BATANGAS STATE UNIVERSITY i

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ESTABLISHMENT OF K WASH CAR WASH IN BARANGAY SAN MIGUEL,

SANTO TOMAS, BATANGAS

A Business Plan
Presented to the Faculty of
College of Accountancy, Business, Economics and 
International Hospitality Management – Graduate School
Batangas State University
Batangas City

In Partial Fulfillment
of the Requirements for the Degree
Master of Business Administration
(Non-Thesis Program)

By:

Medalla, Dan Kevin L.

May 2020
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APPROVAL SHEET 

This business plan, “ESTABLISHMENT OF K WASH CAR WASH AND

AUTODETAILING SERVICES, prepared and submitted by Dan Kevin L.

Medalla, in partial fulfillment of the requirements for the Master of Business 

Administration (Non-Thesis) Program, has been examined and is

recommended  for acceptance in oral examination.  

  

  
JENNIFER M. PEREZ, CPA, MBA 
 Adviser 

Accepted and approved in partial fulfillment of the requirements for the 

degree of Master of Business Administration Non-Thesis Program. 

  
_________________ BENDALYN M. LANDICHO, Ph.D., AFBE  

Date Dean, CABEIHM

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ACKNOWLEDGEMENT

At last, the most awaited moment has come and the fruit has been

harvested—the overcoming all the hardships that yield success. The proponent

will never forget the demands that have become momentous thriller of his

endeavor.

The proponent wish to express his deepest gratitude and sincerest

appreciation to the following persons who in one way contributed a lot to make

this study a reality.

Batangas State University and the College of Accountancy, Business,

Economics, and International Hospitality Management (CABEIHM) for allowing

this study to be developed and nurtured through supervision.

The adviser, Dr. Jennifer Perez the proponent’s hardworking adviser, for

his invaluable guidance, support, encouragement, and supervision, who in one

way or another helped a lot in the accomplishment of this study. The researcher

deeply thanks her for the patience and consideration, coordination, and excellent

advice throughout the declaration of their endeavor in this academe;

The various business entities and institutions, Barangay Officers and Staff

of San Miguel, Sto. Tomas, Batangas, Pepsi-Cola Products Philippines, Inc, fleet

team, Nurian Garments, Eun Hye Garments, Arsal Carwash and R and G

Carwash for their warm accommodation and for giving the necessary data and

information to achieve a reliable and realistic project;

The respondents in San Miguel, Sto. Tomas, Batangas for their

cooperation in providing the necessary data during the actual survey;

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Mr. Daryl John Alora for the knowledge and ability to guide in terms of

Financial Aspect of this study.

The proponent’s family, for the emotional and financial support, guidance

during the conduct of the study and for the love that they give without hesitation;

And above all, the Creator and Lord Jesus Christ for giving the proponent

the wisdom, strength, determination, guidance and protection to complete the

study and for the patience and strength of mind to overcome the hardships;

The proponent will be forever thankful for their support for the fulfillment of

the study.

Medalla , Dan Kevin L.

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TABLE OF CONTENTS
TITLE PAGE
APPROVAL SHEET
ACKNOWLEDGEMENT
TABLE OF CONTENTS
LIST OF TABLES
LIST OF FIGURES
EXECUTIVE SUMMARY

CHAPTER I. BACKGROUND OF THE STUDY

Introduction……………………………………………………………………. 1
Brief background of the Study …...................................................... 2
Objectives of the Study
………………………………………………………. 4
Scope and Limitation of the Study ………………………………………
4
Definition of Terms 6

II. MARKET STUDY

Objectives of the Study 8
Methodology ………………………………………………………………. 9
Research Design …………………………………………………………. 9
Subject of the Study……………………………….. 10
Data Gathering Instrument ………………………………. 11
Data Gathering Procedure ………………………………………………. 14
Statistical Treatment of Data …………………………………………….
16
Demand Analysis………………………………………………………………18
Historical Demand ………18
Projected Demand ………………………………………….…….. 19
Supply Analysis………………………………………………………………..19
Historical Supply ………………………………………………….20
Projected Supply ………………………………………………. 20
Demand and Supply Analysis……………………………………………......21
Market Share ………………………………………………………………
21
SWOT Analysis ……………………………………………………………
22
Strengths ………………………………………………………….. 23
Weaknesses ………………………………………………………. 23
Opportunities……………………………………………………… 23
Threats …………………………………………………………….. 24
Serviced Offered...............................................................................….....24
Brand Name…........................................................................................ 24
Business Logo 25
Price Study…………………………………………………….……………… 26
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Place and Distribution Channel….…………………….…………………… 27

Promotion……………………….……………………………….…………… 27
Online Appointment…………………………………………….…………… 29
Training …………………………………………………. 30
Generalization …………………………………………………. 31

III. TECHNICAL STUDY

Objectives of the Study …………………………………………………..
32
Description of the Product ……………………………………………….. 32
Uses of the Product ……………………………………………………… 33
Manufacturing Process …………………………………………………..
36
Plant Location …………………………………………………………….... 37
Plant Size and Layout ……………………………………… 38
Factory Equipment …………………………………… 40
Factory Furniture and Fixtures ……………………………………… 42
Factory Tools……..…………………………………………………. ……… 44
Factory Supplies……………………………………………………………….44
Office Supplies …………………………………………………………….
46
Direct Materials ……………………………………………………………
46
Indirect Materials ……………………………………………………………
47
Lease and Leasehold………………………………………………………. 48
Utilities ……………………………………………………………………...
49
Electricity …………………………………………………………..
49 Water
………………………………………………………………. 50
Telephone ………………………………………………… 50
Direct Labor and Requirement ………………………………………….
51
Waste Disposal…………………………………………………………………54
Generalization …………………………………………………………….
54

IV. MANAGEMENT STUDY

Objectives of the Study 56
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Forms of Business Ownership 57
Capitalization 57
Organizational Structure 58
Manpower Requirements 59
Job Specification 60
Compensation 63
Benefits and Incentives 63
Organizational Policies 64
Legal Requirements65

V. FINANCIAL STUDY
Objectives of the Study 67
Total Project Cost 68
Source of Financing……………………………………………...……………70
Initial Capital Requirements 70
Financial Assumptions 70
Financial Statements 72
Statement of Financial Performance 73 Statement of Cash flow
76
Statement of Changes in Partner’s Equity 77
Statement of Financial Position 78
Financial Analysis 82
Financial Ratios 83
Liquidity Ratio 83
Current Ratio84
Acid-Test Ratio 85
Working Capital 86
Activity Ratio 87
Inventory Turnover 88
Average Sales Period 88
Accounts Receivable Turnover 89
Collection Period 90
Asset Turnover……………………………….………………………..92
Operating Profit Margin 93
Gross Profit Margin 94
Net Profit Margin 94
Return on Assets 96
Profitability Ratios 98
Return on Equity 98
Solvency Ratio 100
Debt Ratio 100
Equity Ratio 102
Debt-to-Equity Ratio 104
Return on Sales 115
Cost Volume Profit Analysis 116
Contribution Margin 105
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Contribution Margin Ratio 107
Break-even Point Analysis 109
Break-even Sales Volume 110
Break-even Peso Sales 111
Margin of Safety 113
Margin of Safety in Peso 113
Margin of Safety in Ratio 114
Payback Period 115
Generalization 116

VI. SOCIO-ECONOMIC CONTRIBUTION

Contribution to Philippine Economy 117
Social Desirability 117
Employment Generation 118
Supplier 119
Consumer 119
Environment 119
Generalization 119

APPENDICES
CURRICULUM VITAE
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EXECUTIVE SUMMARY

This business plan focused on establishing K Wash Car wash and Auto

Detailing Services which will be situated at Barangay San Miguel, Sto. Tomas,

Batangas. Barangay San Miguel belongs to a City of Sto. Tomas. The target

market of this study are mainly residential households of the barangay.

The Maharlika Highway connects the Barangay San Miguel with Sto. Tomas City

proper and reaches as far as Bicol Region. It is also the home of Pepsi-Cola

Products Philippines, Inc. (PCPPI) mother plant. Since the business is along the

national highway, it is anticipated that many bystanders within and nearby the

area or even from the National Capital Region will be able to reach the business.

The proponents distributed four hundred (400) consumer survey questionnaires

last October 8-10, 2020 to four hundred (400) household out of three-thousand

(3,003) households of Barangay San Miguel, Sto. Tomas, Batangas. The source

for the number of households is taken from the barangay statistics. Survey was
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done in order to determine the possible number of demands of the service. The

group has given two to three minutes to answer the survey questionnaire. The

use of the Slovin’s formula was utilized in computing the sample size with a five

percent margin of error, and the Arithmetic Geometric Curve method in

computing the projected demand and Statistical Parabolic Curve method for

projected supply.

Financial projections and ratio analyses were also conducted to determine

whether K Wash Car wash and Auto Detailing Services will be profitable and

solvent for the years 2021 to 2025 and when the amount invested is expected to

be recovered. This also identified some of the contributions of the business to

society.

The K Wash Car wash and Auto Detailing Services is expected to be

viable in terms as evidenced by the growing demand for the product and with the

company’s sales of volume. The business is also putting a vending machine near

the said carwash and planning to put up a food stand since the business tends to

make the clients waiting while cleaning their car and is possibly to increase

product sales by 10% annually. The enterprise is to be operated as sole

proprietorship and can be run smoothly with the use of line organizational

structure. It can comply with the legal requirements of business operation and a

total of Php14,000.00 must be paid for fees and licenses. The firm is considered

financially feasible with the business earning 10% profit in the first year with Php

40,497.77 the expected recovery of the projected cost of Php 520,000 in two

years. Aside from this, the establishment of K Wash Car wash and Auto Detailing
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Services can contribute to the Philippine economy by paying its value-added

taxes, add income of Santo Tomas City in the form of fees and licenses paid to

the City Government and give a customer satisfaction with fellow Tomasinos by

offering a great and a word class service.