricating, and making minor adjustments 5 times a month so that minor

problems can be detected and corrected before they become a major problem that can

shut down the production line.

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Maintenance and repair for the following:

 Refrigerator

 Gas stove

 LPG tank

 Aircon

2.5 Sources of Equipment

Since the Foodlum investors invest with their own money then there is enough

cash to buy the equipment. The equipment can be bought in appliances, Solane store, and

hardware.

2.6 Planned Capacity

Planned capacity is the process of determining the production capacity needed by

an establishment to meet changing demands for its products and involves estimating the

storage. In production, Foodlum plans to have an 11 production per day totalling to 220

productions in a month. Since, one production generates 100 pieces of Lumpia King then

the total amount of pieces being produce in a month would be 22, 000 while for a whole

year there will be a total of 264, 000 pieces of Lumpia King but since the company

estimated to have a merchandise inventory of 18, 205 then there will be only 258, 500

pieces of Lumpia King for the first year. The number of unit (258, 500) multiplied by its

selling price (P7.00) then there will be net sales of P1, 809, 500.00.
 24

2.7 Future Capacity

As stated in the five-year plan, every year has an increase of numbers in the

production meaning that the net sale also increases. Additional of the workers and

expenses are also stated. Growth rate for the next year:

2021 (10%)
2022 (20%)
2023 (30%)
2024 (40%)

2.8 Terms and Condition of Purchase of Equipment

In purchasing equipment and machineries for the business, there are terms and

condition that is needed to follow. After purchasing the equipment, the warranty of the

equipment should be indicated so that there is an immediate remedy for any damages and

condition of the equipment that the company doesn‟t hold.

2.9 Factory Location and Layout

Figure 5
Location
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Foodlum Company will be renting the place located at San Jose St., Butuan City,
Agusan del Norte with a rental rent of P5, 000.00 per month.

Figure 6
Exterior Design of the Store

Figure 7.
Interior Design of the Store
 26

2.10 Raw Materials

The raw materials needed to make the product (Lumpia King) are the following

ingredients:

Table 6
Raw Materials

Raw Materials Brand

Ground Pork None
Lumpia Wrapper None
Carrots None
Chayote None
Ketchup Banana Ketchup
Oil None
Onion None
Garlic None
Salt None
Seasoning Magic Sarap
 27

2.11 Cost of Raw Materials

It is stated in the table the prices of each ingredients and the total cost production

for one production.

Table 7
Cost of Raw Materials

Raw Materials Brand Quantity Unit Price Amount

Ground Pork None 1 kilo P171.00 P171.00
Lumpia Wrapper None 2 pack (100 25.00 50.00
pieces per pack)
Carrots None 2 pieces 7.50 15.00
Chayote None 2 pieces 7.50 15.00
Ketchup Banana Ketchup 2 pack 7.50 15.00
Oil None ½ kilo 25.00 25.00
Onion None 1 piece 8.00 8.00
Garlic None 1 piece 8.00 8.00
Salt None 1 sachet 3.00 3.00
Seasoning Magic Sarap 1 sachet 5.00 5.00
Total P315.00

2.12 Raw Materials Availability

Foodlum‟s source of ingredients can be bought at the market, convenient store,

and grocery store. The company‟s ingredients are bought through direct purchase.
 28

2.13 Labor

The table below shows the Honorarium of three workers in the Foodlum

Company.

Table 8
Labor

Employee Workers Honorarium Pay day

Position (per day) (per month)
Manager LJ Trisha B. Ala P310.00 P6, 200.00
Cook Xyrel Marie A. Patombon 270.00 5, 400.00
Cashier Ericka Laspiňas 270.00 5, 400.00

Total P17, 000.00

The Foodlum investors decided to have an Honorarium for the first five years of

the business since three of the investors agreed to be one of the employees. The company

use the Honorarium to also cut of some expenses.

2.14 Cost of Labor

The Foodlum‟s total expense for Honorarium is P204, 000.00 for the whole year

and since the company is expecting a net sale of P1, 809, 500.00 for the first year then

there will be P1, 605, 500.00 left enough for other expenses and profit.
 29

2.15 Labor Availability

For the first year of the company, there will be 5 working days in week and 20

working days in month totaling to 240 working days in a year. As the year increases, the

working day of the company also increases as well as to the number of workers. The

workers are available and are on duty except if there are calamities and if there are

instances that the company considers.

2.16 Labor Productivity

Foodlum motivates the workers and develop strong relationship in order for them

to have healthy production. Motivation would lead to them to work with passion and

determination which will make the company successful. Foodlum ensures the safety the

workers and give right amount of compensation at the right time. The company will also

give promotion, bonuses and recognition to the workers who are doing will in the

company.
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2.17 Factory Overhead Expenses

The Foodlum‟s factory overhead expense consists of the cost of direct materials,

the cost of direct Labor, and the manufacturing overhead. The table below shows the

factory overhead expenses of the Foodlum Company.

Table 9
Factory Overhead Expenses

Factory Overhead Expenses Cost (yearly)

Cost of Direct Labor
Honorarium P204, 000.00
Cost of manufacturing overhead
Rent 60, 000.00
Utilities 60, 000.00
LPG Gas 9, 000.00
Depreciation of Equipment 8, 229.00
Total P341, 229.00

2.18 Production Cost

One production of Lumpia King costs P315.00 and since the company decided to

have 11 production per day then the amount cost for a day is P3, 641.00. In a month the

company will produce 220 productions and will have a production cost amounted to P72,

820.00. So in a year, there will 2, 640 production and will have a production cost to P873,

840.00.
 31

SECTION III

ORGANIZATION AND MANAGEMENT PLAN

In this section you will able to distinguish the form of business that we will use. It

offers information on how our business it is managed and operated.

3.1 Form of Business

The form of business of the Foodlum Company will be organized as partnership,

specifically, general partnership. A partnership is a form of business where two or more

people share ownership, as well as the responsible for managing the company and the

income or losses of the business generates. The people in the said parties had an

agreement to equally share in all aspects such as in workload, including the financial and

legal liabilities of the business. All partners are actively involved in business operations.

3.2 Organizational Structure

Figure 8
Organizational Chart
 32

Table 10
Job Specification

Name Of Employees Job Specification Job Description

Czaira Mikhaela B. Butcon
Diane Rose B. Caina
Roel Dexter B. Quilaton
Legune B. Saludo
Vergil Joshua C. Secuya
Kharyll Kae A. Tuyor
LJ Trisha B. Ala General Manager
Ericka Las Pinas
Xyrel Marie A. Patombon
They are the one that
allocates capital with the
expectation of a future
financial return. Investors
Investor utilize investments in order
to grow their money and/or
provide an income during
retirement.
They have the task to
oversee daily business
activities improving overall
business function, training
heads of departments,
managing budgets,
developing strategic plans,
creating policies, and
communicating business
goals.
The duty of a cashier is to
scan items, ensure that
prices are quantities are
correct, and collect
payments. They also assist
Cashier customers by explaining or
recommending items,
answering questions, and
processing exchange or
refunds.
Cooks are responsible for
providing a pleasurable
Cook dining experience for
customers by preparing
high quality food.
 33

Table 11
Monthly Salary

Name Of Employee Position Honorarium

Fee (Monthly)
LJ Trisha B. Ala General Manager P6, 200.00
Ericka Las Pinas Cashier 5, 400.00
Xyrel Marie A. Patombon Cook 5, 400.00

Table 12
Business Organization and Function

Business Organization Function

They are responsible of the expansion of
Investor money, experience and skills to grow the
business.
They are responsible for managing the
company, plan, and coordinate all business
General Manager
operation. They develop strategies and
implement business plan for profitability.
They are responsible to receive and
disburse money in establishments other
than financial institutions. Cashier are task
Cashier with processing debit cards and making
credit card transactions, either with the
general public or during transactions with
employees.
They are responsible for planning menus,
food preparation and for selecting items
Cook
that provide diversity and will please the
palates of the customers.
 34

3.3 Business Experience and Qualification of the Entrepreneur

The business would likely experience failure and dissatisfaction during the whole

process; this experience might be a big support in developing or changing your business

to create new strategies. Being part of the business industry, you must be a risk taker

which means that you need to take the risk in every opportunity that will come. The

business skills that the entrepreneur should possess are having strong communication

skills, willing to take the calculated risk, being able to understand quickly, adopting to

necessary management style and must be a great innovator. A good entrepreneur has the

confidence and makes wise decisions. The workers as well must be hard – working,

determined and trust worthy.

3.4 Pre- Operating Activities

The things to consider before the Foodlum Company will officially start their

business are the following:

1. Market Survey – Through this, the company will gain critical customers feedback

that will able to analyze the market for a particular product or services. It will able

to know what are the skill that you need, the financial capability to own a business

and the difference that you‟ll bring to the market.

2. Food Tasting- This activity is important to know if your product is profitable and

conceivable for the market to the point that the customer will buy it.

3. Feasibility Study - It can provide a company‟s management with crucial

information that could prevent the company from entering blindly into risky

businesses.
 35

4. Business Plan – It has the business set of goals. It contains information about the

company to achieve their goals. It is a document that contains sales and marketing

strategy, and the financial background, and containing a projected profit and loss

statement.

5. SWOT Analysis – An analysis to know your business‟ strength, weaknesses,

opportunities, and threats is recognized. This is important so that we can assess

the things that need to improve.

6. Marketing Plan – This includes analysis of your current market, business

objectives, key strategies, step to achieve your objectives, proposed budget and

things.

3.5 Operating Expenses

Before opening a business, it bears the emphasis that these transactions are made

and it has different expenses linked with them. Those expenditures that a business incurs

to engage in activities not directly associated with the production of goods. Our main

operating expense of our business includes:

Table 13
Pre – Operating Expense

Expenses Amount
Honorarium P204, 000.00
Promotion and Advertising Expense 1, 500.00
Permits and Licenses 2,500.00
Gas Expense 9, 000.00
Rent Expense 60,000.00
Utilities Expense 60, 000.00
Depreciation Expense 8, 229.00
Total P345, 229.00
 36

3.6 Store Equipment

Store equipment is fixed assets that we will need daily when we are in our

workplace that is essential to operate the company. The equipment included this business:

Table 14
List of Store Equipment

Equipment Price
Office Supplies P1, 500.00
Bond paper
Ball pen
Paper clips/Clips
Official Receipts
Kitchen Utensils 8, 391.00
Casserole and Non-stick Pan
Plate
Fork
Spoon
Fixtures and Furniture 9, 400.00
Dining Table
Store Equipment 31, 745.00
Refrigerator
LPG Tank
Gas stove
Aircon
 37

3.7 Administrative Expenses

Administrative expenses are the expenses an organization incurs not directly tied

to a specific function such as manufacturing, production, or sales. The table below shows

the general administrative expenses for the Foodlm company.

Table 15
Administrative Expenses

Expenses Amount
Honorarium P204, 000.00
Promotion and Advertising Expense 1, 500.00
Permits and Licenses 2,500.00
Gas Expense 9, 000.00
Rent Expense 60,000.00
Utilities Expense 60, 000.00
Depreciation Expense 8, 229.00
Tax Expense 217, 140.00
Total P562, 369.00
 38

SECTION IV

FINANCIAL PLAN

This section guides the entrepreneurs estimating the fund required for a business

and the capital needed for the finance project. It determines the framing financial policies

in relation to procurement, investment and administration of funds of an enterprise. It

also identifies the financial goals, organizes and prioritizes them, the outlines the steps

needed to take in order to achieve the and describe each of the activities, resources,

equipment and materials that are needed to achieve these objectives, as well as the

timeframes involved.

4.1 Important Assumptions

The company assume to remain in business for a foreseeable future defining that

the business will not be force to halt operations and liquidate its assets in the near term

despite the circumstances that the economy is facing. We assume a strong economy

without major recession or there are no unforeseen changes in economic policy to make

our customers products immediately obsolete.

 39

4.2 Project Cost

The six investors of the company contribute for the capital totaling to P 900,

000.00 enough to finance the start-up cost of the business. The table below shows the

start-up cost of the company.

Table 16
Start-up Cost

Start – up
Requirements
Start – up expenses
Permits and Licenses P2, 500.00
Marketing and Promotional Materials 1, 500.00
Prepaid Rent (2 months) 10, 000.00
Total Start – up expenses 14, 000.00

Start – up Assets
Cash requirements 816, 759.00
Start – up Inventory 18, 205.00
Other Current Assets 9, 891.00
Long Term Assets 41, 145.00
Total Assets 886, 000.00
Total Requirement P900, 000.00
 40

4.3 Projected Profit and Loss

Profit and loss show the company‟s revenues and expenses during a particular

period. The table below shows the company‟s revenue and expenses in five-years.

Table 17
Statement of Comprehensive Income

Foodlum Company
Statement of Comprehensive Income
For the years ended December 31

2020 2021 2022 2023 2024

Sales 1,809,500.00 1,969,800.00 2,334,360.00 3,031,168.00 4,229,638.00
Cost of Sales 873,840.00 961,224.00 1,153,468.80 1,499,509.44 2,099,314.54

Gross Profit 935,660.00 1,008,576.00 1,180,891.20 1,531,658.56 2,130,323.46

Operating
Expenses
Honorarium 204,000.00 223,200.00 223,200.00 293,760.00 293,760.00
Promotion 1,500.00 3,000.00 4,500.00 6,000.00 7,500.00
and
Advertising
Expense
Permits and 2,500.00 2,700.00 3,500.00 4,000.00 5,000.00
Licenses
Gas Expense 9,000.00 9,000.00 9,000.00 9,000.00 9,000.00
Rent Expense 60,000.00 60,000.00 60,000.00 60,000.00 60,000.00
Utilities 60,000.00 60,000.00 60,000.00 60,000.00 60,000.00
Office 1,500.00 1,500.00 2,000.00 3,000.00
Supplies
Expense
Tax Expense 217,140.00 236,376.00 280,123.20 363,740.16 507,556.56
Depreciation 8,229.00 8,229.00 8,229.00 8,229.00 8,229.00
Expense
Total 562,369.00 604,005.00 650,052.20 806,729.16 954,045.56
Operating
Expense
Net Profit 373,291.00 404,571.00 530,839.00 724,929.40 1,176,277.90
 41

4.4 Projected Cost of Goods Sold

This section provides the information about the costs of all goods sold during the

period and includes the cost of goods manufactured plus the beginning finished goods

inventory minus the ending finished goods inventory. Cost of goods sold is reported as an

expense on the income statements and is the only time product costs are expensed. The

statement below will summarize the items affected for the next years.

Table 18
Statement of Cost of Goods Sold

Foodlum Company
Statement of Cost of Goods Sold
For the years ended December 31

2020 2021 2022 2023 2024

Merchandise - 18,205.00 29,790.00 49,650.00 66,200.00
Inventory,
Beginning
Net Purchases 884,365.00 975,654.00 1,187,758.80 1,542,669.44 2,175,574.54
Transportation – In 7,680.00 15,360.00 15,360.00 23,040.00 23,040.00
Total Goods 849,805.00 991,014.00 1,203,118.80 1,565,709.44 2,198,614.54
Available for Sale
Merchandise 18,205.00 29,790.00 49,650.00 66,200.00 99,300.00
Inventory, End
Cost of Sales 873,840.00 961,224.00 1,153,468.80 1,499,509.44 2,099,314.54
 42

4.5 Projected Changes in Partner’s Equity

The statement of changes in equity shows the reconciliation of the beginning and

ending balances in a company‟s equity balance and then adds or subtracts such items as

profit and dividend payments to arrive at the ending balance. It is summarized below:

Table 19
Statement of Changes in Equity

Foodlum Company
Statement of Changes in Equity
For the year ended December 31

2020 2021 2022 2023 2024

Capital 900,000.00 1,273,291.00 1,677,862.00 2,208,701.00 2,933,630.40
Balance,
January 1
Additional
Investment
Capital
Withdrawal
Net 900,000.00 1,273,291.00 1,677,862.00 2,208,701.00 2,933,630.40
Contributed
Capital
Share in Net 373,291.00 404,571.00 530,839.00 724,929.40 1,176,277.90
Income
Withdrawals
Capital 1,273,291.00 1,677,862.00 2,208,701.00 2,933,630.40 4,109,908.30
Balance,
December 31
 43

Statement of partner‟s equity on the other hand is the final share of the partners in

the ending capital balance of the company. It is demonstrated below:

Table 20
Statement of Changes in Equity by the Investors

Foodlum Company
Statement of Changes in Equity
For the years ended December 31
LJ Diane Karyll Dexter Legune Czairah Vergil Xyrel Ericka Total

Capital 200,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 50,000.00 50,000.00 900,000.00
Balance,
January 1
Additional
Investment

Capital
Withdrawal

Net 200,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00 50,000.00 50,000.00 900,000.00
Contributed
Capital
Share in Net 82,953.56 41,476.78 41,476.78 41,476.78 41,476.78 41,476.78 41,476.78 20,738.39 20,738.39 373,291.00
Income

Withdrawals

Capital 282,953.56 141,476.78 141,476.78 141,476.78 141,476.78 141,476.78 141,476.78 70,738.39 70,738.39 1,273,291.00
Balance,
December 31

4.6 Statement of Cash Flow

The statement of cash flow shows how changes in balance sheet accounts and

income affect cash and cash equivalent, and break the analysis down to operating,

investing, and financing. The data below is the five-year projected statement of cash flow

of the Foodlum Company:

 44

Table 21
Statement of Cash Flow

Foodlum Company
Statement of Cash Flows
For the years ended December 31
2020 2021 2022 2023 2024
Cash flows from
Operating Activities
Cash Received from 1,809,500.00 1,969,800.00 2,334,360.00 3,031,168.00 4,229,638.00
Customers
Cash Payment for
Purchases (884,365.00) (957,449.00) (1,157,968.80) (1,493,019.44) (2,109,374.54)
Tax (162,855.00) (231,567.00) (269,186.40) (342,835.92) (471,602.46)
Honorarium (204,000.00) (223,200.00) (223,200.00) (293,760.00) (293,760.00)
Utilities (60,000.00) (60,000.00) (60,000.00) (60,000.00) (60,000.00)
Rent (60,000.00) (60,000.00) (60,000.00) (60,000.00) (60,000.00)
Gas Expense (9,000.00) (9,000.00) (9,000.00) (9,000.00) (9,000.00)
Transportation – In (7,680.00) (15,360.00) (15,360.00) (23,040.00) (23,040.00)
Kitchen Utensils (8,391.00) (4,325.00) (1,078.00) (800.00) (124.00)
Permits and Licenses (2,500.00) (2,700.00) (3,500.00) (4,000.00) (5,000.00)
Promotion and (1,500.00) (3,000.00) (4,500.00) (6,000.00) (7,500.00)
Advertisement
Office Supplies (1,500.00) (1,500.00) (2,000.00) (3,000.00) (3,000.00)

Net cash provided for 407,709.00 401,699.00 528,566.80 735,712.64 1,187,237.00

(used in) operating
activities
Cash flows from
Investing Activities
Fixtures and 9,400.00
Furniture
Store Equipment 31,745.00
Net cash provided for 41,145.00
(used in) investing
activities
Cash flows from
financing activities
Cash received from 900,000.00
investors 900, 000.00
Net cash provided for
(used in) financing
activities
Net Cash Increase 1,266,564.00
(Decrease)
Add: Cash balance, 1,266,564.00 1,668,263.00 2,196,829.80 2,932,542.44
beginning
Cash balance, end 1,266,564.00 1,668,263.00 2,196,829.80 2,932,542.44 4,119,779.44
 45

4.7 Statement of Financial Position

This statement shows what the company is worth at a given point in time. The

purpose of the balance sheet is to provide an idea of a company‟s financial position. This

shows the total assets, liabilities, and capital of the company at a specific calendar year.

Table 22
Statement of Financial Position

Foodlum Company
Statement of Financial Position
For the years ended December 31
2020 2021 2022 2023 2024
Asset
Cash 1,266,564.00 1,668,263.00 2,196,829.80 2,932,542.44 4,119,779.44
Accounts Receivable
Merchandise 18,205.00 29,790.00 49,650.00 66,200.00 99,300.00
Inventory
Office Supplies 1,500.00 1,500.00 2,000.00 3,000.00 3,000.00
Kitchen Utensils 8,391.00 12,716.00 13,794.00 14,594.00 14,718.00
Total Current Assets 1,294,660.00 1,712,269.00 2,262,273.80 3,016,336.44 4,236,797.44
Fixtures and 9,400.00 9,400.00 9,400.00 9,400.00 9,400.00
Furniture
Less: Accumulated 1,880.00 3,760.00 5,640.00 7,520.00 9,400.00
Depreciation
Store equipment 31,745.00 31,745.00 31,745.00 31,745.00 31,745.00
Less: Accumulated 6,349.00 12,698.00 19,047.00 25,396.00 31,745.00
Depreciation
Total Assets 1,327,576.00 1,736,956.00 2,278,731.80 3,024,565.44 4,236,797.44

Liabilities and Partner's Equity

Accounts Payable
Tax 54,285.00 59,094.00 70,030.80 90,935.04 126,889.14
Capital, end 1,273,291.00 1,677,862.00 2,208,701.00 2,933,630.40 4,109,908.30

Total Liabilities and 1,327,576.00 1,736,956.00 2,278,731.80 3,024,565.44 4,236,797.44

Partner's Equity
 46

4.8 Break – even Analysis

The break-even analysis indicated what will be needed in monthly revenue to

reach the break-even point. The table below shows the company‟s break-even.

Table 23
Break-even Analysis

Estimated monthly fixed cost 27,000.00

Variable cost per unit 3.31

Sales price per unit 7.00

Unit Contribution margin 3.69

Break - even volume 7,317.07

Expected sales per month 150, 791.67

Peso sales required for break - even 51,219.51

Increments 1,000.00

Number of Units Total Fixed Total Variable Cost Total Total

Cost Cost Sales
0 27,000.00 0 27,000.00 0
1000 27,000.00 3,310.00 30,310.00 7,000.00
2000 27,000.00 6,620.00 33,620.00 14,000.00
3000 27,000.00 9,930.00 36,930.00 21,000.00
4000 27,000.00 13,240.00 40,240.00 28,000.00
5000 27,000.00 16,550.00 43,550.00 35,000.00
6000 27,000.00 19,860.00 46,860.00 42,000.00
7000 27,000.00 23,170.00 50,170.00 49,000.00
8000 27,000.00 26,480.00 53,480.00 56,000.00
9000 27,000.00 29,790.00 56,790.00 63,000.00
 47

70000

60000 BEP

50000
Number of units
40000 Total fixed cost
Total variable cost
30000
Total cost
20000 Total sales

10000

0
0 1000 2000 3000 4000 5000 6000 7000 8000 9000

Figure 9
Break-Even Point

The tables and graph show that at 7,317.07 of Lumpia sold, we will have no profit

but we also would not experience loss. At this number of good sold, we will have a fixed

cost of P27,000 and a total variable cost of P24, 219.51 (7,317.07 with a production cost

of P3.31 each) that would total to P51,219.51 as the total production cost. Since the

Lumpia is sold at P7.00 each, we will have total sales of P51, 219.51 as well. Since the

total production cost and the sales is the same amount, our break-even point is at (P51,

219.51 total sales, P51, 219.51 total cost).

 48

4.9 Return of Investment

Return on Investment (ROI) is a performance measure, used to evaluate the

efficiency of an investment or compare the efficiency of a number of different

investments. ROI measures the amount return of on an investment, relative to the

investment‟s cost.

Table 24
Return of Investment

Foodlum Company
Return of Investment
For the years ended December 31

2020 2021 2022 2023 2024

Net Income 373,291.00 404,571.00 530,839.00 724,929.40 1,176,277.90
Average Equity 1086645.50 1475576.50 1943281.50 2571165.70 3521769.35
Return of Investment 34% 27% 27% 28% 33%
 49

4.10 Financial Analysis

This financial analysis is the company‟s process of evaluating businesses,

projects, budgets and other finance-related entities to determine their performance and

suitability. The table below shows the vertical analysis of the company.

Table 25
Vertical Analysis (Profit and Loss)

Foodlum Company
Statement of Comprehensive Income
For the years ended December 31

2020 2021 2022 2023 2024

Sales 100% 100% 100% 100% 100%
Cost of Sales 48% 49% 49% 49% 50%

Gross Profit 52% 51% 51% 51% 50%

Operating Expenses
Honorarium 11% 11% 10% 10% 7%
Promotion and Advertising Expense 0% 0% 0% 0% 0%
Permits and Licenses 0% 0% 0% 0% 0%
Gas Expense 0% 0% 0% 0% 0%
Rent Expense 3% 3% 3% 2% 1%
Utilities 3% 3% 3% 2% 1%
Office Supplies Expense 0% 0% 0% 0% 0%
Tax Expense 12% 12% 12% 12% 12%
Depreciation Expense 0% 0% 0% 0% 0%
Total Operating Expense 31% 31% 28% 27% 23%

Net Profit 21% 21% 23% 24% 28%

 50

Table 26
Vertical Analysis (Balance Sheet)

Foodlum Company
Statement of Financial Position
For the year ended December 31

2020 2021 2022 2023 2024

Asset
Cash 95% 96% 96% 97% 97%
Accounts Receivable
Merchandise Inventory 1% 2% 2% 2% 2%
Office Supplies 0% 0% 0% 0% 0%
Kitchen Utensils 1% 1% 1% 0% 0%

Fixtures and Furniture 1% 1% 0% 0% 0%

Less: Accumulated Depreciation 0% 0% 0% 0% 0%
Store equipment 2% 2% 1% 1% 1%
Less: Accumulated Depreciation 0% 1% 1% 1% 1%
Total Assets 100% 100% 100% 100% 100%

Liabilities and Partner's Equity

Accounts Payable
Income Tax 4% 3% 3% 3% 3%
Capital, end 96% 97% 97% 97% 97%
Total Liabilities and Partner's Equity 100% 100% 100% 100% 100%

Table 27
Profitability Ratios

2020 2021 2022 2023 2024

Gross Profit Margin 52% 51% 51% 51% 50%
Operating Profit Margin 31% 31% 28% 27% 23%
Net Profit Margin 21% 21% 23% 24% 28%
Return on Assets
Net Income/Total Assets 28% 23% 23% 24% 28%
Earnings Before Interest and Taxes/Average 44% 42% 40% 41% 46%
Assets
Return on Equity
Net Income/Total Equity 29% 24% 24% 25% 29%
Net Income/Average Equity 34% 27% 27% 28% 33%
 51

After the whole study of the most important to the littlest detail, the business is

proved to be feasible. It is possible to build this business and be successful.