ST.

PAUL UNIVERSITY PHILIPPINES

TUGUEGARAO CITY, CAGAYAN

In Partial Fulfillment of the Requirements

for the Degree of
Master of Business Administration
Advance Financial Management

Financial Management of
Small-Medium Enterprise Business
ALDEN ANNA SPORTS HOUSE
Mall of the Valley, Tuguegarao City

Submitted by:
Abel, Lucky James S.
Maribbay, Maynard B.
Udan, Michael S.

Submitted to:
Charito Guillermo, CPA, MBA, PhD
I. INTRODUCTION

Profile of the business enterprise

Alden Anna Sports House is engaged in selling

Sporting Goods and Equipment such as badminton, table

tennis and long tennis rackets, basket balls, weight

liftings and many more. It was established in May 10,

2010.

Currently, it has six (6) regular employees and two

(2) under probationary period. The capitalization of the

business is P 2,530,000.00. It is located at Mall of the

Valley, Tuguegarao City, Cagayan. It is owned by Mr.

Aldwin L. Abel, an engineer and Ms. Ma. Rosario V. Abel,

an architect.

II. REVIEW OF RELATED LITERATURE AND STUDIES

1. CASH MANAGEMENT

Collections for the day are deposited the next

banking day. The owner personally manages the collection

and deposit of the business. They acquire their

inventories to suppliers on a cash basis to avail the

cash discounts offered by the supplier.

2. RECEIVABLE MANAGEMENT
 Credit is extended to valued customers for goods and

equipment above P 10,000.00 payable in 60 days. Valued

customers are those customers that buy on a frequent

basis. They are mainly from the downstream areas in which

they also sell the purchased products to their respective

customers. Credit is also extended to government agencies

usually for a 30 day credit term.

3. INVENTORY MANAGEMENT

Manual Inventory management is being used. Inventory

count is performed on a weekly basis with the supervision

of the owner. New Stocks are being kept in the owner’s

house because they find it expensive renting additional

warehouse or stalls to store inventories. The owners are

considering to automate their inventory system but they

are carefully evaluating their options.

4. ASSET MANAGEMENT

Fixed assets are being tagged and monitored

personally by the owner. They maintain property tags on

each equipment as well as subsidiary ledger for each

equipment. Equipment used in the delivery of sporting

goods is subject for maintenance monthly. They are mainly

monitored by the owner.

III. STATEMENT OF THE PROBLEM

1. CASH MANAGEMENT

Sometimes, when the collection for the day is

minimal, the store owner leaves the cash in the vault

which may result to theft or robbery.

2. ASSET MANAGEMENT

Credits extended to individuals are sometimes not

collected within the credit period. The owner only

resorts to repeated demands of payment since there is no

collateral at risk.

3. INVENTORY MANAGEMENT

Using a manual inventory system makes it difficult

for the owner to monitor stock movements. They do not

maintain index cards or stock card for each item. Most of

their inventories are small items making it susceptible

to theft. The owner is already considering a computerized

Accounting system to integrate its business operations.

4. ASSET MANAGEMENT

The business lacks spaces for inventory storage.

IV. METHODOLOGY

SOURCES OF FINANCING

The owners borrowed money from the cooperatives in

starting their business and still have outstanding loans

from cooperatives. There are also offers of credit line

form banks but they believed that they do not need it yet.

They are also considering the high interest expenses to be

incurred if they will borrow money from banks compared to

the cooperatives.

They also consider to loan from cooperatives when there

are bulk orders that needs to be delivered urgently to

customers.

SWOT ANALYSIS

STRENGTH

 Sale of non-perishable goods

The business owners are selling non-perishable goods

which can be stock for long period of time and are

still good for selling for the next months and even

years.

 Keeping the New Stocks in the Owner's House

 Owners can properly monitor the goods instantly if new

goods are kept in their house. Defects on goods

received can also be determined easily by the owner

which could be returned to the seller immediately. No

cost for renting is being expense by the business.

 Only store in the City to sell legitimate premium

quality

The business sells 100% original products such as

Molten, Yonex, Carlton, Yangyang, Pro Kennex and

others. As per observation, they are the only one who

sell premium quality products. Most establishments

here in Tuguegarao City sells class a products,

sometimes replica or made in china products.

 Good Market Location

It is located in first ground of the Mall of the

Valley. Logistically, it’s more accessible to the

customers, conveniently for the deliveries of the

materials and other product lines.

WEAKNESSES

 Pricing

Having original products to sell means high prices.

Customers mostly find difficulty to buy products with

high prices. But if the customers find its way to buy

 premium quality, alden anna is the best in Tuguegarao

and maybe in Region 2.

 Lack of advertisement

The business owners do not advertise their products to

Social Medias. Not having this strategy would not

promote their business name and its products.

OPPORTUNITIES

 Extending Credit to Valued Customers and Government

Agencies

This will give rise to sales of the business since

customers will likely buy more if goods are on credit.

They are the only establishment selling sporting goods

that allows purchase on credit. They also extend their

products to government agencies.

 Millennials increase interest in sports and other

outdoor activities

Nowadays, millennials are health conscious. One way to

be health is to exercise and play sports whether

indoor or outdoor. Playing sports leads to using sport

goods and equipment.

THREAT

 Increasing number of Ukay-ukay stores

 This could decrease the sales of the business since

buyers are looking for low prices of sport goods and

equipment which are likely sold in Ukay-ukay stores

also. It’s been a notion that the quality of the

products sold in an ukay-ukay is a premium quality but

at a low cost but they are not the first hand owner.

 Rising of New Malls in Tuguegarao City

Big Sport Stores such as Toby’s Sports and Chris Sports

which will rent in the SM and Robinson malls if

finished are the possible competitors of the business.

 Patronizing Replica products

Having Class A products are much cheaper and more

favored by the customers through is low price.

V. RESULTS AND DISCUSSIONS

RECENT DECISIONS MADE BY THE MANAGEMENT

The owner recently invested in an Archery Range.

Being the first Archery range in the province, it makes

Cagayanos aware of the said sport. This also compliments

the store’s primary purpose, which is the sale of

sporting goods and equipment. Since they are the first to

offer such recreation center, this new venture is

 promising, it has a target market and with a little

marketing, this may be the next destination of students

and young professionals.

VI. CONCLUSION AND RECOMMENDATION

 Cash collection, material or immaterial in amount, should

be deposited daily to avoid risks of theft or robbery.

 Credit sales amounting to P5,000.00 and above should be

supported by a written document. Collateral should also

be considered on bulk sales or transactions.

 Invest in a computerized inventory system.

 Adopt consignee-consignor agreement to suppliers.

 Expansion of business to other towns and provinces.

VII. DOCUMENTATION